Shareholder engagement used to be management’s job, with the board briefed after the fact. That arrangement is breaking down, and it is breaking down faster than most boards have adjusted for. Institutional investors and activists now expect direct access to directors, not just to management, and this proxy season is making clear which boards planned for that shift and which did not.
The scale of the shift is not subtle. Cleary Gottlieb’s annual review of shareholder activism describes 2025 as a record-breaking year, with more campaigns waged than ever across an increasingly diverse range of public companies, and the firm notes that momentum has carried into 2026. Barclays’ own data puts numbers behind that trend, as a record 255 campaigns launched globally in 2025, surpassing the prior high set in 2018, alongside a marked rise in withhold campaigns aimed at unseating specific directors rather than contesting an entire board.
What Directors Are Actually Being Asked to Do
The list has grown well beyond attending quarterly meetings and reviewing the proxy statement. Directors are now expected to:
- Sit in engagement meetings with major shareholders
- Understand activism preparedness well enough to contribute to it, not just approve a plan built by others
- Be conversant in the logic behind executive compensation decisions, since pay packages are a favorite target once a campaign is underway
- Be capable of speaking credibly to the company’s leadership succession narrative, because activists routinely use a thin bench as evidence that the board itself is not doing its job.
The Exposure Is Personal, Not Institutional
Universal proxy rules changed the math for activists, and the change is already showing up in the data. Rather than running a full slate against a board, activists can now target a handful of individual directors, typically the ones who look most vulnerable on paper: age, tenure, overboarding, or a skill set that no longer maps cleanly to the company’s stated strategy. That is a meaningfully different threat than a boardroom used to face, and it rewards speed.
PwC’s 2025 Annual Corporate Directors Survey found that 55% of directors now believe at least one of their own board colleagues should be replaced, the highest share the survey has recorded. PwC also reports that CEO turnover remained elevated in 2025, with a notable share of departures directly connected to activist pressure. Boards are not short on early warning here. They are short on time to act on it before the next annual meeting sets the terms for them.
The Consensus Fix Is Board Composition
Every serious response to this environment starts in the same place, and it starts now rather than at the next scheduled governance review with proactive, ongoing work on board composition.
That means:
- Continually assessing director profiles against the company’s actual strategic needs rather than waiting for a proxy fight to force the issue
- Treating board refreshment as a standing discipline instead of an occasional cleanup project
- Maintaining an active pipeline of director candidates, so that when a seat does need to change hands, the board is choosing from a bench it has already built, rather than scrambling under pressure with an activist watching and a clock already running.
Boards that only think about this work once a campaign is underway are, by definition, doing it too late. The activists who win individual-director campaigns are not finding secret weaknesses. They are pointing at profiles the board had every opportunity to address on its own timeline, and did not.
The Bridge to Investor Relations
A board can only engage well with shareholders if the executive investor relations function beneath it is doing its job. Directors who show up to an activist meeting without a clear, current view of the company’s narrative, built jointly with a strong IR function and a CFO who owns the numbers behind it, are negotiating from a weaker position than they realize.
Act Before the Next Proxy Season
Board composition is the durable defense here. It works because it is continuous, not because it is triggered by a crisis, and continuous work has to start well before a campaign letter arrives.
The boards that treat director refreshment, succession planning, and skills alignment as ongoing work are the ones that walk into an activist campaign, or an ordinary engagement meeting, from a position of strength rather than exposure. If your board has not run that assessment recently, or has never run one at all, the next few months, before proxy season sets the agenda for you, are the right window.
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