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Activist Investing Today: Gonzalez-Sussman on Why 'Gamesmanship' Fails

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Published: November 6th, 2024
Corporate defender Elizabeth Gonzalez-Sussman discusses what motivated her decision to move away from defending activists, as well as tactics that backfire, settlement subcommittee pros and cons and governance vulnerabilities.

The one big thing corporations often get wrong is believing that all activists are the same, explained Elizabeth Gonzalez-Sussman, who recently was hired to lead the activism defense practice at Skadden, Arps, Slate, Meagher & Flom LLP.

“The best experience I have is understanding the perspectives of the activists and sharing that with the board and management team,” Gonzalez-Sussman said on the latest Activist Investing Today podcast.

Sussman recently left top activist advisory practice Olshan Frome Wolosky LLP, where she spent nearly two decades advising top-tier and first-time activist investors. Sussman discussed corporate defense tactics that can sometimes backfire, settlement subcommittee pros and cons and governance vulnerabilities, as well as other topics.

“There may be first-time activists with no playbook. Having represented many of these first-time activists, one-off activists, maybe the CEO who is coming back for his job again, I can share a different perspective as to their motivations,” she said. “I can help interpret what they are asking for and what is the most effective defense in light of this.”

In addition, Sussman added that she wouldn’t engage in gamesmanship when advising companies on their bylaws or other defensive measures, as it always backfires.

“The institutional investors, proxy advisers view it negatively. It would never be my approach to play games with bylaws or other defensive measures. You compete on substance and may need to adopt a poison pill when facing a rapid accumulation,” she said.

Gonzalez-Sussman also talked about what motivated her to move from defending activists at Olshan to advising activist-targeted companies at Skadden.

“Skadden had a big impact on my decision to move because of their tremendous reputation and roster of clients,” she said. “It also came at a time mid-career thinking about what’s the next phase. Switching was a new interesting element to add to my work life, and I thought I could add a unique perspective that a lot of other advisers don’t have and have an impact on board relationships with the activists and how to engage in a new way.”

Check out the podcast with Elizabeth Gonzalez-Sussman:

More podcasts from The Deal are available on iTunesSpotify and on TheDeal.com.

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