This article (http://www.linkedin.com/news?viewArticle=&articleID=483250554&gid=1331907&type=member&item=51149915&articleURL=http%3A%2F%2Fwww%2Eswissinfo%2Ech%2Feng%2Fbusiness%2FExecutive_bother_as_shareholders_rattle_cage%2Ehtml%3Fcid%3D30030374&urlhash=auoi&goback=%2Egde_1331907_member_51149915) correctly flags the growing crescendo of shareholder activism. As flagged in previous postings, this will not stop and directors and executives need to pay close attention.

Where directors get it wrong is to assume that 1) all shareholders have the same objectives (research and logic clearly demonstrate that they don't); 2) Act as if they do; 3) Treat shareholders as the enemy and a pain to be endured; 4) Fail to understand that directors are proxied by shareholders to deliver shareholder objectives; 5) Fail to understand (or even ask) what their shareholders want; and 6) that institutions are a proxy for all shareholders.

Shareholders get it wrong by 1) trying to run the companies they have appointed directors and managers to run. Shareholder will not ever have the same information and resources to manage the company effectively as management, regardless of how well informed one or a handful of shareholders may be, but they should be telling the company what outcomes they want; 2) assuming that the AGM and a loud voice are the only strategies available to the shareholder.

In order to lower the activism temperature companies should (must) start taking shareholder metrics on what their shareholders want as outcomes from their investment around value, benefit, growth and risk perceptions.

A few large listed companies are now preparing to do this - therefore this is an inevitability so directors need to start paying attention now.

Directors are increasingly being seen by shareholders as "the enemy" even though a core part of their responsibility is ensure that shareholders are satisfied. All the corporate rhetoric says that yet the performance is abysmal. Shareholders are rebuffed at every turn.

The situation is now changing. The days of the corporate executive sitting sanctimoniously on his board-throne is being challenged and will soon crumble. Directors will certainly continue but they will be, and be seen to be "merely" agents of the owners ensuring proper, ethical, legal and commercial performance of their investment in order to deliver to those owners the outcomes they "were promised".

"Times are a changin'."