Gunster attorney Robert B. Lamm writes about how middle-market companies should prepare now for shareholder empowerment in a recent article published by Law360.
Engaging with a company’s institutional investors offers opportunities to better understand individual institutional investors and the governance policies (voting or otherwise) for each, Lamm says in the article. These communications also allow a company to educate the investor about business practices and reasoning, he adds.
Reaching out to major investors before conflicts arise can be a win for both the company and its shareholders. For these meetings, be sure to include one or more board members (if appropriate), be clear about who’s attending (on both sides), as well as what will be discussed. An agenda would not be out of place, Lamm offers.
Middle-market companies are a favored target of empowered shareholders pushing for governance reforms, Lamm says, primarily because easy reforms at larger companies have already been had, and investors may be seeking attention that demonstrates their reform-mindedness. In addition, mid-cap companies usually have fewer resources and less experience in the corporate governance realm than large caps.
Read the entire article: How companies can prepare for shareholder empowerment (Law360, 4/18/17) – note: subscription required.
Read related: What Florida middle-market execs should know (Gunster.com News, 6/6/16)