Big Funds Push Back Against Activist Investor Settlements

After years of support for companies that hand board seats to activists to avoid a bruising public fight, some of the world’s largest institutional investors are pushing back. BlackRock Inc, the world’s largest asset manager, and Norges Bank Investment Management, Norway’s $872 billion sovereign wealth fund are among the major funds resisting, encouraging companies to consult them before responding to an activist. These investors argue that in certain cases, giving board seats to frustrated shareholders with a shorter-term investment horizon could jeopardize the company’s long-term performance.