One 97 Communications, which owns brand Paytm, proposes to cap the remuneration of its non-executive independent directors as part of efforts to save costs amid widening losses.
This fintech major’s independent board members will earn a maximum annual compensation of ₹ 48 lakh, with fixed component of ₹ 20 lakh, as long as the company remains in losses. The variable component will be linked to attendance at the meetings and Chairpersonship/Membership positions held in the various committee(s) of the Board, to ensure good governance. This payout structure will be in force for three years beginning April 1, 2024.
The company has come up with a new remuneration framework for such directors and this will be put to shareholders vote for approval (via ordinary resolution) at the upcoming Annual General Meeting (AGM) on September 12.
Previously, the annual salaries of Non-Executive Independent Directors of Paytm’s board members were as high as ₹2 crore per annum.
The remuneration for Ashit Ranjit Lilani was previously set at ₹1.65 crore, while that of Gopalasamudram Srinivasaraghavan Sundararajan was set at ₹2.07 crore.
According to the company’s exchange filing, the new remuneration structure is based on the benchmarking done by the company, keeping in mind good governance practices, and companies in similar sectors or types of business with similar market capitalisation.
This decision also reflects the board members’ commitment towards ensuring that the company remains financially prudent, as it works towards its intended path of profitability.
Paytm is also seeking shareholder approval on the appointment of former Indian Revenue Services officer, Rajeev Krishnamuralilal Agarwal, to its Board.
The company is also seeking shareholder approval on the reappointment of Ravi Chandra Adusumalli, Founder and Co-Managing Partner of Elevation Capital to its board of directors, who is set to retire by rotation. Elevation Capital was one of the initial backers of Paytm.