Last month I discussed with a member from ShareAction on ways to build an AIG. It is looking like creating a not for profit organization will be the best way to do so. With a not for profit we will have flexibility to bring together voting power of shareholders and create research on DRS.
I am still reaching out to organizations on how to go through the process of creating an AIG alas there are not many AIGs out there. If you would love to help one way to do so is look for organizations that use shareholder resolutions to influence companies. The more we understand this process the more impact we can have.
Now onto the conversation I had with ShareAction. During this conversation I inquired about how they began and what their strategies are. Their main focus is on ESG and to do so they interact with asset managers and asset owners. When the group was originally formed they mainly contacted pension funds to push for certain shareholder resolutions. He described the organization like an umbrella with 3 main objectives:
- Policy and engaging with Policy Makers
- Individual corporate campaign: activities and activism focused on certain theme in climate
- Financial sector standards talking to asset managers and asset owners and allows to hold them in account for who supports them and those that do not
With asset managers he brings up a good point on how we can start advocating for the company and get into contact with asset managers. For their movement they are in contact with 600-700 asset managers and this number is growing as their footprint has been getting larger. The hardest part they have faced is getting their foot in the door with asset managers. When contacting these asset managers they needed an advantage so they could be listened to and for them it was through smaller issues that larger organizations are not covering. The member I am in contact with is the senior manager for financial engagement and has never heard of the Direct Registration system. He was not aware of voting issues and how votes can be discarded. This can give us an advantage with these asset managers as we know a system of the market that they have never heard of. We have immense knowledge on the DRS system which can be supported by evidence on Failure to Delivers, and votes being thrown out as there are too many shares.
Utilizing asset managers, asset owners, and pension funds they are able to put pressure on the companies and their shareholder resolutions are more likely to succeed. One way they are able to get pension funds more involved is if the shareholders in the funds put pressure on their pensions such as threatening to move shares out.
Regarding the organization they are a not for profit which is what he recommends we create the AIG as. As a not for profit they are a charity organization and survive through volunteers and donations. This allows them to be agile and cover a wide range of topics as long as they have a theme. We will need to learn more about what this entails and how we can go about setting this up and what state we will want to do it in.
Along with pushing for policy and engaging with asset managers they also conduct research which is a critical part to what they do. This is similar to us where it is very important to keep on writing DD and exposing the corruption within the market. This will allow us to push for DRS and help us narrow down our shareholder resolutions as it is imperative that we create a detailed resolution. He emphasized that when creating resolutions the most detailed are the ones that are more likely to succeed. One of the first things we should do is send a private letter to Gamestop detailing what we would like them to do, much like how Ryan Cohen sent a letter to the board before he started to take control. If there is pushback then we can start going public and pushing for resolutions at the AGM.
If you have any questions you would like asked send them my way and I can email him or set up another meeting.