Shareholders of Reliance Industries have approved the appointment of Saudi Aramco Chairman Yasir Al-Rumayyan on the company board, with less than 2 per cent of votes cast against the proposal.
Disclosing the results of shareholder votes on the appointment, Reliance in a regulatory filing said 98.03 per cent of votes were cast in favour of the resolution to appoint Al-Rumayyan for three years.
As many as 10.89 crore shares or 1.96 per cent voted against the resolution, while 3.23 crore votes were declared invalid due to lack of proper authorisation, it said.
The California State Teachers' Retirement System (CalSTRS), a shareholder of Reliance, had last month decided to vote against the move based on US proxy advisory research firm Glass Lewis' recommendation.
CalSTRS decided to oppose the appointment due to Al-Rumayyan's position in Saudi Arabia's Public Investment Fund (PIF) as its governor, as well as in Aramco.
PIF has already invested Rs 9,555 crore in Reliance Retail and Rs 11,367 crore in RIL's Jio Platforms.
Also, Aramco is in talks to buy a 20 per cent stake in Reliance's oil-to-chemical business.
Reliance had, however, rejected conflict of interest allegations saying, "The appointment of Yasir Al Rumayyan has no connection with the contemplated transaction with Saudi Aramco."
The O2C business of RIL is being spun off to a subsidiary.
"As per the terms of the proposed transaction, Saudi Aramco will participate in the equity of the O2C subsidiary.
"The O2C subsidiary board may have nominees of Saudi Aramco to protect its interest," it added.
As of June 30, 2020, CalSTRS held 5.3 million fully and partly paid shares of RIL, according to its website.
CalSTRS is America's second-largest public pension fund with assets totalling approximately $318.4 billion as of August 31, 2021.
CalSTRS's opposition was based on a report by Glass, Lewis & Co, an American proxy advisory services company.
According to Glass, Lewis & Co, since Al-Rumayyan has a key role in the operations of Aramco and PIF, he does not qualify to be an independent director.
Under Indian law, an independent director cannot have a role in any company that has a business or equity partnership with the firm that intends to appoint him or her.
Photograph: Shailesh Andrade/Reuters