2016 (End Year)

The U.K. remains the hotbed for activist activity in Europe, and the depressed sterling against the U.S. dollar certainly improves the allure of British companies. The U.K. is usually targeted by event-driven U.S. hedge funds and alternative investors. However, in recent years institutional investors have become more active and, on occasions, formed alliances with alternative investors.

In November 2016, the U.K. Government published a consultation paper on how best to address perceived “boardroom excess”, as well as improving standards of business behavior following debacles at Sports Direct and British Home Stores. More recently, Blackrock has written to the Chairmen of FTSE 350 companies. In that letter, the world's largest asset manager outlined its updated approach to remuneration, which includes a greater focus on any base pay increases or pension payments for executives that run above the general workforce. Its updated guidelines on remuneration also set out certain circumstances under which they believe a vote against the re-election of remuneration committee members may be appropriate. Meanwhile, Jeremy Corbyn, leader of the opposition, has caught flack for his ideas on tackling executive pay. Mr. Corybyn's suggestions—which included capping the pay of executives at twenty times the earnings of lowest paid workers for companies awarded any government contracts—were largely derided, being labelled as “unworkable” in some quarters, and as a “lunatic idea” in others. Nonetheless, with the perception of Board performance amongst investors and the public appearing quite low, there remains scope for potential activist campaigns to gain traction at a host of companies