A proxy fight involves a battle by a shareholder or group of shareholders who seek to change the investment policy of the firm. If the proxy group is successful, current management retains control of the firm but the proxy group dictates what investments the firm makes.

Question

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In a proxy fight, the shareholders seeking change typically aim to gain control of the board of directors and replace current management, rather than simply dictating the firm's investment policy.

A Proxy Fight Involves a Battle by a Shareholder or Group