It depends on the context.
I am playing Trails Beyond the Horizon, the third Trails game in the Calvard arc. In this arc, the main protagonist is Van Arkride, who is ostensibly an underworld fixer who takes on extra-legal jobs that people don't want to go to the police or the Bracer guild for. Much of the sidequests you do are sensitive that people obviously don't want to become public. Like a guy who works at an insurance company who was looking at porn on the company computer that was networked and now the company's database has been hacked, and he wants you to fix this before his boss finds out. Or you are working for a politician who has a delinquent son and he wants you to try to keep this under wraps so that the news does not pick up on it and end his career. Or a celebrity actor who has an affair with a fan. Etc.
The thing is, it gets pretty ridiculous by the end of the first game, as Van is walking around and meeting his client in secret and listening to their secret stuff... while he has his posse of 7 or 8 party members standing over the client's shoulders.
I think we are more likely to intimidate the client fellas.
It also gets ridiculous in Cold Steel 3. There is a much memed scene where you are on the Imperial Intelligence Division's list of persons of interest for dissent. The day after
the Emperor is shot, everyone is on the lookout for traitors and Calvardian infiltrators, people are hiding in their homes, bookstore owners are taking Calvardian books off the shelves for fear of being accused of being unpatriotic, foreigners are becoming the target of hate and are scrambling to leave, etc. You are grounded by the military as suspects at a location outside of the capital. You and your posse of THIRTEEN PARTY MEMBERS are brazenly waltzing around the capital in broad daylight meeting with fellow dissenters (who are also on the list). The ID should be receiving so many phonecalls about you and sending the elite guard to get you.
So in these cases when making important contact, tact is needed, and it would make more sense to split the party so you don't look conspicuous or intimidate weak, nervous strangers. For a systemic CRPG styled game, there should be something like KCD's conspicuousness stat, but it takes into account your whole group.
In most other circumstances, you should be fine walking around with your large posse, like in Suikoden where you play as a rebel leader or a prince surrounded by his retainers, trusted confidantes, advisors, etc.