InvestorQ : Why have the shareholders of Eicher rejected the proposal to reappoint Siddharth *** as the MD of the company?
Lavanya Subramanian made post

Why have the shareholders of Eicher rejected the proposal to reappoint Siddharth *** as the MD of the company?

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Anamika Sodhani answered.
3 months ago
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Let me clarify that the resolution was for reappointment of Siddharth *** for 5 years as MD and also hike his salary by 10%. The shareholders did not have objections to the reappointment but they had problems with salary hike. In fact, 70% of the institutional investors voted against the resolution. As a result, the special resolution got only 73% of the votes as against 75% of the votes that is mandatorily required for such resolutions.

The whole issue was about a 10% hike in touch times when his pay package of Rs.21.2 crore was already the second highest in the industry after that of Rajiv Bajaj. The 10% pay hike would have taken Siddharth ***’s annual salary to above Rs.23.5 crore. This is at a time when most of the auto CEOs take home less than Rs.10 crore. The moral of the story is that the pay hike was not exactly discussed and communicated to the large investors.

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