Is it sheer desperation, opportunism, or a clever move to nominate shareholder activist and ESG investor Jeff Ubben for election to the Bayer Supervisory Board? After all, Ubben, who had bought into the Bayer shareholder base with his fund Inclusive Capital with a about 400 million euros, went public a good year ago via the Financial Times with the demand to replace the Chairman of the Board of Management and break up Bayer. The first part of his demand has now been fulfilled with the change of CEO from Werner Baumann to Bill Anderson, the second is still pending.

When Anderson presented Bayer's figures and corporate strategy at the beginning of the week, expressed a clear rejection of structural changes. "Not now," said the CEO. However, the rejection of structural measures at the present time does not mean that this will never happen, Anderson added. Bayer remains open to everything, but the spin-off of Consumer Health or even the further splitting of Bayer into a pharmaceutical and an agrochemical company is not yet an issue. However, as a member of the Supervisory Board, Ubben will ensure that a spin-off remains on the agenda, especially if the reorganisation measures planned by Anderson do not take effect. The activist sees the agricultural business, which was severely shaken after the acquisition of Monsanto, as a "jewel", the value of which must be realised. Ubben is inspired by the split-up of DowDuPont in 2019 when Dow's seed and crop protection business was spun off as Corteva. Since then, the Corteva share price has risen by 144%. The stock market currently values the agricultural specialist at 36 billion euros, a multiple of 20 on the profit expected for 2024.

Bayer's dealings with Jeff Ubben, his inclusion initially in the Group's Sustainability Council and soon in the Supervisory Board, show the learning curve of German public companies in dealing with activist shareholders. Confrontation has generally been replaced by dialogue, as the goal of increasing value pursued by shareholder activists is usually also shared by other active investors, such as institutional investors. "Those who perform have no problem": This assessment by a DAX CEO experienced in dealing with activists shows the changed relationship. Even large institutional investors who see themselves as long-term investors, such as the Norwegian sovereign wealth fund Norges, appreciate the work of short-term activists. This is because their behaviour usually has a disciplining effect on management and thus creates sustainable added value.

The campaigns of activist shareholders have become more professional, as academics who analyse their activity and market impact acknowledge. The entry of activists usually leads to portfolio adjustments and a sharper risk profile, which is rewarded with a higher share price. Conversely, such a higher risk tends to be disadvantageous for bondholders and lenders, significantly as the distributions often forced by activists in the form of dividends and share buybacks can jeopardise financial stability. In this respect, Bayer's radical dividend cut, to stay with this example, is an essential signal to the lenders of the highly indebted group.

By breaking up outdated corporate structures and rigidities, activist shareholders contribute to the efficiency of the capital market. However, there is still a great deal of agitation on the boards of directors and supervisory boards of German stock corporations when shareholder activists, who were once frowned upon as the capital market's mucky pups, announce themselves or even buy in. Weak performance and disagreements between the management board and supervisory board are often an invitation to activists. A host of consultants live from selling companies defence strategies for these cases. In individual cases, such strategies can be useful. In principle, however, a high share price or an above-average valuation is the best protection against activist shareholders. Which - referring yet again to the example of Bayer – has not been the case since the takeover of Monsanto.