Close this search box.
Close this search box.

Prepping For Pillagers

© AdobeStock
Any company can find itself in an activist’s crosshairs. Here’s how to fight back.

At the close of 2022, we saw investor activist campaigns ramp up for a record number of attacks on corporate America, with high-profile firms Alphabet, Meta, Paypal and Disney among the 235 targets. Directors are regularly caught unprepared and overwhelmed by confusing activists’ media campaigns.

While pioneer activists like Robert Monks, Nell Minow and Ralph Whitworth championed needed transparency and accountability to counter board cronyism, absenteeism and corruption, today’s activist investors are more akin to 1970s leveraged buyout greenmailers raiding healthy businesses at a brief moment of weakness to shake down the board, change out leadership and heave off healthy business units at fire sale auction prices to snag a quick buck from the resulting stock price pop.

DuPont CEO Ellen Kullman, a 27-year veteran of the company, was pushed out this way, despite achieving a record 266 percent total shareholder return during her six years, beating the 165 percent return for all S&P 500 firms and delivering the third-highest shareholder return of all world’s top chemical companies. Activist Nelson Peltz’s firm Trian pounced on a two-quarter downturn, insisting that DuPont’s famous labs—the source of a third of DuPont’s product line and costing only 0.7 percent of sales—be shuttered.

A similar activist campaign Peltz launched against Disney this year failed after he mischaracterized Disney chief Bob Iger’s widely celebrated performance record. Iger had achieved cumulative total shareholder returns of 554 percent during his tenure, in contrast to Peltz’s own troubled track record, as at least half of the companies on whose boards he served underperformed the S&P during his tenure.

In fact, four of the major activist funds targeting Salesforce—Elliott Management, Third Point Management, Starboard and ValueAct Capital—dramatically underperformed major indices, including the S&P 500, the Dow Jones Industrial Average and the Nasdaq-100, while CEO Marc Benioff’s performance was double theirs.

Instead of succumbing to intimidation boards should:

• Fight Fire with Facts. Too often, activists confuse business media, analysts and institutional investors with apples-and-oranges data comparisons of performance where they deceptively cherry-pick data to make the target company look worse and conceal their own performance. Many analysts were led to believe that Alcoa CEO Klaus Kleinfeld’s plan to spin off the new metallurgical products unit Arconic was Elliott Partners’ idea, thanks in part to the board cowering under the threat of personal attacks.

• Compel Strategic Engagement. Instead of retreating under the onslaught, at Disney Iger beat back Peltz by refusing to concede to demands and presenting a compelling restructuring plan refuting the charge that Disney overpaid for Fox Entertainment.

• Stand Up to Locker Room-Style Bullying. Regrettably, the DuPont board and the Proctor & Gamble board won expensive proxy battles against Peltz but then retreated in the face of misleading media campaigns. P&G even surrendered its board charter limits on age and number of board positions for Peltz. By contrast, Carlos Rodriguez of ADP refused to grant infinite extensions for activist Bill Ackman, calling him a “spoiled brat” who didn’t understand ADP’s business, and prevailed.

• Stand by Your Woman. It is no accident that high-performing women CEOs such as PepsiCo’s Indra Nooyi and GM’s Mary Barra were targeted by activists. Research has shown women CEOs are 50 percent more likely to be targets of activists, perhaps due to the belief that boards and institutional investors will more likely to fold on a woman leader. Pepsi- Co’s board stood by Nooyi and, as a result, avoided destroying value by heaving off international beverages or merging Frito-Lay with Peltz’s faltering Mondelez.

• Listen for Ideas. Sometimes activists identify important concerns that can inform strategy. Carl Icahn led some companies into bankruptcy and spearheaded a misguided campaign against Michael Dell, but was right to call out the board’s carte blanche for Chesapeake Energy’s Aubrey McClendon’s egregious self-dealing in 2012.

Twenty years ago, only 17 percent of boards caved in to activists. Now, thanks to media pressure and risk-averse lawyers, more than 50 percent compromise. Clearly, boards need to fortify their backbones.


  • Get the CEO Briefing

    Sign up today to get weekly access to the latest issues affecting CEOs in every industry
  • upcoming events


    Strategic Planning Workshop

    1:00 - 5:00 pm

    Over 70% of Executives Surveyed Agree: Many Strategic Planning Efforts Lack Systematic Approach Tips for Enhancing Your Strategic Planning Process

    Executives expressed frustration with their current strategic planning process. Issues include:

    1. Lack of systematic approach (70%)
    2. Laundry lists without prioritization (68%)
    3. Decisions based on personalities rather than facts and information (65%)


    Steve Rutan and Denise Harrison have put together an afternoon workshop that will provide the tools you need to address these concerns.  They have worked with hundreds of executives to develop a systematic approach that will enable your team to make better decisions during strategic planning.  Steve and Denise will walk you through exercises for prioritizing your lists and steps that will reset and reinvigorate your process.  This will be a hands-on workshop that will enable you to think about your business as you use the tools that are being presented.  If you are ready for a Strategic Planning tune-up, select this workshop in your registration form.  The additional fee of $695 will be added to your total.

    To sign up, select this option in your registration form. Additional fee of $695 will be added to your total.

    New York, NY: ​​​Chief Executive's Corporate Citizenship Awards 2017

    Women in Leadership Seminar and Peer Discussion

    2:00 - 5:00 pm

    Female leaders face the same issues all leaders do, but they often face additional challenges too. In this peer session, we will facilitate a discussion of best practices and how to overcome common barriers to help women leaders be more effective within and outside their organizations. 

    Limited space available.

    To sign up, select this option in your registration form. Additional fee of $495 will be added to your total.

    Golf Outing

    10:30 - 5:00 pm
    General’s Retreat at Hermitage Golf Course
    Sponsored by UBS

    General’s Retreat, built in 1986 with architect Gary Roger Baird, has been voted the “Best Golf Course in Nashville” and is a “must play” when visiting the Nashville, Tennessee area. With the beautiful setting along the Cumberland River, golfers of all capabilities will thoroughly enjoy the golf, scenery and hospitality.

    The golf outing fee includes transportation to and from the hotel, greens/cart fees, use of practice facilities, and boxed lunch. The bus will leave the hotel at 10:30 am for a noon shotgun start and return to the hotel after the cocktail reception following the completion of the round.

    To sign up, select this option in your registration form. Additional fee of $295 will be added to your total.