As dealmaking activity accelerates in the latter half of 2025, activist investors are preparing to ramp up their campaigns targeting corporate governance, operational improvements, and potential spin-offs. After a quieter second quarter, there is now growing confidence in global dealmaking, leading to expectations of a significant increase in shareholder activism. Prominent activist firms like Elliott Investment Management and Starboard Value are preparing to launch new initiatives, aiming to influence strategic decisions at some of the world’s largest companies.
The Surge of Activist Investors in 2025
In recent years, activist investors have played an increasingly prominent role in shaping the direction of major corporations. Known for pushing companies to focus on shareholder value, activists often demand changes in management, restructuring, or the sale of non-core businesses. As we enter the second half of 2025, the increased pace of dealmaking is expected to give activist investors even more opportunities to assert their influence.
One of the key areas of focus for activists in 2025 is corporate governance. Many activists are pushing for changes to the composition of boards of directors. They believe that improving board oversight and bringing in fresh perspectives can help companies become more agile and responsive to market changes. In particular, there is a strong push for more diversity on boards, with activists calling for greater representation of women and minority groups in leadership roles. This trend reflects broader societal calls for diversity and inclusion, with many activists arguing that diverse leadership leads to better decision-making and improved corporate performance.
Another focus area for activist investors is mergers, acquisitions, and spin-offs. In an effort to unlock value for shareholders, activists are advocating for corporate restructuring, often pushing companies to divest non-core assets or break up conglomerates into more focused businesses. Activists argue that these actions can help companies achieve greater operational efficiency, improve strategic focus, and enhance long-term shareholder value. For example, activists may demand that a large company sell off a subsidiary that is underperforming or is no longer aligned with the company’s core mission.
Activists are also pushing for companies to improve their operational performance. This can include recommending cost-cutting measures, divesting underperforming assets, or implementing more efficient business practices. These calls for operational improvements are not only aimed at increasing profitability but also at ensuring that companies are able to better adapt to changing market conditions.
In recent years, environmental, social, and governance (ESG) issues have become a significant part of activist campaigns. Activists are increasingly pressuring companies to adopt stronger ESG policies in response to growing shareholder and societal expectations. These initiatives may include adopting more sustainable business practices, improving diversity and inclusion efforts, and enhancing corporate transparency. With ESG issues playing an increasingly important role in investment decisions, many companies are now responding to activist demands for stronger corporate social responsibility practices.
Corporate Responses and Strategic Adjustments
As the influence of activist investors continues to grow, companies are taking more proactive steps to address potential vulnerabilities before activists launch campaigns. Many corporations are now engaging in regular dialogues with their shareholders to understand their concerns and expectations. By doing so, they can make necessary adjustments in advance, reducing the likelihood of costly proxy battles or public confrontations.
While high-profile proxy battles may have become less frequent in recent years, the underlying trend of shareholder activism is intensifying. More and more companies are recognizing that activism can be a force for positive change, helping to improve corporate governance, increase efficiency, and unlock shareholder value. In many cases, companies are settling with activist investors behind the scenes, agreeing to changes that benefit both parties.
Institutional investors, who often hold significant stakes in large corporations, are generally supportive of activist campaigns. They view activism as an important mechanism for holding management accountable and driving long-term value. As a result, activist investors are no longer seen as adversaries by many corporations, but as key partners in improving corporate performance and achieving better financial outcomes.
The Future of Shareholder Activism
As dealmaking activity continues to accelerate, shareholder activism will likely become an even more powerful force in shaping corporate strategy. Activists are pushing companies to focus on governance, restructuring, operational efficiency, and ESG practices, all of which are becoming increasingly important in today’s business world. Companies that proactively engage with their investors and adapt to these demands will be better positioned to thrive in an increasingly competitive and complex marketplace.