The board of Eicher Motors Ltd. has reappointed Siddhartha Lal as the managing director for five years after revising his remuneration structure that was earlier rejected by shareholders.
The board unanimously decided to reappoint Lal as managing director, with effect from May 1, 2021, the parent of Royal Enfield maker said in its exchange filings on Monday. The primary concern with investors was not Lal's reappointment or the proposed compensation, but was the lack of clarity regarding the enabling provision that allowed payment of up to 3% of profits.
S Sandilya, chairman at Eicher Motors, said while over the last four years they have had the same limit of 3%, he was paid a fraction of that amount. “The actual remuneration during FY2021 was at 1.04% of profits, with the preceding years being at a lower percentage,” he said.
The board, the company said, has now approved a revised remuneration structure for Lal, capped at 1.5% of profit.
The board will again go back to the shareholders for approval through postal ballot. Specific details of the remuneration will be shared via the postal ballot, the company said.
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