Chanda Kochhar had been re-appointed as the Director of ICICI Securities Board. She has been the director at the Board since October 2008 till her leave in June this year.
ICICI Securities stocks jumped to nearly 6% from the news of her appointment to the Board.
Voting pattern
ICICI Bank, which holds nearly 80% stake in the company, voted in her favor. According to the voting pattern shared 95.78% of the shareholders voted in her favor. Among the category of promoters and promoter groups, except 2.27% votes, the rest were in her favor.
ICICI Securities Board consists of four independent directors, two non-executive non-independent directors (nominated from ICICI Bank) and two are whole time directors.
Legal Allegations against Kochhar
ICICI Bank has been conducting an independent inquiry against Kochhar since her leave in June this year. The SEBI and CBI are investigating her on charges involving conflict of interest over loans given by the bank to Videocon group. Supposedly this group is considered to have business dealings with NuPower Renewables, a firm run by Deepak Kochhar.
Proxy firms
Proxy advisory firms produce detailed analysis and reports on the actions of vote in AGM(Annual General Meeting), EGM (Emergency General Meeting) thereby advising share holders on their votes.
Glass Lewis advised shareholders to vote against Kochhar. ‘There are significant legal and regulatory issues involving the company’s non-executive chair nominee Chanda Kochhar. We believe shareholders should be concerned about the matters facing Kochhar, which includes her being forced to take a leave of absence from the ICICI Bank board, pending the outcome of the investigation into her conduct’
IiAS advised share holders to vote against Kochhar. ‘Kochhar’s presence on the board of ICICI Securities, while legally compliant, exposes the company to the same risks and the possibility of legal and regulatory sanctions. We believe she should be reappointed on the board only after all the charges have been cleared’
SES advised share holders to vote for Kochhar. ‘Kochhar’s appointment is compliant with law and no concern has been identified in the profile, attendance, performance and time commitment of Kochhar.’