Forced by minority shareholders to reconsider the re-appointment of Neeraj Kanwar as managing director, Apollo Tyres said on Wednesday the board would back the re-appointment while seeking an independent assessment on the compensation.
Minority shareholders had defeated a special resolution to extend Kanwar’s tenure beyond 2019, ostensibly unhappy with the very high compensation package, estimated by proxy advisory firm IIAS at around Rs 65 crore. The company said the board will now seek shareholder guidance and independent opinion on Kanwar’s compensation. Kanwar is son of Onkar Singh Kanwar chairman and managing director. What has upset shareholders is that the increases in the remuneration have been steep at a time when the company has not been doing well. In 2017-18, for instance, when the company’s profits fell 34 per cent to Rs 724 crore, Neeraj Kanwar took home Rs 44.6 crore, a 45 per cent increase over the remuneration earned in 2016-17.
As IIAS has pointed out the ratio of this remuneration to the median employee salary at the firm was 940 times. Father and son together made Rs 94.2 crore, which was 13.1 per cent of the net profits. Neeraj Kanwar’s remuneration has risen sharply since 2013-14, when he got Rs 14 crore. —FE