Five years after stewardship codes became mandatory for mutual funds and AIFs, India has largely nailed the paperwork. But regulators and analysts are finding little proof that this procedural compliance is translating into stronger governance outcomes. The result: institutional investors increasingly act, yet companies see limited influence from those actions on decisions that matter.
The RBI has proposed curbs on banks and NBFCs investing in Alternative Investment Funds, capping any single regulated entity’s contribution to 10% of a scheme’s total corpus. The move tightens concentration risk and changes how financial firms allocate money into AIFs, with potential ripple effects for funding strategies and investment flows.
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