Paytm has proposed to cut remuneration for board members, cap the annual compensation at Rs 48 lakh with a fixed component of Rs 20 lakh. The decision has come ahead of its annual general meeting scheduled on September 12. The new proposed remuneration framework will be subject to shareholder approval.
Previously, the annual salaries of non-executive independent directors of Paytm’s board members, including Ashit Ranjit Lilani was set at Rs 1.65 crore, while that of Gopalasamudram Srinivasaraghavan Sundararajan was set at Rs 2.07 crore. With the revised structure, the annual compensation of each non-executive independent director will be capped at Rs 48 lakh, with a fixed component of Rs 20 lakh.
The variable component will be linked to attendance at the meetings and chairpersonship/membership positions held in the various committee(s) of the board, to ensure good governance. The revised remuneration structure will be in effect from April 1, 2024.
According to the company’s exchange filing, the new remuneration structure is based on the benchmarking done by the company, keeping in mind good governance practices and companies in similar sectors or types of business with similar market capitalisation.
Meanwhile, in a message to shareholders, Vijay Shekhar Sharma, founder and CEO, said the company is now refocused on path to deliver a long-term, sustainable and profitable business model.
“There are times when actions speak louder than words and results speak louder than plans. After resolving many of the challenges that we faced, we are now refocused on our path to deliver a long-term, sustainable and profitable business model,” said Sharma. “In the last quarter, we encountered regulatory action on our associate entity Paytm Payments Bank Limited, which presented significant challenges and provided us with many valuable lessons,” he said.
The RBI had barred Paytm Payments Bank from onboarding of new customers in January this year. Sharma said that the company is striving to become a consistently free cash generating entity. “For me personally, this year has been centered on our core business, instilling a compliance-first approach in every team member, and striving to become a consistently free cash generating company,” said Sharma.
He added that the focus on financial inclusion and digitising the informal economy will bring long-term benefits to both the company and the country. Paytm will not only leverage AI-led cost savings but also build AI-first products that can help small merchants and micro-businesses harness the power of technology previously available only to large enterprises.
With the new appointments, Paytm continues to bring industry leaders and seasoned veterans to its Board.
The company is also seeking shareholder approval on reappointment of Ravi Chandra Adusumalli, Founder and co-Managing Partner of Elevation Capital to its board of directors, who is set to retire by rotation. Elevation Capital was one of the initial backers of Paytm.