No impact on Murugappa group of gender bias allegation: Experts

By Venkatachari Jagannathan

Chennai, Jan 10 (SocialNews.XYZ) Experts in brand building and market analysts are unanimous in their view that the allegation of gender bias against the promoters of the Murugappa Group will not have any impact on its brands or stock prices in short or long term.

The Murugappa Group hit the headlines recently with the US-based Valli Arunachalam, the daughter of late M.V. Murugappan, alleging that the group promoters have a gender bias against women getting into family business and hence she and her sister were denied a board berth in Ambadi Investments Ltd after their father's death in 2017.

Ambadi Investments is the family holding company of the promoters of the Rs 37,000-crore industrial conglomerate Murugappa Group which finds itself in the middle of a gender bias controversy.

"I do believe there will be zero impact on Brand Murugappa Group. Consumers do not take cognizance of board level issues of this kind as yet in India," brand expert Harish Bijoor told IANS.

"These are seen as back-end boardroom battles that have no impact on the products and services the company offers and consumers partake," Bijoor, also the founder of Harish Bijoor Consults Inc, added.

Largely a manufacturer of products used by industries, the Murugappa Group companies also roll out the BSA brand cycles, the Parry brand sugar, and financial products like general insurance, home loans, among others.

"Nowadays investors dump the stocks of listed companies the moment they hear about any corporate governance issues. Institutional investors will take investment decisions based on corporate governance aspects," said Sunil Damania, Chief Investment Officer at research advisory company MojoMarkets Ltd.

He said all the nine listed companies of Murugappa group have female directors and there is no issue of breach of any rules or corporate governance issues.

"The markets have not reacted negatively in respect of Murugappa group's listed companies," Damania said.

"Going by Valli Arunachalam's media interviews, she is more interested in selling off the family's stake in the holding company and has used the gender bias issue as a bargaining chip," he added.

John Arokiasamy, perception strategist at Persona Leaders told IANS that "there are two aspects to the issue - legalese and the public perception - that are playing out for both the parties concerned".

"Unfortunately, when it comes to female gender diversity of corporate boards the Indian average is abysmally low in comparison to the western average which is even around 40 per cent, where some companies meet the critical mass capacity,", said Arokiasamy, who has handled corporate crisis scenarios in the past and is now a noted poll strategist.

According to him, the holding company of the Murugappa group family - Ambadi Investments - may have a temporary setback of being perceived as one lacking gender diversity or being biased towards females, despite the fact that it may not be a mandatory requirement in this case.

"Also, I don't think it would have any major adverse impact on the other brands of the group now or in the longer run," Arokiasamy added.

Meanwhile, the other members of the Murugappa family, including the group Executive Chairman M.M. Murugappan, are refusing to comment on the issue.

Queried about their "no comments" response to the allegations made by Arunachalam, a communications professional told IANS: "This tactic is employed when one party feels, his or her case is strong, complying with legal provisions and following the family tradition or practice."

Referring to Arunachalam's statement that her patience is running out, he said if the matter goes to court then the situation could change.

According to him, the Murugappa family may not allow the matter to end up in court.

Source: IANS