2024 was the year for activist investors to make their voices heard.
According to a Barclays (LON:BARC) report, a record surge in activist investor campaigns and pressure tactics delivered robust returns and analysts predict further growth in shareholder activism in 2025.
"Looking back to 2024, it feels almost as if there was a shareholder revolt," said Barclays global head of shareholder advisory Jim Rossman.
The report revealed that 160 investors, including hedge funds, launched campaigns targeting global companies for strategic improvements or leadership changes.
Of these, 45 were first-time activists. This marked an 18% rise from 2023, which saw 135 activists, including 31 new entrants. Campaigns rose to 243, slightly below the 2018 peak of 249.
Investors are increasingly demanding immediate changes.
"Investors are no longer willing to sit and wait for promised improvements and are saying, 'We want the companies where we are invested to change right now,'" Rossman said.
High-profile firms posted returns of nearly 30%, outperforming the S&P 500’s 23% growth in 2024.
Major campaigns included Trian Fund Management targeting Walt Disney (NYSE:DIS) and Elliott Investment Management pressuring Starbucks (NASDAQ:SBUX) and Southwest Airlines (NYSE:LUV).
New players also entered the fray, with Ananym Capital Management engaging Henry Schein (NASDAQ:HSIC), Daventry Group targeting Kinaxis, and Firstlight Management challenging Sotera Health.
Activist priorities
Activists increasingly prioritised operational enhancements over mergers and acquisitions (M&A), with strategic demands accounting for 26% of campaigns, up from 19% in 2021. Only 22% of 2024 campaigns called for M&A, compared to 43% during the 2021 M&A boom.
Chief executives faced heightened scrutiny, with a record 27 ousted in 2024, including leaders at Kohl’s, CVS Health (NYSE:CVS) and Norfolk Southern (NYSE:NSC).
CEOs at Starbucks, SmartRent and Wolfspeed also announced their departures as activist investors circled.
"Activist investors are holding companies and boards accountable and that includes sometimes no longer allowing the CEO to steer the ship," Rossman said.
The United States led global activity, hosting nearly half of all campaigns, while the Asia-Pacific region, especially Japan, South Korea and Australia, saw significant growth.
Campaigns surged 67% from Q3 to Q4 2024, signalling continued momentum into 2025.