In India, where corporate scandals have prompted significant reforms in governance practices, the ownership structure emerges as a critical determinant of corporate financial distress. This study explores the relationship between various ownership types—managerial, block-holder, institutional, state and foreign—and the likelihood of corporate financial distress using a matched-pairs research design with 374 observations, comprising 187 distressed and 187 non-distressed firms, based on a sample of Indian listed companies covering the period 2013–2022. Using the conditional (fixed effects) logistic regression technique, the results show that institutional ownership is negatively associated with the firm’s likelihood of falling into financial distress, whereas state ownership exhibits a positive relationship. However, the results show that managerial ownership, block-holder ownership and foreign ownership do not have any impact on the likelihood of distress in the Indian scenario. Our findings are relevant to the regulatory body and policymakers in the formulation of a robust code of corporate governance aimed at managing corporate failures.
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