Food delivery and quick commerce firm Swiggy on Wednesday issued a detailed clarification defending its proposed governance changes, days after shareholders voted against amendments to the company's Articles of Association tied to its Indian-Owned and Controlled Company (IOCC) ambitions.
In a regulatory filing, Swiggy sought to reassure investors that the proposed founder-linked board nomination rights were not directed at "concentration of power" and instead, reflect a transparent and accountable mechanism for achieving strategic objectives of the company and domestic board representation in a company without an identifiable promoter group.
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The clarification comes after the special resolution to amend the Articles of Association received 72.36 per cent shareholder approval -- below the 75 per cent threshold required for passage.
The company said the amendments were intended to create "continuity of domestic management oversight" in a company without an identifiable promoter group and were part of preparatory steps toward eventual IOCC classification under Indian foreign exchange regulations.
Swiggy specifically defended the proposed rights for co-founders Sriharsha Majety and Phani Kishan Addepalli, arguing the rights were conditional, limited, and subject to shareholder oversight.
According to the filing, Majety's proposed right was only to nominate one senior management executive from within the company to the board, while Addepalli's right would have existed only as long as he retained qualifying economic interest through employment, vested ESOPs, and shareholding.
Swiggy stressed that the amendments would not have granted veto powers, affirmative voting rights, permanent board seats, committee control, quorum rights, or majority board appointment powers.
The company also pushed back against criticism around ownership thresholds, saying Indian corporate and securities laws do not prescribe any minimum shareholding requirement for director nomination rights.
Swiggy said it will continue engaging with shareholders and evaluate future structural or strategic changes through "transparent and shareholder-aligned processes".
Under current FEMA rules, a company can qualify as Indian-owned and controlled only if both ownership and control rest with resident Indian citizens or eligible Indian entities, including through a board composition and nomination framework that supports domestic control over the board.
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