CORPORATE GOVERNANCE REPORT
1. COMPANY'S PHILOSOPHY ON CODE OF GOVERNANCE
Corporate governance at Arvind is a value-based framework to manage our Company affairs in a fair and transparent manner. As a responsible corporation, we use this framework to maintain accountability in all our affairs and employ democratic and open processes. We have evolved guidelines and best practices over the years to ensure timely and accurate disclosure of information regarding our financials, performance, leadership and governance of the Company.
Our corporate governance philosophy is based on the following principles:
• Satisfy the spirit of the law and not just the letter of the law. Corporate governance standards should go beyond the law.
• Be transparent and maintain a high degree of disclosure levels.
• Make a clear distinction between personal conveniences and corporate resources.
• Communicate externally, in a truthful manner, about how the Company is run internally.
• Have a simple and transparent corporate structure driven solely by business needs.
• The Management is the trustee of the shareholders' capital and not the owner.
The Board of Directors ('the Board') is at the core of our corporate governance practice and oversees how the Management serves and protects the long-term interests of all our stakeholders. We believe that an active, well-informed and independent Board is necessary to ensure the highest standards of Corporate Governance. The majority of our Board, 6 out of 10, are independent members. Given below is the report on Corporate Governance at Arvind.
2. BOARD OF DIRECTORS
2.1 Composition of the Board
The Board has 10 Directors, comprising of Chairman and Managing Director, Wholetime Director and Chief Financial Officer, 2 Executive Directors and 6 Non- Executive Directors. The Non-Executive Directors who are also Independent Directors are leading professionals from varied fields who bring in independent judgment to the Board's discussions and deliberations.
Except between Mr. Sanjay Lalbhai (Chairman & Managing Director) and his two son viz. Mr. Punit Lalbhai (Executive Director) and Mr. Kulin Lalbhai (Executive Director), there is no relationship between the Directors inter-se.
2.2. Directors' Profile
The Board of Directors comprises highly renowned professionals drawn from diverse fields. They bring with them a wide range of skills and experience to the Board, which enhances the quality of the Board's decision making process.
The brief profile of the Company's Board of Directors is as under:
MR. SANJAY S. LALBHAI (DIN: 00008329) (CHAIRMAN AND MANAGING DIRECTOR)
Mr. Sanjay Lalbhai is the Chairman and Managing Director of Arvind Limited, a 1 Billion Dollar Indian conglomerate. It was under his leadership that Arvind has become one of the largest manufacturers of woven textiles in India and one of the largest denim fabric manufacturers in the world. He was also responsible for acquiring India's first denim brand - Flying Machine - in 1981 and for guiding the process of building Arvind's current impressive apparel brand portfolio. He serves on the Board of Adani Ports & Special Economic Zone Limited - one of India's largest Port companies. He also serves on the board of several premier educational and research institutes. He is the President of Ahmedabad Education Society and Ahmedabad University and is a member of the Board of Governors of Indian Institute of Management, Ahmedabad, and a member of the Council of Management of the Physical Research Laboratory. He is also Chairman of CEPT University and is a member on the Governing Body of Adani Institute of Infrastructure Management.
Mr. Sanjay Lalbhai believes that addressing societal concerns and creating long lasting benefit to society is integral to the business strategy and a duty of every business leader. He provides strategic leadership to Arvind's CSR initiatives as Trustee to SHARDA Trust the CSR arm of the company.
MR. PUNIT LALBHAI (DIN: 05125502) (EXECUTIVE DIRECTOR)
Mr. Punit Lalbhai, 34, is an MBA from INSEAD (France) specialized in Strategy and General Management, along with Post-Graduate degree in Masters of Environmental Science from Yale University and a Bachelors degree in Science (Conservation Biology) from University of California, USA. He has several awards and honors during his career including Research Grants, Presidential Fellowship Grants, J.M. Long Endowed Scholarship and inclusion in Dean's Lists for consistent Academic Excellence. He is passionate about nature conservation and sustainability and is currently serving as a Board Member for Sustainable Apparel Coalition, Council Member for Better Cotton Initiative (Geneva) and Member of CII for family Business Network.
MR. KULIN LALBHAI (DIN: 05206878) (EXECUTIVE DIRECTOR)
Mr. Kulin Lalbhai, 30, is currently Executive Director at Arvind Limited and sits on the Board. He is driving new initiatives in the consumer businesses of the group. He is also spearheading Arvind's foray into e-commerce space. He also plays an active role in the overall corporate strategy for the group with particular focus on B2C businesses.
Mr. Kulin Lalbhai holds an MBA from the Harvard Business School and a BSc in Electrical Engineering from the Stanford University. Prior to his current role, he has also worked with management consulting with McKinsey & Co's Mumbai office.
MR. JAYESH SHAH (DIN: 00008349)
(WHOLETIME DIRECTOR AND CHIEF FINANCIAL OFFICER)
Mr. Jayesh K Shah is presently wholetime Director and Chief Financial Officer of Arvind Limited, a flagship Company of the Lalbhai Group, having an annual turnover of US $ 1 Billion. He has been with the Company since 1st July, 1993 and prior to this, he was associated with group Companies for about eighteen years. Mr. Jayesh Shah, aged 55 years, has a distinguished academic career and has extensive administrative, financial, regulatory and managerial expertise with his vast experience in the field. He also holds directorship in Adi Finechem Limited and e-infochips Limited.
He started his career in a garment division of the Lalbhai Group. Then, he had been assigned with the textile division and looked after all the financial aspects of the Group companies viz., textiles, branded garments, electronics, telecom, financing. He was also actively involved in merger, acquisition, expansion, diversification, project funding, Euro-issue of the Company. As being a dynamic professional, he has always been exploring new business opportunities and challenges. He undertook Financial Restructuring of the Company during the period 2000 to 2002 and very successfully restructured financial debt of the Company.
Dr. BAKUL H. DHOLAKIA (DIN: 00005754)
Dr. Bakul Dholakia is currently the Director General of International Management Institute, Delhi. Prior to joining IMI, he was the Director of Adani Institute of Infrastructure Management & Gujarat Adani Institute of Medical Sciences, Bhuj. Earlier, he was the Director of IIM, Ahmedabad. Dr. Dholakia is a Gold Medalist from Baroda University and holds a Doctorate in Economics. He has 46 years of professional experience including 33 years at IIM, Ahmedabad. During the course of his long tenure at IIM Ahmedabad, Dr. Dholakia occupied the Reserve Bank of India Chair from 1992 to 1999, served as the Dean from 1998 to 2001 and as the Director of the Institute from 2002 to 2007. He had received Best Professor Award for his teaching in Postgraduate Programme at IIMA. He has guided 20 Ph.D. students specializing in Economics, Finance, Business Policy and Public Systems at IIMA. He has been a consultant to various national and international organizations. In 2007, Dr. Dholakia was awarded Padma Shri by the Government of India in recognition of his distinguished services in the field of education. In 2006,
Global Foundation for Management Education (GFME), jointly formed by the Associations of American and European Business Schools, had nominated Dr. Bakul Dholakia as a Member of the Board of GFME representing Asia. In 2008, Dr. Dholakia was conferred the coveted Bharat Asmita National Award for his contribution to management education and teaching by the Hon'ble Chief Justice of India. Dr. Dholakia has been a major guiding force behind the numerous initiatives and expansion of activities at IIMA contributing to its enhanced international image and global recognition. His achievements in institution building have been nationally and internationally acclaimed. Dr. Dholakia had been a Board Member of Reserve Bank of India Western Area Board from 1993 to 2001. In recognition of his efforts to improve the quality of management education, the Government of India had appointed Dr. Dholakia as the Chairman of the National Board of Accreditation for Technical Education in India (2005 to 2008). He has also served as External Director on the Board of several public & private sector companies. He has an extensive experience of conducting executive development programmes for top management of leading companies and also for senior bureaucrats in India and abroad. He has also served as a member of the Jury for various Corporate Excellence Awards and Selection Committees for CEOs. Over the last two decades, Dr. Dholakia has worked on numerous government committees, the recent ones being the Rangarajan Committee on Pricing and Taxation of Petroleum Products (2006) and the Expert Group on Pension Fund constituted by the Government of India (2009). The Competition Commission of India has appointed Dr. Bakul Dholakia as a Member of the Eminent Persons Advisory Group (EPAG), which serves as a think tank to give broad inputs and advice on larger issues impacting markets and competition. Dr. Dholakia is the author of 12 books, 28 monographs and more than 50 research papers published in professional journals in India and abroad.
Ms. RENUKA RAMNATH (DIN: 00147182)
Ms. Renuka Ramnath is the Founder, Managing Director & CEO of Multiples Alternate Asset Management which manages circa $800 million of Indian and International capital.
In India, Private Equity ('PE') funds were typically set-up by financial institutions. Ms. Renuka Ramnath is one of the earliest PE professionals in India to set the trend to establish an independent private equity fund when she founded Multiples in 2009. Multiples is a sector agnostic private equity fund focused on growth and buy-outs in Indian companies. Several global pension funds across Europe, US and Asia along with seven Indian Public Sector Banks and LIC have committed capital to Multiples.
Today, Multiples has the distinction of being one the select Independent private equity platforms in India to be backed by Institutional investors both Indian as well as International.
In her new avatar, Ms. Renuka Ramnath looks to bring together her tremendous experience, long-standing credibility and enormous relationships to build Multiples as a platform to channelise long-term capital to create valuable enterprises and successful entrepreneurs. She draws motivation from the fact that supporting entrepreneurs to build sustainable businesses has the potential to generate employment, to create ripple effects in the Indian economy and to facilitate the greater process of nation building.
Pioneer in Indian Private Equity-2000-2009
Ms. Renuka Ramnath took over the reins of ICICI Venture (a subsidiary of ICICI Bank) when it managed sub $70 mm of largely proprietary capital. In a span of less than 10 years, she led ICICI Venture to become India's largest Private Equity Fund managing over $ 2 billion of third party capital.
The transformation of ICICI Venture from a bank's investment arm to a traditional private equity fund managing substantial amounts of third party capital is unique in many ways. Ms. Renuka Ramnath convinced Indian Banks to allocate capital to private equity for the first time - thus opening up a new LP community in India.
Similarly, Ms. Renuka Ramnath successfully secured commitments from global LP community to ICICI Venture. Resultantly, all four funds raised by her from 2003-2008 have been the then largest domestic funds raised in the Indian market.
Ms. Renuka Ramnath has raised and managed third party funds adhering to highest standards of professionalism, governance and transparency. ICICI Venture was twice (in 2007 and 2008) given the award as Best Private Equity Firm in India by Private Equity International.
Having built a franchise backed by blue-chip investors, Ms. Renuka Ramnath led several pioneering transactions in the Indian private equity space including the first leveraged buy-out and the first management buy-out. She has the experience of having invested and divested across multiple economic cycles. One of her strengths has been the identification of sectors and opportunities ahead of the curve and the ability to develop innovative transaction structures.
Ms. Renuka Ramnath is today one of the few professionals in India to have a full-cycle private equity track record of raising, managing and returning cash with superior returns to investors. She has played a pivotal role in developing the PE market in India, having contributed to this evolution in many different ways over the last decade.
Leading Business Woman in Financial Services - 1986-2000
Ms. Renuka Ramnath joined the ICICI Group as a management trainee in 1986. In her career spanning nearly two and a half decades in the Indian financial sector, Ms. Renuka Ramnath has been involved with building several businesses from scratch in the ICICI Group which include Investment Banking, Structured Finance and e-Commerce in the 1990s and Private Equity in 2000; much before each of these terms became ubiquitous in Indian marketplace.
Time and again, Ms. Renuka Ramnath has demonstrated her ability to identify and conceptualize new business opportunities, create high quality teams and quickly build these businesses to scale. As a result, she has featured in many prestigious listings, including the Top 25 Most
Powerful Women in Business (Business Today, India), India's most Powerful CEO's (Economic Times), in the Top 25 Non Bank Women in Finance (US Banker's global list), in the Top 50 for Achievement in Business: Asia's Women in the Mix (Forbes) and in the Top 25 women in Asian asset management (Asian Investor).
Ms. Renuka Ramnath holds a Bachelor of Engineering from VJTI, University of Mumbai and an MBA from the University of Mumbai. She has also completed the AMP from the Harvard Business School.
Mr. DILEEP CHOKSI (DIN: 00016322)
Mr. Dileep C. Choksi is a chartered accountant by profession and has been in practice for over 35 years. His areas of specialization include tax advisory and litigation, structuring of collaborations and joint ventures, executive advisory and decision support and corporate restructuring with a focus on start-up, turnaround and change management strategies. He also advises some of India's largest business houses on various strategic matters, including family succession and on wills and trusts.
Mr. Choksi was the former Joint Managing Partner of Deloitte in India till 2008, before he set up C.C. Chokshi Advisors Pvt. Ltd. of which he is the Chief Mentor.
Mr. Choksi is on the Board of various companies like AIA Engineering Limited, Hexaware Technologies Limited, ICICI Bank Limited, ICICI Home Finance Company Limited, ICICI Lombard General Insurance Company Limited, Lupin Limited, Swaraj Engines Limited and Tata Housing Development Company Limited. He is also a member of the Investment Committee of Aditya Birla Real Estate Fund.
Mr. Choksi is a member of the Society of Trust and Estate Practitioners (STEP). He is a member of the Managing Committee of the Indian Merchants' Chamber. He is also a trustee of the A.D. Shroff Memorial Trust and member of Council of Forum of Free Enterprise. Mr. Choksi was on the Advisory Board of foreign banks as well as Ex-Chairman of Banque Nationale De Paris, Bombay. Mr. Choksi was a trustee of Anchorage, an institute for the rehabilitation of the mentally challenged.
He was also a trustee of Child Relief and You (CRY), an organization that is dedicated to the education and welfare of underprivileged children. He is a passionate rider and a sports enthusiast.
Mr. Choksi is a Fellow Member of the Institute of Chartered Accountants of India, Bachelor of Law, Member of the Institute of the Cost and Works Accountants of India.
Mr. Choksi enjoys teaching when his professional commitments allow and has contributed various papers on mergers and acquisitions, valuation of business enterprises, company law, and taxation. He has been a speaker at various seminars and conferences of professional interests organized by the Reserve Bank of India, the Institute of Chartered Accountants, Bombay Chartered Accountants' Society, etc. Mr. Choksi contributed in the preparation of Kanga and Palkhivala's The Law and Practice of Income Tax (Eighth Edition) by late Mr. N.A. Palkhivala and Mr. B.A. Palkhivala.
Mr. VALLABH BHANSHALI (DIN: 00184775)
Mr. Vallabh Bhanshali is a leading thinker speaker and a nationalist businessman of the country. A devoted Vipassana meditator, he is also the Chairman and co-founder of Enam Securities Pvt. Ltd. - a very reputed home grown investment Bank and investor group of India.
ENAM played a significant role in the development of India in the vital and vibrant period of 1985 -2010 building most of the leading business houses of the times such as Infosys, Reliance, Sterlite, Zee, Jindal, etc. and public/joint sector companies such as NTPC, PTC, PFC, PGCIL etc. ENAM had its sway through it's almost 25% share of the retail and institutional markets for IPOs and its pioneering equity research in the country. ENAM and its founders are amongst the most reputed and longest term investors in the country. In 2012 ENAM merged its investment banking business with Axis Bank, India's third largest private sector bank to become large shareholders of the bank.
A man of many parts Mr. Bhanshali has a degree in law and is also a Chartered Accountant.
Widely recognised across business, media, social and spiritual circles for his work, talks, interviews and innovative ideas, amongst the prominent positions held, he was the Chairman of the Global Vipassana Foundation; part of several government and capital market committees bringing major reforms to the country and a Trustee of the Bombay Stock Exchange. He is a founder director of FLAME— India's pioneering and innovative Liberal Arts University. He was awarded an honorary doctorate by the Bhagwan Mahavir University, Muradabad.
He most recently founded the Desh Apnayen Foundation to instill a sense of active citizenship and volunteerism amongst India's citizens starting with school and college going children. Some of the most elite schools of Mumbai have adopted the program which is poised for a national roll out in due course.
Mr. SAMIR MEHTA (DIN: 00061903)
Mr. Samir Mehta, 52, is the Vice Chairman of the USD 2.75 billion Torrent Group and Chairman of Torrent Pharma. A B-School grad, Mr. Mehta has hands-on exposure and experience in the nuances of business and management. Torrent Group is being ably guided by Mr. Mehta through his analytical and professional approach. He has been providing strong strategic direction to all the business units of the Group.
Under his leadership, Torrent Pharma took various strategic initiatives including forays into new therapies and geographies, creating resources to match the exacting demands of markets, making Torrentone of India's fastest growing pharma majors. It has established a strong presence in the cardio vascular, neuropsychiatry, diabetology, gastroenterology segments and has also ventured into new segments like pain management, dermatology, gynecology, oncology and nephrology. Through acquisitions, Torrent has strengthened its position in the nutraceuticals, women healthcare and dermatology segments.
Mr. Mehta can be rightfully credited for establishing Torrent Pharma's strong pan-global presence, especially through its subsidiaries in the US, Germany and Brazil. It is his strong belief, that the future of Indian pharma lies in its research capabilities, and this led Torrent to invest in bolstering its R&D infrastructure. Today, Torrent Pharma has state-of-the-art research and manufacturing facilities which are certified by the regulatory bodies of various international regulated and semi-regulated markets.
Likewise, Mr. Mehta evinces keen interest in Power business of the Group. Under his guidance, Torrent Power has systematically improved its performance on all efficiency parameters and today it ranks amongst the best run power utilities in the country. With an installed generation capacity of 3334 MW, Torrent Power is fully integrated across the power sector value chain. Its Transmission & Distribution (T&D) loss in its license areas is amongst the lowest in the country. Mr. Mehta's ability to take calculated risks enabled Torrent Power to expand its distribution operations in Maharashtra and Uttar Pradesh, and as a result, Torrent Power distributes power to over 3 million customers in the cities of Ahmedabad, Gandhinagar, Surat, Bhiwandi and Agra. Mr. Mehta's urge for efficacy and quality has led the Company to demonstrate excellent operational capabilities and high customer orientation, and this has won many accolades. The Company's success in Bhiwandi has become a case study in the annals of the Indian power sector - a model discussed in various forums.
Equally conscious of his responsibilities towards society, Mr. Mehta has always been the guiding force behind the Group's various environmental and CSR initiatives. All the units of Torrent Group have established extensive green covers in their vicinity. Environment conservation principles are incorporated at the design stage itself when new facilities are planned. The Group's power plants and pharma manufacturing facilities have obtained IMS certifications and have been conferred the Sword of Honor by British Safety Council for their exemplary performance in health and safety management.
The CSR activities of the Group primarily focus on education and healthcare. Educational initiatives include setting up schools, providing merit scholarships, and improving quality of education and infrastructure. On healthcare side, the Group has set up the U N Mehta Institute of Cardiology in Ahmedabad, a 450-bed hospital with state-of-the-art facilities, to provide quality treatment especially to the economically weaker strata of the society. A recently launched ambitious child healthcare program - REACH (Reach EAch CHild), aims to positively impact lives of 25,000+ children across India's rural belts over the next few years through concerted efforts of each member of the Torrent Group. A fine blend of trained business acumen, managerial genius and rational exuberance, Mr. Mehta has helped shape various spheres of the Group through his contemporary outlook and innovative but realistic ideas. The Torrent Group,having a diverse workforce of nearly 20,000 employees with 900 internationally based, has earned a reputation for being employee-centric due to Mr. Mehta's practice of fairness and humaneness.
Mr. NILESH SHAH (DIN: 01711720)
Mr. Nilesh Shah is the Managing Director (MD) of Kotak Mahindra Asset Management Co. Ltd. He has over 25 years of experience in capital markets and market related investments, having managed funds across equity, fixed income securities and real estate for local and global investors. In his previous assignments, Mr. Nilesh Shah has held leadership roles with Axis Capital, ICICI Prudential Asset Management, Franklin Templeton and ICICI securities. Mr. Nilesh Shah is the recipient of the inaugural Business Standard Fund Manager of the year award - Debt in 2004. He was part of the team that received the best fund house of the year award at Franklin Templeton as well as at ICICI Prudential. Mr. Nilesh Shah is a gold medalist chartered accountant and a merit ranking cost accountant. His hobbies include reading and educating investors on financial planning. He has co-authored book on Financial Planning called "A Direct Take".
2.3 Board Agenda
The annual calendar of Board and Committee Meetings is agreed upon at the beginning of each year. Meetings are governed by a structured Agenda and a Board Member may bring up any matter for consideration of the meeting in consultation with the Chairman. Agenda papers are generally circulated to the Board Members at least 7 working days in advance. In addition, for any business exigencies the resolutions are passed by circulation and later places at the subsequent Board or Committee Meeting for ratification/approval. Detailed presentations are made at the meetings on all major issues to enable the Board to take informed decisions.
Invitees & Proceedings:
Apart from the Board Members, the Company Secretary, the Heads of Manufacturing and Marketing are invited to attend all the Board Meetings. Other senior management executives are called as and when necessary, to provide additional inputs for the items being discussed by the Board. The CFO makes presentation on the quarterly and annual operating & financial performance and on annual operating & capex budget. The Managing Director and other senior executives make presentations on capex proposals & progress, operational health & safety and other business issues.
Support and Role of Company Secretary:
The Company Secretary is responsible for convening the Board and Committee meetings, preparation and distribution of agenda and other documents and recording of the minutes of the meetings. He acts as interface between the Board and the Management and provides required assistance to the Board and the Management.
2.4 Meetings and Attendance
During the year, the Board of Directors met 5 times on 6th May, 2015, 14th May, 2015, 6th August, 2015, 5th November, 2015 and 4th February, 2016. The gap between two Board Meetings was within the maximum time gap prescribed in SEBI (LODR) Regulations, 2015.
2.5 Independent Directors
Independent Directors play an important role in the governance processes of the Board. They bring to bear their expertise and experience on the deliberations of the Board. This enriches the decision making process at the Board with different points of view and experiences and prevents conflict of interest in the decision making process.
None of the Independent Directors serves as "Independent Directors" in more than seven listed companies.
The Independent Directors have confirmed that they meet with the criteria of independence laid down under the Companies Act, 2013 and the SEBI (LODR) Regulations, 2015.
During the year under review, the Independent Directors meton February 4, 2016, interalia:
• To evaluate the performance of Non Independent Directors;
• To evaluate the performance of the Board of Directors as a whole;
• To evaluate the performance of Chairman of the Company, taking into account the views of the Executive Directors on the same;
• To evaluate the quality, content and timelines of flow of information between the Management and the Board that is necessary for the Board to effectively and reasonably perform its duties.
They expressed satisfaction at the robustness of the evaluation process, the Board's freedom to express views on the business transacted at the Meetings and the openness with which the Management discussed various subject matters on the agenda of meetings.
Familiarisation Programme for Independent Director:
On appointment of an individual as Director, the Company issues a formal Letter of Appointment to the concerned director, setting out in detail, the terms of appointment, duties and responsibilities. Each newly appointed Independent Director is taken through a formal familiarisation program including the presentation from the Chairman & Managing Director providing information relating to the Company, Denim / Shirtings / Branded Garments Business Divisions, industry, business model of the Company, geographies in which Company operates, etc. The programme also provides awareness of the Independent Directors on their roles, rights, responsibilities towards the Company. Further, the Familiarisation Programme also provides information relating to the financial performance of the Company and budget and control process of the Company. The details of familiarization program can be accessed from the website of the Company www.arvind.com <http://www.arvind.com>.
2.6 Evaluation of the Board's Performance:
During the year, the Board adopted a formal mechanism for evaluating its performance as well as that of its Committees and individual Directors. The exercise was carried out through a structured evaluation process covering various aspects of the Boards functioning such as composition of the Board & committees, experience & competencies, performance of specific duties & obligations, governance issues etc. Separate exercise was carried out to evaluate the performance of individual Directors including the Board Chairman who were evaluated on parameters such as attendance, contribution at the meetings and otherwise, independent judgement, safeguarding of minority shareholders interest etc.
The evaluation of the Independent Directors was carried out by the entire Board and that of the Chairman and the Non-Independent Directors were carried out by the Independent Directors.
The Directors were satisfied with the evaluation results, which reflected the overall engagement of the Board and its Committees with the Company.
2.7 Code of Conduct for Directors and Senior Management Personnel:
In terms of provisions of SEBI (LODR) Regulations, 2015, the Board of Directors of the Company has laid down a Code of Conduct for all Board Members and Senior Management Personnel of the Company. The said Code of Conduct has been posted on the website of the Company. The Board Members and Senior Management Personnel of the Company have affirmed compliance with the Code. The Chairman & Managing Director of the Company has given a declaration to the Company that all the Board Members and Senior Management Personnel of the Company have affirmed compliance with the Code.
2.8 Prevention of Insider Trading Code:
In January 2015, SEBI notified the SEBI (Prohibition of Insider Trading) Regulations, 2015 which came into effect from May 15, 2015. Pursuant thereto, the Company has formulated and adopted a new Code for Prevention of Insider Trading.
The new code viz. "Code of Conduct for Prohibition of Insider Trading Code" and the "Code of Practices & Procedures for Fair Disclosure of Unpublished Price Sensitive Information" allows the formulation of a trading plan subject to certain conditions and requires pre-clearance for dealing in the Company's shares. It also prohibits the purchase or sale of Company's shares by the Directors, designated employees and connected persons, while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window is closed.
The Head-Legal & Secretarial is responsible for implementation of the Code.
All Directors, designated employees and connected persons have affirmed compliance with the code.
2.9 Committees of the Board
The Board of Directors has constituted 5 Committees of the Board viz.
• Audit Committee
• Nomination & Remuneration Committee
• Stakeholders' Relationship Committee
• Management Committee
• Corporate Social Responsibility Committee
The Board determines the terms of reference of these Committees from time to time. Meetings of these Committees are convened by the respective Committee Chairman/Company Secretary. At each Board Meeting, minutes of these Committees are placed before the Directors for their perusal and noting.
3. AUDIT COMMITTEE
The Audit Committee of the Company comprises of 4 members out of which 3 members are Non-Executive-Independent Directors. Mr. Dileep Choksi, an Independent Director, acts as Chairman of the Committee. The Committee members are professionals having requisite experience in the fields of Finance and Accounts, Banking and Management. The Audit Committee met 4 times during the year. The representatives of Internal and Statutory Auditors are invitees to Audit Committee meetings and the Company Secretary acts as the Secretary of the Audit Committee.
3.1 Terms of reference of the committee interalia, include the following:
1. Oversight of the company's financial reporting process and the disclosure of its financial information to ensure that the financial statement is correct, sufficient and credible;
2. Recommendation for appointment, remuneration and terms of appointment of auditors of the company;
3. Approval of payment to statutory auditors for any other services rendered by the statutory auditors;
4. Reviewing, with the management, the annual financial statements and auditor's report thereon before submission to the board for approval, with particular reference to:
a) Matters required to be included in the Director's Responsibility Statement to be included in the Board's Report in terms of clause (c) of sub-section 3 of section 134 of the Companies Act, 2013;
b) Changes, if any, in accounting policies and practices and reasons for the same;
c) Major accounting entries involving estimates based on the exercise of judgment by management;
d) Significant adjustments made in the financial statements arising out of audit findings;
e) Compliance with listing and other legal requirements relating to financial statements;
f) Disclosure of any related party transactions;
g) Qualifications in the draft audit report;
5. Reviewing, with the management, the quarterly financial statements before submission to the board for approval;
6. Reviewing, with the management, the statement of uses / application of funds raised through an issue (public issue, rights issue,
preferential issue, etc.), the statement of funds utilized for purposes other than those stated in the offer document / prospectus / notice and the report submitted by the monitoring agency monitoring the utilisation of proceeds of a public or rights issue and making appropriate recommendations to the Board to take up steps in this matter;
7. Review and monitor the auditor's independence and performance and effectiveness of audit process;
8. Approval or any subsequent modification of transactions of the company with related parties;
9. Scrutiny of inter-corporate loans and investments;
10. Valuation of undertakings or assets of the company, wherever it is necessary;
11. Evaluation of internal financial controls and risk management systems;
12. Reviewing, with the management, performance of statutory and internal auditors, adequacy of the internal control systems;
13. Reviewing the adequacy of internal audit function, if any, including the structure of the internal audit department, staffing and seniority of the official heading the department, reporting structure coverage and frequency of internal audit;
14. Discussion with internal auditors of any significant findings and follow up there on;
15. Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the board;
16. Discussion with statutory auditors before the audit commences, about the nature and scope of audit as well as post-audit discussion to ascertain any area of concern;
17. To look into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders (in case of nonpayment of declared dividends) and creditors;
18. To review the functioning of the Whistle Blower mechanism;
19. Approval of appointment of CFO (i.e., the whole-time Finance Director or any other person heading the finance function or discharging that function) after assessing the qualifications, experience and background, etc. of the candidate;
20. Carrying out any other function as is mentioned in the terms of reference of the Audit Committee.
3.2 The Composition of the Committee as at 31st March, 2016 and the details of Members participation at the Meetings of the Committee are as under:
During the year, 4 Audit Committee Meetings were held on 14th May, 2015, 6th August, 2015, 5th November, 2015 and 4th February, 2016.
4. NOMINATION & REMUNERATION COMMITTEE
The Nomination & Remuneration Committee of the company comprises of 3 Directors, all of whom are Non-Executive-Independent Directors. The Nomination & Remuneration Committee did not meet during the year.
4.1 The terms of reference of the Committee inter alia, include the following: Nomination of Directors / Key Managerial Personnel / Senior Management*
1. To evaluate and recommend the composition of the Board of Directors;
2. To identify persons who are qualified to become Directors and who may be appointed in senior management in accordance with the criteria laid down by the Committee;
3. Consider and recommend to the Board appointment and removal of directors, other persons in senior management and key managerial personnel (KMP);
4. Determining processes for evaluating the effectiveness of individual directors and the Board as a whole and evaluating the performance of individual Directors;
5. To administer and supervise Employee Stock Options Schemes (ESOS) including framing of policies related to ESOS and reviewing grant of ESOS;
6. Formulate the criteria for determining qualifications, positive attributes and independence of a Director;
7. To review HR Policies and Initiatives.
Remuneration of Directors / Key Managerial Personnel / Senior Management*/ other Employees
1. Evolve the principles, criteria and basis of Remuneration Policy and recommend to the Board a policy relating to the remuneration for all the Directors, KMP, senior management and other employees of the Company and to review the same from time to time;
2. The Committee shall, while formulating the policy, ensure the following :
(a) The level and composition of remuneration is reasonable and sufficient to attract, retain and motivate Directors of the quality required to run the Company successfully;
(b) Relationship of remuneration to performance is clear and meets appropriate performance benchmarks; and
(c) Remuneration to Directors, KMP and senior management involves a balance between fixed and incentive pay reflecting short and long-term performance objectives appropriate to the working of the Company and its goals.
* Senior Management for the above purpose shall mean personnel of the Company who are members of its core management team excluding Board of Directors comprising all members of management one level below the executive directors, including the functional heads.
4.2. Nomination & Remuneration Policy:
1. Purpose of this Policy:
Arvind Limited ("Arvind" or the "Company") has adopted this Policy on appointment and remuneration of the Directors, Key Managerial Personnel and Senior Management (the "Policy") as required by the provisions of Section 178 of the Companies Act, 2013 (the "Act") and the provisions of SEBI (LODR) Regulations, 2015.
The purpose of this Policy is to establish and govern the procedure applicable:
a) To evaluate the performance of the members of the Board.
b) To ensure that remuneration to Directors, KMP and Senior Management involves a balance between fixed and incentive pay reflecting short and long-term performance objectives appropriate to the working of the Company and its goals.
c) To retain, motivate and promote talent and to ensure long term sustainability of talented managerial persons and create competitive advantage.
The Committee should ensure that the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate Directors of the quality required to run the Company successfully and the relationship of remuneration to performance is clear and meets appropriate performance benchmarks.
Independent Director means a director referred to in Section 149(6) of the Act and the SEBI (LODR) Regulations, 2015, as amended from time to time.
Key Managerial Personnel (the "KMP") shall mean "Key Managerial Personnel" as defined in Section 2(51) of the Act.
Nomination and Remuneration Committee, by whatever name called, shall mean a Committee of Board of Directors of the Company, constituted in accordance with the provisions of Section 178 of the Act and the SEBI (LODR) Regulations, 2015.
Remuneration means any money or its equivalent given or passed to any person for services rendered by him and includes perquisites as defined under the Income-tax Act, 1961.
Senior Management means personnel of the Company who are members of its core management team excluding Board of Directors. This would include all members of management one level below the Executive Directors, including all functional heads.
Words and expressions used and not defined in this Policy, but defined in the Act or any rules framed under the Act or the Securities and Exchange Board of India Act, 1992 and Rules and Regulations framed thereunder or in the SEBI (LODR) Regulations, 2015 or the Accounting Standards shall have the meanings assigned to them in these regulations.
3. Composition of the Committee:
The composition of the Committee is / shall be in compliance with the Act, Rules made thereunder and the SEBI (LODR) Regulations, 2015, as amended from time to time.
4. Role of the Committee:
a) Formulate the criteria for determining qualifications, positive attributes and independence of a Director;
b) Identify persons who are qualified to become Director and persons who may be appointed in Key Managerial and Senior Management positions in accordance with the criteria laid down in this Policy;
c) Lay down the evaluation criteria for performance evaluation of Independent Director and the Board;
d) Recommend to the Board, appointment, remuneration and removal of Director, KMP and Senior Management;
e) To devise a Policy on Board diversity.
5. Criteria for Determining the followings:-
5.1 Qualifications for appointment of Directors (including Independent Directors):
a) Persons of eminence, standing and knowledge with significant achievements in business, professions and/or public service.
b) Their financial or business literacy/skills.
c) Their textile industry experience.
d) Other appropriate qualification/experience to meet the objectives of the Company.
e) As per the applicable provisions of Companies Act, 201 3, Rules made thereunder and SEBI (LODR) Regulations, 2015. The Nomination and Remuneration Committee shall have discretion to consider and fix any other criteria or norms for selection of the most suitable candidate/s.
5.2 Positive attributes of Directors (including Independent Directors):
• Directors are to demonstrate integrity, credibility, trustworthiness, ability to handle conflict constructively and the willingness to address issues proactively.
• Actively update their knowledge and skills with the latest developments in the railway/heavy engineering/infrastructure industry, market conditions and applicable legal provisions.
• Willingness to devote sufficient time and attention to the Company's business and discharge their responsibilities.
• To assist in bringing independent judgment to bear on the Board's deliberations especially on issues of strategy, performance, risk management, resources, key appointments and standards of conduct.
• Ability to develop a good working relationship with other Board members and contribute to the Board's working relationship with the senior management of the Company.
• To act within their authority, assist in protecting the legitimate interests of the Company, its shareholders and employees.
• Independent Directors to meet the requirements of the Companies Act, 201 3 read with the Rules made there under and SEBI (LODR) Regulations, 2015 as amended from time to time.
5.3 Independence Standards:
The following would be the independence review procedure and criteria to assist the Committee evaluate the independence of Directors for recommending to the Board for appointment. A Director is independent if the Board affirmatively determines that the Director does not have a direct or indirect material relationship with the Company, including its affiliates or any member of senior management. "Affiliate" shall mean any company or other entity that controls, is controlled by, or is under common control with the Company.
Also, the candidate shall be evaluated based on the criteria provided under the applicable laws including Companies Act, 2013 read with Rules thereon and the SEBI (LODR) Regulations, 2015. In addition to applying these guidelines, the Board will consider all relevant facts and circumstances in making its determination relating to a director's independence.
Independence Review Procedures
1. Annual Review
The director's independence for the independent director will be determined by the Board on an annual basis upon the declarations made by such Directors as per the provisions of the Companies Act, 2013 read with Rules thereon and the SEBI (LODR) Regulations, 2015.
2. Individual Director's Independence Determination
If a director is considered for appointment on the Board between annual general meetings, a determination of independence, upon the recommendation of the Committee, shall be made by the Board prior to such appointment.
All determinations of independence shall be made on a case-by-case basis for each director after consideration of all the relevant facts and circumstances and the standards set forth herein. The Board reserves the right to determine that any director is not independent even if he or she satisfies the criteria set forth by the provisions of the Companies Act, 2013 read with Rules thereon and the SEBI (LODR) Regulations, 2015.
3. Notice of Change of Independent Status
Each director has an affirmative obligation to inform the Board of any change in circumstances that may put his or her independence at issue.
5.4 Criteria for appointment of KMP/Senior Management:
• To possess the required qualifications, experience, skills & expertise to effectively discharge their duties and responsibilities.
• To practice and encourage professionalism and transparent working environment.
• To build teams and carry the team members along for achieving the goals/objectives and corporate mission.
• To adhere strictly to code of conduct
The Term of the Directors including Managing Director/ Wholetime Director / Independent Directorshallbe governed as per the provisions of the Act and Rules made thereunder and the SEBI (LODR) Regulations, 2015, as amended from time to time.
Whereas the term of the KMP (other than the Managing / Wholetime Director) and Senior Management shall be governed by the prevailing HR policies of the Company.
The Committee shall carry outevaluation of performance of every Director.
The Committee shall identify evaluation criteria which will evaluate Directors based on knowledge to perform the role, time and level of participation, performance of duties, level of oversight, professional conduct and independence. The appointment / re-appointment / continuation of Directors on the Board shall be subject to the outcome of the yearly evaluationprocess.
Due to reasons for any disqualification mentioned in the Act or under any other applicable Act, Rules and Regulations thereunder and / or for any disciplinary reasons and subject to such applicable Acts, Rules and Regulations and the Company's prevailing HR policies, the Committee may recommend, to the Board, with reasons recorded in writing, removal of a Director,KMP or Senior Management.
4.4 Remuneration of Directors:
Remuneration of Executive Directors is recommended by the Nomination & Remuneration Committee and approved by the Board of Directors and the Shareholders of the Company.
The Remuneration Committee and the Board of Directors at their meetings held on 9th May, 2012 and shareholders at their Annual General Meeting held on 28th September, 2012 have approved remuneration payable to Mr. Sanjay S. Lalbhai, Chairman and Managing Director of the Company for a period from 1st January, 2013 to 31st March, 2017. The Company has entered into an agreement with him laying down his tenure, remuneration and other terms.
The Remuneration Committee and the Board of Directors at their meetings held on 26th July, 2012 and shareholders at their Annual General Meeting held on 28th September, 2012 have approved remuneration payable to Mr. Punit S. Lalbhai and Mr. Kulin S. Lalbhai - Executive Directors of the Company for a period of five years from 1st August, 2012 to 31st July, 2017. The Company has entered into agreements with them laying down their tenure, remuneration and other terms.
The Nomination & Remuneration Committee and the Board of Directors at their meetings held on 15th May, 2014 and shareholders at their Annual General Meeting held on 30th July, 2014 have approved remuneration payable to Mr. Jayesh K. Shah, Whole-time Director and Chief Financial Officer of the Company for a period of five years from 1st October, 2014 to 30th September, 2019. The Company has entered into an agreement with him laying down his tenure, remuneration and other terms.
The remuneration of Non-Executive Directors is determined by the Board and is also approved by the Shareholders in General Meeting. Non-Executive Directors are paid Sitting Fees of Rs. 10,000/- for every meeting of Board of Directors or Committee attended by them. Apart from this, Non-Executive Directors (other than Managing Director and Whole Time Director(s)) are entitled for commission within the limit of 1% of the net profits of the Company per annum.
None of the Directors of the company / Key managerial Personnel had any pecuniary relationship with the Company during the year.
5. STAKEHOLDERS' RELATIONSHIP COMMITTEE
The Stakeholders' Relationship Committee has 3 Members comprising of 1 Non-Executive Director and 2 Executive Directors.
5.1 Terms of reference of the Committee inter alia, include the following:
1. To specifically look into the redressal of Investors' Grievances pertaining to:
• Transfer of shares and debentures;
• Non-receipt of declared dividends, interests and redemption proceeds of debentures;
• Dematerialization of shares and debentures;
• Replacement of lost, stolen, mutilated share and debenture certificates;
• Non-receipt of rights, bonus, split share and debenture certificates;
• Non-receipt of balance sheet.
2. To look into other related issues towards strengthening investors' relations.
3. To consider and approve issuance of share / debenture certificates including duplicate share/debenture certificates.
4. To look into the reasons for any defaults in the payment to the Depositors, Debenture holders, Shareholders (in case of non-payment of declared dividends) and Creditors.
5.2 The Composition of the Committee as at 31st March, 2016 and the details of Members participation at the Meetings of the Committee are as under:
During the year, 2 Stakeholders Relationship Committee Meetings were held on 5th November, 2015 and 4th February, 2016. The Attendance of Members at meetings was under:
5.3 Name and Designation of Compliance Officer:
R. V. Bhimani Company Secretary Arvind Limited
6. MANAGEMENT COMMITTEE
The Management Committee consists of 2 Directors, all of whom are Executive Directors.
The Management Committee's primary role is to look after the day-to-day business activities of the Company within Board approved direction/ framework. The Committee meets frequently, as and when need arises, to transact matters within the purview of its terms of reference.
6.2. The Composition of the Committee as at 31st March, 2016 and the details of Members participation at the Meetings of the Committee are as under:
During the year, 17 Management Committee Meetings were held on various dates. The Attendance of Members at meetings was as under:
7. CORPORATE SOCIAL RESPONSIBILITY COMMITTEE
The Corporate Social Responsibility Committee has 4 Members comprising of 1 Non-Executive Independent Director and 3 Executive Directors.
7.1 Terms of reference of the Committee inter alia, include the following:
(a) formulate and recommend to the Board, a Corporate Social Responsibility Policy which shall indicate the activities to be undertaken by the company as specified in Schedule VII to the Companies Act, 2013;
(b) to finalise a list of CSR projects or programs or initiatives proposed to be undertaken periodically including the modalities for their execution / implementation schedules and to review the same from time to time in accordance with requirements of section 135 of the Companies Act 2013;
(c) recommend the amount of expenditure to be incurred on the activities referred to in clause (a);
(d) monitor the Corporate Social Responsibility Policy of the company from time to time;
(e) Review the CSR report and other disclosures on CSR matters for the approval of the Board for their inclusion in the Board Report.
7.2 Composition of the Committee as at 31st March, 2016 and the details of Members participation at the Meetings of the Committee are as under:
During the year, 1 Meeting was held on 5th November, 2015.
8. MEANS OF COMMUNICATION:
8.1 The Quarterly, half-yearly and yearly financial Results are published in the Financial Express - All India Editions and Financial Express Gujarati Edition of Ahmedabad and are also posted on the Company's website at www.arvind.com .
8.2 Information released to the press at the time of declaration of results is also sent to all Stock Exchanges where the shares of the Company are listed for the benefit of investors. Moreover, the Company's web-site hosts a special page giving information which investors usually seek.
8.3 Presentations made to institutional investors/analysts are posted on the Company's web site at www.arvind.com .
9. GENERAL SHAREHOLDER INFORMATION:
9.1 Annual General Meeting:
Date 4th August,2016
Time 9:30 a.m.
Venue Thakorebhai Desai Hall, Near Law Garden, Ellisbridge, Ahmedabad-380006.
9.2 Financial Calendar:
The Financial Year of the Company is for a period of 12 months from 1st April to 31st March.
First quarter results : Last week of July, 2016
Second quarter results : Last week of October, 2016
Third quarter results : Last week of January, 2017
Fourth quarter results / Year end results : In the Middle of May, 2017
9.3 Book Closure:
Saturday, the 30th July, 2016 to Thursday, the 4th August, 2016 (Both Days inclusive).
9.4 Dividend payment Date :
9th August, 2016
9.5 Listing on Stock Exchanges:
Shares of the Company are listed on the following Stock Exchanges.
Name of the Stock Exchange Address
1 BSE Ltd.
Phiroze Jeejeebhoy Tower, Dalal Street Mumbai - 400 001
2 National Stock Exchange of India Ltd.
Exchange Plaza, 5th Floor, Plot No.C/1, G. Block, Bandra -Kurla Complex, Bandra (E), Mumbai - 400 051.
The Company has paid Annual Listing Fees for the year 2016-2017 to the above Stock Exchanges. The equity shares of the Company have been delisted from Ahmedabad Stock Exchange Ltd., w.e.f 23rd December, 2015.
9.6 Registrar And Transfer Agent
Link Intime India Private Limited (from 16th June, 2016)
303, Shopper's Plaza - V, Opp. Municipal Market Off. C. G. Road, Navrangpura, Ahmedabad-380009. Phone & Fax No. 079-26465179
E-mail : email@example.com
Sharepro Services (I) Pvt. Ltd. (upto 15th June, 2016).
9.7 SHARE TRANSFER SYSTEM
(I) Delegation of Share Transfer Formalities:
Since the Company's shares are compulsorily traded in the demat segment on stock exchanges, bulk of the transfers take place in the electronic form. However, shares in the physical form are processed by the Registrar and Share Transfer Agents. However to expedite the transfers, the Board has delegated share transfer formalities to certain officers of the Company who attend to them at least 3 times in a month. Physical transfers are affected within the statutory period of one month. The Board has designated the Company Secretary as the Compliance Officer.
(II) Investors' Grievances:
The Registrar and Transfer Agent under the supervision of the Secretarial Department of the Company look after investors' grievances. Link Intime India Private Limited (from 16th June, 2016) / Sharepro Services (I) Pvt. Ltd. (upto 15th June, 2016) is responsible for redressal of Investors' Grievances. The Company Secretary of the Company has been appointed as the Compliance Officer for this purpose. At each Meeting of the Investors' Grievance Committee, all matters pertaining to investors including their grievances and redressal are reported.
9.8 Dematerialisation of shares and liquidity:
The Company's shares are available for dematerialisation on both the Depositories viz. National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). Shares of the Company are compulsorily to be delivered in the demat form on Stock Exchanges by all investors. As on 31st March, 2016, 25,49,08,130 shares representing 98.71%of the issued capital have been dematerialised by investors and bulk of transfers take place in the demat form.
Equity Shares fully paid: INE034A01011
9.9 Outstanding GDRs / ADRs / Warrants or any convertible instruments and conversion date and likely impact on equity:
9.10 Commodity price risk or foreign exchange risk and hedging activities:
Company is exposed to foreign exchange risk on account of import and export transactions entered. Also it is a sizable user of various commodities including cotton which exposes it to the price risk on account of procurement of commodities. The company is proactively mitigating these risks by entering into commensurate hedging transactions with banks and / or Commodity Exchanges as per applicable guidelines.
9.11 Plant Locations:
• Lifestyle Fabrics-Denim, Naroda Road, Ahmedabad - 380 025, Gujarat.
• Lifestyle Fabrics - Voiles, Ankur Textiles, Outside Raipur Gate, Ahmedabad - 380 022, Gujarat.
• Lifestyle Fabrics-Shirting, Khakis & Knitwear, Santej, PO Khatrej, Taluka Kalol, Dist. Gandhinagar-382721, Gujarat.
• Lifestyle Apparel-Knits, PO Khatrej, Taluka Kalol, Dist. Gandhinagar - 382 721, Gujarat.
• Lifestyle Apparel-Jeans, # 26/2, 27/2, Kenchenahalli, Mysore Road, Near Bangalore University, Bangalore-560 059.
• Lifestyle Apparel-Shirts, # 63/9, Doddathogur Village, Electronic City Post, Bangalore - 560100.
• Arvind Intex, Rajpur Road, Gomtipur, Ahmedabad - 380 021, Gujarat.
• Arvind Polycot, Khatrej, Taluka Kalol, Dist. Gandhinagar- 382 721, Gujarat.
• Arvind Cotspin, D-64, MIDC, Gokul Shirgaon, Tal. Karveer, Kolhapur - 416 234, Maharashtra.
9.12 Unclaimed Dividend:
(1) Unclaimed dividends up to and including the financial years 1993-94 have been transferred to the General Revenue Account of the Central Government. Shareholders who have not encashed their dividend warrants relating to any financial year up to 1993-94 are requested to claim the amounts from the Registrar of Companies, Gujarat, ROC Bhavan, Near Ankur Bus Stand, Naranpura, Ahmedabad 380 013 in the prescribed form. Investors may write to the Secretarial Department of the Company or the Registrars and Transfer Agents for a copy of the form.
(2) Dividends on equity shares for the financial years 1994-95 to 1997-98 and 2004-05 to 2005-06 remaining unclaimed for 7 years from their due dates have been transferred by the Company to the Investor Education and Protection Fund (IEPF) established by the Central Government pursuant to Section 205C of the Companies Act, 1956.
(3) The Company did not declare any dividends on equity shares for the financial years 1998-99 to 2003-04 and 2006-07 to 2010-11.
9.13 Nomination Facility:
Shareholders holding shares in physical form and desirous of making a nomination in respect of their shareholding in the Company, as permitted under Section 72 of the Companies Act, 2013 are requested to submit the prescribed Form SH-13 for this purpose. Shareholders may write to the Secretarial Department of the Company for a copy of the Form.
9.14 Address for correspondence:
Shareholders may correspond with the Company at the Registered Office of the Company or at the office of Registrar and Transfer Agent of the Company:
Secretarial Department Naroda Road, Ahmedabad - 380 025.
Phone Nos: 079-30138000/30138108-09 Fax No. : 079-30138668
e-mail : firstname.lastname@example.org Web-site address: www.arvind.com
Link Intime India Private Limited (from 16th June, 2016)
Registrar and Transfer Agent
303, Shopper's Plaza - V, Opp. Municipal Market Off. C. G. Road, Navrangpura Ahmedabad-380009.
Phone & Fax No. 079-26465179 E-mail : email@example.com
Sharepro Services (I) Pvt. Ltd. (upto 15th June, 2016)
10. OTHER DISCLOSURES :
10.1 There are no materially significant transactions with the related parties viz. promoters, directors or the management or their relatives or subsidiaries etc. that had potential conflict with the company's interest. Suitable disclosure as required by the Accounting Standard (As 18) has been made in the Annual Report. The Related Party Transaction Policy as approved by the Board is uploaded on the Company's Website at <http://www.arvind.com/pdf/shareholding/2015/Policies/RelatedParty> TransactionsPolicy.pdf.
10.2 Transactions with related parties are disclosed in detail in Note No. 39 in "Notes forming part of the Accounts" annexed to the financial statements for the year. There were no related party transactions having potential conflict with the interest of the Company at large.
10.3 There are no pecuniary relationships or transactions of Non-executive Directors vis-a-vis the Company which has potential conflict with the interests of the company at large.
10.4 No Strictures or penalties have been imposed on the company by the Stock Exchanges or by the Security Exchange Board of India (SEBI) or by any statutory authority on any matters related to capital markets during the last three years.
10.5 During the year ended 31st March, 2016, the Company has one Material Unlisted Subsidiary Company as defined in Regulation 16 of the SEBI (LODR) Regulations, 2015. The Company has formed the policy for determining material subsidiary as required by under Regulation 16 of the SEBI (LODR) Regulations, 2015 and the same is disclosed on the Company's website. The web link is <http://www.arvind.com/pdf/> shareholding/015/Policies/PolicyforDeterminationofMaerialityofEvent.pdf.
The Audited Annual Financial Statements of Subsidiary Companies are tabled at the Audit Committee and Board Meetings.
Copies of the Minutes of the Audit Committee / Board Meetings of Subsidiary Companies are individually given to all the Directors and are tabled at the subsequent Board Meetings.
10.6 Vigil Mechanism :
In staying true to our values of Strength, Performance and Passion and in line with our vision of being one of the most respected companies in India, the Company is committed to the high standards of Corporate Governance and stakeholder responsibility.
The Company has a Whistleblower Policy (WB Policy) that provides a secured avenue to directors, employees, business associates and all other stakeholders of the company for raising their concerns against the unethical practices, if any. The WB Policy ensures that strict confidentiality is maintained whilst dealing with concerns and also that no discrimination will be meted out to any person for a genuinely raised concern.
Pursuant thereto, a dedicated helpline "Arvind Ethics Helpline" has been set up which is managed by an independent professional organization. The Ethics Helpline can be contacted to report any suspected or confirmed incident of fraud / misconduct on:
Online Portal: <https://www.ethicscentre.co.in/>
Toll Free Hotline: 1800 220 256
Ethics Email ID: firstname.lastname@example.org <mailto:email@example.com>
Whistle blower Committee has been constituted which looks into the complaints raised. The Committee reports to the Audit Committee and the Board.
No personnel have been denied access to the Chairman of the Audit Committee, for making compliant on any integrity issue.
10.7 Details of compliance with mandatory requirements and adoption of the non-mandatory requirements :
During the year, the Company has fully complied with the mandatory requirements as stipulated under SEBI (LODR) Regulations, 2015.
The status of compliance with discretionary recommendations and adoption of the non-mandatory requirements as specified in regulation 27(1) of the SEBI (LODR) Regulations, 2015, is provided below:
a. The Board: The Chairman of the Company is Executive Director.
b. Shareholder Rights: Half-yearly and other Quarterly financial statements are published in newspapers, uploaded on company's website www.arvind.com and same are not being sent to the shareholders.
c. Modified Opinion(s) in Audit Report: The Company already has a regime of un-qualified financial statement. Auditors have raised no qualification on the financial statements.
d. Separate posts of Chairperson and Chief Executive Officer: Mr. Sanjay S. Lalbhai is the Chairman and Managing Director of the Company.
e. Reporting of Internal Auditor: The Internal Auditor reports to the Audit Committee.
The above Report was placed before the Board at its meeting held on 12th May, 2016 and the same was approved.
For and on behalf of the Board
SANJAY S. LALBHAI
Chairman & Managing Director
Date: May 12, 2016