Twitter Revolt Could March Next on Proxy Season

Agenda-Setting Financial Insight.
Feb. 24 2012 1:27 PM

Twitter Revolt Could March Next on Proxy Season

Will Twitter facilitate a revolution among fed up investors?

Photo by MANDEL NGAN/AFP/Getty Images

The revolution is being Tweeted. Social media have enabled political uprisings in the Middle East, the global Occupy movement and even a swift blowback against banking fees in the United States. A logical next step would be for Facebook, Twitter and their ilk to intensify the voice of the investing masses.

The upcoming proxy season in Corporate America could be the perfect opportunity. The annual rite whereby shareholders get a chance to vote on a variety of corporate proposals, including matters of corporate governance, provides a testing ground to see if social media’s influence can extend to the world of finance.

Corporate directors seem ill-prepared for the possibility of digital activism, though Carlyle co-founder David Rubenstein did sound the alarm a year ago when he suggested employees and shareholders “could use Facebook to rally support against an acquisition.”

Yet bankers were as caught off-guard by the swift mobility of the Occupy Wall Street protests as the autocratic regimes in Egypt and Syria were by the Arab Spring’s dawning. Bank of America was forced into an embarrassing climb-down after customers rallied online against its $5 monthly fee for debit-card use.

Services like Twitter offer an opportunity for increasingly marginalized retail shareholders to regain influence. A half century ago, individual investors owned nine out of 10 shares of U.S. companies. But the rise of public pension funds and insurers has shrunk the retail base for most large companies to below 20 percent. Many of the biggest investors typically sit on their hands when it comes to challenging management.

It isn’t hard to imagine a lightning-rod issue like say-on-pay or a board fight, like the one currently brewing at Yahoo, providing the spark this year. It would take just one high-profile victory to wake up corporate executives, and sleepy institutional investors, to the idea that Facebook is more than just a powerful marketing channel for their brands.

Read more at Reuters Breakingviews.

Jeffrey Goldfarb is a New York-based assistant editor with a focus on Wall Street, private equity, M&A and the media industry. Before becoming a columnist, Jeffrey wrote about banking, deals, international trade, healthcare and the Internet.



Talking White

Black people’s disdain for “proper English” and academic achievement is a myth.

Hong Kong’s Protesters Are Ridiculously Polite. That’s What Scares Beijing So Much.

The One Fact About Ebola That Should Calm You: It Spreads Slowly

Operation Backbone

How White Boy Rick, a legendary Detroit cocaine dealer, helped the FBI uncover brazen police corruption.

A Jaw-Dropping Political Ad Aimed at Young Women, Apparently

The XX Factor
Oct. 1 2014 4:05 PM Today in GOP Outreach to Women: You Broads Like Wedding Dresses, Right?

How Even an Old Hipster Can Age Gracefully

On their new albums, Leonard Cohen, Robert Plant, and Loudon Wainwright III show three ways.

How Tattoo Parlors Became the Barber Shops of Hipster Neighborhoods

This Gargantuan Wind Farm in Wyoming Would Be the Hoover Dam of the 21st Century

Oct. 1 2014 8:34 AM This Gargantuan Wind Farm in Wyoming Would Be the Hoover Dam of the 21st Century To undertake a massively ambitious energy project, you don’t need the government anymore.
  News & Politics
Oct. 1 2014 7:26 PM Talking White Black people’s disdain for “proper English” and academic achievement is a myth.
Buy a Small Business
Oct. 1 2014 11:48 PM Inking the Deal Why tattoo parlors are a great small-business bet.
Dear Prudence
Oct. 2 2014 6:00 AM Can’t Stomach It I was shamed for getting gastric bypass surgery. Should I keep the procedure a secret?
  Double X
The XX Factor
Oct. 1 2014 5:11 PM Celebrity Feminist Identification Has Reached Peak Meaninglessness
  Slate Plus
Behind the Scenes
Oct. 1 2014 3:24 PM Revelry (and Business) at Mohonk Photos and highlights from Slate’s annual retreat.
Brow Beat
Oct. 1 2014 9:39 PM Tom Cruise Dies Over and Over Again in This Edge of Tomorrow Supercut
Future Tense
Oct. 1 2014 6:59 PM EU’s Next Digital Commissioner Thinks Keeping Nude Celeb Photos in the Cloud Is “Stupid”
  Health & Science
Oct. 1 2014 4:03 PM Does the Earth Really Have a “Hum”? Yes, but probably not the one you’re thinking.
Sports Nut
Oct. 1 2014 5:19 PM Bunt-a-Palooza! How bad was the Kansas City Royals’ bunt-all-the-time strategy in the American League wild-card game?