Hedge Funds and Activists: Positioning and Campaigns — 2026-09-10
South Korea implemented mandatory cumulative voting for large listed companies on September 10, marking a structural shift in shareholder rights. In the US, activist Starteepo escalated its campaign against Xerox, demanding a strategic review and leverage reduction. Meanwhile, FTI Strategic Communications reported that global shareholder activism activity held steady in H1 2026 despite market volatility.
Hedge Funds and Activists: Positioning and Campaigns — 2026-09-10
Top developments
South Korea enforces mandatory cumulative voting for large caps
Effective September 10, 2026, South Korea enforced amended Commercial Code provisions mandating cumulative voting for listed companies with total assets exceeding 2 trillion KRW. This change prevents companies from excluding the mechanism, aiming to empower minority shareholders in board elections. Companies are reportedly adjusting board sizes and director terms ahead of the 2027 shareholder meetings to manage potential activist influence.
Starteepo escalates Xerox activist campaign
Activist investor Starteepo is intensifying pressure on Xerox Holdings Corp. by demanding a strategic review of its financial services division and a significant reduction in leverage. The campaign aims to unlock value and address the company's capital structure, signaling continued activist focus on legacy technology firms with complex balance sheets.
Global activism volume stable despite volatility
FTI Strategic Communications’ annual "State of the Market" report indicates that shareholder activism activity in the first half of 2026 remained consistent with H1 2025 levels. Despite fresh waves of market volatility, activists maintained resilience, with M&A serving as a key lever for campaigns. The report highlights new challenges for activists in proxy contests and shifts in leadership at ISS.
Korean fund Align Partners faces employee backlash at Gabia
Align Partners Asset Management, a prominent Korean activist fund, is facing resistance from employees at IT firm Gabia. Employees issued a joint statement on August 24, criticizing Align's opaque investor composition and short-term profit motives, stating, "We cannot sell and leave our workplace." This highlights growing domestic tension between activist funds and corporate stakeholders in Korea's tech sector.
Local view
Japan: Local media reports indicate a shift in activist tactics from financial demands to governance interventions, specifically targeting board member appointments and dismissals. Diamond magazine highlighted three attack patterns used against major firms like Kadokawa, Kyocera, and Wacom, noting the rise of "parent-child listing" dissolution campaigns. Strategic Capital utilized Article 160 of the Companies Act to nullify voting rights of parent companies in specific proposals, a tactic gaining traction.
Korea: Bloter featured an interview with Lee Chang-hwan, CEO of Align Partners, emphasizing that corporate transformation is more critical than proxy battles, reflecting a maturation of the local activist ecosystem. However, Hankyung reported that only 40% of retail investors who followed activist stock picks generated profits, suggesting high volatility and risk for individual followers.
Context & numbers
- Korea Threshold: The mandatory cumulative voting rule applies to listed companies with total assets of 2 trillion KRW or more, effective September 10, 2026.
- Activism Volume: Global shareholder activism activity in H1 2026 held steady at H1 2025 levels, demonstrating resilience against market volatility.
- Adani Group: Three and a half years after the Hindenburg Research report, analysts note that Adani Group is gradually rebuilding investor confidence as US proceedings move toward resolution.
On the radar
- Korea Proxy Season Prep: Korean companies are actively adjusting the number of directors and their terms in preparation for the next shareholder meetings to mitigate the impact of the new cumulative voting rules.
- Pending US Proxy Contests: The Activist Investor is tracking five pending proxy contests scheduled for 2026 and 2027, indicating an early start to the next campaign cycle.
This content was collected, curated, and summarized entirely by AI — including how and what to gather. It may contain inaccuracies. Crew does not guarantee the accuracy of any information presented here. Always verify facts on your own before acting on them. Crew assumes no legal liability for any consequences arising from reliance on this content.
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