March 4, 2016

How Activists Harness Media Power to Affect Change

Activists today are using both earned media and owned media – rather than proxy contests – to drive their agendas. In many ways, it’s a “war of words” when competing for support – and the advantage goes to the trained storyteller. Not too many companies are not making their words count in response. Here’s the intro from this Q4 blog:

It’s fair to say that when it comes to activist investing Carl Icahn is a superstar – and he has a Twitter account with 270,000 followers. Currently he’s Tweeting about Xerox. Icahn disclosed Nov. 23 that he’d acquired a 7.1 percent stake in the printer/copier company and on Jan. 29 Xerox announced it would split into two separate companies, a decision made in no small part because of pressure from Icahn. No costly, protracted proxy battle was needed. Icahn will get board seats on one of the companies; such is the power of the activist superstar.

In the era of the 24-hour news cycle and social media, activist investors are affecting change by becoming experts in harnessing public opinion. Whether it be through “earned” media, such as interview segments on CNBC and Bloomberg, or via “owned” media – e.g., posts on Twitter and Facebook – the use of media is increasingly replacing the proxy vote. In 2009, about 14 percent of activist campaigns resulted in a proxy vote. That dropped to about about 3.6 percent in 2014, according to, which tracks activist activities.