All of these answers are correct, but the corollary issue is if the protagonist is too passive, another more pro-active character will steal the story.

Working as Intended

This might be exactly what you want. Moby Dick, Amadeus, and Sherlock Holmes use POV characters to frame a more interesting character's story. They sit around passively shocked or enthralled by the more interesting character's rise and fall. They provide a moral and emotional touchstone that anchors the reader, working like a greek chorus to say what is "normal" outside of the sensational leading character.

Coming-of-age stories work in the same way. A story about everyday-courage, or everyday-tyranny, can work better narratively when discovered through the eyes of an innocent. The POV character has dramatic uncertainty over the conflict, and goes through an emotional arc which the leading character doesn't show.

Fractured Fairytales

The (too) passive protagonist becomes a big problem in "heroic" stories about good and evil, where the villain instigates everything, the villain has all the plans, and the villain gets all the good speeches – the villain is the main character, we are being told his story about his rise and fall.

It gets even worse with clichéd grim-dark brooding anti-heroes who have nothing to their character than the ability to super-punch/super-outgadget/super-runfaster/super-shootthegun… oh, and a dead wife/daughter/sister/parents who were fridged before the story even began. This protagonist is too passive. He has no goals, no life of his own, no story to interrupt. He is boring. He only reacts to the villain's plans, that's the only reason he is there. He is just a foil to the more interesting villain.

At the end of a "broken" heroic story, the reader remembers the unique villain and forgets the cookie-cutter hero.

Damsel in Distress

Another "bad" example is a damsel-in-distress who is kidnapped by a villain, then rescued by the hero who tells her to stay put, then the villain kidnaps her again because he knows the hero is in love with her, and the hero snatches her again in a boring sports ball game of pass-the-woman. She screams and falls off buildings, events happen to her and around her. She is at the center of the story, but she is essentially an inanimate MacGuffin that is strategically transported from location to location as the plot demands, but has no agency or character arc of her own.

The adoring damsel might seem like a Watson at first, a "normal" character through which we are meant to see the fantastical hero and the maniacal villain, but if she has no agency of her own readers will start to see her as an annoyingly passive object that looks pretty and is used as a plot crutch. Fans may even want her to die because she serves no purpose than to be a handicap to the hero.

Who Makes the Plot Happen?

In contrast, Supermanâ„¢ was originally a power fantasy for children, but it was adapted for cinema shorts he needed to appeal to general audiences. The main character shifted from reactive-only Superman to Lois Lane, an extremely pro-active reporter who chases villains for interviews and always looks behind the curtain to expose what they are up to. Villains hate Lois Lane. They tie her up and leave her to die because she is smart and dogged and will expose their plan, not because she is somebody's girlfriend.

Lois is reckless and eventually needs to be saved (not all the time, just special occasions when Superman has to expose himself), meanwhile she actively complicates her own conflict by sabotaging Superman's ability to protect her. Every time she misdirects Clark Kent, she unwittingly sends her rescuer in the wrong direction. The show is called "Superman" but it's Lois Lane who drives all the action forward. Superman just reacts. He reacts to villains, he reacts to Lois. When you watch them you actually feel sorry for Superman, well not really, he has superpowers but he is just a boring guy from Kansas.

In current films she is a do-nothing passive girlfriend who carries the emotional water so Superman can be even more portentous, but the original Lois is ridiculously un-passive (she accepts no situation as is) and pro-active (really, you should watch the Fleischer Studios cartoons, she is a psychopath) so the stakes can be raised several times before Superman shows up "in the nick of time".

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