The shareholders voted out the resolution with 91.37% of the total votes rejecting her proposed appointment, dealing a major blow to Ms Arunachalam's efforts to enter the male-dominated board, said two people aware of the development.
Ambadi Investments Ltd (AIL), a holding company of over $ 5 billion Murugappa Group in its Annual General Meeting (AGM) decided on Monday, not to allow her on the board of the holding company that controls the financial services-to-agro commodity conglomerate.
“I am shocked at the manner in which the Family, which is the majority shareholder, in this case, has conducted itself,” said Arunachalam in an email response. “We made multiple attempts to ask the family to settle us per my father's wishes by purchasing our stake in AIL at fair value. We have proposed many ways in which they can settle the matter amicably, including mediation, and they have refused. For more than a year now, I have been asking for a board seat, pending the settlement, to make sure our rights are preserved as a promoter and major shareholder. Now, yet again they have made clear their intent of continuing the oppressive and vexatious conduct against us.”
Arunachalam (59) is negotiating with other family members to succeed her late father, former patriarch of the group MV Murugappan, as a member of the male-only board of the holding company. Along with her mother and a sister, she owns about 8.15% in the AIL.
“In any event, we would definitely pursue justice and we will take all the steps needed for the same,” said Arunachalam. “It was always our wish that the family issues remain within and are settled at the family level, but clearly it seems the family is more concerned about protecting its draconian perspectives and practices, even if it means forcing us to take the battle to courts. We will not shy away this time.”
A nuclear engineer by training, Arunachalam is the eldest daughter of former executive chairman MV Murugappan, who died in 2017. New York-based Arunachalam says she was denied a board position in Ambadi Investments, despite being his heir.
“It is evident that the family cannot tolerate women in their boardrooms, and they have showcased their considered view in this regard. It is very unfortunate that the AIL shareholders, the overwhelming majority of whom are also board members, are not able to understand what contributions women can make on the board,” said Arunachalam. “It is clear indication that gender bias exists at the highest levels of the Murugappa group.”
Email queries to Murugappa Group did not elicit any response immediately.
On September 11, she had confirmed that her appointment as a director was on the agenda of the meeting.
Under the Hindu Succession (Amendment) Act of 2005, women could become the Karta–or head—of the family, allowing them to inherit as much as sons. Arunachalam is Karta of the MVM Hindu Undivided Family (HUF) branch, which holds the stake in Ambadi Investments.
Founded in 1900, the Murugappa Group currently controls more than two dozen companies, including nine listed ones--Coromandel International, EID Parry (India), Shanthi Gears, Carborundum Universal, Tube Investments of India, Wendt (India), Cholamandalam Financial Holdings and Cholamandalam Investment & Finance Company among others.
In her statement, Arunachalam also questioned why a female heir with a doctorate degree, 24 years work experience in Fortune 500 multinational companies, and numerous patents and publications to her name, cannot be inducted to the board, even three years after her father’s death, despite being representative of the same shareholding whilst a 23-year old male heir with a master’s degree and no job-experience can be inducted to the board soon after his father’s passing.
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21 Comments on this Story
Salil Varma24 days ago
Take the family to court to seek justice. In business no one in the family or friends are to be trusted. Let her fight for her rights and win, gender bias is unacceptable in a modern society.
Rammohan Vengalathur30 days ago
A family member irrespective of the gender with an overseas stature and experience instead of being put into business furtherance and other advantages, are being seen wasted purely on gender bias and other ego factors. Also future litigations are going to result in wasteful legal expenses and heart burns on both sides and I am sure both side matured minds should use this opportunity to bury the hatchet and build family relationships as well as businesses furtherance.
Ramkie R30 days ago
Who know what has been instructed and paid to the other members by the external takeover team.. this need to be fought, eod its a matter of money your attorneys to spend in courts and other ways to reach to a settlement..But much to worry, what is it stopping a female into the board?? the courts need to be appraised on this