From an entire board resigning on the spot to the first non-traditional activist-led proxy battle, the 2024 proxy season was contentious for shareholders and activists alike. Proxy voting battles, contests in which shareholders propose their own nominees or vote against management proposals, can reshape a company’s future. They offer deep insights into the company’s health and the quality of its leadership. While some boards flounder, others embrace the conflict. Read below to get the highlights from the 2024 proxy season.
1. Disney vs. Nelson Peltz
Overview
Activist investor and co-founder of Trian Partners, Nelson Peltz, fought an unsuccessful proxy battle over two Disney board seats. Peltz started his Restore the Magic campaign in the final quarter of 2023 by leveraging his approximately $3 billion stake in Disney, former Marvel Entertainment Ike Perlmutter’s support, and a last-minute endorsement from Institutional Shareholder Services (ISS). In his campaign, he criticized Disney’s pivot to streaming and disparaged its lack of a CEO succession plan. The mass media giant responded by launching its own multi-million dollar campaign and flooding its shareholders’ inboxes with letters, emails, and social media ads.
The most expensive proxy battle to date ended in Disney’s favor. Disney’s full slate of 12 directors received overwhelming shareholder support. Meanwhile, Peltz received just 31% of the vote. Peltz promptly sold off his Disney shares, while Disney shares spiked by 11%.
Impact
Disney earned one of the first major victories under the new universal proxy card. Since the universal proxy card allows mixed slate voting, Peltz and Disney had to campaign for and against specific candidates instead of an entire slate. This new voting style highlighted the importance of retail investors, who were a major deciding factor for Disney’s victory. Corporations and activists alike will have to make like Disney and focus on persuasive, investor-focused campaigns to pull through future proxy battles.
Key Takeaways
- Colorful social media ads and catchy slogans may seem convincing, but taking the time to explore both sides can help you maximize your vote.
- Major proxy advisors still have influence. ISSbacked Peltz, while Glass Lewis supported Disney. You may want to check their positions if you are unsure about a high-profile proxy battle.
- Your inbox may be fuller than usual next proxy season. Disney succeeded because it reached out to every voter, from institutional investors down to the individual shareholder.
2. Norfolk Southern vs. Ancora Holdings
Overview
After the Norfolk Southern train derailment that forced every resident in East Palestine, Ohio, to evacuate in February 2023, Ancora Holdings launched its activist campaign. The activist hedge fund with a billion-dollar stake in Norfolk Southern used the derailment to pose its takeover attempt as a solution to a national safety issue. Ancora pushed for seven board seats and the removal of the CEO, Alan Shaw. It criticized Shaw’s performance while arguing that Norfolk was underperforming operationally and needed to cut costs. Meanwhile, Norfolk argued that Ancora’s proposed Precision Scheduled Railroading strategy would be ineffective and its $800 million savings goal impossible without mass layoffs.
After the May 2024 vote, Ancora Holdings won three of the seven board seats. Alan Shaw stayed on as CEO, and Ancora continued to pressure him.
Impact
Ancora Holdings’ partial victory represents one of the most important dissident wins of the proxy season. This proxy battle shows that a dissident does not need full control of the board to make major changes. The hedge fund did not unseat Shaw immediately, but it did call for an ethics investigation that would later force Shaw to resign in September 2024. After Shaw’s termination, CFO Mark George was promoted to CEO while John Orr remained COO. Both companies also agreed to expand Norfolk Southern’s board to 14 seats and install a mutually agreed-upon independent director.
Key Takeaways
- Small wins are still wins. If you are unsure about voting for an activist, remember that Ancora Holdings only needed three board seats to spark major reforms.
- Watch out for the fallout. Proxy battles do not always end after the final vote. Shaw resigned months after Ancora failed to remove him.
- Safety matters. Major material issues like Norfolk Southern’s derailment can garner stronger dissident support.
3. Southwest Airlines vs. Elliott Management
Overview
In June 2024, activist hedge fund Elliot Management leveraged its approximately $1.9 billion or 10% stake in Southwest Airlines to demand major leadership changes. It criticized the airline’s stagnant leadership. Pushed for the removal of CEO Bob Jordan and Executive Gary Kelly, and argued that Southwest’s failure to evolve led to its share price dropping below its 2020 pandemic price. Elliot then nominated a slate of 10 new board members and called for a special meeting. Southwest Airlines responded by enacting its shareholder Rights Plan that would mark down all shares by 50% if Elliott acquired a 12.5% stake or more. It also announced some structural changes, but shareholders seemed to agree that it was too little too late.
In October, Elliott and Southwest settled. Chairman Kelly agreed to retire early. Five of Elliott’s candidates, as well as the former CFO of Chevron, were voted onto the board. Meanwhile, Southwest’s stock dipped roughly 4% after the shareholder meeting before recovering a month later.
Impact
Although Bob Jordan is still CEO, he now faces heightened board scrutiny and performance expectations. In February 2025, Southwest implemented a workforce reduction of 1,750 employee roles that mainly targeted leadership positions. Southwest also made some more customer-focused changes, like assigned seating and premium seats with extra legroom. For Elliot Management, 2024 marked one of its largest U.S. board victories and demonstrated its effectiveness as an activist. Elliot’s victory followed a broader trend of rising activist involvement made easier, and more unpredictable, by the universal proxy card.
Key Takeaways
- Board refreshment matters. Invested in a stagnating company? Voting in new board members can shift long-standing, unpopular policies like open seating to new revenue models (premium seating charges).
- Short-term volatility follows long-term gain. Southwest’s stock dropped following the proxy battle, but recovered quickly and exceeded previous projections.
- You can teach an old dog new tricks. Even legacy brands like Southwest are not immune to shareholder pressure when financial performance is down.
4. Gildan Activewear vs. Browning West
Overview
Canadian apparel company Gildan Activewear sparked shareholder backlash in December 2023 when it ousted its co-founder and CEO of nearly forty years, Glenn Chamandy. Activist investment firm Browning West, holding roughly 5% of Gildan stock, stepped up in January 2024 by calling a special meeting to reinstate Chamandy and nominate eight new board members. Both ISS and Glass Lewis backed Browning West nominees while urging shareholders to withhold their support for Gildan’s nominees. Gildan responded by filing multiple lawsuits. It argued that Browning West’s share acquisitions violated the US Hart-Scott-Rodino Act and that Browning failed to observe a 30-day waiting period before completing the purchases.
Just months after Gildan took legal action, the Canadian courts threw out both lawsuits. The entire incumbent board of directors resigned ahead of the May 2024 meeting, and Browning’s entire slate won by default. Vince Tyra also stepped down and reinstated Chamandy as CEO.
Impact
Following the complete leadership overhaul, the new board immediately stopped discussions regarding the previously announced buyout. Gildan’s U.S.-listed shares rose approximately 5% after the board takeover and Chamanday’s reinstatement. Although Gildan technically lost the proxy battle, the company’s immediate growth and overwhelming shareholder support for the new board demonstrated that coordinated shareholder action can reshape an entire company. Browning West’s flawless campaign and landslide victory redefined activist success.
Key Takeaways
- Think globally. While most high-profile proxy battles feature American companies, Gildan Activewear’s campaign made headlines alongside megacorporations like Disney. Next time you evaluate your investments, you may want to look further north.
- New is not always better. Replacing Glenn Chamandy prompted instant shareholder backlash.
- Lawsuits are not the end of the world. The courts threw out both of Gildan’s lawsuits before the proxy battle even began.
5. Starbucks vs. The Strategic Organizing Center
Overview
In November 2023, the Strategic Organizing Center (SOC) nominated three directors to serve on Starbucks’ board. The labor coalition argued that the board failed to address its workers’ concerns surrounding pay and working conditions, resulting in a series of major labor disputes. Between 2021 and 2023, workers filed over 600 complaints against Starbucks with the National Labor Relations Board. Starbucks responded to the SOC by confirming the nominations, then emphasizing the current board’s qualifications. Starbucks quickly received support from both Glass Lewis and ISS ahead of the proxy battle, and both advisors urged shareholders to vote for the entire Starbucks slate.
In late February 2024, Starbucks agreed to begin collective bargaining under a framework with Workers United. Talking points included benefits such as credit card tipping or faster sick leave accrual for unionized stores. Just a week later, Starbucks’ progress prompted the SOC to withdraw its nominees.
Impact
The Starbucks and SOC proxy battle reminds us that success does not always require a seat on the board. The first-ever campaign launched by a non-traditional activist was a resounding success for both parties. Starbucks kept its board intact, and the SOC strong-armed Starbucks into collective bargaining arrangements that it had previously been avoiding.
Key Takeaways
- Labor issues are shareholder issues. The SOC proxy battle shows that labor disputes can escalate to the boardroom level.
- Non-traditional activism is easier than ever. Thanks to the universal proxy card, you may see other non-traditional activists follow in the SOC’s footsteps to foster corporate change.
- Proactive change can save the day. Starbucks avoided a drawn-out proxy battle by addressing labor negotiations early.