Anant Ambani Faces Pushback On Board Seat

By Consultants Review Team Tuesday, 17 October 2023

An international proxy advisory firm, Institutional Shareholder Services Inc., has advised shareholders to vote against the proposal to appoint billionaire Mukesh Ambani's youngest son, Anant Ambani, to the board of the family-controlled Reliance Industries Ltd., highlighting concerns about succession planning at India's largest company by market value.  

"A vote against this resolution is warranted because Anant Ambani's limited leadership/board experience of around six years raises concerns about his potential contribution to the board," ISS stated in a note shared with Bloomberg on Oct. 12. It has supported the board appointments of his elder siblings, Isha and Akash Ambani, in the shareholder vote, which ends on October 26. 

ISS's concerns echo those of Mumbai-based Institutional Investor Advisory Services, or IIAS, which stated in an Oct. 9 report that "at 28 years of age," the appointment of the young Ambani scion "does not align with our voting guidelines." The IIAS has backed the proposals to elect Isha and Akash.

Reliance did not answer Bloomberg's questions, but informed the proxy firms that Anant has "the relevant experience and maturity to add value to the board deliberations" because of his involvement in the conglomerate's businesses and the training he has gotten from senior leadership over the years. Both the ISS and the IIAS included Reliance's response in their findings. 

Another international proxy firm, Glass Lewis, is in favor of Anant’s appointment. “We do not single out Anant Ambani from the other siblings based on experience,” Decky Windarto, Glass Lewis’s director of Asia-Pacific Research, said in an emailed response. “We noted that the other two directors up for election are just three years older than Anant, with similar professional experiences.” While the induction of Anant and his elder, twin siblings as non-executive, non-independent directors, is critical to the succession plan announced by Asia’s richest person, the counterpoints from proxy advisories show that Ambani and the “next-generation” leaders at $190 billion group will continue to be in focus for corporate governance watchers.

The leadership transfer is vital, according to Reliance investors, as the fossil fuel juggernaut morphs into a consumer and technology titan with big green energy ambitions. Ambani told shareholders in August that he plans to lead the company for the next five years as he raises his children.According to the corporate notification to shareholders, Akash, 31, has been working at Reliance Jio Infocomm Ltd. since 2014 and is currently its chairman. As an executive director of Reliance Retail Ventures Ltd, Isha, also 31, has been leading the retail business's expansion. In recent years, both have made presentations to shareholders at the flagship's annual shareholder meeting. 

Anant, who is thought to be spearheading the expansion of energy and materials sectors, particularly green energy, has yet to address shareholders formally. According to the business response included in the ISS report, Anant has been a member of Reliance's executive committee, is on the boards of two green energy subsidiaries, and "has been part of the decision making for the large strategic investments and partnerships."


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