PTC India Financial Services sees three independent directors quit citing governance issues

Three independent directors on the board of PTC India Financial Services Ltd., tendered their resignations on Sunday, September 28, citing corporate governance issues at the company.

The three independent directors, Seema Bahuguna, Naveen Bhushan Gupta and PV Bharathi, who had joined the board in November 2022, cited issues in recent times at the company, which had made their working as independent directors "difficult."

In their letters, all three independent directors highlighted how, over the last three years, they worked to address the issues at the company, including corporate governance, by recruiting a new Managing Director, and also filled up posts lying vacant for many years at the board level as well as at the company level.

"We also addressed the long-pending issues pertaining to finance / audit, reviewed and approved the policies, helped set up a proper system for internal controls and facilitated devising of SOPs for most functions," a common point in all three letters highlighted.

Their letters further state that it is because of these steps taken that the company could be in compliance with other regulations and therefore improve its performance.

Seema Bahuguna, one of the independent directors who quit, highlighted in her letter that over the last few months, an environment was being created in the company, which made her functioning in an independent and impartial manner difficult.

The same was also expressed by Naveen Bhushan Gupta in his resignation letter.

"In this scenario, I am feeling constrained in upholding the highest standards of corporate governance expected of me as an Independent Director," PV Bharathi stated in her resignation.

However, none of the three independent directors have highlighted the factors that led to their resignation, other than the events, which they have not elaborated upon.

While Seema Bahuguna is also an independent director on the board of DCM Shriram, PV Bharathi is on the board of IDBI Bank in multiple roles, including being Chairperson of their risk management committee.

Recently, an independent director at KRBL quit citing multiple corporate governance issues, which the management went on to deny and appointed an external auditor to investigate the same.

Shares of PTC India Financial Services ended 3.2% lower on Friday at ₹35.33. The stock has declined over 7% in the last one month, taking its year-to-date loss to 20%.

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