PFS Chairman did not act in shareholder interest: SEBI
India (SEBI), has found government-owned PTC India’s financial arm PTC India Financial Services Chairman Rajib Mishra and MD and CEO Pawan Singh responsible for corporate governance lapses in its initial probe. As per SEBI notice, the MD and CEO (Pawan Singh) being in the executive position and in control of the daily affairs of the company, along with the Chairman (Rajib Mishra), are found to be at the steering wheel in PFS, and therefore, responsible for corporate governance failure.
The SEBI’s investigation followed allegations leveled by the three independent directors of PFS in January 2022.
The Directors, Kamlesh Vikamsey, Santosh Nayar, and Thomas Mathew resigned en masse citing serious governance lapses accusing the Chairman and MD and CEO of running the company affairs single-handedly including ‘changing the composition’ of the Board Committees and ‘tweaking the terms and conditions’ of the loans without the prior approval from the Board.
The SEBI observed multiple e-mail requests made by the three independent directors between November and December 2021 to the PFS chairman and MD/ CEO relating to the appointment of one independent woman director, the constitution of the Nomination and Remuneration Committee, or these directors seeking legal help, were “blatantly ignored.”
As per SEBI, PFS Chairman should have ensured that the composition or the constitution of the committees is not vitiated, however, it found “no heed” was given by him even on multiple requests by the directors. Such dismissive and failure to act on the issues raised by the independent directors highlights PFS chairman “did not discharge his responsibility effectively,”.
