Shareholder activism is when shareholders generally try to influence the operations of companies and corporations to induce changes to increase values of equity that they own. One way Shareholder activists accomplish their influence is by obtaining board seats on companies as Board of Directors and establishing proxy voting as a tool to incorporate their influence using Universal Proxy Rules established by the SEC. Significant increases with shareholder activism has occurred in recent years. Examples of this increase are that in 2018 and 2020 it was record years as reported by the Harvard School Forum of Corporate Governance (Chen,2022). In 2021 and 2022 the overall activist proxy campaigns experienced increases in activist campaigns in multiple industry sectors (Jason Frankl, Brian G. Kushner, (October 6, 2022)).

Shareholder activists will buy into a company and then exercise their influence once established. There are goals that are targeted by shareholder activists ranging from monetary reasons to non-financial polices related to politics, social and environmental issues, and foreign government activities. Shareholder activism may even involve friendly or hostile company mergers or takeovers.

Recent shareholder activism in 2021 and trending for 2022 are mergers and acquisitions, environmental issues. One example was with Exxon Mobile where four seats on the board of directors were targeted to put pressure on the company related to environmental objectives to be obtained. The goals achieved were backed by major financial investors like Vanguard and Blackrock to put pressure on proxy voting so the members could get elected to the Board of Directors. Another recent example was with one of the kings of shareholder activism Carl Icahn. Icahn proposed that the entire board of directors be replaced on a Gas Companies board. The goals were to take the company in a different business direction and to increase the share price of the company. The way Carl Icahn executed this attempt was with his strong financial influence as a stockholder of the company. Icahn's strategy is to get heavily involved and imbed himself with the company, get proxy voting rights, and execute his influence to steer the company in certain direction which may be a merger, or sale of the company. This started in 2021 and is still going on as of today in a long drawn out battle.

Question: After reading the opinion above, what is your response? What may be some risks or drawbacks? Please be detailed in your opinion.