Perception and awareness levels of retail investors on corporate governance practices in an emerging economy

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Abstract

Many criteria encompass the concept of corporate governance. There is an apprehension that it’s the non-retail investors who would be interested in such governance of firms rather than retail investors, as they hold a small fraction of ownership, usually being passive investors and not in a capacity to influence the management. This study is an attempt to understand the attitude and perception of retail investors in India toward corporate governance practices and for that purpose, a questionnaire was served to consist of a range of corporate governance factors. The data was studied through percentage analysis and chi-square was run. It was established, that retail investors pay attention to corporate governance factors, more importantly to the board of directors, this finding supports the results of Chakraborty et al. (2023). But there is no strong course of action that they prefer to resolve any of their governance-related issues. India, where promoter groups are dominant, has a long way to go to bring out shareholder activism at par with developed markets.

Keywords: Corporate Governance, Retail Investors, Attitude, Perception

Authors’ individual contribution: Conceptualization — S.S.; Methodology — S.S.; Formal Analysis — S.S.; Writing — Original Draft — S.S. and N.P.; Writing — Review & Editing — S.S. and N.P.

Declaration of conflicting interests: The Authors declare that there is no conflict of interest.

JEL Classification: G34, G4, N2

Received: 07.11.2022
Accepted: 24.02.2023
Published online: 28.02.2023

How to cite this paper: Sandhya, S., & Parashar, N. (2023). Perception and awareness levels of retail investors on corporate governance practices in an emerging economy. Corporate Governance and Organizational Behavior Review, 7(1), 178–183. https://doi.org/10.22495/cgobrv7i1p17