The Harvard Law School Forum on Corporate Governance | Contributors

Posts from: Yvan Allaire

A “Successful” Case of Activism at the Canadian Pacific Railway: Lessons in Corporate Governance

Posted by Yvan Allaire and François Dauphin, IGOPP and UQAM, on

Friday, December 23, 2016

Boards of Directors, Canada, Hedge funds, Information asymmetries, Information environment, International governance, Management, Mergers & acquisitions, Pershing Square, Proxy fights, Shareholder activism, Target firms
More from: Francois Dauphin, Yvan Allaire

Yvan Allaire is Emeritus professor of strategy at Université du Québec à Montréal (UQAM) and Executive Chair of the Institute for Governance of Private and Public Organizations (IGOPP); François Dauphin is Director of Research of IGOPP and a lecturer at UQAM. This post is based on their recent paper. Related research from the Program on Corporate Governance includes: The Long-Term Effects of Hedge Fund Activism by Lucian Bebchuk, Alon Brav, and Wei Jiang (discussed on the Forum here); and Pre-Disclosure Accumulations by Activist Investors: Evidence and Policy by Lucian Bebchuk, Alon Brav, Robert J. Jackson Jr., and Wei Jiang.

Pershing Square Capital Management, an activist hedge fund owned and managed by William Ackman, began hostile maneuvers against the board of CP Rail in September 2011 and ended its association with CP in August 2016, having netted a profit of $2.6 billion for his fund. This Canadian saga, in many ways, an archetype of what hedge fund activism is all about, illustrates the dynamics of these campaigns and the reasons why this particular intervention turned out to be a spectacular success… thus far.

Wachtell Keeps Running Away from the Evidence

Posted by Lucian Bebchuk, Harvard Law School, on

Monday, July 28, 2014

Bebchuk-Brav-Jiang study, Hedge funds, IGOPP, Long-Term value, Shareholder activism, Short-termism
More from: Francois Dauphin, Lucian Bebchuk, Martin Lipton, Yvan Allaire, Wachtell Lipton

Lucian Bebchuk is William J. Friedman and Alicia Townsend Friedman Professor of Law, Economics, and Finance and Director of the Program on Corporate Governance, Harvard Law School. This post responds to a Wachtell Lipton memorandum by Martin Lipton and Steven A. Rosenblum, Do Activist Hedge Funds Really Create Long Term Value?, available on the Forum here. This memorandum criticizes a recently-issued empirical study by Lucian Bebchuk, Alon Brav, and Wei Jiang on the long-term effects of hedge fund activism. The empirical study is available here, and is discussed on the Forum here. Additional posts discussing the study, including critiques by Wachtell Lipton and responses by Professors Bebchuk, Brav, and Jiang, are available on the Forum here.

In a memorandum issued by the law firm of Wachtell, Lipton, Rosen & Katz (Wachtell) last week, Do Activist Hedge Funds Really Create Long Term Value?, the firm’s founding partner Martin Lipton and another senior partner of the law firm criticize again my empirical study with Alon Brav and Wei Jiang, The Long-Term Effects of Hedge Fund Activism. The memorandum announces triumphantly that Wachtell is not alone in its opposition to our study and that two staff members from the Institute for Governance of Private and Public Organizations (IGOPP) in Montreal issued a white paper (available here) criticizing our study. Wachtell asserts that the IGOPP paper provides a “refutation” of our findings that is “academically rigorous.” An examination of this paper, however, indicates that it is anything but academically rigorous, and that the Wachtell memo is yet another attempt by the law firm to run away from empirical evidence that is inconsistent with its long-standing claims.

Posts from: Yvan Allaire

A “Successful” Case of Activism at the Canadian Pacific Railway: Lessons in Corporate Governance

Wachtell Keeps Running Away from the Evidence

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