“A vote against this resolution is warranted as Anant Ambani’s limited leadership/governance experience of about six years raises concerns about his potential contribution to governance,” ISS said in an Oct. 12 note, which it shared with Bloomberg. It has supported the board appointments of its twin older siblings, Isha and Akash Ambani – both 31 – in the shareholder vote that ends on October 26. Anant is 28 years old.
ISS’s objections reflect the recommendations of its Mumbai headquarters Advisory services for institutional investors, or IIAS, which said in an October 9 report that “at the age of 28,” the appointment of the young Ambani scion “is not in line with our voting guidelines.” IIAS has supported the proposals to elect Isha and Akash.
Reliance did not respond to Bloomberg’s questions, but told the proxy firms that Anant “has the relevant experience and maturity to add value to the board’s deliberations,” given his participation in the conglomerate’s operations and grooming he has received from senior management over the years. Both ISS and IIAS added Reliance’s response to their reports.
Another international proxy firm, Glass Lewis, is in favor of Anant’s appointment. “We do not differentiate Anant Ambani from the other siblings based on experience,” Decky Windarto, Glass Lewis’s director of Asia-Pacific Research, said in an emailed response. “We noticed that the other two directors up for election are only three years older than Anant, and have similar professional experiences.”
While the introduction of Anant and his siblings as non-executive, non-independent directors is crucial to the succession plan announced by Asia’s richest person, the counterpoints from proxy opinions show that Ambani and the leaders of the “ next generation” with a $190 billion group will continue to capture the attention of corporate governance observers.
Evolving expectations
The ISS and IIAS recommendations also point to investors’ changing expectations of a conglomerate that includes Google and Meta Platforms Inc. is now one of the major investors in its consumer activities.
Reliance’s founders own more than 41% of the company’s shares, making them the largest voting share. The three resolutions require a majority of votes cast to be adopted. Foreign and local institutions, which often vote based on the recommendations of proxy firms, own nearly 40% of Reliance. Their position will be known after the vote has closed.
Succession is a crucial issue for the billionaire. Ambaniwho was appointed to the Reliance board in 1977 at the age of 20, faced a bitter brotherly feud after his father died without a will in 2002.
From the perspective of Reliance investors, the leadership transition is critical as the fossil fuel giant transforms into a consumer and technology titan with huge green energy ambitions. Ambani told shareholders in August that he plans to run the company for five years while he prepares his children.
Akash has been with Reliance Jio Infocomm Ltd since 2014. and is currently chairman, the company told shareholders. Isha has driven the expansion of the retail business as Executive Director of Reliance Retail Ventures Ltd. Both have given presentations to shareholders at the flagship’s annual shareholder meeting in recent years.
Anant, who is said to be driving the expansion of energy and materials companies, especially green energy, is yet to formally address shareholders. Anant has been a member of Reliance’s executive committee, sits on the boards of two green energy subsidiaries and “has been part of the decision-making for its major strategic investments and partnerships,” according to the company’s response in the ISS report.
