Paytm parent One97 Communications’ shareholders have been advised by the Institutional Investor Advisory Services India (IIAS) against the reappointment of Vijay Shekhar Sharma as its chief executive, and his remuneration. The proxy advisory firm, ahead of Paytm’s annual general meeting on August 19, has said that Sharma had, in the past, made commitments that did not play out well.
The firm said that they believe that the board must consider professionalising the management, according to a report in the Economic Times.
IIAS spoke about the massive fall in Paytm shares from the issue price resulting in destruction of wealth for shareholders.
The firm raised concerns about Sharma being liable to retire by rotation, and that he will become permanent in the board if he continues in a non-executive capacity, following the end of his term as managing director. It also pointed out that Sharma’s remuneration was higher than the salaries of CEOs of all S&P BSE Sensex companies, most of which are profitable.
"The company is seeking shareholder approval for the proposed remuneration as minimum remuneration — which will be paid to him even if the company continues to report losses," the report added. The firm estimated Sharma’s remuneration for FY23 at more than Rs 796 crore, which also includes stock options of 21 million at an exercise price of Rs 9.
If shareholders approve, stated the report, Sharma is likely to take home Rs 4 crore in remuneration for the financial year, including benefits.
IIAS also opposed the remuneration for Paytm President and Group CFO Madhur Deora. It did not oppose his reappointment. It, however, opposed the reappointment of Elevation Capital’s Ravi Adusumalli as director on the board.
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