Activist Hedge Funds’ Next Big Battle Is Inside The Beltway

Activist Hedge Funds – guest post by Greg Marose

As the hedge fund industry exploded over the past fifteen years, it facilitated a new era of activist investing geared toward influencing corporate decision-making. Hedge fund activism, which many policymakers contend prioritizes profits over job creation and broader economic impact, is now finally emerging as a front-and-center issue inside the Beltway.

This past spring, Senators Tammy Baldwin (D-WI) and Jeff Merkley (D-OR) introduced legislation to enhance oversight of hedge funds employing activist strategies. The bill would shorten the Securities and Exchange Commission’s (SEC) Schedule 13D disclosure period and establish new rules around using derivatives to establish “net short” positions. The House Financial Services Committee also began exploring options to regulate proxy advisory firms...