The curious case of LIC’s voting on Reliance, Adani board resolutions

In all, of the about 9,000 resolutions since the beginning of fiscal year 2023 (FY23), LIC voted in favour of over 92% of them and abstained from voting on another 6%.

- SATISH KUMAR/MINT

It rejected just under 2% of the resolutions.

The insurer owns more than 1% stake in over 300 companies as per a review of its voting disclosures.

LIC's voting record highlights a potential risk: inconsistent standards, as detailed in this story, an impact on how the insurer manages its ₹57.23 trillion ($645 billion) in assets under management as of September. The fiduciary duty it has to its crores of policy holders and investors whose money it invests in stocks, mutual funds, and government securities is detailed in its ‘stewardship code’.

Among other goals, the code states: “Stewardship aims to promote the long-term success of investee companies in such a way that the ultimate providers of capital also prosper. Effective stewardship benefits investee companies, investors and enhances the quality of capital markets.”

At least on one occasion, there was a violation of the guidelines laid out in LIC's voting policy document regarding discipline at its investee companies. This was on the approval of the fiscal 2025 standalone and consolidated accounts of Adani Enterprises and is detailed later in this story.

Queries sent to LIC on Thursday, 20 November, remained unanswered. RIL and Adani did not respond to emails seeking comment sent on Monday, 24 November.

Ambani reappointment

More than two years ago, in August 2023, LIC voted in favour of the reappointment of Mukesh Ambani as RIL’s managing director. Ambani is also the company’s chairperson.

But this March, LIC abstained from voting on Venu Srinivasan’s reappointment as chairman emeritus and managing director of TVS Motor Company, stating only that the abstention was “as per our internal guidelines’, without elaborating.