Vedanta Reappoints Ex-SEBI Chief UK Sinha, Overwhelmingly Rejected by Institutional Investors
Moneylife Digital Team 12 August 2021
Billionaire Anil Agarwal-led Vedanta Ltd managed to survive voting during its annual general meeting (AGM) held earlier this week with support from the promoters and votes from public non-institutional shareholders. However, during the AGM, institutional shareholders made their presence felt by overwhelmingly voting against some resolutions, like passing financial accounts of the company for FY20-21 and re-appointment of UK Sinha, former chairman of SEBI as non-executive independent director of Vedanta.
In its regulatory filing, Vedanta revealed details of the votes received for its resolutions by all shareholders.
The resolution to appoint Mr Sinha as independent director of Vedanta for three more years was rejected by institutional shareholders by 70.70% out of their percentage of votes polled of 75.78%. However, with full support from promoters including Mr Agarwal and public non-institutional shareholders, this resolution was passed by 84.65% votes in favour.
For the resolution on audited stand-alone financial statements of Vedanta for financial year ended 31 March 2021, institutional shareholders, however, were divided. This, as well as the resolution for adopting consolidated financial statements for FY20-21, was passed with full support from promoters and public non-institutional shareholders.
During the AGM, institutional shareholders also voted against appointment of Dindayal Jalan and Akhilesh Joshi as non-executive independent director for two years. While majority institutional investors voted against these proposal, Vedanta promoters and public non-institutional shareholders voted in favour of it resulting in the resolution getting passed.
Earlier, Institutional Investor Advisory Services India Ltd (IiAS) too had recommended voting against the resolutions on financial statements, as well as appointment of Mr Sinha, Mr Jalan and Mr Joshi. Mr Sinha has been on the Vedanta board since 13 March 2018.
In a report, it says, "We believe the current independent directors have not protected the minority shareholder rights by maintaining a passive stance and allowing cash flow support to the group through the company and Hindustan Zinc Ltd. We therefore do not support Mr Sinha’s reappointment as an independent director to Vedanta’s board."
According to IiAS, both Mr Jalan and Mr Joshi were former employees of Vedanta group and it was not sure of both of these executives have completed three-year cooling period.
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