REPORT ON CORPORATE GOVERNANCE
The Company considers Corporate Governance as an important process for conducting and managing its business activities in a transparent and visible manner in the interest of all its stakeholders, besides keeping important segments of the society adequately informed. Birla Shloka Edutech Limited (BSEL) adopted good corporate practices all through its existence and oriented its actions in consonance with them. It has been the endeavour of BSEL to give fair and equitable treatment to all its stakeholders including employees, customers and shareholders as also to comply with applicable rules and regulations.
In conformity with the provisions of the Act as well as the Company's Articles, the Board met at regular intervals to review the quarterly / annual results and to transact other business. The Agenda for the Board meetings, containing relevant matters as requisite, are distributed in advance to all the Board members.
COMMITTEES OF THE BOARD (a) AUDIT COMMITTEE:
The Audit Committee acts as a link among the Management, the Statutory Auditors, Internal Auditors and the Board of Directors to oversee the financial reporting process of the Company. The Committee's purpose is to oversee the quality and integrity of accounting, auditing and financial reporting process including review of the internal audit reports and action taken report.
TERMS OF REFERENCE:
The terms of reference of the Audit Committee are wide enough to cover the matters specified for Audit Committee under Clause 49 of the Listing Agreements, as well as in Section 177 of the Companies Act, 2013. The terms of reference of the Audit Committee are broadly as under:
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.
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 the 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, the 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, if any, in the payment to the depositors, debenture holders, shareholders (in case of non-payment 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.
21. Reviewing financial statements, in particular the investments made by the Company's unlisted subsidiaries.
REVIEW OF INFORMATION BY AUDIT COMMITTEE:
1. The Management discussion and analysis of financial condition and results of operations;
2. Statement of significant related party transactions submitted by management.
3. Management letters / letters of internal control weaknesses issued by the Statutory Auditors;
4. Internal audit reports relating to internal control weaknesses and
5. The appointment, removal and terms of remuneration of the Chief internal auditor.
Whistle Blower Policy: The Company has laid down a Whistle Blower Policy. The employees can bring to the notice of the management their concerns on any issues. A "Suggestion Box" is also available in the Company in which employees can deposit in writing their concerns and suggestions even without disclosing their name
(b) NOMINATION AND REMUNERATION COMMITTEE
The Board of Directors of the Company changed the nomenclature of the Remuneration Committee of the Company to "NOMINATION AND REMUNERATION COMMITTEE" and also modified its terms of reference to comply with the requirements of the Companies Act, 2013 and Clause 49 of the Listing Agreement. The constitution and terms of reference of NOMINATION AND REMUNERATION COMMITTEE of the Company are in compliance with provisions of Companies Act, 2013 and Clause 49 of the Listing Agreement.
TERMS OF REFERENCE:
1. Formulation of the criteria for determining qualifications, positive attributes and independence of a director and recommend to the Board a policy, relating to the remuneration of the directors, key managerial personnel and other employees;
2. Formulation of criteria for evaluation of Independent Directors and the Board;
3. Devising a policy on Board diversity;
4. Identifying persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down, and recommend to the Board their appointment and removal and shall carry out evaluation of every director's performance.
5. To recommend / review remuneration of the Managing Director(s) and Wholetime Director(s) based on their performance and defined assessment criteria.
6. To carry out any other function as is mandated by the Board from time to time and / or enforced by any statutory notification, amendment or modification, as may be applicable.
7. To perform such other functions as may be necessary or appropriate for the performance of its duties.
Shri Vineet Tripathi Company Secretary placed before the Board, the draft of Appointment letter for an Independent Director.
Policy for selection and Appointment of Directors and their Remuneration Criteria of selection of Non-executive Directors:
The Non-executive Directors shall be of high integrity with relevant expertise and experience so as to have a diverse Board with Directors having expertise in the fields of marketing, education, finance, taxation, law, governance and general management.
In case of appointment of Independent Directors, the Committee shall satisfy itself with regard to the independent nature of the Directors vis-a-vis the Company so as to enable the Board to discharge its function and duties effectively.
The Committee shall ensure that the candidate identified for appointment as a Director is not disqualified for appointment under Section 164 of the Companies Act, 2013.
The Committee shall consider the following attributes / criteria, whilst recommending to the Board the candidature for appointment as Director.
i. Qualification, expertise and experience of the Directors in their respective fields;
ii. Personal, Professional or business standing;
iii. Diversity of the Board.
In case of re-appointment of Non-executive Directors, the Board shall take into consideration the performance evaluation of the Director and his engagement level.
The Non-executive Directors shall be entitled to receive sitting fees for each meeting of the Board attended by them, of such sum as may be approved by the Board of Directors within the overall limits prescribed under the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and reimbursement of expenses for participation in the Board Meetings.
Managing Director- Criteria for selection / appointment
For the purpose of selection of the Managing Director the Committee shall identify persons of integrity who possess relevant expertise, experience and leadership qualities required for the position and shall take into consideration recommendation, if any, received from any member of the Board.
The Committee will also ensure that the incumbent fulfils such other criteria with regard to age and other qualifications as laid down under the Companies Act, 2013 or other applicable laws.
At the time of appointment or re-appointment, Managing Director shall be paid such remuneration as may be mutually agreed between the Company (which includes the Committee and the Board of Directors) and the Managing Director within the overall limits prescribed under the Companies Act, 2013.
The remuneration shall be subject to the approval of the Members of the Company in General Meeting.
The remuneration of the Managing Director comprises of fixed and variable component as per the provisions of Companies Act, 2013. The fixed component comprises salary, allowances, perquisites, amenities and retiral benefits.
Remuneration Policy for the Senior Management Employees
In determining the remuneration of the Senior Management Employees the Committee shall ensure the relationship of remuneration and performance benchmark is clear.
The Managing Director will carry out the individual performance review based on the respective defined objectives, qualification, expertise, experience and other factors whilst recommending the annual increment and performance incentive to the Committee for its review and approval.
(c) STAKEHOLDERS' RELATIONSHIP COMMITTEE:
The Board of Directors of the Company changed the nomenclature of "STAKEHOLDERS COMMITTEE" to "STAKEHOLDERS RELATIONSHIP COMMITTEE" and also modified its terms of reference to comply with the requirements of the Companies Act, 20l3 and Clause 49 of the Listing Agreement. The constitution and terms of reference of Stakeholders' Relationship Committee of the Company are in compliance with provisions of Companies Act, 20l3 and Clause 49 of the Listing Agreement.
TERMS OF REFERENCE:
1. Oversee and review all matters connected with the transfer of the Company's securities.
2. Monitor redressal of investors' / shareholders' / security holders' grievances.
3. Oversee the performance of the Company's Registrar and Transfer Agents.
4. Recommend methods to upgrade the standard of services to investors.
5. Carry out any other function as is referred by the Board from time to time or enforced by any statutory notification / amendment or modification as may be applicable.
(d) SECURITIES TRANSFER COMMITTEE:
The Board of Directors of the Company changed nomenclature of "SHARE TRANSFER COMMITTEE" to "SECURITIES TRANSFER COMMITTEE".
In order to provide efficient and timely services to investors, the Board of Directors has delegated the power of approving transfer/ transmission of Company's Securities, issue of duplicate share / debenture certificates, split up / sub-division, and consolidation of shares, issue of new certificates on re-materialization, sub-division and other related formalities to the Securities Transfer Committee and to Shri Vineet Tripathi Company Secretary.
(e) CORPORATE SOCIAL RESPONSIBILITY COMMITTEE
Considering the requirements of the Companies Act, 20l3 , the Board of Directors of the Company the Corporate Social Responsibility Committee.
The Committee's prime responsibility is to assist the Board in discharging its social responsibilities by way of formulating and monitoring implementation of the framework of "Corporate Social Responsibility Policy", observe practices of Corporate Governance at all levels and to suggest remedial measures wherever necessary.
The Committee's constitution and terms of reference meet with the requirements of the Companies Act, 20l3.
TERMS OF REFERENCE OF THE COMMITTEE, INTER ALIA, INCLUDES THE FOLLOWING:
1. To 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 of the Companies Act, 20l3 and rules made there under;
2. To recommend the amount of expenditure to be incurred on the CSR activities.
3. To monitor the implementation of framework of CSR Policy.
4. To carry out any other function as mandated by the Board from time to time and / or enforced by any statutory notification, amendment or modification as may be applicable or as may be necessary or appropriate for performance of its duties.
PERFORMANCE EVALUATION OF THE BOARD
After taking into consideration one to one inputs received from the Directors, covering various aspects of the Board's functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance; pursuant to the provisions of the Companies Act, 20l3 and Clause 49 of the Listing Agreement, the Board has carried out the annual performance evaluation of its own performance, the Directors individually as well as the evaluation of the working of its Audit, Nomination and Remuneration Committees.
The performance evaluation of the Independent Directors was carried out by the Board. The performance evaluation of the Managing Directors was carried out by the Independent Directors who also reviewed the performance of the Secretarial Department. The Board of Directors expressed their satisfaction with the evaluation process.
Independent Directors Meeting
During the year under review, the Independent Directors met on 12.02.2015, inter alia, to discuss:
1. Evaluation of the performance of Managing Director and the Board of Directors as a Whole;
2. Evaluation of 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. All the Independent Directors were present at the meeting.
DISCLOSURES ON RELATED PARTY TRANSACTIONS
No materially significant related party transactions were entered by the Company with its promoters or directors, which could be deemed to be potentially conflicting with the interests of the Company. There were some transactions with related parties in the ordinary course of business of the Company. The register of contracts contains details of transaction in which directors are interested and the same is placed before the meeting of the Board. The details of such transactions are disclosed in the Notes to Accounts.
The Company has 2 (two) Subsidiary Company. The minutes of the subsidiary are placed before the Board of Directors of the Company and the same were reviewed.
There are no materially significant related party transactions made by the Company with its Promoters, Directors or Management, their subsidiaries or relatives, etc. that may have potential conflict with the interests of the Company at large.
There was no reported case of levy of any penalties, or imposition of strictures on the Company by the Stock Exchanges or SEBI on any matter related to the capital markets during the last three years.
A risk management policy is in place, wherein key risks are categorised and assessed in terms of probability and its likely impact on the Company's business which are evaluated and report of the same are placed before the Board for review.
MEANS OF COMMUNICATION
The Company regularly publishes its quarterly, half-yearly and annual results in due time in National and Regional Daily newspapers (Business Standard and Mahanayak) in compliance with requirements. These are also displayed on Company's website www.birlashloka com. No presentation was made to analyst during the financial year under report.
The Management Discussion and Analysis Report appended elsewhere and forms integral part of the Annual Report.
A firm of Chartered Accountants/Company Secretaries periodically carried out Secretarial Audit to reconcile the total admitted capital with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) and the total issued and listed capital. The secretarial audit reports confirm that the total issued and paid up capital is in agreement with the total number of shares in physical form and the total number of dematerialized shares held with NSDL and CDSL.
GENERAL SHAREHOLDER INFORMATION
Annual General Meeting
Day, date and time of Annual general meeting
Tuesday 29.09.2015 12.00 noon G-4 Melstar House M.I.D.C Cross Road ‘A’ Andheri (East) Mumbai-400093.
Dates of book closure From 22nd September, 2015 to 29th September, 2015 (both days inclusive)
Special Resolutions: No Special Resolution(s) are proposed at the above-mentioned Annual General Meeting .
Resolutions Passed by Postal Ballot: No resolution was passed by Postal Ballot during the year 2014-15
1) First Quarter Results : On or before 14th August
2) Second Quarter / Half yearly Results : On or before 14th November
3) Third Quarter results : On or before 14th February
4) Fourth Quarter / Audited Annual Results : On or before 30th May
Stock Exchanges on which Company’s shares are listed:
Bombay Stock Exchange Limited Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai - 400 001 Code: 511607
The Company has been regular in paying the Listing Fees to the Stock Exchanges. Listing Fees for the year 2015-16 have also been paid.
Registrar and Share Transfer Agent: The complete address of Registrar and Share Transfer Agent for communication is as follows:
Bigshare Services India Private Limited,
E-2, Ansa Industrial Estate, Sakinaka Road, Sakinaka, Andheri (east), Mumbai -400072. Tel: 022-40430200, Fax: 022-28475207
Share Transfer System
The Shares lodged for transfers and dematerialization are processed by the Registrar and Share Transfer Agent on a weekly basis and generally registered and returned within a period of two weeks from the date of receipt, if the documents are complete in all respects.
The Company has been obtaining half yearly certificates from a Company Secretary in Practice within 15 days from the close of the relevant period with regard to compliance of share transfer formalities as per the requirement of clause 47(c) of the Listing Agreement of the stock exchanges, where the securities of the company are listed.
'Dematerialization of Shares and Liquidity: All shares of the Company are under compulsory dematerialization for delivery on sale / purchase. A at 3l.03.20l5, the number of shares of the Company in demat form stood at 20,489,047 share representing 97.83% of shares issued by the Company. Considering the advantages of trading in demat form, members are encouraged to consider dematerialisation of their shareholding so as to avoid inconvenience in future.
Demat ISIN Number allotted to company's shares by NSDL and CDSL is: INE8I4E0I0I8.
Declaration on Compliance with the Code of Conduct
It is hereby confirmed that all the Directors and Senior Management Personnel (i.e. one level below the executive directors, including all functional heads) of the Company have received, read and understood for compliance with the Code of Conduct framed by the Company and confirmations for the year ended 31.03.2015 have been obtained from the Directors and Senior Management Personnel of the Company.
The Code of conduct for Directors and Senior Managers as adopted by the Board has been posted on the web site of the Company (www.birlashloka.com).
Address of registered office, subsidiary office and other Indian offices for correspondence:
Industry House, l59, Churchgate Reclamation, Mumbai 400020.
Outstanding GDRs / ADRs, etc.: The Company has not issued any GDRs or ADRs or any other convertible instruments