Sanofi Not Complying with Listing Norms: Advisory Firm
Mumbai: Proxy advisory fir m S t a ke h o l d e r s Empower ment Services (SES) said Sanofi India has not been complying with the listing re gulations as well as Companies Act since October 21, 2015 after it had appointed L Guerin, N Rajaram and A Sood as whole-time directors and designated them as executive directors.
The company has called an annual general meeting on Friday when it will seek approval from the shareholders to appoint these three directors. SES is of the opinion that such a practice is not good governance, and hence recommends that shareholders vote against the resolutions.
“Appointment of these three ex- ecutive directors of the company as alternate directors is against the spirit of the Section 161 of the Companies Act, 2013 which provides that a director cannot hold two positions of directors of the company,” SES said in a note.
In response to an ET query, a Sanofi India spokesperson said that under the Companies Act, the board of directors is permitted to appoint an alternate for a director during his absence from India for not less than three months. “These three were not appointed first as whole-time directors and subsequently as alternates to non-executive directors. The strength of the board continues to be nine with three alternates”.
The company said it has been advised that it is in compliance with the provisions of the Companies Act.
SES has raised concerns about the “strong affinity” between outgoing chairman Vijay Mallya and two independent directors A Nedungadi and S Gupte, who have occupied positions in the former liquor baron’s group companies.
“SES is of the opinion that such close association casts a doubt on independence of A Nedungadi & S Gupte,” the note said.
Sanofi said Gupte and Nedungadi were elected as independent directors by the shareholders of the company through a postal ballot for a term of five years each from March 31, 2015. “They represent the SIL Board in their independent capacity and not because of any association with Dr. Mallya,” said company spokesperson.