Activism and the concept of counterintuitiveness.

From Governance, Risk Management, and Compliance by Richard M. Steinberg. Copyright [C]2011 by Steinberg Governance Advisors Inc. Published by John Wiley & Sons Inc. (www. wiley.com/business).

THERE's SOMETHING EXTRAORDINARILY DEMOCRATIC about the idea of those who own a company being able to effect important decisions, and gains have already been made. The ability for shareholders to cast an advisory vote on executive pay, including golden parachutes and the like, is now law. Numerous disclosures of such matters as board composition, structure, and operation also are required.

Gains by shareholder activists can become intoxicating. The more they succeed in gaining power and basking in the limelight, the more active they become. I do behave, however, that reality will take hold before we self-destruct. While it's counterintuitive, more power in the hands of shareholders does not translate into better performance...