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E-MailSebastian Alsheimer is a Partner and Head of the Shareholder Engagement and Activism Defense Practice, J.T. Ho is a Partner, and Paul J. Shim is a Partner and Co-Leader of the Americas M&A Group at Cleary, Gottlieb, Steen & Hamilton LLP.
As the 2026 proxy season approaches its midpoint, the early data confirm rather than reverse the structural shifts that defined 2025. Shareholder activism remains a feature of the public markets that virtually every issuer must confront, whatever its size, maturity, reputation, or governance profile. So far in 2026, activists have launched more campaigns than they did in the same period last year. They have pressed for more M&A demands, concentrated their activity among a familiar set of well-capitalized hedge funds, and turned their attention toward larger companies and the technology sector. Settlements remain the main path to the boardroom, even though board seats have grown harder to win. This post offers a mid-season assessment in two parts: the key issues that have emerged so far, and the lessons and outlook for the rest of the year. Unless we note otherwise, the figures below come from Deal Point Data and cover identified activist campaigns launched between January 1 and June 1 of each year, at companies with a market capitalization of at least $300 million.
I. Overview of Shareholder Activism and Key Issues in 2026 to Date
A Record Pace Continues
Campaign volume keeps climbing. Activists launched 84 campaigns so far in 2026, up roughly 12% from the 75 they launched in the same period last year. Activism has become a structural, year-round feature of the market, not a cyclical event tied to the annual meeting calendar.
Campaign Focus: M&A Demands Rise
M&A leads the activist agenda so far in 2026. M&A demands appeared in 39 of the 84 campaigns this year, more than double the 19 in the same period last year. That moved M&A from second place, behind governance reform a year ago, to first this year. Governance reform fell slightly as a share of campaigns, slipping to second. Operational demands also rose and now ranks third. As the chart below shows, activists have centered their campaigns on transactional and strategic outcomes, such as calls to sell, spin off, or separate businesses, while continuing to press governance demands as a complementary lever.
A strong M&A market and steady investor pressure to simplify complex corporate structures help explain the increase. We expect both forces to keep transactional demands at the center of the activist agenda for the rest of the year.
Board Seats: Settlements Still Dominate, but Seats Are Harder to Win
Activists have won 25 board seats so far in 2026, across 15 companies. In the same period last year, they won 31 seats at 19 companies. The hit rate also dropped. Roughly 17% of this year’s campaigns produced board seats, down from about 27% a year earlier, so seats have grown harder to win even as campaign volume has risen. The route to the boardroom has not changed. Activists have obtained 24 of this year’s 25 seats by settlement rather than a contested vote, close to the 27 of 31 a year earlier and consistent with the pattern that has held since the universal proxy rules took effect.
Who Is Driving the Season?
Hedge funds continue to drive most activity, and their share has grown. Hedge funds ran roughly 68% of campaigns so far in 2026, up from about 59% a year earlier, while other institutional investors [1] slipped to about 19% from roughly 29%. Together the two groups still account for the large majority of campaigns in both years.
A familiar set of prolific names concentrated the activity. Elliott Investment Management L.P. have run the most campaigns so far in 2026, launching six—double the three it launched a year earlier. Five led to board refreshment and together produced five seats through cooperation agreements. Starboard Value LP followed with four campaigns. Engine Capital Management, LP, Irenic Capital Management LP, Fondren Management LP, and Pictet Asset Management SA each launched three. A year earlier, Saba Capital Management, L.P. ran the most, with five. Concentration has also deepened. Sixteen activists have launched two or more campaigns so far in 2026, together accounting for half of all campaigns, up from 13 such activists accounting for roughly 42% a year earlier.
Where Activists Are Looking: Sector and Size
The sector mix shifted. Technology has drawn the most campaigns so far in 2026, roughly 21%, up from about 12% a year earlier, when it ranked third. Financial services again runs a close second at roughly 19%, a bit higher than a year earlier. Healthcare, the most-targeted sector a year ago at nearly 19%, fell to roughly 10% and fifth place.
Activists also moved up the market-cap spectrum. Small-cap companies still drew the most campaigns, but their share fell to roughly 48% from about 57% a year earlier. The sharpest change came at the top. Large-cap companies have drawn about 19% of campaigns so far in 2026, roughly double their share a year earlier. Scale and brand no longer offer real protection against an activist approach.
Evolving Tactics and the Proxy Advisor Backdrop
Two dynamics frame these numbers. First, activists keep shifting toward year-round, privately negotiated engagement. Proxy contests start earlier, many leading funds engage well before nomination windows open, and the largest activists show more patience for multi-year campaigns. The universal proxy rules reinforce this pattern because they favor negotiated outcomes and make an outright win by either side less likely. Second, the voting landscape is in flux. Regulators and investors have stepped up their scrutiny of proxy advisors, and several large asset managers have cut their reliance on ISS and Glass Lewis in favor of internal, sometimes AI-supported, voting tools. These shifts could reshape how contested matters are decided.
II. Lessons and Outlook for the Rest of 2026
The early data carry several practical lessons for boards and management teams, and they shape what we expect for the rest of the year.
Prepare for more, and more focused, campaigns. A concentrated group of sophisticated funds is running more campaigns, though fewer now yield board seats. The universal proxy rules reward activists who field strong slates and target a few clearly vulnerable directors, often on age, tenure, or overboarding. Boards can stay ahead by reviewing director profiles, refreshing the board, keeping a candidate pipeline, and sharpening director biographies and proxy disclosure to show the skills the strategy needs.
Revisit the portfolio and capital allocation. With M&A demands rising, activists see the most opportunity at companies that run multiple businesses, often with few synergies, where the market values the whole at less than the sum of its parts, or whose capital allocation does not clearly tie to the value the company says it is building. Boards should review the portfolio and capital plan regularly, and pair that review with clear messaging that explains how current investments connect to long-term value. When shareholders understand the rationale, activists have less room to frame an alternative narrative.
Build institutional relationships early. Proxy advisor support does not decide a contest. As large investors refine their stewardship and lean less on advisor recommendations, a company can prevail, even against an activist the advisors back, by earning the support of its major holders through regular engagement. Companies should respond to investor feedback and address perception issues early. The most durable relationships form well before a campaign begins.
Tell your story. Companies that have underperformed benefit from explaining their strategic decisions and the path to long-term value. When a growth plan is in place but results will take time, investors need to see how near-term choices connect to eventual returns. A clear, consistent message, delivered early, leaves activists less room to argue that capital is being misallocated. Communications advisors alongside counsel can help.
Plan for year-round activism. Leading activists no longer wait for the annual meeting. Boards should conduct annual vulnerability assessments, think like an activist, and keep a preparedness framework ready that includes a break-the-glass response plan and a shelf rights plan. That framework should be refreshed as the company changes, whether through shifts in strategy, board refreshment, or other developments that warrant revisiting its assumptions.
Outlook for the rest of 2026. We expect these patterns to hold. M&A and operational demands should stay at the front of the agenda, with governance demands serving as a complementary lever. Board change should continue to run primarily through settlement. The shift toward larger targets shows that larger issuers should not count on size for protection. Each shapes how investors see a company and how ready it is to respond when an activist appears.
Conclusion
The early part of 2026 shows a stronger transactional emphasis and activity concentrated among the market’s most sophisticated funds. As we have said before, the best activism defense begins long before an activist appears. Companies that assess their vulnerabilities, refresh their boards, review their portfolios, and build durable relationships with their major shareholders will be ready to respond from strength when approached.
1Defined by Deal Point Data as all other institutional investors (e.g., mutual funds, private equity funds, venture capital funds, private pension funds, and other investment firms).(go back)
