Zee denies Invesco allegations of corporate misgovernance

The broadcaster said five of the six independent directors had joined the board in the past two years, and Invesco was consulted before their appointment.

The Mumbai-based media conglomerate said Invesco’s actions and open letters over the past few weeks appear to be “motivated by concerns completely different from any corporate governance issue”.

“The Board notes that Invesco, in its open letter, has referred to the advisory letter issued by SEBI (Securities and Exchange Board of India) dated June 17, 2021. We note that the open letter refers to SEBI’s advisory letter as “extraordinary regulatory reprimand” but ignores the remaining comments in the letter leading to SEBI admitting that the company has taken corrective measures and the company The audit committee has been directed to place corrective measures,” Zee said in a disclosure to the exchanges.

Zee’s statement is partly true as the markets regulator, in its June 17 advisory note, said its investigation into the company’s affairs “revealed several irregularities” and “cautioned” the company to be “cautious in future”.

“It will be noted here that out of the six existing independent directors on the Board of the Company, five have been appointed following the investment of Invesco in 2019 and Invesco was consulted and their views were positively considered at the time of such appointments. it was done.” said.

Wednesday’s 11-page disclosure by Zee was the second day after the company disclosed a detailed note made by its managing director. Puneet Goenka on Tuesday.

On Monday, Invesco Developing Markets Equities Chief Investment Officer Justin Leverenz cited issues that forced a US fund manager to take a proactive approach for the first time in its history.

“Our initiative is driven by our belief that the promoter family of Zee, with the support of its current board of directors, continues to evade accountability to its common shareholders, who hold 96 per cent stake in Zee,” he said.

“Lack of governance oversight by the present board of Zee has allowed Zee to become deeply embroiled with the financial woes of its founding family, as identified in a SEBI letter dated 17 June 2021. In this extraordinary regulatory rebuke, SEBI has mentioned ‘large dues from the parties concerned’, ‘letters of comfort issued by the directors of the company without informing the board’, and concluded, among other comments, that ‘the actions of the company are in the best interest of the shareholders. I’m not,’ Leverenz said.

“These matters are in the public domain, and you, as shareholders, are as aware of them as we are. We note that on the eve of our EGM demand, the Indian stock market indices had more than doubled over the past five years, while Zee’s stock rallied by more than half in the same period. This is a sad report card.’ Besides the removal of Zee Managing Director and company founder Subhash Chandra’s son Puneet Goenka from the board, it urged shareholders to vote on the induction of six new independent directors.

Zee has rejected Invesco’s demands to hold a special shareholder meeting. Both Invesco and Zee are fighting before the National Company Law Tribunal and the Bombay High Court.

At press time, Invesco did not receive any response to email queries.