When a company makes a decision that may benefit shareholders, who gets the credit? Is it the activist who popularized the idea? Or the chief executive and board that made it happen? Lately, it seems to be the former, which must nettle the CEOs at places such as Dow, DuPont, General Electric, Qualcomm, Ebay and now Xerox. The dynamics surrounding shareholder activism and corporate strategy are shifting once again. When the surge in activism began a couple years ago, savvy investors were seen to be stepping in with some tough love and great ideas to help companies find their way (and of course, make themselves lots of money in the process). But if you peel back the onion in some recent situations, the activist is playing the role of a stock picker, essentially endorsing what the CEO already seems to be doing and rallying support from other shareholders.
Activists have turned much more passive, yet it feels like they’re increasingly getting the praise. Some folks are starting to recognize this dissonance. Earlier this month, Rob Kindler, Morgan Stanley’s head of M