Arunachalam, a technology consultant by profession, was among the inheritors of the family patriarch’s shareholding of 8.15 per cent, along with her mother,
M V Valli Murugappan, and sister. Arunachalam’s contention is that after her father’s passing away, she had discussed two options on inheritance with the current management of the company and her uncle, M V Subbiah, who is now the senior-most in the family.
The first option was allowing her a seat on the board of Murugappa Group’s investment company. The second was to exit the group by selling her stake to other family members at fair market value. But, according to her, the group hasn’t accepted either of the options. “Right now, despite being one of the largest shareholders in the (investment) company, we have zero visibility of the company’s operations. Requests for meetings since August last year have fallen on deaf ears,” she said.
Arunachalam said she was flexible about different ways the sale of her stake could have been executed. “There are always innovative ways to do a deal like this and we never said we need to be paid the full amount at one go. But we don’t see any intent (on their part) at this stage,” she said.
Arunachalam said the situation would perhaps have been different had she not been a woman.
“In this lone battle for equal rights for women in the boardroom, I hope this will have some impact in making the journey easier for other women who are treated unfairly and not given the opportunities they deserve.”
She said the group’s interests were owned by the shareholding company of the group called Ambadi Investments, a private firm which has no women representative. Moreover, unlike women members of the family, Murugappa male heirs have always had an early induction into businesses, she said.
Arunachalam said she tried her best to ensure her father's wish that all asset distribution should be handled amicably was fulfilled. But two years later, she said, it appeared she was running out of all options that would have made him happy. Her father had supported the family, helped other family members in many ways, and was a pillar of support for everybody, but strangely none of that was being reciprocated after he passed away, she said.
Emails and messages to M V Subbiah and M A Alagappan were not answered. Murugappa Group
executives declined to comment as the matter pertained to “family and the family investment company”. Subbiah is the current patriarch of the group and a former executive chairman. Alagappan is the former executive chairman of the group, and stepped down in 2009.
Amit Tandon, managing director of Institutional Investor Advisory Services (IiAS), said for any large business house with multiple promoters involved, changing the management ethos in operation for a few generations was not easy. However, the family constitution ought to be reviewed periodically in order to factor in the changing dynamics and corporate shifts, he added. "The important thing is that it needs to be done by consensus," Tandon said. "One of the biggest changes in corporations and business houses in the last decade is that women have become far more hands-on than before.”
Like many successful family business groups, Murugappa Group
has separated its ownership role from its operational management to be future ready. This meant roping in professional managers as well as non-family directors on the board.
Although many of its firms are in low margin, old economy verticals, there has been continued focus on investing in new areas and expanding existing businesses. In 2018, the company announced that it would invest Rs 2,000 crore in a gas plant in Russia.