The role of institutional investors as activists: a critical review of active ownership

Abstract

The following study serves as a conceptual compendium of relevant informationabout active ownership for BPI Gestão de Activos, a Portuguese asset management company. Initially,theauthordevelopsthetopicbydrawingonpriorempiricalevidenceonthefinancial benefits of active ownership. At the next stage, guidelines on how to build an effective active ownership policy are provided, with a focus on the due diligence process, prioritization and methods of engagement of both voting and engagement activities and respectivetransparency.Specific considerations are given for activists investing in fixed income securities, emerging markets and engaging with public policymakers. Finally, the author uses a Brazilian power generationcompany-Eneva-toguideapracticalapproachonimplementingactiveownership.