MUMBAI: Proceeding with protocol, ICICI Bank on Thursday voted in favour of its MD & CEO Chanda Kochhar’s re-appointment to the board of ICICI Securities.
Kochhar is currently on an imposed leave pending the outcome of an independent probe, and cannot attend board meetings. She, however, offered herself for re-election. Sources said ICICI Bank, which holds nearly 80 per cent stake in the broking arm, was bound by protocol to pass the resolution and re-appoint Kochhar as a director on the board of ICICI Securities during Thursday’s AGM.
“Not voting in favour will send signals that allegations about Kochhar aren’t entirely baseless. The board has done what was expected of it (passing the resolution),” said ICICI Bank shareholder and whistleblower Arvind Gupta. He added that since the outcome of the independent probe was pending, the board couldn’t have left the directorship vacant.
Kochhar’s re-appointment needed a simple majority and though some minority shareholders and proxy advisory firms opposed the move, it did not pass muster as it was an ordinary resolution. “ICICI Bank should’ve avoided the situation (preventing Kochhar from offering herself for re-appointment). The board is sending mixed signals to investors by passing the resolution,” Shriram Subramanian, founder, InGovern Research Service, told TNIE.
He added that because Kochhar is on leave, and cannot attend board meetings, the purpose of her re-election is defeated. “The bank should have ideally clarified on the pending probe and when its outcome is expected,” he said. In all, there are eight members on the board of ICICI Securities including four independent directors, two non-executive non-independent directors nominated from ICICI Bank and two whole-time directors.
Multi-agency probe in progress
Kochhar, who has been on leave since July 19, is facing investigation from multiple agencies for alleged impropriety on her part extending loans to some firms including Videocon Group, in return for reciprocal benefits. Earlier, ICICI Bank had dismissed these allegations but later the private lender initiated an independent probe into the allegations of conflict of interest. Her current stint at ICICI Bank expires next March