Venu Srinivasan's reappointment faces shareholder voting challenges

Venu Srinivasan’s reappointment as managing director of TVS Motor Co. Ltd is uncertain. Proxy advisory firms have raised concerns about his dual roles as chairman emeritus and managing director, especially since both he and his son, Sudarshan Venu, hold the title of managing director. Three proxy advisory firms recommend that shareholders vote against Srinivasan’s reappointment due to potential conflicts. They argue that having both a non-executive role and an executive role may lead to governance issues. Institutional Investor Advisory Services (IiAS) and InGovern specifically mention the confusion created by the overlapping positions. Shareholders can vote on this issue from February 20 until March 21. To remain in his position, Srinivasan needs at least 75% of the votes in his favor. If the resolution fails, he could lose both roles. The proxy firms also highlighted the unclear hierarchy created by having two managing directors, suggesting it might affect the company’s decision-making process. TVS Motor’s spokesperson defended Srinivasan’s roles, claiming that each title has distinct responsibilities, and both leaders are crucial for the company’s growth. Market regulator Sebi has also encouraged companies to separate the roles of chairperson and managing director for better governance. Recently, the compliance requirement was made voluntary. TVS Motor is a significant player in the Indian two-wheeler market, with a market capitalization of 1.08 trillion. Its shares have performed well recently, gaining over 11% in the past year.