Shares of Raymond were gaining on Friday after the company’s independent directors made a key decision to safeguard company interests amid an ongoing marital dispute between the group’s CEO and his ex-wife.
What Happened: Amid the ongoing dispute between Raymond Chairman and Managing Director Gautam Singhania and ex-wife Nawaz Modi, the company’s independent directors (ID) have taken measures to ensure the dispute does not impact the company’s affairs, according to a statement.
The independent directors have appointed Berjis Desai, a senior independent legal counsel with no connections to the promoters or the company, to advise them during this challenging period.
In a stock exchange notification, the company stated that the independent directors are committed to maintaining the chairman and managing director’s capacity to manage the company despite the matrimonial disputes. While the independent directors recognised that corporate governance standards do not mandate an inquiry into such disputes, they assured stakeholders of dispassionate and vigilant actions to safeguard all interests.
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Why It Matters: The move comes in response to suggestions from Institutional Investor Advisory Services (IiAS), a proxy advisory firm, urging the independent directors to appoint an interim CEO and investigate allegations of assault by Singhania on his wife and daughter. IiAS also recommended asking Singhania and Modi to take a break from their board responsibilities. Modi, a board member, accused Singhania of physical assault and of misusing company funds for personal gain.
Singhania, in late November, assured employees and board members that the company’s operations remain unaffected, emphasising his commitment to its smooth functioning. Despite personal challenges, he reaffirmed his dedication to Raymond’s business, reassuring stakeholders of “business as usual.”
The independent directors’ decision to seek independent legal counsel underscores their commitment to impartiality and proactive measures to protect stakeholders’ interests in the evolving situation.
Price Action: Raymond’s share price was up 3% at ₹1,548.50 around noon on Friday.
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