Changing the world through shareholder activism?

Abstract

As one of the more progressive facets of the socially responsibleinvestment (SRI) movement, shareholder activism isgenerally recommended or justified on the grounds that itcan create social change. But how effective are differentkinds of activist campaigns likely to be in this regard? Thisarticle outlines the full range of different ways in whichshareholder activism could make a difference by carefullygoing through, first, all the more specific lines of actiontypically included under the shareholder activismumbrella and, second, all of the different ways in which ithas been suggested that these could influence the activitiesof commercial companies. It is argued that – althoughmuch more empirical research is needed in the area – thereare at least theoretical reasons for thinking that it will bedifficult to influence companies through the standardactions of filing or voting on shareholder resolutions.However, some alternative strategies open to activists mayallow them to increase their efficacy. It is specificallyargued that even individual investors could be able to pushfor corporate change through devising a radically selfsacrificialcampaign that manages to get the attention ofpowerful forces outside the corporate sphere.