By Rob Cox
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
America’s shareholder spring hit a cold patch. Just when it seemed investors were finally breaking through entrenched boards’ barricades, the owners of Coca-Cola turned to jelly, led shockingly by Warren Buffett. The failure to challenge a transfer of vast shareholder treasure to the top 5 percent of Coke’s soda jerks shows the agency problem is still alive and well in American capitalism.
Not that investors will retreat from behaving more like owners. Greater shareholder democracy is still on the march. Last month, for instance, activists made nearly 100 U.S. Securities and Exchange Commission filings, exceeding the February number by a third, according to Activist Insight.
The capital markets are filled with anecdotes about shareholders getting more involved. Massive companies have seen their cages rattled by uppity investors with minor economic stakes. Some smaller firms have been forced to change strategy entirely just to satisfy stakeholder demands. Even little guys are getting into the act, successfully putting resolutions on the ballots at annual meetings.
While many of these actions are substantive, some are frivolous, even downright nit-picky: Should Darden Restaurants spin off Red Lobster with or without its real estate? Still others are a total waste of time: Should General Electric hire an investment banker to sell itself?