Shareholder Activism: Ten Trends for 2027
Last year, we identified ten trends that we expected to shape shareholder activism in 2026. Those trends included: increasing M&A-focused activism, emboldened occasional activists, less visibility into shareholder views, the normalization of serving as a dissident nominee, and more “withhold” campaigns.
The 2026 proxy season has largely borne out our expectations. Activism continued at elevated levels globally in the first half of 2026. Approximately 40% of campaigns involved an M&A-related thesis, fueled by a constructive regulatory and financial environment. However, the high volume of activism has not translated into a corresponding increase in proxy fights going to a vote. Settlements remain the principal mechanism for resolution, with a significant number of settlements being announced prior to any public agitation by the activist. The proxy voting system is also becoming more fragmented, and therefore less predictable, as the “Big Three” institutional investors split their voting teams, pass-through voting becomes more prevalent, and large investors increasingly incorporate AI into their voting models.
Against this backdrop, we expect the following ten trends for the year ahead.
(1) Companies are Winning at the Ballot Box Under the Right Circumstances
The vast majority of activism campaigns are resolved via settlement; often, these settlements occur before any preliminary proxy materials are filed and increasingly, they do not always involve a formal agreement. However, companies that have conviction in their strategies and/or are dealing with activists with unreasonable expectations will still take proxy fights to a vote. In those cases, companies often emerge victorious. As of August 2026, six total campaigns went all the way to a vote in the United States (at companies with over $250M market cap), down from nine in 2025. Of those, only one campaign resulted in an activist successfully winning any board seats. Especially where an activist is unable to recruit quality candidates and keep its eyes on a clear and understandable message, shareholders remain willing to back a board actively engaged in overseeing the company’s strategy, even in the face of some historic underperformance.
(2) Summer is the New Fall
Activism for any given proxy season has tended to kick off in the fall, often centered around various activism conferences at which activist funds will announce their top targets. More recently, activists have been initiating private engagement with companies earlier in the calendar year, sometimes approaching companies over the summer in the first few months after an annual meeting, almost a year before they could win any seats in a contested election. Because many activists—especially the larger, more prolific ones—evaluate multiple potential activism targets at once, the nature of an initial contact can offer helpful clues about the seriousness and maturity of the activist’s thesis. Early engagement can be useful, both to understand the activist’s perspective and to demonstrate responsiveness. Still, an early approach needs to be managed in a way that allows the management team and board to focus on the business and does not create unreasonable expectations as to what level of access an activist will be afforded over the course of a year.
(3) Succession Planning in the Crosshairs
Activists typically target companies whose stock prices are underperforming, which may coincide with a board’s consideration of CEO succession or a broader management transition. But CEO transition is a vulnerable moment on its own. An activist’s arrival can complicate an already consequential decision-making process by creating pressure to announce a CEO transition before a successor has been identified, install an interim CEO, or accelerate a search that the board had been conducting on a different timetable. There is no one-size-fits-all model for handling such pressure: the appropriate approach will depend on the timetable, the incumbent CEO, the available internal and external candidates, and the company’s current circumstances and needs. What is critical is that the board be able to demonstrate to investors that it has made the decision thoughtfully and deliberately, rather than allowing the activist to dictate the nature and timing of one of the board’s most fundamental decisions; and that the board be mindful of investor dialogue throughout.
(4) Activists Without Borders
Activists are increasingly looking outside of the United States for target companies, especially in APAC. Japan is the most prominent example of this phenomenon: Japan alone accounted for approximately 25% of all activism campaigns globally in 2026. Currency and interest rate differences undoubtedly play a role, but so does the multitude of US activist investors relative to the opportunity set abroad. Many of the non-US campaigns are waged by US investors or based on tactics practiced in the US market. Companies in regions where activism preparedness has not historically been standard practice can benefit from lessons learned in the United States, including regular vulnerability assessments, robust shareholder engagement, board education, and stock monitoring. Those tools should be adapted to take into account the local rules, practices and shareholder dynamics, which can differ significantly across jurisdictions.
(5) Activism is No Longer the Crisis It Once Was
The sheer volume of activism activity in the post-COVID era has reduced some of the novelty and reputational risk once associated with being targeted by an activist. Many activist campaigns also employ the same set of themes and templates, typically calling for some combination of board or management changes, M&A, capital return, and/or operational changes. New funds with no activist history call themselves activists to garner attention and raise capital. While media coverage may treat every activist engagement as a newsworthy event, it no longer necessarily generates the same sense of crisis inside the boardroom or among the shareholder base. Companies increasingly understand that an activist approach is not, by itself, evidence of any failure or a reflection of broader investor sentiment.
(6) Directors are Battle-Tested
A growing number of public-company boards include one or more directors who have experienced activism in their roles at other companies. That experience can be highly valuable, particularly in maintaining board cohesion and calm thinking, and avoiding mistakes after an activist approaches based on what is known versus what is suspected. While experience can always be informative, directors likewise should recognize that circumstances can vary greatly between companies and across engagements. Even the most battle-tested board will benefit from context-specific legal, financial, PR and IR advice and expertise in dealing with the specific activist at hand.
(7) Waning Influence of Proxy Advisors
ISS’ and Glass Lewis’ recommendations are no longer outcome-determinative. Companies have prevailed in proxy fights despite getting an “against” recommendation from one or both of ISS and Glass Lewis. The institutional vote is becoming increasingly more fragmented and less prone to proxy advisor sway, with many institutional investors applying their own policies and conducting their own analyses and voting choice and pass-through voting programs becoming more prevalent. Nevertheless, ISS and Glass Lewis remain important constituents in contested elections, and companies should continue to take into account their policies and processes. Companies should prepare carefully for proxy advisor meetings, including by selecting directors who can speak credibly and persuasively, but they should not over-index on those meetings at the expense of taking the case directly to investors. The proliferation of settlements also means that many campaigns are never evaluated by the proxy advisors.
(8) AI is Shaping Proxy Voting
Large institutional investors are leveraging artificial intelligence to read proxy statements, evaluate governance issues and make voting decisions. For example, earlier this year, the Wall Street Journal reported that JPMorgan Chase’s asset-management unit would be cutting all ties with proxy advisory firms and using an in-house AI-powered platform called Proxy IQ to assist on U.S. company votes. The bank is using this technology to manage voting, as well as analyze data for more than 3,000 annual company meetings and provide recommendations to portfolio managers, replacing the typical roles of ISS and Glass Lewis. The shift to AI-enabled voting may create a period of unpredictability while investors establish their voting frameworks and train their models. In the meantime, companies should begin evaluating the extent to which their proxy statements and other investor materials are legible to AI programs that will be filtering and evaluating information for voting decision-makers. For contested situations, we still expect the stewardship teams at institutional shareholders to play an active engagement role in shaping voting decisions.
(9) No More Silent Partners
The regulatory environment for activism is evolving rapidly. Among other developments, the SEC issued a new Corporation Finance Interpretation (CFI 110.09) in July 2026, pursuant to which activists’ Schedule 13D filings would be required to disclose the identity of each underlying investor in an entity (such as a special purpose vehicle (SPV)) formed for the purpose of raising funds to acquire securities in a specific company and engage in activism. Previously, activists using SPVs to finance their campaigns were able to simply disclose the name of the entity and the activist’s fund. While the extent of any impact remains to be seen, the new guidance may have a disproportionate impact on newer or less-capitalized activists that depend more frequently on campaign-specific financing.
(10) Multi-Year Activism
An annual meeting or an activist settlement can often mark a chapter in an activism campaign rather than its conclusion. Activists have returned for a second (and sometimes a third) year to agitate for changes at a company. Indeed, some never leave and see their search for a governance-entry point as a multi-year situation from the start. Therefore, companies should stay mindful and vigilant of post-contest behavior, regardless of whether the contest ended successfully or not. For example, companies should maintain positive relationships with any independent directors (including any who were nominated by activists) who join their boards, as they may be particularly credible voices on behalf of the company in any future activism campaign. A scorched-earth approach to winning a particular campaign that targets or alienates one director may have ongoing consequences and can make the company more vulnerable in the long run.
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In an ever-evolving activism landscape where activism has become more commonplace, more persistent and year-round, preparedness matters more than ever. Boards and management teams should regularly assess, and discuss with their advisors, their potential vulnerabilities, their relationships with investors, and their response plan in case of an unforeseen approach. For a more comprehensive discussion on activism preparedness and the tactics and considerations relevant to responding to an activist approach, refer to our memo: Dealing with Activist Hedge Funds and Other Activist Investors.
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