KRBL orders third-party review after director's exit over governance issues

KRBL Ltd, a major basmati rice producer and owner of the India Gate brand, on Monday said its board has ordered an independent review following the resignation of independent director Anil Kumar Chaudhary, who raised multiple corporate governance concerns.

In a filing to stock exchanges, the company said separate meetings of independent directors and the board were convened on Monday to discuss the observations made by Chaudhary in his resignation letter dated September 8.

Chaudhary stepped down with immediate effect on September 8, saying he could no longer contribute meaningfully to the board due to what he called a culture where "dissent is suppressed or sidelined."  In his resignation letter, the independent director detailed concerns, including inconsistencies in board meeting minutes, information being withheld from directors, unjustified write-offs of export receivables, misuse of CSR funds, arbitrary pay decisions, major changes to company objectives made without proper discussion.

 

The board convened emergency meetings on Monday to address the allegations.

KRBL said it would hire a third-party firm to review the issues within 30 days, with board committees to make recommendations based on the findings.

"We continue to conduct the business with utmost transparency and integrity and would keep the stock exchanges informed about any further update," KRBL said in a stock exchange filing.

The company said it has systems and processes in place commensurate with its operations size to ensure financial impact or non-compliances are highlighted to the board with full disclosures to stock exchanges as required.