Shareholder activism is everywhere. In May, hedge fund Jana
Partners pushed Whole Foods Market to overhaul its board, fix its
operations and pursue “all avenues to shareholder value creation,”
following a slump in its share price and stiff competition from other
grocers entering the organic food market.
Etsy, a path-breaking online marketplace, laid off nearly a quarter of its employees this spring and hired a new chief executive
officer in May after shareholder complaints of weak growth.
In this article, published in the August 7, 2017, edition of
Westlaw Journal Corporate Officers and Directors Liability, I discuss how benefit corporation law can distinguish constructive activism that contributes to real economic growth from tactics that seek quick stock gains by relying on short term actions that ultimately harm the entire economy.