CFA Practice Question

There are 233 practice questions for this study session.

CFA Practice Question

During the 1980s, notable activist investors such as Carl Icahn and T. Boone Pickens gained international notoriety and were often perceived as "corporate raiders" for acquiring an equity stake in publicly owned companies (like Icahn's investment in B.F. Goodrich) and then forcing these companies to take action to improve value or rid themselves of rebel intruders (like Icahn) by buying back the raider's investment at a fat premium, often at the expense of other shareholders. These actions are referred to as ______.
A. shareholder engagement
B. shareholder activism
C. shareholder takeover
Explanation: Shareholder activism is a way in which shareholders can influence corporations' behaviors by exercising their rights as owners. Although shareholders don't run companies, there are ways for them to influence the board of directors and management.

User Contributed Comments 0

You need to log in first to add your comment.