Accountability Capital redefines what active investing means and what active investment managers should be doing. We don’t think hope is a viable strategy and yet that is what investing strategies are largely based on. Investors, whether institutional or retail, tend to buy stocks and hope for higher share price at some point. This is not a strategy, much less a good one.
Traditionally, active investing strategy simply means making deliberate choice to deviate from the characteristics of the relevant benchmark. At Accountability Capital our objective is to be a catalyst for improved share price performance. We bring solutions and ideas to improve shareholder returns. When underperforming board or CEO fails to listen to our concerns and advice, we work with our fellow shareholders and seek to replace the board.
We believe investors in many Canadian companies suffer from the absence of highly active investment manager that seeks and demands accountability and result. The lack of truly active investment management, combined with low quality corporate directors and executives which are prevalent particularly in public companies in Canada, have resulted in persistent and significant investment losses for many investors.
In our experience, Canadian markets and investors are particularly susceptible to incompetent boards and management because of tendency to hire and promote what we refer to the 4 F’s: family, friends, former colleagues and fools (failed politicians, and others with no relevant skill/experience). To be candid, many directors are also well past their best-before date and perhaps should be resting at a retirement home.
The capital markets are highly inefficient. Regulators, analysts, mutual fund managers and other key players have largely let shareholders down. There have been too many significant losses, fraudulent companies (Sino Forest, Poseidon, etc), blow-ups (Concordia, Valeant, etc), and perennial underperformers.
Too many Canadian companies are defined by mediocrity and complacency, and many directors are characterized by arrogance and incompetency. We believe it is shareholders’ responsibility to demand better performance. If the directors were truly independent, engaged, knowledgeable and actually working for shareholders (as they should be), investors wouldn’t have experienced nearly as much financial losses.
We encourage investors to ask the following key questions:
(1) How has the share price performed over the past 12-24 months under the current board and CEO?
(2) What specific shareholder-friendly actions has the board undertaken over the past year?
(3) How has your investment manager voted for any given board?
At Accountability Capital, we hold boards accountable for share price performance. We actively seek to change underperforming directors and management. We believe all investors have a responsibility and obligation to do the same in order to safeguard their investments. After all, buy and hope is not a strategy.
We welcome opportunities to work with other investors and shareholders in addressing underperformance and making the necessary board and management changes.
Don’t leave your investments to chance. Seek and demand better performance. Invest with Accountability Capital.
Accountability Capital is the leading active investment holding company in Canada. Our objective is to drive positive results by engaging board and managements and working to change the leadership of the company, when necessary. We believe there are too many directors who fail in their number one priority which is to work for the benefit of shareholders and increase shareholder value in a timely manner. Entrenched, inept and arrogant directors often enable poor strategy or execution by management and lead to share price destruction.
Accountability Capital is catalyst for change and actively pursues strategies to remove and replace incompetent boards and managements. We bring actionable, new ideas to boards. Directors who are unwilling to listen and engage with their shareholders do not deserve to be a board member. In addition to our primary investing strategy of engaging boards and championing changes in order to unlock or enhance shareholder value, we also utilize put-write and covered call strategies to manage risk and enhance yield and overall returns for our shareholders.