Mukesh Ambani has been on the board of Reliance since 1977.
Indian billionaire businessman Mukesh Ambani's Reliance Industries Ltd (RIL) has sought shareholders' approval to give him another five-year term as chairman and managing director of the company till 2029. During this period, he has opted to draw nil salary.
Reliance is India's most valuable company with a market capitalisation of Rs 16,98,000 crore as of August 4, 2023. The share price of the company was Rs 2,508 on August 5. The 68-year-old Ambani will cross the company law-mandated 70 years age for the chief executive of the company. It requires a special resolution by the shareholders for him to be appointed beyond that age bar.
In a special resolution, Reliance sought the nod of shareholders to appoint Ambani as the head of the company till April 2029. Ambani has been on the board of Reliance since 1977 and was elevated as chairman of the company after the death of his father and group patriarch Dhiburhai Ambani in July 2002.
In the special resolution posted to shareholders, Reliance said its Board of Directors on July 21, 2023 approved "re-appointed Mukesh D. Ambani as Managing Director, for a period of 5 years from the expiry of his present term, i.e. with effect from April 19, 2024."
Ambani, it said, had capped his annual remuneration at Rs 15 crore from financial year 2008-09 (April 2008 to March 2009) to FY20; and since FY21, he opted to forego his salary, due to COVID-19 pandemic, until the company and all its businesses were fully back to their earnings potential.
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Accordingly, he has not been paid any salary and profit-based commission for three years in a row beginning FY21. At the request of Ambani, "the Board has recommended that no salary or profit-based commission be paid to him for the proposed term from April 19, 2024 till April 18, 2029," the resolution said.
"He shall, however, be entitled to reimbursement of expenses incurred for travelling, boarding and lodging including for spouse and attendant(s) during business trips and provision of car(s) for use on company's business and communication expenses at residence shall be reimbursed at actuals and not considered as perquisites," the special resolution said.
In its latest annual report, Reliance said Ambani's remuneration for the financial year 2022-23 was "nil". In June 2020, he voluntarily decided to forego his salary for the year 2020-21, in light of the COVID-19 outbreak in India, which exacted a huge toll on the societal, economic and industrial health of the nation. He continued to forgo his salary in 2021-22 as well and now in 2022-23.
In these three years, Ambani did not avail of any allowances, perquisites, retiral benefits, commission or stock options from Reliance for his role as the Chairman and Managing Director. Prior to that, the Chairman and Managing Director had his salary capped at Rs 15 crore since 2008-09 in order to set a personal example of moderation in managerial compensation levels.
The Rs 15-crore salary in 2019-20 was the same as in the previous 11 years. Ambani has kept salary, perquisites, allowances and commission together at Rs 15 crore since 2008-09, forgoing over Rs 24 crore per annum.
(With inputs from PTI)
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