Shareholder activism up among promoter groups

Mumbai: This year could well be the tipping point of shareholder activism in India. In addition to individual investors donning the role of aggressive shareholders, members of promoter group are also dissenting against boards and management of their companies.

Interestingly, directorial appointments and remuneration were the most scrutinised proposals by investors this year. Also, the number of cases where shareholders dissented against the board and management was unprecedented. Notable instances where members of promoter group too protested are Tata Group and Infosys. Investors’ scrutiny increased manifold on proposals tabled by India Inc with as many as 45 companies of the top 100 having at least one AGM proposal that got more than 20 per cent dissenting votes, says a study titled ‘The India Proxy Season 2017’ by shareholder advisory firm InGovern.



The report says 10,972 resolutions were proposed during the proxy voting season (January to September 2017) by 1,502 listed companies — 9,889 resolutions tabled at AGMs, 755 through postal ballots, 268 at EGMs and 60 at court-convened meetings. Of these, 8,291 resolutions were classified as ordinary, while 2,681were special resolutions.

Grant Thornton partner (India leadership team) Harish H V says, “It is important that shareholders be active just like we want active and knowledgeable voters in a democracy.”