Zee Entertainment Enterprises Ltd’s Punit Goenka on Thursday failed to secure shareholders’ approval to continue as director on the company’s board. However, he will continue as chief executive officer (CEO) of India’s largest media and entertainment conglomerate.
Goenka’s ouster marks an end to his nearly two-decade journey on the board of Zee since he was inducted in January 2005. Significantly, this implies that for the first time since Subhash Chandra founded the company in 1992, none of his family members remain on the board of any of the four listed Zee companies.
Goenka lost the vote by a slender margin—while 50.4% of shareholders rejected his candidature, 49.5% voted in favour.
The board of Zee had recommended Goenka as Zee director on 18 October; however, a month later, he stepped down as managing director, while offering to continue as CEO. Goenka said he wanted to focus entirely on his operational responsibilities. It may be noted that directorships need to be approved by shareholders, while the board is free to select the CEO.
Chandra, who owns 3.99% in Zee along with his family, is chairman-emeritus, but is not on the Zee board. None of the family members are on the boards of Zee Media Ltd and Zee Learn Ltd.
Shareholders’ decision
Shareholders of Dish TV India rejected the candidature of managing director Jawahar Goel, Chandra’s younger brother, for the board in 2022. Yes Bank Ltd blew the bugle for investor revolt at Dish TV in September 2021 when, unhappy over how the company was run, it demanded a board reconstitution, including appointing seven directors. Yes Bank had hoped to recover the money it had lent to Chandra by selling Dish TV to a new owner. Over the last three years, Dish TV has repeatedly rebuffed investor demands to call a special shareholder meeting, even as investors have removed 20 directors. In February 2023, the National Company Law Tribunal (NCLT) ordered insolvency proceedings against Zee Learn, after Yes Bank filed a petition over non-payment of dues.
On 27 November, Mint reported, citing people aware of the matter, that officials of Life Insurance Corp. of India (LIC) informed Zee executives at a shareholder outreach programme that they would not back another five-year term for Goenka as managing director.
At Zee’s annual general meeting earlier in the day, Goenka addressed shareholders’ concerns, outlining strategies for growth and updates on ongoing legal challenges. He reaffirmed the company’s commitment to navigating the evolving media landscape while creating long-term value for stakeholders. He outlined Zee’s goal of achieving 8-10% revenue growth and an 18-20% margin over the next three years. While television remains the largest contributor to both revenue and margin, he stated that digital and music businesses are poised for faster growth.
However, his candidature as director failed to secure sufficient votes, and Zee informed the stock exchanges of the outcome of voting late at night.
