The UK shareholder spring, when shareholders expressed displeasure with compensation packages and reprimanded chief executives for underperformance, has been widely welcomed. But the uprising has highlighted a paradox, which until now has been largely ignored.

Interventions by shareholders may come at the expense of other stakeholders in a company: employees and creditors. There is some evidence to suggest that, while shareholders gain appreciably from activism, other investors, in particular bondholders, may be worse off.