Short-Selling Activism and Corporate Governance in India: A Qualitative Study of Market, Regulatory and Board Responses

Short-selling activism has real consequences for corporate governance in India. When institutions respond well, it can improve transparency, sharpen monitoring and prompt correction. When they respond poorly, it breeds uncertainty and reputational harm. The paper's main argument is that an activist short report is best seen as a stress test of a firm's governance, whatever its accuracy. How the board, investors and regulators respond decides whether the episode ends in better accountability or in a prolonged quarrel. The study has clear limits: it rests on public documents, a small number of episodes and interpretive coding. Later work could add interviews with directors and investors, systematic coding of a larger set of campaigns, and comparison with other markets where ownership is also concentrated.

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