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RIP, Evelyn Y. Davis: an unstoppable shareholder activist for the age

RIP, Evelyn Y. Davis: an unstoppable shareholder activist for the age

Evelyn Y. Davis offers a bullet from an ammunition bandolier, which she wore at the shareholders' meeting of 20th Century-Fox Film Corp. in 1971. (Bill Ingraham / AP)

During an annual shareholders' meeting in the 1990s, Nell Minow remembers Evelyn Y. Davis, the flamboyant business horde who died last year at the age of 89 as a theatrical but persistent thorn in the eyes of business leaders.

"She was arguing with the staff there, and she felt very strongly that the microphone for the question-and-answer session should come closer to her place," recalls Minow, an old-share proponent and advisor on issues related to corporate governance. Not only that, but "she wanted the CEO to move it in person," she said. "And he did."

The story is classic Davis, the Dutch American investor, survivor of the Holocaust, shareholder activist and publisher of an annual newsletter – Highlights and highlights of annual meetings & # 39; – who gave her a press card for the White House. She served resolutions for many public companies for decades and would not only appear at the annual meetings to take the lead and call the board to better corporate governance, but occasionally flirt with the chief executive and seemingly always draw attention on it's own .

She told JPMorgan Chase CEO Jamie Dimon in 2010 that "you should stay here forever", wearing a swimsuit at a General Motors meeting in 1970 and, according to Automotive News, former Ford CEO Alan Mulally said that although not bad was, looking, "you should go back to Boeing, and we should have my king, Bill Ford, back and become chairman and CEO again."

In 2003 Bill Ford personally delivered the keys to her new Jaguar to the Watergate complex in Washington, where she lived. Then she said: "This is my secret, manipulating the male ego, playing one against the other," reported Bloomberg.

A tombstone she had installed at Rock Creek Cemetery in Washington years ago was "Queen of the Corporate Jungle" and "I am not where I am by standing in line, nor being shy." When The Washington Post profiled her in 2003, she presented her own headline: "I was gifted with both extraordinary beauty and extraordinary brains and I have used them both for my greatest benefit."

Like most shareholder activists, her proposals often did not win a majority of votes. But she was effective and won a majority vote at a meeting of the Bank of New York in 2006 on how board members were elected, for example, and led Bristol-Myers Squibb to conduct an annual election policy after years of pressure. In 1990, she encouraged General Motors to ban inflated payments for shares and contributed to influencing, among other things, the rules of the US Securities and Exchange Commission on executive remuneration.

Her focus on important issues such as the quality of board management, voting processes of shareholders, executive remuneration, corporate bills and political contributions are still being handled by investors, according to experts in the area of ​​governance.

"She identified these corporate governance issues very early in our largest companies and was a consistent proponent and, some say, annoying," said Charles M. Elson, who runs a management center at the University of Delaware. "The message she promoted was really ahead of her time, which was considered quite far out there [then] is not only mainstream today, but in the dead end of mainstream. "

Her tactic, Minow said, "made it easy to reject the legitimacy of her points, which were mostly excellent, and the questions she raised were the same things investors do today." Davis "has trained the shareholder community more than they have the business community has trained. "

The world of shareholder activism has changed dramatically since Davis began attending shareholders' meetings in 1959. Nowadays, discussions between shareholders and companies are more often behind the scenes or less dramatically, even if pension funds and other institutional investors take part of their activities. the problems that Davis promoted.


Evelyn Y. Davis had shares in more than 80 public companies and enjoyed showing her presence at shareholders' meetings. Her flamboyant methods & # 39; made it easy to reject the legitimacy of her points, which were usually excellent & # 39 ;, said one observer. (Seth Wenig / AP)

"Companies have started to become far less aloof," said Richard Clayton, research director at CtW Investment Group, an activist organization working with union-sponsored pension funds. They are "more engaging and more willing to make a change if they think the change is relatively modest and logical, and if that allows them to avoid public controversy."

Resolutions of shareholders are often withdrawn if a company makes a change and may never get the vote.

Yet the role of the individual investor as a business horde is alive and kicking. According to Proxy Insight data, individual filers, such as John Chevedden and James McRitchie, along with others, were responsible for 200 shareholder proposals that until now were made in business proxy statements in 2018, or 38 percent of the total. The average support vote was 34 percent.

"They do not wear clown-noses at annual meetings and they do not wear hot pants like Evelyn did," Minow said, "but they're slow and stable," and their problems "get support over time."

In an e-mail, McRitchie said that while Davis "used too many exciting tactics, such as pushing the sale of her newsletter to CEO & # 39; s and dressing like a crackpot," she "definitely does the envelope on topics like the decrypting more boards had helped, "All are chosen every year, instead of being spread over time.


The tombstone that Evelyn Y. Davis commissioned for himself. (Courtland Milloy / The Washington Post)

"She won majority voting on that topic at 36 companies between 2001 and 2009 and perhaps much more before that time," McRitchie said. "We can all be grateful for that, but creating more democratic corporate governance is not something that is only done by old men in three-piece suits, embracing diversity."

Minow said that individual shareholder activists can cause problems because large institutional investors – especially cash-handling companies – "do not always want to take the lead." When horflies submit the resolution, "it's like a note in a bottle, imagine it beyond," and larger investors can eventually follow.

With the growth of money management companies and institutional investors and the influence of proxy advisers, today there is also more opportunity to increase the ideas of individuals, Elson said.

Elson, who had known Davis for years, said things were different during her heyday. "Her style was theatrical and at that time, for a person, you or someone should pay attention," he said. He remembers how on Saturday morning he threw rounds with his children and received phone calls from Davis.

& # 39; She had everyone's cell phone number, & # 39; he said, and "she screamed a bit in the phone, CHARLIE! It did not matter where you were; you would stop. She did not let you go before she was done. & # 39;

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