Aarti Industries CEO, MD, chairman, board of directors and AGM

Mutual fund votes, meeting of 2 Aug 2024, 23 fund houses

• To receive, consider and adopt the Audited Standalone and Consolidated Financial Statements of the Company for the financial year ended March 31, 2024, together with the reports of the Board of Directors and Auditors thereon.MoreLess

  23 for0 against
• To declare dividend @ 20% i.e. Re. 1/- (Rupee One only) per equity share for the year ended March 31, 2024.

  23 for0 against
• Appointment of Shri Suyog Kalyanji Kotecha (DIN: 10634964) as Director liable to retire by rotation in place of Shri Parimal Hasmukhlal Desai (DIN: 00009272), who retires by rotation and has not offered himself for re-appointment as Director of the Company.MoreLess

  23 for0 against
• To appoint a Director in place of Smt. Hetal Gogri Gala (DIN: 00005499), who retires by rotation and being eligible, has offered herself for re-appointment as a Director of the Company.

  ›Against Edelweiss Mutual Fund, HSBC Mutual Fund, Invesco Mutual Fund, Mirae Asset Mutual Fund

  • Edelweiss Mutual FundAdequate information not given.
  • HSBC Mutual FundA vote AGAINST this resolution is warranted given that: • The board independence norms are not met (as per our reclassification) and Hetal Gogri Gala is a nonindependent director nominee.
  • Invesco Mutual FundHetal Gogri Gala, 49, is part of the promoter group and MD and Vice Chairperson Aarti Pharmalabs Limited. She has been on the board of the company since November 2001 and retires by rotation. During FY24, she attended all ten board meetings. Although her reappointment meets statutory requirements, the aggregate promoter representation on the board excluding Parimal Desai, is high at four board members (27% of the total board size), three of whom are executive. With the additional three executive directors who are professional – executive directors comprise 40% of the board size (6 of 15 member board). We believe an excessive level of promoter family representation on the board and within the company limits the company from attracting the right professional talent, and also expands board size to meet board independence requirements. At an eventual board size of 14, Aarti Industries’ board size is higher than the NIFTY 500 average of about 9 – 10 directors
  • Mirae Asset Mutual FundAs per advisory recommendation (passive holding)

  19 for4 against
• Appointment of Shri Suyog Kalyanji Kotecha (DIN: 10634964) as an Executive Director.

  23 for0 against
• Appointment of Shri Belur Krishna Murthy Sethuram (DIN: 03498701) as an Independent Director.

  23 for0 against
• Appointment of Shri Nikhil Jaysinh Bhatia (DIN: 00414281) as an Independent Director of the Company.

  23 for0 against
• Appointment of Smt. Rupa Devi Singh (DIN: 02191943) as an Independent Director.

  23 for0 against
• Appointment of Shri Ashok Kumar Barat (DIN: 00492930) as an Independent Director of the Company.

  23 for0 against
• Re-appointment of Shri Lalitkumar Shantaram Naik (DIN: 02943588) as an Independent Director.

  ›Against Bajaj Finserv Mutual Fund, Bandhan Mutual Fund, Baroda BNP Paribas Mutual Fund, Groww Mutual Fund, JM Financial Mutual Fund, LIC Mutual Fund, Motilal Oswal Mutual Fund, PGIM India Mutual Fund, PPFAS Mutual Fund

  • Bajaj Finserv Mutual Fund, Bandhan Mutual Fund, Baroda BNP Paribas Mutual Fund, Groww Mutual Fund, JM Financial Mutual Fund, LIC Mutual Fund, Motilal Oswal Mutual Fund, PGIM India Mutual FundNo concern on the merit of proposed appointee. Non-Compliance: Re-appointment is not in accordance with law, prior approval of shareholders not obtained for re-appointment as an ID.
  • PPFAS Mutual FundNo prior approval of shareholder; Inadequate disclosure regarding attendance

  14 for9 against
• To approve payment of Commission to Non-executive Directors of the Company

  23 for0 against
• To approve revision in terms and conditions of appointment of the Executive Director Shri Ajay Kumar Gupta (DIN: 08619902).

  23 for0 against
• To approve the remuneration of the Cost Auditors for the Financial Year 2024-25.

  23 for0 against

Mutual fund votes, meeting of 4 Aug 2023, 15 fund houses

Each resolution counts the houses whose vote was matched to it; the rest are listed last.

• To receive, consider and adopt the Audited Standalone and Consolidated Financial Statements for the financial year ended March 31, 2023 together with the Reports of the Board of Directors’ and the Auditors’ thereonMoreLess

  14 for0 against
• To declare the final dividend @ 30% i.e. Rs.1.50/- (Rupee One and Fifty Paise only) per Equity share for the financial year ended March 31, 2023

  14 for0 against
• To appoint Shri Ajay Kumar Gupta (DIN: 08619902) as an Additional Director in the category of Executive Director of the Company with effect from June 29, 2023 and who holds office up to the date of this AGM of the Company, liable to retire by rotation, in place of Shri Kirit R Mehta (DIN: 00051703), who retires by rotation in this AGM and has not offered himself for reappointment as a Director of the CompanyMoreLess

  ›Against HSBC Mutual Fund

  • HSBC Mutual FundWe have concerns about insufficient independence on the board.

  12 for1 against
• To not fill vacancy caused by the retirement of Shri Narendra J Salvi (DIN: 00299202), Non-Executive Director as he has not offered himself for re-appointment as a Director of the Company

  14 for0 against
• To approve appointment of Prof. Aniruddha Pandit (DIN: 02471158) as an Independent Director of the Company

  14 for0 against
• To approve appointment of Shri Shekhar Khanolkar (DIN: 02202839) as an Independent Director of the Company

  14 for0 against
• To approve appointment of Shri Ajay Kumar Gupta (DIN: 08619902) as an Executive Director of the Company

  ›Against Bandhan Mutual Fund, HSBC Mutual Fund, Invesco Mutual Fund, Kotak Mahindra Mutual Fund, Mirae Asset Mutual Fund, Motilal Oswal Mutual Fund, Nippon India Mutual Fund, SBI Mutual Fund

  • Bandhan Mutual Fund, Motilal Oswal Mutual FundNon-compliance with Section 196(2) of the Companies Act, 2013 as term of appointment has not been disclosed.
  • HSBC Mutual FundWe have concerns about insufficient independence on the board.
  • Invesco Mutual FundAjay Kumar Gupta’s term of appointment as executive director has not been defined. We note that under regulations, the maximum term for an executive director cannot exceed five years, and that Ajay Kumar Gupta is liable to retire by rotation. Even so, the company should have articulated the tenure of his appointment. Further, the remuneration terms have not been disclosed. The company has merely articulated the proposed remuneration for FY24, which we estimate at Rs. 36.7 mn – however, any future remuneration is unclear. The company needs to specify the terms of his remuneration or articulate that will seek annual shareholder approval for his remuneration as executive director
  • Kotak Mahindra Mutual FundAjay Kumar Gupta, 59 is currently Executive Director and Chief Manufacturing Officer of Aarti Industries Ltd. He has over three decades of experience in petrochemical industry. He has worked in leadership positions at IPCL, Reliance industries limited, Grasim Industries and Jubilant Life Sciences. The company has not articulated the tenure of his appointment. Further, the remuneration terms have not been disclosed, hence it is non-compliant with Section 196(2) of the Companies Act, 2013.
  • Mirae Asset Mutual FundIn line with advisor recommendation (passive holding)
  • Nippon India Mutual FundInadequate disclosure
  • SBI Mutual FundAjay Kumar Gupta’s term of appointment as executive director has not been defined. We note that under regulations, the maximum term for an executive director cannot exceed five years, and that Ajay Kumar Gupta is liable to retire by rotation. Even so, the company should have articulated the tenure of his appointment. Further, the remuneration terms have not been disclosed. The company has merely articulated the proposed remuneration for FY24, which we estimate at Rs. 36.7 mn – however, any future remuneration is unclear. The company needs to specify the terms of his remuneration or articulate that will seek annual shareholder approval for his remuneration as executive director.

  6 for8 against
• To approve revision in terms & conditions of appointment of Chairman & Managing Director, Shri Rajendra Vallabhaji Gogri (DIN:00061003)

  ›Against Bandhan Mutual Fund, HSBC Mutual Fund, Invesco Mutual Fund, Kotak Mahindra Mutual Fund, Mirae Asset Mutual Fund, Motilal Oswal Mutual Fund, Nippon India Mutual Fund

  • Bandhan Mutual Fund, Motilal Oswal Mutual FundCompliant with law. Governance concerns: Clubbed resolution and CMD is also a beneficiary, skewed remuneration, conflict of interest as NRC member.
  • HSBC Mutual FundThe performance criteria and vesting periods for the LTIP are not disclosed.
  • Invesco Mutual FundRajendra V. Gogri, 48, is Promoter, Chairperson and Managing Director. In FY23, his remuneration aggregated Rs. 80.6mn. We estimate his proposed remuneration at Rs. 88.6 mn for FY24, which could increase to over Rs. 133.4 mn during his tenure. The proposed remuneration structure is open-ended – executive directors can get commission upto 3% of profits, for which a large share is expected to be paid to Rajendra V Gogri. The board must cap the commission payable to Rajendra Gogri in absolute terms, and articulate performance measure that Rajendra Gogri is expected to achieve for his variable pay. We raise concern over the number of promoter family members on the board holding executive capacities; the estimated aggregate executive compensation at Rs. 296.3 mn, ~4.8% of FY23 PBT is high. We also raise concern over the independence of the Nomination Remuneration Committee - it comprises three tenured Independent Directors, along with Rajendra V. Gogri
  • Kotak Mahindra Mutual FundRajendra V. Gogri, 48, is Promoter, Chairperson and Managing Director. In FY23, his remuneration aggregated Rs. 80.6mn. The proposed remuneration structure is open-ended executive directors can get commission upto 3% of profits. The amount to be paid is not articulated.
  • Mirae Asset Mutual FundIn line with advisor recommendation (passive holding)
  • Nippon India Mutual FundSkewed Remuneration

  4 for7 against
• To approve revision in terms and conditions of appointment of Vice-Chairman and Managing Director, Shri Rashesh Chandrakant Gogri (DIN:00066291)

  ›Against Bandhan Mutual Fund, HSBC Mutual Fund, Invesco Mutual Fund, Kotak Mahindra Mutual Fund, Mahindra Manulife Mutual Fund, Mirae Asset Mutual Fund, Motilal Oswal Mutual Fund, Nippon India Mutual Fund

  • Bandhan Mutual Fund, Motilal Oswal Mutual FundCompliant with law. Governance concern: Skewed remuneration & Excessive Time commitments as per SES.
  • HSBC Mutual FundThe performance criteria and vesting periods for the LTIP are not disclosed.
  • Invesco Mutual FundRashesh C. Gogri, 48, is Promoter, Vice-Chairperson and Managing Director. In FY23, his remuneration aggregated Rs. 80.6mn. In addition, Rashesh Gogri draws remuneration from Aarti Drugs Limited as Managing Director, which aggregated Rs. 34.7 mn for FY23. We estimate his proposed remuneration from the company at Rs. 88.6 mn for FY24, which could increase to over Rs. 133.4 mn during his tenure. The proposed remuneration structure is open-ended – executive directors can get commission upto 3% of profits, for which a large share is expected to be paid to Rashesh C Gogri. The board must cap the commission payable to Rashesh Gogri in absolute terms, and articulate performance measure that Rasesh Gogri is expected to achieve for his variable pay. We raise concern over the number of promoter family members on the board holding executive capacities; the estimated aggregate executive compensation at Rs. 296.5 mn, ~4.8% of FY23 PBT is high. We also raise concern over the independence of the Nomination Remuneration Committee - it comprises three tenured Independent Directors, along with Rajendra V. Gogri
  • Kotak Mahindra Mutual FundRashesh C. Gogri, 48, is Promoter, Vice-Chairperson and Managing Director. In FY23, his remuneration aggregated Rs. 80.6mn. In addition, Rashesh Gogri draws remuneration from Aarti Drugs Limited as Managing Director, which aggregated Rs. 34.7 mn for FY23. The proposed remuneration structure is open-ended executive directors can get commission upto 3% of profits. The amount to be paid is not articulated.
  • Mahindra Manulife Mutual FundWe raise concern over the number of promoter family members on the board holding executive capacities; the estimated aggregate executive compensation at Rs. 296.5 mn, ~4.8% of FY23 PBT is high. We also raise concern over the independence of the Nomination Remuneration Committee - it comprises three tenured Independent Directors, along with Rajendra V. Gogri.
  • Mirae Asset Mutual FundIn line with advisor recommendation (passive holding)
  • Nippon India Mutual FundSkewed Remuneration

  3 for8 against
• To approve revision in terms and conditions of appointment of Executive Director, Shri Parimal Hasmukhlal Desai (DIN:00009272)

  ›Against Bandhan Mutual Fund, HSBC Mutual Fund, Invesco Mutual Fund, Kotak Mahindra Mutual Fund, Mahindra Manulife Mutual Fund, Mirae Asset Mutual Fund, Motilal Oswal Mutual Fund, Nippon India Mutual Fund

  • Bandhan Mutual Fund, Motilal Oswal Mutual FundCompliant with law. Governance concerns: Skewed remuneration, re-appointment and continuation of appointment after 70 years not approved from shareholders.
  • HSBC Mutual FundThe performance criteria and vesting periods for the LTIP are not disclosed.
  • Invesco Mutual FundParimal Desai, 73, is Promoter and Executive Director. We estimate his proposed remuneration at Rs. 19.9 mn for FY24, which could increase to over Rs. 39.6 mn by FY28. The amount is reasonable and commensurate with size and scale of the company. Nonetheless, we raise concern over the high number of family members on the board, holding executive capacities with no disclosures on their roles and responsibilities. The estimated aggregate executive compensation at Rs. 296.5 mn, is ~4.8% of FY23 PBT is high. The company must also provide clarity on the expectations of performance that set the basis of executive remunerations and cap commission in absolute terms. The Nomination Remuneration Committee comprises three tenured Independent Directors, along with Rajendra V. Gogri
  • Kotak Mahindra Mutual FundParimal Desai, 73, is Promoter and Executive Director. The estimated aggregate executive compensation at Rs. 296.5 mn, is ~4.8% of FY23 PBT is high. The company must also provide clarity on the expectations of performance that set the basis of executive remunerations and cap commission.
  • Mahindra Manulife Mutual FundWe raise concern over the number of promoter family members on the board holding executive capacities; the estimated aggregate executive compensation at Rs. 296.5 mn, ~4.8% of FY23 PBT is high. We also raise concern over the independence of the Nomination Remuneration Committee - it comprises three tenured Independent Directors, along with Rajendra V. Gogri.
  • Mirae Asset Mutual FundIn line with advisor recommendation (passive holding)
  • Nippon India Mutual FundNo absolute cap on commission

  3 for8 against
• To approve revision in terms and conditions of appointment of Executive Director, Shri Manoj Mulji Chheda (DIN:00022699)

  ›Against HSBC Mutual Fund

  • HSBC Mutual FundThe performance criteria and vesting periods for the LTIP are not disclosed.

  10 for1 against
• To approve revision in terms and conditions of appointment of Executive Director, Shri Renil Rajendra Gogri (DIN:01582147)

  ›Against Bandhan Mutual Fund, HSBC Mutual Fund, Invesco Mutual Fund, Kotak Mahindra Mutual Fund, Mahindra Manulife Mutual Fund, Mirae Asset Mutual Fund, Motilal Oswal Mutual Fund, Nippon India Mutual Fund

  • Bandhan Mutual Fund, Motilal Oswal Mutual FundCompliant with law. Governance concern: skewed remuneration.
  • HSBC Mutual FundThe performance criteria and vesting periods for the LTIP are not disclosed.
  • Invesco Mutual FundRenil R. Gogri, 36, is Promoter and Executive Director. In FY23, his remuneration aggregated Rs. 30.4 mn. We estimate his proposed remuneration at Rs. 35.3 mn for FY24, which could increase to over Rs. 70.1 mn by FY28. The proposed remuneration structure is open-ended – executive directors can get commission upto 3% of profits, from which a share is expected to be paid to Renil R. Gogri. The board must cap the commission payable to Renil R. Gogri in absolute terms, and articulate performance measure that he is expected to achieve for his variable pay. We raise concern over the number of promoter family members on the board holding executive capacities; the estimated aggregate executive compensation at Rs. 296.5 mn, ~4.8% of FY23 PBT is high. We also raise concern over the independence of the Nomination Remuneration Committee - it comprises three tenured Independent Directors, along with Rajendra V. Gogri.
  • Kotak Mahindra Mutual FundRenil R. Gogri, 36, is Promoter and Executive Director. In FY23, his remuneration aggregated Rs. 30.4 mn. The proposed remuneration structure is open-ended executive directors can get commission upto 3% of profits. The amount to be paid is not articulated.
  • Mahindra Manulife Mutual FundWe raise concern over the number of promoter family members on the board holding executive capacities; the estimated aggregate executive compensation at Rs. 296.5 mn, ~4.8% of FY23 PBT is high. We also raise concern over the independence of the Nomination Remuneration Committee - it comprises three tenured Independent Directors, along with Rajendra V. Gogri.
  • Mirae Asset Mutual FundIn line with advisor recommendation (passive holding)
  • Nippon India Mutual FundNo absolute cap on commission

  3 for8 against
• To approve revision in terms and conditions of appointment of Executive Director, Shri Kirit Ratilal Mehta (DIN: 00051703), for a period from April 1, 2023 till the date of this meeting

  ›Against Bandhan Mutual Fund, HSBC Mutual Fund, Motilal Oswal Mutual Fund

  • Bandhan Mutual Fund, Motilal Oswal Mutual FundCompliant with law. Governance concern: re-appointment and continuation of appointment after 70 years not approved from shareholders
  • HSBC Mutual FundThe performance criteria and vesting periods for the LTIP are not disclosed.

  8 for3 against
• To approve Commission payable to Non-Executive Directors

  ›Against Bandhan Mutual Fund, HSBC Mutual Fund, Invesco Mutual Fund, Kotak Mahindra Mutual Fund, Mirae Asset Mutual Fund, Motilal Oswal Mutual Fund, Nippon India Mutual Fund, SBI Mutual Fund, Taurus Mutual Fund

  • Bandhan Mutual Fund, Motilal Oswal Mutual FundCompliant with law. Governance concern: No absolute cap on proposed payment of commission & Perpetual Approval.
  • HSBC Mutual FundNon-executive directors participate in performance-based incentive schemes. The approval will be valid till perpetuity and shareholders will not get to review the payments in the future.
  • Invesco Mutual FundThe company currently pays sitting fees to its non-executive directors. The proposed commission at 0.5% of profits to non-executive directors is in line with market practices and statutory requirements. However, we are unable to support the resolution as the company has not defined a specific tenure for the proposed commission and thus the resolution is valid in perpetuity. We believe shareholders must get a chance to periodically review such payments. Further, as a good practice, the company must cap the aggregate value of commission in absolute terms
  • Kotak Mahindra Mutual FundThe company currently pays sitting fees to its non-executive directors. The proposed commission at 0.5% of profits to non-executive directors is in line with market practices and statutory requirements. However, the company has not defined a specific tenure for the proposed commission and thus the resolution is valid in perpetuity. Hence voting against .
  • Mirae Asset Mutual FundIn line with advisor recommendation (passive holding)
  • Nippon India Mutual FundPerpetual approval, hence not approved
  • SBI Mutual FundThe company currently pays sitting fees to its non-executive directors. The proposed commission at 0.5% of profits to non-executive directors is in line with market practices and statutory requirements. However, we are unable to support the resolution as the company has not defined a specific tenure for the proposed commission and thus the resolution is valid in perpetuity. We believe shareholders must get a chance to periodically review such payments. Further, as a good practice, the company must cap the aggregate value of commission in absolute terms.
  • Taurus Mutual FundRashesh C. Gogri, 48, is Promoter, Vice-Chairperson and Managing Director. In FY23, his remuneration aggregated Rs. 80.6mn. In addition, Rashesh Gogri draws remuneration from Aarti Drugs Limited as Managing Director, which aggregated Rs. 34.7 mn for FY23. We estimate his proposed remuneration from the company at Rs. 88.6 mn for FY24, which could increase to over Rs. 133.4 mn during his tenure. The proposed remuneration structure is open-ended – executive directors can get commission upto 3% of profits, for which a large share is expected to be paid to Rashesh C Gogri. The board must cap the commission payable to Rashesh Gogri in absolute terms, and articulate performance measure that Rasesh Gogri is expected to achieve for his variable pay. We raise concern over the number of promoter family members on the board holding executive capacities; the estimated aggregate executive compensation at Rs. 296.5 mn, ~4.8% of FY23 PBT is high. We also raise concern over the independence of the Nomination Remuneration Committee - it comprises three tenured Independent Directors, along with Rajendra V. Gogri.

  6 for9 against
• To approve the remuneration of the Cost Auditors for the Financial Year 2023-24

  12 for0 against
• To approve re-classification from ‘Promoter / Promoter Group’ Category to ‘Public’ Category of the Company

  ›Against Bandhan Mutual Fund, Invesco Mutual Fund, Kotak Mahindra Mutual Fund, Mirae Asset Mutual Fund, Motilal Oswal Mutual Fund

  • Bandhan Mutual Fund, Motilal Oswal Mutual FundCompliant with law. Governance & Transparency Concern: Lack of clarity w.r.t the relationship; Inadequate justification
  • Invesco Mutual FundThe company received requests from some members of Promoter / Promoter Group family , namely Mananjay Sing Garewal, Nehal Garewal, Shreya Suneja and Monisha Bhatia for reclassification from promoter to public category. Their aggregate holding as on date is 1,864,524 shares representing a holding of 0.51%. The applicants have confirmed that they have complied with Regulation 31A(3)(b) of the SEBI Listing Regulations, 2015. However, no disclosures have been made with respect to their relationship with the main promoter group, if any
  • Kotak Mahindra Mutual FundThe company received requests from some members of Promoter / Promoter Group family , namely Mananjay Sing Garewal, Nehal Garewal, Shreya Suneja and Monisha Bhatia for reclassification from promoter to public category. Their aggregate holding as on date is 1,864,524 shares representing a holding of 0.51%. The applicants have confirmed that they have complied with Regulation 31A(3)(b) of the SEBI Listing Regulations, 2015. However, no disclosures have been made with respect to their relationship with the main promoter group and no adequate justification is provided with respect to reclassification. Hence voting against .
  • Mirae Asset Mutual FundIn line with advisor recommendation (passive holding)

  9 for5 against

Mutual fund votes, meeting of 29 Oct 2022, 14 fund houses

Each resolution counts the houses whose vote was matched to it; the rest are listed last.

• Grant of Performance Stock Options to the Employees of the Company Under ‘Aarti Industries Limited Performance Stock Option Plan 2022’

  ›Against Axis Mutual Fund, Bandhan Mutual Fund, Baroda BNP Paribas Mutual Fund, HDFC Mutual Fund, JM Financial Mutual Fund

  • Axis Mutual FundThe company proposes to grant 1,813,000 options (0.5% of the issued, subscribed and fully paid up equity share capital) through PSOP 2022 Plan where the exercise price will be at face value, a deep discount to fair value. While the vesting will be performance-based, linked to the achievement of certain annual targets such as achievement of EBIDTA targets with 60% weightage and return on invested capital 40% weightage, the NRC will have the power to add or replace the performance targets creates scope for alterations to stated targets. We do not support stock unit plans where the exercise price is at a significant discount to market price. Also, granting stock options at deep discount may result in transfer of significant economic benefit to a particular employee, especially when the maximum options to per employee is equal to the entire pool available in the scheme.
  • Bandhan Mutual Fund, JM Financial Mutual FundCompliant with law. Governance concern: Excessive benefit can be extended to an individual employee.
  • Baroda BNP Paribas Mutual Fundexercise price of Rs5 per share is at a steep discount to the market price and defeats the purpose of ESOP, which is to align the interest of the employees with that of shareholders.
  • HDFC Mutual FundESOPs/PSUs are being granted at a significant discount to market price

  5 for5 against
• Grant of Stock Options to the Employees of the Subsidiary Companies (Present or Future) Under “Aarti Industries Limited Performance Stock Option Plan 2022”

  ›Against Axis Mutual Fund, Bandhan Mutual Fund, Baroda BNP Paribas Mutual Fund, HDFC Mutual Fund, JM Financial Mutual Fund

  • Axis Mutual FundThe company proposes to grant 1,813,000 options (0.5% of the issued, subscribed and fully paid up equity share capital) through PSOP 2022 Plan where the exercise price will be at face value, a deep discount to fair value. While the vesting will be performance-based, linked to the achievement of certain annual targets such as achievement of EBIDTA targets with 60% weightage and return on invested capital 40% weightage, the NRC will have the power to add or replace the performance targets creates scope for alterations to stated targets. We do not support stock unit plans where the exercise price is at a significant discount to market price. Also, granting stock options at deep discount may result in transfer of significant economic benefit to a particular employee, especially when the maximum options to per employee is equal to the entire pool available in the scheme.
  • Bandhan Mutual Fund, JM Financial Mutual FundCompliant with law. Governance concern: Excessive benefit can be extended to an individual employee.
  • Baroda BNP Paribas Mutual Fundexercise price of Rs5 per share is at a steep discount to the market price and defeats the purpose of ESOP, which is to align the interest of the employees with that of shareholders.
  • HDFC Mutual FundESOPs/PSUs are being granted at a significant discount to market price

  5 for5 against

Mutual fund votes, meeting of 26 Sep 2022, 14 fund houses

Each resolution counts the houses whose vote was matched to it; the rest are listed last.

• To receive, consider and adopt the Audited Standalone and Consolidated Financial Statements for the financial year ended March 31, 2022 together with the Reports of the Auditors’ and the Board of Directors’ thereon.MoreLess

  13 for0 against
• To declare the final dividend @ 30% i.e. Rs. 1.50 (Rupee One and Fifty Paise only) per Equity share for the financial year ended March 31, 2022.

  14 for0 against
• To appoint a Director in place of Shri Renil Rajendra Gogri (DIN: 01582147), who is liable to retire by rotation and being eligible, offers himself for re-appointment.

  ›Against Bank of India Mutual Fund, Baroda BNP Paribas Mutual Fund, Franklin Templeton Mutual Fund, HSBC Mutual Fund

  • Bank of India Mutual FundRenil Rajendra Gogri, 34, Whole-Time Director, represents the promoter family on the board. He has been on the board of the company since August 2012. He retires by rotation. The aggregate promoter representation on the board is high at five board members (31% of the total board size), all of whom are executive. With the additional three executive directors who are professional – executive directors comprise 50% of the board size (8 of 16 member board). We believe board positions must not be treated as legacies and the company should ration the number of family members on the board. Further, Renil Gogri’s FY22 remuneration at Rs. 61.9 mn is high for his responsibilities, and not comparable to peers in similar roles.
  • Baroda BNP Paribas Mutual FundSkewed remuneration
  • Franklin Templeton Mutual FundA vote AGAINST the following nominee is warranted because: • The board independence norms are not met and the board is not at least one-half independent and Renil Gogri is non_x0002_independent director nominee.
  • HSBC Mutual FundA vote against this resolution is warranted as this is against appointing non-independent candidates if board is less than 50% independent and where board chair is an executive or the promoter.

  10 for4 against
• To appoint a Director in place of Shri Manoj Mulji Chheda (DIN: 00022699), who is liable to retire by rotation and being eligible, offers himself for re-appointment.

  ›Against Franklin Templeton Mutual Fund, HSBC Mutual Fund

  • Franklin Templeton Mutual FundA vote AGAINST the nominee is warranted because: • The board independence norms are not met and the board is not at least one-half independent and Manoj Chheda is non_x0002_independent director nominee.
  • HSBC Mutual FundA vote against this resolution is warranted as this is against appointing non-independent candidates if board is less than 50% independent and where board chair is an executive or the promoter.

  12 for2 against
• Appointment of Statutory Auditors of the Company.

  ›Against Bank of India Mutual Fund, Edelweiss Mutual Fund, Invesco Mutual Fund, Kotak Mahindra Mutual Fund, SBI Mutual Fund

  • Bank of India Mutual FundGokhale & Sathe replace Kirtane & Pandit LLP as statutory auditors for five years from conclusion of 2022 AGM. Gokhale & Sathe were the company’s auditors for 10 years till 2017 AGM. They continued to audit the company’s two subsidiaries, Aarti Corporate Services Limited and Aarti Polychem Pvt Limited, till FY22. On account of their long and continued association with the group, we raise concerns over auditor independence and objectivity. Therefore, we are unable to support Gokhale & Sathe’s appointment. As per Regulation 36(5) of SEBI’s LODR 2015, companies are mandated to disclose the terms of appointment/ re appointment of auditors, including the remuneration payable to them. The company has not made any disclosures on auditor profile nor the proposed audit fees. The audit fees in FY22 aggregated Rs. 4.5 mn.
  • Edelweiss Mutual Fundcant see history and track record of proposed auditors and engagement with other Listed enitties
  • Invesco Mutual FundGokhale & Sathe replace Kirtane & Pandit LLP as statutory auditors for five years from conclusion of 2022 AGM. Gokhale & Sathe were the company’s auditors for 10 years till 2017 AGM. They continued to audit the company’s two subsidiaries, Aarti Corporate Services Limited and Aarti Polychem Pvt Limited, till FY22. On account of their long and continued association with the group, we raise concerns over auditor independence and objectivity. Therefore, we are unable to support Gokhale & Sathe’s appointment. As per Regulation 36(5) of SEBI’s LODR 2015, companies are mandated to disclose the terms of appointment/ re appointment of auditors, including the remuneration payable to them. The company has not made any disclosures on auditor profile nor the proposed audit fees. The audit fees in FY22 aggregated Rs. 4.5 mn
  • Kotak Mahindra Mutual FundNon-Compliant with Regulation 36(5) of SEBI LODR as Proposed audit fee not disclosed.
  • SBI Mutual FundGokhale & Sathe replace Kirtane & Pandit LLP as statutory auditors for five years from conclusion of 2022 AGM. Gokhale & Sathe were the company’s auditors for 10 years till 2017 AGM. They continued to audit the company’s two subsidiaries, Aarti Corporate Services Limited and Aarti Polychem Pvt Limited, till FY22. On account of their long and continued association with the group, we raise concerns over auditor independence and objectivity. We do not believe that the cooling period is effective if the auditors keep auditing the subsidiary companies.

  7 for5 against
• To approve the re-appointment of Shri Rajendra V. Gogri (DIN: 00061003) as the Managing Director of the Company.

  ›Against Baroda BNP Paribas Mutual Fund

  • Baroda BNP Paribas Mutual FundNo absolute cap on remuneration. Skewed remuneration. Dual position of CMD.

  13 for1 against
• To approve variation in terms of Remuneration of Executive Directors.

  ›Against Bank of India Mutual Fund, Baroda BNP Paribas Mutual Fund

  • Bank of India Mutual FundAlthough we recognize that individual remuneration levels are comparable with peers, we raise concern over the aggregate executive director compensation and more specifically, the promoter family compensation. Aggregate executive compensation aggregated Rs. 512.7 mn, which accounted for 3.4% of FY22 consolidated pre-tax profits. Of this, promoter family remuneration aggregated Rs. 456.0 mn, which accounted for about 3.0% of FY22 consolidated pre-tax profits. We further raise concern over the large number of executive directors. Aarti Industries has eight executive directors – which is more than those on the boards of most S&P BSE SENSEX companies. The company must consider presenting the remuneration resolutions of all executive directors separately, with complete remuneration details, rather than only provide a resolution to increase fixed pay, which accounts for less than 25% of the comprehensive remuneration paid.
  • Baroda BNP Paribas Mutual FundClubbed resolution. Skewed remuneration

  11 for2 against
• To approve holding of office of profit in the Company by Shri Mirik R. Gogri.

  ›Against Bank of India Mutual Fund, Baroda BNP Paribas Mutual Fund, Franklin Templeton Mutual Fund, HSBC Mutual Fund

  • Bank of India Mutual FundAarti Industries’ board comprises of five members of the promoter family as whole timedirectors. We believe that in a public listed company, the promoters should refrain from appointing large members of promoter family in executive roles of the company. This practice also deters from attracting right talent to the company. Having five family members on board in an executive capacity and two holding office (includes Nikhil Desai, as per 2018 AGM) of profit is excessive.
  • Baroda BNP Paribas Mutual FundExcessive Remuneration & Discretion to MD.
  • Franklin Templeton Mutual FundA vote AGAINST this resolution is warranted: • The board retains discretion in terms of his remuneration arrangement. • The proposal is deemed a related-party-transaction and the proposed mandate may limit shareholders' rights to review and vote on the said transaction on a periodic basis.
  • HSBC Mutual FundA vote against this resolution is desired as it could negatively impact shareholder rights.

  10 for4 against
• To approve the remuneration of the Cost Auditors for the Financial Year 2022-23.

  14 for0 against

Mutual fund votes, meeting of 10 Mar 2022, 17 fund houses

• Approve Scheme of Arrangement for Demerger of the Pharmaceuticals business from Aarti Industries Limited to Aarti Pharmalabs Limited.

  17 for0 against

Mutual fund votes, meeting of 24 Nov 2021, 14 fund houses

• Appointment of Smt. Natasha Kersi Treasurywala as an Independent Director for a period of 3 (Three) years.

  14 for0 against