ESOP Policy and Compensation Committee Governance in Pune

Pune's product economy runs on stock options. Hinjewadi SEZ engineering teams, Magarpatta and Kharadi SaaS firms, and the Baner-Balewadi venture cohort all use ESOPs to hold senior talent against Bangalore and Hyderabad salaries. The grant decisions, though, usually live in a founder's head rather than in a board organ, which is exactly what a Series B diligence team flags first.

This engagement closes that gap. Patron Accounting constitutes your Section 178 Nomination and Remuneration Committee, drafts the ESOP and remuneration policy, writes the committee charter, and maps decision rights across the board, the committee and management. The output is a governance trail an investor or a future merchant banker can audit, not a set of ad-hoc approvals.

Geography matters here only because it shapes the work. A Hinjewadi services firm with 300 option-holders, a Viman Nagar seed startup with its first 20 grants, and a Chakan MIDC unit converting key engineers to equity each need the same Section 178 organ, but a very different policy sitting underneath it. We build the committee, the charter and the policy to fit the company in front of us, not a template.

Pune companies file with the Registrar of Companies, Pune, under the Western Region, the same RoC that registers most Maharashtra entities outside the Mumbai metropolitan jurisdiction. That is where your committee resolutions, the remuneration policy and the MGT-7 board-committee disclosures surface, so the governance framework has to be drafted with Pune RoC filing in mind from day one.

The local picture is cluster-driven. Hinjewadi (Rajiv Gandhi Infotech Park) and the Magarpatta-Kharadi belt are full of mid-stage SaaS and engineering-services firms where ESOP pools have grown to 8 to 12 percent and grants now run into the hundreds, well past the point where a single founder should be approving them alone. Viman Nagar and Baner-Balewadi host younger, venture-funded startups setting up their first independent board seats. In both cases an investor's term sheet typically asks for a constituted Nomination and Remuneration Committee and a written ESOP policy as a closing condition.

A typical Pune scenario: a Hinjewadi SaaS company at Series A wants to refresh its ESOP pool and onboard an independent director ahead of Series B. We constitute the committee around that new director, draft the charter and ESOP policy, and route the pool top-up through a committee recommendation so the cap-table change has a clean board trail. The same framework then governs every future grant, vesting waiver and exit decision.

Across Pune's IT-services belt and the MIDC-Chakan manufacturing cluster, two kinds of company reach for this governance layer: those legally required to constitute an NRC, and those that have simply outgrown founder-led equity decisions.

• Hinjewadi and Viman Nagar SaaS firms heading into a Series B, where the term sheet expects a board committee to own ESOP grants.
• Listed public companies, which must constitute an NRC under Section 178 and SEBI LODR.
• Public companies that have crossed the paid-up capital, turnover or borrowings thresholds.
• Chakan and Talegaon manufacturers professionalising the board before a strategic investor or a listing.

Statutory anchor: under Section 178, every listed public company and prescribed public companies, those with paid-up capital of Rs 10 crore or more, turnover of Rs 100 crore or more, or aggregate loans, debentures and deposits exceeding Rs 50 crore, must constitute an NRC of three or more non-executive directors, at least half of them independent.

To frame the committee and policy for a Pune company, we start by reading where equity decisions currently sit. A Baner SaaS team and a Chakan MIDC manufacturer hand over very different starting points, so the pack we ask for stays the same but tells us how much we are building from scratch:

• The board roster as filed with RoC Pune, with director independence noted against each name.
• Articles of Association, together with the board resolutions that currently authorise grants.
• The live ESOP scheme document and any remuneration policy draft already in circulation.
• The cap table and grant history we will use to draw the decision-rights map.
• Any earlier committee charter or governance note the company has on file.
• Investor term-sheet conditions or SEBI LODR Regulation 19 expectations, where a listing is in view.

The governance gaps we see across Pune cut along the same lines whether the company writes code in Magarpatta or builds components in Chakan. Here is what tends to surface in a board review, what it costs the company, and how we close it.

All fees and charges listed are indicative only and do not constitute a binding offer. Final amounts may vary depending on the volume of work and the complexity involved.

Professional service charges for drafting, filing, and representation are separate from the statutory fees. The exact fee depends on the complexity of the case, disputed amount, and number of hearings required. Contact us for a detailed quote.

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Patron Accounting LLP is a CA and CS firm with 15+ years advising boards on committee constitution, charters and corporate governance.

With offices in Pune, Mumbai, Delhi and Gurugram, Patron Accounting serves businesses across India, both in-person and remotely.

A Pune SaaS company eyeing a future listing has to bridge two rule sets: the Companies Act baseline its private board already follows, and the stricter SEBI LODR norms it will inherit on the way to the exchange. The table below sets the two side by side so a Hinjewadi or Magarpatta board can see exactly what tightens.

For Pune companies, governance filings route through RoC Pune, but the substantive rules sit in central law. Governing provision: Section 178 of the Companies Act 2013 requires every listed public company and prescribed public companies to constitute a Nomination and Remuneration Committee of three or more non-executive directors, at least one-half independent.

Applicability: the prescribed thresholds are paid-up capital of Rs 10 crore or more, turnover of Rs 100 crore or more, or aggregate loans, debentures and deposits exceeding Rs 50 crore. Private companies are not mandated, and Section 8 and specified IFSC public companies are exempt.

Listed entities: SEBI LODR Regulation 19 requires all directors of the committee to be non-executive, at least half independent, and the committee to be chaired by an independent director.

Penalty: under Section 178(8), contravention makes the company liable to a penalty of Rs 5 lakh and every officer in default to Rs 1 lakh.

Authoritative sources: the Ministry of Corporate Affairs (Section 178, committees), the Companies Act and Rules, SEBI (LODR Regulation 19), and the ICSI (secretarial standards, governance).

Governance gaps surface fastest in due diligence, when an investor asks who approved a grant and there is no committee or policy to point to. Constitute the committee and write the policy before the round, not during it, so equity decisions already carry a clean board trail.

ESOP governance is what turns equity from an informal founder decision into a board-owned, defensible process.

Patron Accounting LLP, a CA and CS firm with 15+ years of governance experience, constitutes your Section 178 committee, drafts the charter and ESOP policy, and maps decision rights, so your equity decisions are made and recorded the way investors and regulators expect.

Start with the national ESOP Policy and Compensation Committee Governance service, then explore complementary ESOP services across India.

• ESOP Policy and Compensation Committee Governance in India - the national parent service
• ESOP Services Hub - the full ESOP advisory hub - route by stage, scenario or tax
• ESOP Scheme Design - design the option pool, vesting schedule and leaver terms
• ESOP Valuation Services - Rule 11UA fair-market-value reports for grants and exercises
• ESOP Corporate Filings - MGT-14, PAS-3 and Form SH-6 register filings
• ESOP Perquisite Tax (Sec 17(2)(vi)) - perquisite tax and TDS computation at exercise

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