Proxy firm advises against Gautam Singhania's reappointment at Raymond
Institutional Investor Advisory Services (IiAS), a prominent proxy advisory firm, has publicly opposed the reappointment of Gautam Singhania, as Chairman and Managing Director of Raymond. The firm has also advised against his return to the firm's board as a director. According to IiAS, Singhania is due for retirement as director by rotation. The firm has urged shareholders to protect the company from this intra-promoter clash, by voting against Singhania's reappointment.
Singhania faces allegations amid reappointment controversy
Singhania, a board member of Raymond since 1990, is currently undergoing divorce proceedings. His estranged wife, Nawaz Modi, has leveled accusations of domestic violence and misuse of company funds for personal benefits, against him. However, it remains unclear whether Raymond's board has requested an independent investigation into these allegations, as no update has been issued since their last statement in December 2023.
IiAS criticizes Singhania's pay package
IiAS has also criticized Singhania's proposed remuneration structure for the period from July 2024 to June 2027, labeling it as higher than regulatory thresholds and peers. In FY24, Singhania received around ₹20 crore in remuneration and is estimated to receive around ₹23 crore in FY25. The structure allows for payment in excess of 5% of the company's profits, potentially exceeding ₹35 crore.
Concerns over Singhania's remuneration structure
IiAS has raised concerns over the lack of a maximum cap on remuneration, absence of disclosed performance targets for commission payment, and uncertainty about clawback clauses in the remuneration structure. "Given the high level of remuneration in the past, and the lack of clarity in the proposed remuneration structure, we do not support the resolution," the firm stated. Raymond is scheduled to conduct its Annual General Meeting (AGM) on June 27.
