High Performance Boards

CHAPTER 26Boards and Investors

There is a trend toward increasing engagement and advocacy by shareholders who expect to have greater access to boards. More generally, environmental, social, and governance (ESG) dimensions have become important factors in investments. This has been accentuated by greater technology-enabled exchanges of information between boards and shareholders.

Information Design and Capital Raising: Crowdfunding

The proliferation of new approaches to raising capital has resulted in higher quality and transparency of information available to investors. From private equity to crowdfunding, the ‘closed shop’ way of interacting on investment decisions is becoming a thing of the past. Instead, accurate and timely – often real-time – information is made available, thus delivering on the promise of digital technology. It has had a powerful effect on levelling the playing field between institutional and private investors, as well as between active and potential investors.

The Oculus VR is a virtual-reality headset that puts players into their favourite games. With over $2 million raised in 30 days through crowdfunding, the Oculus team went on to raise additional investment capital and was acquired by Facebook. The $2 billion acquisition was controversial and many crowdfunding backers that contributed to the Oculus campaign expressed their desire to benefit from the company's success since they were the first supporters of the company.

The impact of the transforming ...