Activist investors are expected to carry out fewer environmental and social campaigns this year after the strategy proved less lucrative than other shareholder agendas, according to business consulting firm Alvarez & Marsal Inc.
An analysis by the firm found that activist campaigns focused on operational or strategic change outperformed the market by an average of 9.4% over the past six years. By contrast, campaigns focused on environmental and social issues saw the weakest relative returns, outperforming the market by just 0.2% on average for the same period, according to a report published Tuesday.
“As investors focus more firmly on returns in 2024 in a challenging market, we expect to see a decline in ESG-related campaigns and a renewed focus on metrics such as margin growth, cash generation and return on capital,” said Andre Medeiros, a managing director of A&M.
A&M’s analysis is based on 550 public campaigns by shareholder activists launched between the start of 2016 and Oct. 31, 2021, against companies headquartered in Europe and the US. The firm then looked at the total shareholder return for each company over the subsequent two years following the campaign launch and compared that return to either Europe’s Stoxx 600 Index or the S&P 500 Index, depending on where the company was located.
By listening for what truly matters and where clients want to make a difference, advisors can avoid politics and help build more personal strategies.
JPMorgan and RBC have also welcomed ex-UBS advisors in Texas, while Steward Partners and SpirePoint make new additions in the Sun Belt.
Counsel representing Lisa Cook argued the president's pattern of publicly blasting the Fed calls the foundation for her firing into question.
The two firms violated the Advisers Act and Reg BI by making misleading statements and failing to disclose conflicts to retail and retirement plan investors, according to the regulator.
Elsewhere, two breakaway teams from Morgan Stanley and Merrill unite to form a $2 billion RIA, while a Texas-based independent merges with a Bay Area advisory practice.
Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.
Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.
