From the Picket Line to the Boardroom: Union Shareholder Activism

Abstract

Trade unions in a number of countries have recently begun to use corporate law to pursue employee interests. They are putting forward resolutions to be voted on at company annual general meetings (AGMs); lobbing for proxy votes through the distribution of statements in support of union sponsored AGM resolutions; posing questions to the board of directors at shareholder meetings in order to highlight employee interests; and, less commonly, requisitioning special meetings of shareholders. Unions appear to be utilising corporate law in order to forge a role in influencing company workplace practices, where this role has been greatly diminished because of changes to labour law. This article examines the recent practice of union shareholder activism in Australia through eight case studies in which unions have used corporate law to advance employee interests. The rationale, methods, effectiveness and perceived legitimacy of unions engaging in shareholder activism are evaluated.

Keywords: union shareholder activism, corporate governance, corporate law, trade unions

JEL Classification: G34, J51, J58, K22, M54