‘Shareholder Activism': Recent Developments and the Evolving Landscape

Introduction

India is witnessing a growing trend of shareholder activism, where investors are increasingly being viewed as positive participative forces. Past instances have shown that in the right circumstances, shareholder activism can contribute to unlocking value for all shareholders. Further, shareholder activism is not necessarily limited to isolated individual instances of demand for change. Rather, in a developing market, it assumes the role of being a catalyst in fostering an atmosphere of good corporate governance and structural stability.

Private companies, with sizeable investments from institutional investors, in the natural course of their growth cycle, may seek listing in the future. This, in addition to other macroeconomic factors, should result in a larger number of listed companies in India witnessing more dispersed shareholding (i.e., lesser concentration of promoter shareholding and larger share of public shareholding, both institutional and