Name: Jan Marc B.

Concio Date: November 12, 2022

Course & Section: BSE-2B Instructor: Mrs. Justine Gonzales

ISSUE FOR DEBATE

Discussion Questions

1. Do you think that shareholder involvement contributes to a firm's organic

growth? Explain.
● Shareholder involvement does contribute to a firm's organic growth.
Shareholder activism acts as an effective monitoring mechanism that can
improve corporate governance efficiency within the firm and can, in many
instances, positively impact firm value, performance, and decision-making. Even
if we say that Organic growth refers to the development of a business through
internal processes, relying on its resources, How can they implement the target
increase of sales or marketing strategy if they don't have money? And the
primary goal of activist shareholders is to bring change within or for the company.
They plan to impact the behavior of a company by exerting their voting power or
influencing other shareholders.

2. What are the risks and challenges facing a firm that has shareholders who are
becoming more active?
●As shareholders become more active, Share prices can go down and up, so
shareholders must be prepared for the possibility of losing money. Also, they
may receive nothing if the company faces bankruptcy, and they can face losses.
Share prices might fall, and, at worst, the shareholder could lose all the capital
invested. Alongside that, the shareholder also sacrifices the return they would
have made if they'd put the money into a more successful investment.