Even as Zomato’s stock is getting battered at the stock markets, its CEO has given away a chunk of it towards the upliftment of its delivery partners.
Zomato CEO Deepinder Goyal will be donating ESOP (Employee Stock Option) proceeds worth nearly Rs. 700 crore to the Zomato Future Foundation. Zomato Future Foundation will use the amount for the upliftment of Zomato’s delivery partners and their families. Zomato’s stock has been floundering at the stock markets, and has lost 62% of its value since November last year.
“Right before we went public, I was granted some ESOPs by our investors/ board, basis my past performance and some of these ESOPs vested last month because there’s a minimum one year vesting required as per law,” Goyal said in a letter to Zomato’s employees. “At the average share price over the last month, these ESOPs are worth $90m or Rs 700 crore. I am donating all the proceeds from these ESOPs (net of taxes) towards the Zomato Future Foundation,” Goyal added.
The Zomato Future Foundation will be covering education of up to two children of all Zomato delivery partners, up to Rs 50,000 per child per annum on actuals, above a certain service quality benchmark, who have been on Zomato’s fleet for more than five years, according to the memo.
Goyal further said that the amount will go up to Rs 1,00,000 per child per annum if the delivery partner completes 10 years with Zomato. For women delivery partners, the service thresholds will be lower and Zomato Future Foundation will introduce ‘prize money’ for girl children if a girl completes 12th grade and her graduation.
Along with this, the Zomato Future Foundation will offer higher education scholarships for children with higher performance and potential, Goyal said. The foundation will also offer livelihood support to the families of all its delivery partners, irrespective of their service tenure, who encounter accidents on the job, Goyal said.
“This is just the start,” Goyal continued. “As and when needed, we will keep expanding and re-evaluating the scope of this Foundation to benefit our ecosystem further. I am especially pumped for what this foundation will do for our delivery partner’s children – I believe that education is the one and only thing that can give them a chance to build a life much better than their previous generations,” he added.
Zomato has often been criticized in the past for not adequately paying its delivery executives. Zomato’s delivery partners aren’t Zomato employees but independent contractors, and also don’t receive many benefits that full-time employees receive. Deepinder Goyal’s generous donation, in part, appears to be a means to quell much of that criticism.
But donations might not alone paper over the alleged mistreatment of Zomato’s gig workers. As per the Fairwork India Ratings 2020, which track how companies treat their contract employees, Zomato and Swiggy were both ranked at the very bottom, with the lowest possible scores of 1 out of 10. Zomato CEO Deepinder Goyal now seems to have donated a substantial portion of his stocks towards a foundation which will supposedly help gig workers, but it remains to be seen if these donations are enough for the upliftment of delivery partners instead of the structural changes they’d been demanding.