Activists shift tactics

Shareholder activists are pressing for board seats, bylaw fights and vote-no campaigns more often than old-style persuasion with management. (corpgov.law.harvard.edu) In 2025, activists waged a record number of campaigns, and more than 90% of the U.S. board seats they won came through negotiated settlements rather than contested elections. Thirty-two chief executives resigned within one year of an activist campaign, up 60% from the previous four-year average. (corpgov.law.harvard.edu) Activists also used cheaper pressure tactics more often. Fried Frank said 2025 brought more “withhold” campaigns, in which investors urge shareholders to vote against directors instead of running a full competing slate. (friedfrank.com) The mechanics of board fights changed after the Securities and Exchange Commission’s universal proxy rules took effect in 2022. Those rules require a single ballot listing both company and dissident nominees, making it easier for shareholders to mix and match candidates and helping activists win partial representation. (news.bloomberglaw.com) That shift pushed companies to rewrite their defenses. Bloomberg Law reported that advance-notice bylaw updates jumped from about 100 in a normal year to more than 300 in 2022 and more than 400 in 2023, as boards added disclosure demands for activists seeking nominations. (news.bloomberglaw.com) By early 2026, advisers were telling boards to refresh activism playbooks every year, run shareholder-intelligence programs and review advance-notice bylaws before nomination windows open. PwC said boards are also reworking engagement protocols as voting decisions become more fragmented across institutions, proxy advisers and retail-investor choice programs. (clearygottlieb.com, pwc.com) The agenda changed, too. Diligent said M&A activism hit a five-year high in 2025, and Cleary Gottlieb said 61% of activist campaigns in the fourth quarter had an M&A angle, including demands to sell, spin off or break up businesses. (diligent.com, corpgov.law.harvard.edu) Lawyers advising companies say the fight is now less about one climactic proxy vote and more about procedures that shape who gets on the ballot and how investors cast votes. Directors & Boards wrote on April 17 that contests are unfolding in a “less transparent and increasingly decentralized” voting environment as more institutions bring voting decisions in-house. (directorsandboards.com) Activists say those rules can entrench incumbents. Company advisers say advance-notice bylaws and disclosure demands serve a legitimate purpose by telling shareholders who is financing a campaign and what conflicts a nominee may have. (news.bloomberglaw.com) The result is a market where activists can force change without always winning a public brawl, and boards are spending more time preparing for campaigns before any dissident files papers. (pwc.com, friedfrank.com)