NEW DELHI: The going may get tougher for the male-only board of the Murugappa Group as one of the female heirs — Valli Arunachalam — hinted at exploring the legal route after she was denied a board seat in the holding company.
At the Annual General Meeting (AGM), the board members of Ambadi Investments (AIL) — the holding company of the Rs.38,100 crore Chennai-based Group — rejected the appointment of the eldest daughter of former executive chairman M V Murugappan on its board as more than 90 per cent of the shareholders voted against the resolution.
Arunachalam, who has been waging a lone battle to unseat alleged gender bias in the century-old company’s board for over a year now, said that the female heirs “will not shy away this time” from taking the ultimate step of dragging the matter to the court.
“I am shocked at the manner in which the Family, which is the majority shareholder, in this case, has conducted itself. It is evident that the family cannot tolerate women in their boardrooms, and they have showcased their considered view in this regard. It is very unfortunate that the AIL shareholders, are not able to understand what contributions women can make on the board. It was always our wish that the family issues remain within and are settled at the family level, but clearly it seems the family is more concerned about protecting its draconian perspectives and practices, even if it means forcing us to take the battle to courts. We will not shy away this time,” she said in an email response on Tuesday.
The promoter shareholding in AIL is collectively owned by seven branches of the Murugappa family. According to Arunachalam, the other six branches of the family are represented on the board and she is seeking a seat to represent her family by virtue of its stake in the holding company.
Along with her sister Vellachi Murugappan and mother MV Valli Murugappan, she holds an 8.15 per cent stake in AIL, which entitles them at least one board seat. Alternatively, attempts to sale the entire stake at a “fair price” so that they can exit the company also did not elicit a positive response, she added.
"It is clear indication that gender bias exists at the highest levels of the Murugappa group. I have been asking for a board seat, pending the settlement, to make sure our rights are preserved as a promoter and major shareholder. The question remains as to why a female heir with a doctorate degree, 24 years work experience in fortune 500 multinational companies, and numerous patents and publications to her name, cannot be inducted to the board, even three years after her father’s death, despite being representative of the same shareholding, whilst a 23-year-old male heir with a master’s degree and no job experience can be inducted to the board soon after his father’s passing" said Arunachalam, the karta of the MVM Hindu Undivided Family. Under the Hindu Succession (Amendment) Act of 2005, women could become the head of the family (Karta) and daughters became coparceners, allowing them to inherit as much as sons.