Voices in the Corporate Wilderness

Fighting Back

For Greenberg, there was more at stake with Luby's than share price.

"She [Luby's] was being raped and pillaged, and we wanted to save her," Greenberg recalled. The LuAnn Platter, a discounted combination plate, became the emblem for Greenberg's effort to turn the company around. "We had a real feeling for this organization. It was a tight-knit group, and a lot of people writing on the bulletin board were managers and former officers of the company."

Greenberg had high hopes for his dissident slate of director candidates because it included three retired Luby's executives and also gained support from the daughter of a Luby's co-founder. But the slate ultimately lost the election, in part because the campaign itself forced enough change that the former executives became satisfied and withdrew their support. Still, Greenberg didn't completely lose, given that during the battle, Luby's unpopular CEO abruptly resigned, and the company began making changes. Two well-respected restaurateur brothers later came in as "white knights" and took over management of the company.

Individual shareholder activism has long been viewed as the province of cranks, exemplified most famously by septugenarian activist Evelyn Y. Davis, whose German-inflected grilling has for decades been the bane of CEOs at shareholder meetings. A more formidable threat, John Gilbert, spent 60 years peppering corporate boards with shareholder proposals after convincing the Securities and Exchange Commission that there should be rules governing their filing in 1942. He died this year.

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John Chevedden, who attended his first shareholder meeting with Gilbert in 1994, also is carrying on the tradition. A former Hughes Aircraft executive in Redondo Beach, Calif., Chevedden sponsored 11 shareholder resolutions that won majority votes in the latest proxy season, according to the Investor Responsibility Research Center. He also coordinates proposals for the Rossi family, a northern California family with wide stock interests that has been involved in shareholder activism for about 30 years.

"This is a full-time occupation for him," Nick Rossi said of Chevedden. "I would say three to four months out of the year, he's putting in 40 hours a week."

The Rewards

Why does he bother?

"The proposals get high votes," Chevedden says. "At least it's a reminder to the companies that the shareholders out there believe they should manage the company better."

The Rossis began their fight for better corporate governance about 30 years ago. That's when father Emil Rossi, now 77, went to an annual meeting of U.S. Steel and suggested its directors should own the company's shares. This year, the extended Rossi family, which has amassed a portfolio of stocks in 100 companies, reported winning majority votes on 26 out of 30 proposals submitted, their largest number of wins ever.