Introduction to another.[5] Shareholder engagement is defined as

Introduction

In an era characterized by corporate collapses and
managerial misconduct, one of the corporate constituents which have gained a
lot of attention in corporate governance are the shareholders of the company.1
As a result, the past decade has seen a marked increase in regulatory
initiatives that give shareholders a greater voice in corporate affairs.2
Shareholder engagement is a very broad concept, maybe too broad, which can mean
different things to different people.3
Winter argued that shareholder engagement is a concept that should be more
specified into different levels of intensity.4
Engagement has a superfluous meaning, which makes that its content can differ
from one person to another.5 Shareholder
engagement is defined as shareholders:

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“Actively monitoring companies, engaging in a dialogue with
the board of the company and using their shareholder’s rights, if need be to
improve the governance of the company in the interests of long-term value
creation”.6

This also includes efforts made by companies to engage with
their shareholders on a wide range of topics including executive compensation, strategy,
risk management and other topics falling outside of the usual financial and
strategic conversations.7
Corporate governance is an integral part of the process of checks &
balances and evaluating the governance of companies it’s not necessarily about
exclusion from portfolios it’s about regulating exposure to governance risk.8 “Corporate
governance is not something that is put in place and then left. Ensuring its
effectiveness depends on regular review, preferably regular independent review.
And, in the end that comes down to the shareholders. Outside assessment and
self-assessment need to be regular events.”9
The relationships between shareholders and issuers deserve more attention than
most companies give the impact of those relationships could have material
consequences for both sides.10

1 Ben
W. Heineman, Jr. Stephen Davis, ‘Are Institutional Investors Part of the
Problem or Part of the Solution?’  2011
available at: < https://pdfs.semanticscholar.org/485a/65234d9ee2660730c7aa149155d2871c1bdd.pdf>.
From Van Campe Frederic, ‘Corporate Governance in a Post Crisis Era: Is
Shareholder Engagement the Answer? A Critical Assessment’ page 4, Master’s
Thesis 2011-2012 accessed 28
December 2017.

2 Virginia
E. Harper Ho, ‘Enlightened Shareholder Value: Corporate Governance Beyond the
Shareholder-Stakeholder Divide’ (2010) 36 Journal of Corporation Law 1 (61-96)
at 60.

3 Van
Campe Frederic, ‘Corporate Governance in a Post Crisis Era: Is Shareholder
Engagement the Answer? A Critical Assessment’ page 47, Master’s Thesis
2011-2012 accessed 1 January
2018.

4 Stuart
Gillan, Laura T. Starks, ‘The Evolution of Shareholder Activism in the United
States’ 28 January 2007 available at: < https://papers.ssrn.com/sol3/papers.cfm?abstract_id=959670>. From Van Campe
Frederic, ‘Corporate Governance in a Post Crisis Era: Is Shareholder Engagement
the Answer? A Critical Assessment’ page 16, Master’s Thesis 2011-2012
accessed 28 December 2017.

5 Van
Campe Frederic, ‘Corporate Governance in a Post Crisis Era: Is Shareholder
Engagement the Answer? A Critical Assessment’ page 47, Master’s Thesis
2011-2012 accessed 1 January
2018.

6 European
Commission’s Green paper on the EU corporate governance framework’ (Brussels)
2011 available at: < http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2011:0164:FIN:EN:PDF>.
From Van Campe Frederic, ‘Corporate Governance in a Post Crisis Era: Is
Shareholder Engagement the Answer? A Critical Assessment’ page 8, Master’s
Thesis 2011-2012 accessed 28
December 2017.

7 Tarun
Mehta, Advisor, ISS Corporate Services ‘Shareholder Engagement: Maximizing the
Shareholder Relationship’ (2013) Exec Comp 13.3 at 1.

8 Jan
Hall, Thomas O’Malley, ‘A Study of Investors Company and Adviser Perspectives
Conducted by the JCA Group for the Financial reporting Council’ (JCA) Section
2, page 6 < www.jcagroup.net/perch/.../corporate-governance-shareholder-engagement.pdf>accessed
16 December 2017.

9
Jim Jones. From Van Campe Frederic, ‘Corporate Governance in a Post Crisis Era:
Is Shareholder Engagement the Answer? A Critical Assessment’ page 1, Master’s
Thesis 2011-2012 accessed 28
December 2017.

10 Tarun
Mehta, Advisor, ISS Corporate Services ‘Shareholder Engagement: Maximizing the
Shareholder Relationship’ (2013) Exec Comp 13.3 at 1.