Quasi-Insider Shareholder Activism: Corporate Governance at the Periphery of Control

Jonathan Cohn, Mitch Towner and Aazam Virani

The Review of Corporate Finance Studies, 2025, vol. 14, issue 1, 1-34

Abstract: We analyze shareholder activism by “quasi-insiders”: founders, former executives, and other individuals tangentially connected to a firm. These individuals seek control in their campaigns, use aggressive tactics, and target smaller, poorly performing firms. Their campaigns are associated with positive announcement returns. Former CEOs who engage in campaigns often depart from the target under negative circumstances before launching their campaigns soon afterward. Our results suggest that insiders at the periphery of control may intervene in firms too small for traditional activists to target. (JEL: G34, G32)

Date: 2025
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