An interview with Guiseppe Bivoni, co-founder of Bluebell Capital Partners.

When visiting your firm’s website, the backdrop is a field of bluebells. Where did the name come from?

The name was chosen by the young daughter of my partner, Marco Taricco. We like the name because it contains two words. One is blue, which is the “blue blood” of the investment banks, where I worked for many years, like at Morgan Stanley, who do business in a first-class way. And bell, which is a bit like the bell that we ring when we show up in a company. It’s a very unintimidating name in the space but I think people in the corporate world understand what we do.

Could you tell us more about your campaign at BlackRock?

BlackRock is exactly the kind of company we like to invest in, as a champion in its own industry. And, obviously, we do see a lot of growth opportunity across region products. But we’ve been certainly focusing on their strategy on ESG. I think, clearly, they managed to alienate a lot of their own clients, some of whom believe they are doing too much in ESG.

As a matter of fact, we will say something different. BlackRock is not doing what they say they are doing [on ESG] which, for us, is a big concern. And we say that from our previous position as fellow shareholders in companies like Richemont and others where we really end up observing how, in our judgement, BlackRock does live up to the standards of being a champion in ESG.

And the campaign revolves around the removal of CEO Larry Fink?

We are asking a number of things, we are focused on the business side. When a company starts to alienate its own clients, it’s not a good thing for anybody, including shareholders. So, we are asking first of all, that BlackRock run a strategic review of its ESG strategy, including, for instance, its recent Voting Choice initiative.

We are asking BlackRock to improve its governance by splitting up the role of the chairman and the CEO and empowering a new CEO. And we are asking the asset manager to appoint a new lead independent director. For a company like BlackRock, which likes to say that it champions ESG, having a lead independent director who has been a director sitting in the boardroom for 20 years is not exactly what we’re expecting from them.

Bluebell is often recognized for taking on long-shot, long-term campaigns. Do you agree with this claim?

Yes, absolutely. Our strategy is a bit like applying private equity style to the public market. We focus on four areas: operational strategy, capital structure, governance, and, more broadly, ESG. But implementing change which creates sustainable long-term value does require some time. Think about, for instance, our campaign at Danone. We invested in 2020, and managed, in 2021, to change its governance, split the role of the chairman and CEO, and oust the then-CEO. But then it took six months to hire a new CEO. It then took that new CEO six months to understand the company and charter a new course. We support this change which, again, requires time.

What is one of your most memorable campaigns?

It’s a difficult question, because, of course, each one of them is very important for us. And each one is special, in its own way. Personally, I’m very fond of what we did accomplish at Solvay. We ran a campaign which was essentially purely environmentally-focused to get the company to address some significant environmental issues related to its operations in the Mediterranean Sea. It took more than two years but, in the end, the company agreed with our proposed changes and we worked together on the same direction. It started very confrontational. It ended in a very constructive manner.

We issued a joint press release in September of last year announcing some very important changes. It’s a great success story and something for which we are very proud of.

What lessons have you learned from campaigns that did not go as planned?

Be patient. Some engagements do take longer than what we would have expected. As an investor, we work with public information so we need to be prepared sometimes to recognize when our thesis could potentially be not taken into account or welcomed with open arms.

Always be very keen to listen. Our objective is, again, to work alongside companies to create value. So, these are certainly two lessons which I keep very close to my heart when I look back at the last three years of activity at our firm.

While you lost a proxy fight at Richemont last year, your campaign still compelled the company to revamp its governance and appoint a board representative for Class A shareholders. Do you consider this campaign a success?

We consider Richemont one of our most successful campaigns. This is not the business of just winning a board seat, at least not for us. Think about what we achieved at Richemont – the major ask we had with the company when we reached out to them in the summer of 2021 was to exit its online business, YOOX Net-A-Porter, which they acquired but had nothing to do with their product.

In August of last year, they announced the deal with Farfetch which was essentially a first step in this direction. We asked them to reduce the size of the board and they did it. We asked them to increase the number of independent directors. They did it. We asked them to appoint a director in representation of the market, which they did not. We did not manage to get the director appointed as we suggested but, for the first time in 34 years, there is a director sitting on the board which is accountable toward the market, which never has been the case since Richemont’s initial public offering (IPO). And, by the way, the stock since we invested has done phenomenally well.

What trends in activism are you expecting to see for the rest of this year?

We think that activism in Europe is still in its infancy. Somebody said recently that we are entering the golden age of activism. There’s a lot of underperforming companies, there are still conglomerates with very poor performance, and we do see instances of dysfunctional governance. So, I must admit, we are quite excited at the current juncture.

This interview featured as part of Insightia’s Beyond The Boardroom podcast hosted by Kieran Poole. For more in the series, listen on Apple and Spotify.