Ronald Chan participated in a panel discussion at the Hong Kong Investor Relations Association conference on institutional shareholder activism and how it affects investor relations.
He noted that the absolute number of activist targets represents roughly less than 0.6 percent of all listed stocks in Asia over the past few years. In most cases these targeted companies had excess cash on their balance sheets. To minimise the chance of being targeted, simply improving investor communication on cash management and providing a consistent dividend policy would greatly reduce the risk.
Companies with corporate governance issues were the second biggest targets. The discussion panel agreed that five qualities are essential in building better relationships with shareholders: listening, understanding, communication, transparency, and consistency.
Source: Hong Kong Investor Relations Association