Reliance Industries Ltd (RIL) has sought approval from its shareholders to extend Mukesh Ambani’s tenure as Chairman and Managing Director for another five years, until 2029. This move comes despite Ambani opting to draw no salary during this period, a decision he made in light of the COVID-19 pandemic’s impact on the economy and business.
Ambani, who has been on the board of Reliance since 1977, took over as chairman after his father and group patriarch Dhirubhai Ambani’s death in July 2002.
He will cross the company law-mandated age of 70 during his proposed term, necessitating a special resolution by the shareholders for his appointment beyond that age bar.
The resolution also states that Ambani will be entitled to reimbursement of expenses incurred for travelling, boarding, and lodging during business trips, including for his spouse and attendants. The company will also provide security for Ambani and his family members, with the expenses borne by the company not considered as perquisites.
In the special resolution posted to shareholders, Reliance said its Board of Directors on July 21, 2023 approved “re-appointed Mukesh D. Ambani as Managing Director, for a period of 5 years from the expiry of his present term, i.e. with effect from April 19, 2024.”
Ambani, it said, had capped his annual remuneration at Rs 15 crore from financial year 2008-09 (April 2008 to March 2009) to FY20; and since FY21, he opted to forego his salary, due to COVID-19 pandemic, until the company and all its businesses were fully back to their earnings potential.
Reliance said Ambani will attain the age of 70 years on April 19, 2027. “The company has grown multifold under his leadership and it would be in the interest of the company that he continues to lead the company even after he attains the age of 70 years. Accordingly, approval of the members (shareholders) is sought for passing the resolution proposed (to give him another 5-year term) as a Special Resolution.” Ambani, it said, satisfies all the conditions set out in company law and has not disqualified from being appointed as director.
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