All began with a letter. At the end of 2022, Larry Fink wrote an open letter to the board of a fast-growing Indian tech firm. He urged them to be more open about executive compensation, business plans and risk management. That gnawing sensation of what could have been a mere “noise” in the market actually became a turning point: the company’s board held special meetings, revised its disclosure policies and established new communication channels with shareholders, things it was only beginning to acknowledge. What was a minor moment meant a larger change in the business landscape in India: the board cannot work in isolation and cannot be shielded from the scrutiny of not only the investors but also the general public.
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The book is titled “The Silent Revolution in Corporate Governance.”
In India, the corporate governance model has been one that has been dominated by promoter throughout its history, in which the persons who exercise control over a firm are generally in control of the composition of the board and the direction of the firm with little opposition. Formal activism was less extensive than it could have been, and minority shareholders were underrepresented. But, regulatory changes like Companies Act, 2013 and later SEBI regulations have given more authority to the minority shareholders and institutional investors, and ensured greater shareholder voice through e-voting, proxy advisories and public disclosures. As a result, boards have been forced to become more accountable and to be more sensitive to outside stakeholders.
As a result, proxy advisory firms, including the most established proxy advisory company in India, Institutional Investor Advisory Services, have played a significant role in recommending proxy votes on shareholder resolutions for almost 300 listed companies and have conducted proxy analyses of such resolutions. They provide a counterpoint to some traditional governance structures in which independent control was weak, by providing informed, data-driven insights to governance.
Activism in Indian Corporate Context
Shareholder activism is nothing new in developed markets like the U.S. and the U.K., but it is a relatively new phenomenon in India. Although concentrated promoter ownership has made activism more difficult, statistics and case studies suggest that there has been a recent surge in shareholder participation. The pie charts have been flipped, and minority interests are not being passive in their opposition to management proposals regarding compensation, related party transactions, and board appointments, according to proxy reports. In emerging markets like India, activism requires more transparency, accountability and harmony between management and shareholders, a global study reveals. As investors have become more focused on long-term value rather than short-term gains, it now concentrates on governance standards, board composition and Environmental, Social and Governance (ESG) criteria.
The activists’ actions in the face of public scrutiny. Activism in the public eye.
Activism gained visibility in India as in the case of 2023’s high-profile report by Hindenburg Research on irregularities in the Adani Group. The effect proved to be devastating: Adani’s market value plummeted by more than $100 billion within weeks, a testament to how investor confidence and accountability can be rapidly impacted by the attention of the public.
This event caused a stir over market behaviour and responses to regulate it, but it also revealed a new reality: boards can no longer be insulated from outside examination or activist scrutiny. Shareholders, clients, journalists and regulators are now a network of watchdogs that can change the way an organisation thinks, talks and operates in an instant.
Boards Rethinking Their Accountability Structures
In the wake of greater scrutiny, Indian boards are now taking the opportunity to reflect on their practices, including greater transparency with regards to executive pay, diversity of its members, the performance of independent directors and standards for risk governance. Boards spend more time with investors, preparing for activists and having stakeholder discussions to prevent investors’ dissatisfaction, analysts note. There is evidence that more institutional investors are involved in companies, especially through stewardship codes and policies for voting transparency, which improve their corporate responsibility. A 2025 research report by The Economic Times revealed that Indian mutual funds that have a voting culture tend to vote for improved governance, signifying a maturing voting culture that is in sync with global trends.
Struggle and Uneven Outcomes
The momentum keeps going with a few hurdles. Promoter control is generally consolidated in most Indian firms and so unless shareholders mobilise openly, it has limited influence from promoter activists. In some instances, however, legal restrictions like compliance in regulated markets can provide a means for boards to challenge activists’ demands, as in the case of the Prosus-led campaign to influence leadership decisions at Think and Learn in 2023, where courts were key in solving investor-board conflict.
Further, many academic studies indicate that the benefits of activism to financial performance are debatable, though it can have a positive effect on areas of governance, like board composition or disclosure quality. However, a few studies in India have found no direct correlation between activism and profitability of a firm.
A New Paradigm of Board Accountability
However, the message is clear: Activist investors and publicity is transforming the Indian boardroom. The old passive stakeholder paradigm is giving way to an increased governance culture where investors are demanding boards to justify their strategy, communicate value creation and to prove their oversight abilities on a frequent basis in response to regulatory demands.
With the emergence of ESG activism, boards need to move beyond merely reporting on their financial returns and clearly communicate their social responsibility, risk management and transparency to a variety of stakeholders. That’s why accountability is not just a given but a strategic need. In India, as on the rest of the world, the changing dynamics of corporate governance are a result of activism and publicity, driving a board to undertake more proactive and transparent leadership in response to investors and society.
