UGRO Capital has dismissed concerns raised by proxy advisory firm IiAS over the re-appointment and salary compensation of its Managing Director Shachindra Nath. In a regulatory filing to stock exchanges, the company stated that the proposed compensation is at or below market median, as independently confirmed by Aon — one of the world's foremost compensation advisory firms. The benchmarking process was commissioned by the company's 100% independent Nomination and Remuneration Committee in April, comparing Nath's proposed remuneration against three peer groups: promoter MDs, founder MDs, and MDs of NBFCs managing assets above ₹15,000 crore.
UGRO alleged that proxy advisory firms have routinely advised 'against' the appointment of managing directors of comparable NBFCs, where compensation was similar or higher. The company stated that in each case, shareholders rejected the advisory recommendation and the respective individuals continue in their roles today. The proposed package involves zero increase in Nath's existing fixed compensation of ₹7 crore, with the company highlighting significant restrictions on his compensation structure due to promoter classification under SEBI regulations. As per Sumit Agrawal, Senior Partner at Regstreet Law Advisors and a former SEBI officer, "Merely using share price as a reference metric for determining variable pay does not, by itself, bring the arrangement within the ambit of the SEBI SBEB regulation."
On the issue of variable pay raised by IiAS, UGRO clarified that the variable pay resolution before shareholders is an enabling authority only. The company emphasized that no variable pay can be paid until shareholders pass a separate Special Resolution by a 75 per cent super majority. Even then, the NRC — comprising only independent directors — will design all parameters, including performance metrics, cap, and clawback provisions. The proxy advisory report's most pressing concern was the proposed share price-linked variable pay component, which the firm characterized as akin to cash-settled Stock Appreciation Rights (SARs) prohibited for promoters under SEBI's share-based employee benefits regulations. However, UGRO emphasized that share price appreciation is one of the proposed criteria — not the sole criterion for variable pay determination.
Satyananda Mishra, IAS (Retd.), Independent Chairman of UGRO Capital's Board, emphasized Nath's significant contributions to the company's growth. During March and April 2026, Nath's promoter entity, Poshika Financial Ecosystem Private Ltd, raised a stake in the company via share purchase from the open market. Poshika acquired 18,54,374 equity shares at prevailing market prices between ₹107.65 and ₹110.94 per share, investing approximately ₹20 crore of personal capital and increasing the cumulative promoter holding to 2.88 per cent of the company's total diluted share capital. Nath has voluntarily guaranteed ₹1,830 crore of the company's borrowings — without a single rupee of commission or fee — while building an institution that employs 2,500 professionals and serves 2,50,000 MSMEs across India.
