Aswath Damodaran 47
The Stockholder Backlash
! Institutional investors such as Calpers and the Lens Funds have become much
more active in monitoring companies that they invest in and demanding
changes in the way in which business is done
! Individuals like Michael Price specialize in taking large positions in
companies which they feel need to change their ways (Chase, Dow Jones,
Readers’ Digest) and push for change
! At annual meetings, stockholders have taken to expressing their displeasure
with incumbent management by voting against their compensation contracts
or their board of directors
All of these developments represent the backlash to managers putting their
interests over stockholder interests.
