Awareness of Shareholder Engagement among Sub-Brokers, Investment Advisors and Shareholders
Keywords:Investment Advisors, Proxy Advisory Firms, Shareholders, Shareholder Engagement, Sub-Brokers
Companies Act 2013 has given legal protection to shareholders’ rights. It has granted new rights to minority shareholders, such as; i) Approval of shareholders for amending the company's memorandum of association/articles of association, ii) Right to appoint and remove Directors, iii) Approval of shareholders for obtaining loans, iv) Approval of shareholders for Related Party Transactions, v) Right to appoint Auditor, vi) Right to Grievance Redressal Mechanisms, vii) Filing Class and Derivative actions suits, etc. Against the backdrop of this, the present study was undertaken by the researcher. The study aims to investigate the awareness of Shareholder Engagement among Sub-Brokers, Investment Advisors and Shareholders. The study was conducted in major cities of North Karnataka and Hyderabad-Karnataka covering Kalburagi, Bellary, Belagavi, Vijayapura and Hubli-Dharwad cities. Primary data was collected through a questionnaire. The result of the study reveals that; i) The majority of Sub-Brokers and Investment Advisors were unaware of the concept of Shareholder Engagement, ii) The majority of Sub-Brokers and Investment Advisors were unaware of a) Investor Relationship Policy implemented by companies, b) Investors Road Show conducted by companies, c) Board- Shareholder Dialogue conducted by companies, iii) None of the Sub-Brokers and Investment Advisors are aware of working of Proxy Advisory Firms, filing Class and Derivative actions suits by shareholders, iv) None of the shareholders are aware of the out concept of Shareholder Engagement, Board-Shareholder Dialogue, the existence of Proxy Advisory Firms and Shareholder Association. The study is expected to help the Government of India and SEBI to chalk out policies for stronger Shareholder Engagement. The outcome of the study also expected the Proxy Advisory Firms to develop marketing strategies to reach out to investors.
How to Cite
Copyright (c) 2023 N Maruti Rao
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
Anandarajah, K. (2012). Shareholder activism -shareholder rights and its effectiveness. Available from: https://www.eguide.sid.org.sg/images/SIDeGuide/ articles/Bulletin/2013I1-01-Shareholder%20 Activitism-Shareholder %20Rights.pdf
Brown L. D. (2004). Corporate Governance and Firm Performance. Georgia State University Working Paper. DOI: https://doi.org/10.2139/ssrn.586423
Christine C., (2011). Establishing a corporate sustainability monitoring tool using the shareholder engagement commitment indicator. Journal of Sustainable Finance & Investment, 195-208.
Hockerts, K. & Moir, L. (2004). Communicating corporate responsibility to investors: The changing role of the investor relations function. Journal of Business Ethics, 52, 85-98. https://doi.org/10.1023/ B:BUSI.0000033109.35980.16 DOI: https://doi.org/10.1023/B:BUSI.0000033109.35980.16
Patel & Bwakira. (2002). Measuring transparency and disclosure at firm-level in emerging markets. Emerging Markets Review, 3, 325-337. https://doi.org/10.1016/ S1566-0141(02)00040-7 DOI: https://doi.org/10.1016/S1566-0141(02)00040-7
Rourke, O. (2003). A new politics of engagement: shareholder activism for corporate social responsibility, Business Strategy and the Environment, 12(4), 227-239. https://doi.org/10.1002/bse.364 DOI: https://doi.org/10.1002/bse.364
Shingade, S., Rastogi, S., Jagjeevan, K., & Venkata, M. B. (2022). Impact of shareholder activism on the dividend policies of the Banks in India. Universal Journal of Accounting and Finance, 10(1), 306-316. Available from: https://www.hrpub.org/download/20220130/ UJAF31-12225629.pdf. https://doi.org/10.13189/ujaf.2022.100131 DOI: https://doi.org/10.13189/ujaf.2022.100131
Shingade, S., Rastogi, S., Venkata, M. B., & Abhijit, C. (2022). Shareholder activism and its impact on profitability, return, and valuation of the firms in India. Journal of Risk Financial Management,15(4). https:// doi.org/10.3390/jrfm15040148 DOI: https://doi.org/10.3390/jrfm15040148
Springer (2012). Shareholder activism and its impact on corporate behaviour: with special reference to Australian ethical’s climate advocacy fund. Independent Study Project Collection. 1464. Available from: https://digitalcollections. sit.edu/isp_collection/1464