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Shareholder rebellion occurs when the owners of a corporation work to throw out management or oppose their decisions. Shareholder rebellion may occur at an annual general meeting or through a
proxy battle A proxy fight, proxy contest or proxy battle (sometimes even called a proxy war) is an unfriendly contest for the control over an organization. The event usually occurs when a corporation's stockholders develop opposition to some aspect of the corp ...
. Shareholders may also threaten to collapse a firm's stock price through concentrated selling. In 1998, the
Rockefeller family The Rockefeller family () is an American industrial, political, and banking family that owns one of the world's largest fortunes. The fortune was made in the American petroleum industry during the late 19th and early 20th centuries by brot ...
led a shareholder revolt against
Exxon ExxonMobil Corporation (commonly shortened to Exxon) is an American multinational oil and gas corporation headquartered in Irving, Texas. It is the largest direct descendant of John D. Rockefeller's Standard Oil, and was formed on November 30 ...
over its climate change policy. In 2005,
Michael Eisner Michael Dammann Eisner (born March 7, 1942) is an American businessman and former chairman and chief executive officer (CEO) of The Walt Disney Company from September 1984 to September 2005. Prior to Disney, Eisner was president of rival film st ...
retired after
Walt Disney Walter Elias Disney (; December 5, 1901December 15, 1966) was an American animator, film producer and entrepreneur. A pioneer of the American animation industry, he introduced several developments in the production of cartoons. As a film pr ...
's nephew, Roy Disney, led a shareholder revolt, claiming Eisner was a
micromanager In business management, micromanagement is a management style whereby a manager closely observes, controls, and/or reminds the work of their subordinates or employees. Micromanagement is generally considered to have a negative connotation, main ...
who had caused a creative brain drain. In 2010, British Petroleum and
Shell Shell may refer to: Architecture and design * Shell (structure), a thin structure ** Concrete shell, a thin shell of concrete, usually with no interior columns or exterior buttresses ** Thin-shell structure Science Biology * Seashell, a hard o ...
faced a shareholder revolt over their Canadian tar sands policy. Recently, shareholder rebellions have occurred over the issue of
executive compensation Executive compensation is composed of both the financial compensation (executive pay) and other non-financial benefits received by an executive from their employing firm in return for their service. It is typically a mixture of fixed salary, variab ...
at Cable and Wireless and Shell; Shell in response unveiled a plan to curb executive compensation and bonuses. According to some analysts, institutional shareholders have been lax about holding management accountable because they were concentrating on picking correct stocks rather than protecting their interests in the stocks they owned. Shareholder revolts are becoming more common, with a record number of advisory “Say on Pay” votes in the US failing to win majority support in 2018.


History

On 24 January 1609, Amsterdam-based businessman Isaac Le Maire filed a petition against the
Dutch East India Company The United East India Company ( nl, Verenigde Oostindische Compagnie, the VOC) was a chartered company established on the 20th March 1602 by the States General of the Netherlands amalgamating existing companies into the first joint-stock co ...
(VOC), marking the first recorded expression of
shareholder activism A shareholder (in the United States often referred to as stockholder) of a corporation is an individual or legal entity (such as another corporation, a body politic, a trust or partnership) that is registered by the corporation as the legal owne ...
or shareholder rebellion.Hansmann, Henry; Pargendler, Mariana (2013). ''The Evolution of Shareholder Voting Rights: Separation of Ownership and Consumption''. (Yale Law Journal, Vol. 123, pp. 100–165, 2014)


See also

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Shareholder activism A shareholder (in the United States often referred to as stockholder) of a corporation is an individual or legal entity (such as another corporation, a body politic, a trust or partnership) that is registered by the corporation as the legal owne ...
*
Shareholder oppression Shareholder oppression occurs when the majority shareholders in a corporation take action that unfairly prejudices the minority. It most commonly occurs in non-publicly traded companies, because the lack of a public market for shares leaves minori ...


References

{{Reflist Rebellion