REPORT ON CORPORATE GOVERNANCE
(As required by Clause 49 of the Listing Agreement with the Stock Exchanges)
Company's philosophy is to achieve excellence in its entire activities serve the interest of the shareholder, stakeholders and the society in general, thereby contributing to the welfare of the nation. The Company continues to be transparent in all its dealings and present a complete picture of the operations of the Company to the public at large and the shareholders and stakeholders in particular. The Company has always believed in fair business and corporate practices while dealing with the shareholders, employees, customers, farmers, creditors, lenders and others. The Company is prompt in discharging its statutory obligations and duties. All the mandatory requirements of this clause have been complied with.
The Company has laid down a Code of Conduct for observance by Directors and senior management. Affirmation of Compliance to this code has been obtained from all of them and the Executive Chairman has furnished a declaration to this effect.
1. Board of Directors
The Board of Directors comprises of 10 members out of whom 4 belong to the promoter group. The Board has a judicious mix of Executive and Non-Executive Directors. There are now 2 Executive Directors and 8 Non Executive Directors. Out of the Non-Executive Directors, one Director represents the lending Financial Institution IREDA as their nominee. There are 5 Independent Directors. One Woman Director has also been appointed. Constitution of Board of Directors of the Company is in full compliance with Clause 49 of the Listing Agreement and the Company has taken effective steps to comply with the applicable provisions of the new Companies Act, 2013.
2. Board Meetings, and AGM and Attendance thereat
The Board met five times during the financial year, on 29.05.2014, 13.08.2014, 12.11.2014, 19.01.2015 and 11.02.2015
3. Management Committee
The Board has constituted a Management Committee to facilitate the operational needs of the Company. It meets as and when the need to consider any matter assigned to it arises. Four meetings were held on 31.12.2014, 30.01.2015, 28.02.2015 and 16.03.2015 during the year.
The Names of Directors of the Management Committee are given below
? Dr Palani G.Periasamy
? Mr. M. Ramalingam
? Mr. A. Sennimalai
? Mr P.S Gopalakrishnan
4. Audit Committee
The qualified and independent audit committee constituted in accordance with Sec 177 of the Companies Act, 2013 and clause 49 of the Listing Agreement comprises of 4 non-executive directors out of whom 2 are Independent Directors. The Chairman of the Audit Committee is Mr P S Gopalakrishnan an independent Director. All the members satisfy the requirements stipulated in Clause 49. The Chairman of the Audit Committee was present at the Annual General Meeting held on 24th September 2014. The Committee has since been reconstituted.
The following are the present members of the Audit Committee.
? Mr. P S Gopalakrishnan - Chairman (Independent)
? Mr. A Sennimalai
? Dr K C Reddy
? Mr T Pitchandi
? Dr S Muthu
A whistle blower policy and Vigil Mechanism has been set up and disclosed in the Website. No personnel have been denied access to the Audit Committee.
Shri E P Sakthivel, Company Secretary is the Secretary to this Committee.
The Audit committee has to consider all matters connected with accounting standards issued by the Institute of Chartered Accountants of India and to see whether Cost Accounting Records are maintained as per the requirements. The committee shall also discuss the accounting systems, accounting policies, internal controls adopted by the Company. In addition, the Committee is expected to review the financial statements before recommending to the Board of Directors. Further the Committee will examine the financial and operational performance of the Company and take note of the major developments of the Industry.
5. Nomination & Remuneration Committee
Remuneration Committee constituted in the year - 2002 and renamed as Nomination & Remuneration Committee has the following non-executive Directors as Members to recommended names as Directors and determine the speciic remuneration packages for executive directors including pension rights etc;. The Chairman is an independent Director. The committee will examine the performance, experience and qualiication and accordingly recommend suitable names as also remuneration.
· Mr P S Gopalakrishnan : Chairman (Independent Director)
· Dr K C Reddy : Nominee Director (IREDA)
· Mr. A Sennimalai : Director
· Mr T Pitchandi : Independent Director
No remuneration is paid to Non executive Directors, except sitting fees for attending the Board/ Committee meetings. Sitting fees are paid within the limits prescribed by Government of India and the Articles of Association of the Company.
a. Remuneration proposed to be paid to Dr Palani G Periasamy for the year 2014 2015 is regulated in terms of Schedule V, Part-II, Section-II and is given below:
b. Remuneration proposed to be paid to Shri M Ramalingam, Managing Director is in accordance with Schedule II part II of Schedule V of the Companies Act, 2013.
As the Company has not earned any profits for the year 2014-15, the remuneration proposed to be paid to management personnel for the year 2014-15 has been kept at the minimum amount i.e., not exceeding Rs. 60 lakhs p.a. payable as fixed in Section II part II of Schedule V of the Companies Act, 2013 for a Company whose effective capital is Rs.100 crores or more. Comparative figures for the current year and last year are given below:
6. Independent Directors Meeting
The Independent Directors held one meeting during 2014-15 without the attendance of Non Independent directors and reviewed the performance of Directors, Chairperson, etc. as prescribed.
7. Stakeholders Relationship Committee
The Stakeholders Relationship Committee consists of Dr K C Reddy, Chairman who is a Non-Executive Director, Shri M Ramalingam, Managing Director and Mr A Sennimalai Director with Shri E P Sakthivel, Company Secretary as compliance officer. The committee gives utmost importance to redress the investor's complaints promptly. The complaints are settled within 15 days from the date of receipt of the complaints. The nature of complaints normally relate to transfer of shares, non-receipt of Annual Reports, non- receipt of declared dividends etc., The committee reviewed the action taken by the Company on those matters.
Investors Grievance complaints e-mail email@example.com
Corporate Identiication No
9. Cost Accounting Records (Electricity Industry) Rules 2011.
The Company has maintained all records, books, registers, accounts and the reports as required by the Cost Accounting Records Rules 2011 in regard to the Co-generation Power Plant, Sugar plant and Distillery plants.
Related party transactions are contracts or arrangements made by the Company from time to time with companies which are considered related parties. All these contracts or arrangements were approved in the Board, entered wherever applicable, in the Register of contracts maintained under section 189 of the Companies Act, 2013 and the register placed in the subsequent Board Meeting.
All such material transactions with related parties during the year 2014 - 2015 are given against note 25.4.11 to the Accounts. They were also brought to the notice of the Audit Committee.
There was no instance of non-compliance by the Company of any matter relating to the Capital markets during the last three years.
No penalty or strictures were imposed on the Company by Stock Exchange or SEBI or any statutory authority during the last three years.
The Managing Director and President (Corporate Finance) & Chief Financial Officer have furnished the required certificate as provided in Clause 49 (IX) of the Listing Agreement.
All the mandatory requirements as per Clause 49 of the Listing Agreement have been followed.
11. Non-mandatory requirements.
Board felt that the other non-mandatory requirements like separate posts of Chairman and Chief Executive Oficer, shareholders' rights, etc., can be considered at the appropriate time.
12. Means of Communication.
a. Publication of Results: The quarterly financial results of the Company were announced within the stipulated period and were published in the following English and Tamil newspapers from Chennai City as required by the Listing Agreement with Stock Exchanges.
b. News, Release etc.
The Company has its own website www.dharanisugars.in and all vital information relating to the Company and its performance including inancial results, press releases pertaining to important developments, performance updates and corporate presentations etc., are regularly posted on the website.
a) The Ministry of Corporate Affairs has taken a "Green Initiative in the Corporate Governance" to allow paperless compliances by the Corporate sector. After introducing E-filing of various Returns through the MCA portal, MCA by its Circular dated 21.04.2011 has now made permissible the service of documents through electronic mode to shareholders.
b) As a responsible corporate citizen, the Company shall endeavour to support the Green Initiative of the Government. This however would be possible only with the active support and co-operation of shareholders.
The Company has attached a separate format to its shareholders to send an email conirmation to its designated ID firstname.lastname@example.org mentioning the name, DP/Customer ID or Folio No. and the Email ID of the Shareholder for communication. On this confirmation:
i. The Company would henceforth send all Notices, Annual Report and other communication to these shareholders through Email.
ii. Copies of same would be available under the 'investor section' of our websites www.dharanisugars.in
iii. Shareholders will at all times be entitled to receive free of cost, hard copy (paper version) of Annual Report and other communication on specific request.
iv. Shareholders always have the liberty to modify their instructions any time.
The Company earnestly appeals to all its shareholders to support the Green Initiative of the Government by opting for electronic mode of receiving our corporate communications, including Notices and Annual Reports.
Management discussion and Analysis report is a part of the Directors' Report.
13. Insider Trading
SEBI has on 15th January 2015 notified a new set of regulations called the SEBI (Prohibition of Insider Trading) Regulations 2015 to come into force by the 15th May 2015. The earlier regulations called SEBI (Prohibition of Insider Trading) Regulations, 1992 are repealed from this date. The revised regulations have been approved to put in place a frame work for prohibition of insider trading in securities and to strengthen the legal frame work, on the basis of the recommendations of the High Level Committee led by Justice Sodhi about a year back.
In accordance with the new regulations, the Board of Directors has formulated and published on its website a code of practices and procedures for fair disclosure of unpublished price sensitive information and informed to the Stock Exchanges also. Similarly a Code of conduct to govern trading by its employees has been drawn up. The Company Secretary has also been designated as the compliance oficer to monitor and ensure compliance with these regulations.
The Board monitors the adherence to the various requirements as set out in the code every quarter. No violation of the erstwhile regulations has taken place.
14. General Shareholder Information
i. Time, Date and Venue of Annual General Meeting
28th September 2015 at 10.20 A.M.
Narada Gana Sabha, New No. 314 TTK Road Alwarpet, Chennai 600 018
ii. Financial Year
April 2014 - March 2015
iii. Date of Book Closure
22nd September 2015 to 28th September 2015 (both days inclusive)
iv. Listing on Stock Exchanges
1. Bombay Stock Exchange, Mumbai
2.The National Stock Exchange of India Ltd, Mumbai
18. Registrars and Share Transfer Agents
M/s Cameo Corporate Services Limited "Subramanian Building, 5th Floor No 1 Club House Road, Chennai 600 002.
Phone No 91-44-28460390/28460718
Fax No: 91-44-28460129, E-mail : email@example.com / Investor@cameoindia.com
Transfer/Transmission of shares can be effected through the above by sending the required documents to the General Manager, Cameo Corporate Services Limited, Chennai at the above address.
20. Dematerialisation of Shares.
The Company's Equity Shares already stand dematerialized with ISIN No. INE988C01014. Trading of equity shares in the stock exchanges is done only in dematerialized form.
21. Plant Location
Sugar Unit -I
Dharani Nagar,Vasudevannallur - 627 760 Tirunelveli Dist , Tamil Nadu
Sugar Unit - II
Karaipoondi Village,Polur - 606 803 Thiruvannamalai Dist, Tamil Nadu
Sugar Unit - III
Kalayanallur Village, SankarapuramTaluk , Villupuram Dist. - 606 206 Tamil Nadu
Distillery (in Unit I)
Dharani Nagar, Vasudevannallur - 627 760 Tirunelveli Dist , Tamil Nadu
Distillery (in Unit III)
Kalayanallur Village, SankarapuramTaluk, Villupuram Dist. - 606 206 Tamil Nadu
Co- Generation of Power (In Unit II)
Karaipoondi Village,Polur - 606 803 Thiruvannamalai Dist. Tamil Nadu
Co- Generation of Power (In Unit III)
Kalayanallur Village, SankarapuramTaluk Vlilupuram Dist. - 606 206 , Tamil Nadu
22. Nomination Facility.
Individual shareholders can avail of the facility of nomination. The nominee shall be the person in whom all rights of transfer and / or amount payable in respect of the shares shall vest, in the event of the death of the shareholder. A minor also can be a nominee but the name of the guardian has to be given in the nomination form. In case, any assistance is needed, Share Department of the Company can be approached.
23. Bank Mandate
i. Physical holding:In order to provide protection against fraudulent encashment of the warrants, shareholders holding shares in physical form are requested to intimate the Company under the signature of the sole/ first joint holder, their Bank account particulars to be incorporated in the dividend warrants. This is a mandatory requirement in terms of SEBI Circular No. D&CC/FITTC/Cir-04/2001 dated 13.11.2001.
ii. Demat holding : Bank account details as furnished by their Depositories to the Company in the case of shareholders holding shares in electronic form will be printed on their dividend warrants as per the applicable regulations of the Depositories and the Company will not entertain any direct request from such shareholders for deletion of / Change in such bank details. Instructions, if any, already given by them in respect of shares held in physical form will not be automatically applicable to shares held in electronic mode. Shareholders who wish to change such bank account details are advised to inform their Depository Participants about such change, with complete details of bank account.
iii. ECS mandate : Shareholders holding shares in physical form who wish to avail Electronic Clearing Facility (ECS) may authorise the Company with their ECS mandate in the prescribed form and requests for payment of dividend through ECS.
24. The CEO and CFO have furnished the required Certificate to the Board of Directors, as provided in Para IX of Clause 49.
Certificate under Para IX of Clause 49 of the Listing Agreement.
We have reviewed financial statements and the cash flow statement for the year 2014-15 and that to the best of our knowledge and belief:
a. These statements do not contain any materially untrue statement or omit any material fact or contain statements that might be misleading;
These statements together present a true and fair view of the Company's affairs and are in compliance with existing accounting standards, applicable laws and regulations.
b. There are, to the best of our knowledge and belief, no transactions entered into by the Company during the year which are fraudulent, illegal or violative of the Company's code of conduct.
c. We accept responsibility for establishing and maintaining internal controls for financial reporting and that we have evaluated the effectiveness of internal control systems of the Company pertaining to inancial reporting and we have disclosed to the auditors and the audit committee, deiciencies in the design or operation of such internal controls, if any, of which we are aware and the steps we have taken or propose to take to rectify these deficiencies.
d. We have indicated to the auditors and the Audit committee Significant changes in internal control over financial reporting during the year:
Signiicant changes in accounting policies during the year and that the same have been disclosed in the notes to the financial statements and instances of significant fraud of which we have become aware and the involvement therein, if any, of the management or an employee having a signiicant role in the Company's internal control system over inancial reporting.
M P Kaliannan President (Corporate Finance)& CFO
M Ramalingam Managing Director
25. Affirmation of Compliance with the Company's code of conduct-Clause 49 II (E)
I hereby declare that all the Board Members and Senior Management have afirmed compliance with the code of conduct laid down by the Board.
Dr Palani G Periasamy Executive Chairman
26. Compliance Officer
Shri E.P Sakthivel, Company Secretary is the Compliance Officer under SEBI (Registrar to an Issue and Share Transfer Agents) Regulations, 1993 and under Clause 47 of the Listing Agreement with Stock Exchanges. His email ID is firstname.lastname@example.org
27. Addresses for Communication
M/s Dharani Sugars and Chemicals Limited "PGP House" No.59, Sterling Road Nungambakkam, Chennai - 600 034.
Telephone: 044 - 2820 7480, 2831 1313, Fax No: 044 - 2823 2074 CIN - L15421TN1987PLC014454
Email: email@example.com,firstname.lastname@example.org Website : www.dharanisugars.in