Evelyn Davis, Queen of Shareholder Activism, Dies at 89
(Bloomberg) -- Evelyn Y. Davis, the self-proclaimed “queen of the corporate jungle” who turned public companies’ annual meetings into stages for a theatrical, confrontational and self-promoting version of shareholder activism, has died. She was 89.
She died on Nov. 4 at Washington Hospital Center in Washington, according to a news release by the Evelyn Y. Davis Foundation. No cause was given.
Though known as a gadfly, Davis spent decades pressing serious governance issues, advocating term limits for corporate directors, greater disclosure of executive compensation, independence of accountants and scrutiny of legal bills.
With a nest egg from her neurologist father, plus income from her quirky annual newsletter, “Highlights and Lowlights of Annual Meetings,” she maintained investments of at least $2,000 -- the threshold to offer resolutions -- in 80 to 120 companies at any time, and attended as many as 50 meetings a year. In her thick Dutch accent, she held forth at the microphone as chief executives and chairmen had no choice but to listen.
“You can see I’m in control at these meetings, and I really want to be,” Davis, whose four marriages ended in divorce, was quoted as saying in a 2002 Vanity Fair article. “I enjoy having power over men.”
At a CBS Inc. shareholder meeting in 1995, Davis cheered the imminent buyout by Westinghouse Electric Corp. “Finally we are being liberated from the Tisch regime,” she declared, taunting outgoing CBS Chairman Laurence A. Tisch, who told her, “Sit down or be thrown out.”
At the 2000 meeting of Goldman Sachs Group Inc. -- the company’s first, following its transition from a private partnership -- Davis pressed CEO Henry Paulson on the arrest of a part-time computer graphics artist who had been charged with insider trading.
“Which idiot in this company,” she asked, “is responsible for hiring a temp to work on mergers?” No temporary workers are assigned to mergers, Paulson replied.
In 2003, Davis used some of her microphone time at Morgan Stanley’s meeting to demand the firing of Mary Meeker, one of Wall Street’s most outspoken promoters of technology stocks.
“A lot of people lost money because of her,” Davis said. CEO Philip Purcell told Davis that Meeker was “a pioneer” who produced valuable research.
Some executives tried casting her as a foil. One was Warren Buffett, who presided over the 1992 meeting of Salomon Brothers as its unpaid interim chairman following a bond-trading scandal that forced the resignation of John Gutfreund.
How, Davis demanded, could Buffett justify charging $158,000 for his corporate-jet travel between New York City and Omaha, Nebraska?
“I work cheap, but I travel expensive,” Buffett replied, according to Janet Lowe’s 2007 book, “Warren Buffett Speaks: Wit and Wisdom from the World’s Greatest Investor.”
Davis flaunted her familiarity with corporate chiefs. “Jamie, you have to stay here for forever,” she told Jamie Dimon at the 2011 shareholder meeting for JPMorgan Chase & Co. “I’m not going to let you ever resign.”
Her act so annoyed another shareholder at Eastern Airlines Inc.’s 1977 meeting that he lunged at Davis, causing her to fall. She needed five stitches to close a cut on her right ear, according to a Washington Post account. She still showed up later that day at the annual meeting of the New York Times Co., her dress stained with blood.
“Her most lethal weapon is the fact that she does not care what anyone else thinks of her, and so she’s prepared to be rude, to interrupt, to be domineering, and to do essentially whatever it takes to command attention,” Randall Tobias, a former CEO of Eli Lilly & Co., told NBC News in 2002.
One of her favorite gambits was having automaker CEOs personally compete for her business.
“This is my secret, manipulating the male ego, playing one against the other,” she said in 2003, after receiving the keys to her new Jaguar from Bill Ford, chief executive of Ford Motor Co., in front of the Watergate, the Washington complex where she had her home and office.
Evelyn Yvonne DeJong was born Aug. 16, 1929, in Amsterdam, the younger of two children of Herman, a neurologist, and Marianna, a psychologist. In published interviews, she talked of growing up in a 12-room house with a governess and two maids.
During World War II, the family, which had Jewish roots, was rounded up with other wealthy Dutch Jews when Davis’s father was in the U.S. on business. Davis, her mother and her brother were sent to concentration camps in the Netherlands and Czechoslovakia. At one, Davis was hit by shrapnel in a mortar attack that left a scar on her right calf, according to a Washington Post profile.
Her parents divorced after the war, with Evelyn and her brother moving with their father to Maryland. She graduated from high school in Catonsville, Maryland, in 1947 and studied business administration at George Washington University, leaving before she got a degree.
Her father’s death in 1956 left her an estate that included a portfolio of stocks. As a private investor, she never had to detail her holdings or her wealth. She told People magazine in 1996 that she owned shares in 120 companies and had a net worth of about $3 million. In 2000, she told Vanity Fair she had 100 to 500 shares in each of 86 companies, for a portfolio of about $1.5 million and a net worth of “much more.”
In 1959, living in New York City, Davis attended her first shareholder meeting, that of International Business Machines Corp. She formed a business, Shareholder Research Inc., based in a hotel room near the United Nations.
A brush with the law there in 1963 led to her arrest and conviction for “offering to commit lewd and indecent acts,” according to the Post, a chapter she declined to discuss with interviewers.
In a 1966 article on shareholder meetings, the New Yorker magazine’s John Brooks noted the regular presence of the “most celebrated” activists of the time, Wilma Soss and Lewis D. Gilbert, and also took note of Davis -- “the youngest and best-looking of the professional stockholders but, on the basis of what I saw at the AT&T meeting and others, not the best informed or the most temperate, serious-minded or worldly wise.”
For “Highlights and Lowlights,” her annual newsletter, Davis charged $600 per copy, with a minimum of two copies per subscriber. In her capacity as publisher, she obtained a White House press pass starting in the 1970s.
“I used to seat her behind some potted plants at the rear of the East Room and show the president where she was sitting so that he wouldn’t call on her,” Larry Speakes, President Ronald Reagan’s spokesman from 1981 to 1987, wrote in his memoir. He said Reagan would “invariably” call on Davis anyway, and Speakes would ask him why.
“I don’t know,” Reagan would reply, according to Speakes. “I know I made a mistake, but she just jumped out from behind those potted flowers.”
Her biggest victory may have come in 1990, when General Motors Corp. banned paying above-market prices for shares held for fewer than two years by a major shareholder. Davis had been pushing for a resolution banning such inflated payments -- sometimes called greenmail -- since GM paid H. Ross Perot $743 million for his stock, almost twice the market value, in a 1986 deal to get him off its board.
In 2005, she issued a press release to announce her fourth marriage, to James Patterson, a retired foreign-service officer who had sent her “several fan letters.” A year later, she issued a press release to announce her fourth divorce. Her prior marriages were to William Davis, an accountant; Marvin Knudsen, a stockbroker; and Walter Froh Jr., an economist.
On never becoming a mother, she liked to say, “Stocks are my children.”
Decades before her death, she oversaw installation of her tombstone at Rock Creek Cemetery in Washington. It says in part, “I did not get where I am by standing in line. Nor by being shy.”
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