CORPORATE GOVERNANCE REPORT
Federal-Mogul Goetze (India) Limited defines Corporate Governance as a process directing the affairs of the Company with integrity, transparency and fairness, so as to optimize its performance and maximize the long term shareholder value in legal and ethical manner, ensuring justice, courtesy and dignity in all transactions of the Company. Your Company is committed to good Corporate Governance in all its activities and processes.
The Company maintains the optimum combination of Executive, Non-executive and Independent Directors having rich experience in related sectors for providing premeditated direction to the Company. The Board of Directors always endeavor to create an environment of fairness, equity and transparency in transactions with the underlying objective of securing long term shareholder value, while, at the same time, respecting the right of all stakeholders.
2. BOARD OF DIRECTORS
a) Composition: The Board of Directors of the Company has an optimum combination of executive, non-executive and Independent directors having rich knowledge and experience in the industry and related sectors for providing strategic guidance and direction to the Company. Presently, the Company has nine Directors on its Board, out of which six are Non Executive Directors including one woman director. Moreover, 3 of the Non Executive Directors are Independent Directors. The Chairman of the Board is a Non - Executive Independent Director. The non-executive Independent Directors bring a wide range of expertise and experience to the Board.
During the year, there was no pecuniary relationship or business transaction by the Company with any non-executive Director, other than the sitting fee for attending the Board/ Committee meetings.
b) Details of Board Meetings held during the year 1st January, 2014 to 31st March, 2015
Information placed before the Board :
Apart from the items that are required to be placed before the Board for its approval under the statutes, the following are also tabled for Board's Periodic Review/ Information, to the extent applicable:
• Annual operating plans and budgets and any updates;
• Capital budgets and any updates;
• Quarterly results for the company and its operating divisions or business segments;
• Minutes of meetings of audit committee and other committees of the board;
• The information on recruitment and remuneration of senior officers just below the board level, including appointment or removal of Chief Financial Officer and the Company Secretary;
• Show cause, demand, prosecution notices and penalty notices which are materially important;
• Fatal or serious accidents, dangerous occurrences, any material effluent or pollution problems;
• Any material default in financial obligations to and by the company, or substantial non payment for goods sold by the company;
• Any issue, which involves possible public or product liability claims of substantial nature, including any judgement or order which, may have passed strictures on the conduct of the company or taken an adverse view regarding another enterprise that can have negative implications on the company;
• Details of any joint venture or collaboration agreement;
• Transactions that involve substantial payment towards goodwill, brand equity, or intellectual property;
• Significant labour problems and their proposed solutions. Any significant development in Human Resources/ Industrial Relations front like signing of wage agreement, implementation of Voluntary Retirement Scheme etc;
• Sale of material nature, of investments, subsidiaries, assets, which is not in normal course of business;
• Quarterly details of foreign exchange exposures and the steps taken by management to limit the risks of adverse exchange rate movement, if material;
• Non-compliance of any regulatory, statutory or listing requirements and shareholders service such as non-payment of dividend, delay in share transfer etc.
c) Information in respect of Directors being re-appointed is as under:
Mr. Sunit Kapur and Mr. Bernhard Georg Motel, Directors are liable to retire by rotation, in the ensuing Annual General Meeting of the Company and being eligible, offer themselves for re-appointment. Item regarding their re-appointment has been included in the notice of the ensuing Annual General Meeting.
Mr. Sunit Kapur, is a Mechanical Engineer from the Punjab University and has also done General Management Programme at CEDEP (INSEAD). Mr. Kapur has been associated with the Company since 1994. He has around 21 years of rich experience in Manufacturing, Engineering, Projects, TPM, Operation, Supply Chain Management and General Management. He began his career as Production Manager at the Patiala Plant of the Company and has been instrumental in introduction of various new processes and changes over his tenure of 21 years with the Company. His professional skills and abilities accumulated through intensive On the Job and Off the Job trainings from eminent Global Management and Technical Experts. Prior to his appointment as Managing Director, Mr. Sunit Kapur was holding the position of Executive Director Operations. Presently he is Vice President and General Manager - Global Ignition in Federal- Mogul Corporation.
Mr. Bernhard Motel holds Master Degree in Engineering from Berlin, Germany. He has around 17 years experience in the industry. He has held several senior management positions in Federal-Mogul. Presently, he is Senior Vice- President and General Manager Global Piston BU, in Federal Mogul.
Mr. Mahendra Kumar Goyal was appointed as an Additional Non-executive Independent Director in the Board Meeting held on 13th August, 2014 for a period of 5 years. Mr. Mahendra Kumar Goyal, aged 46 years, is a Chartered Accountant, Company Secretary & Cost Accountant with an Advanced Management Program Certificate from Oxford University. He dedicatedly served Anand Group for over almost 20 years and handled positions of increasing responsibility in the areas of Finance, Controlling, Treasury, Corporate Governance, Board and Legal matters. In his current capacity, Mr. Goyal has been overseeing the entire After Market operations, including After Market Exports at the Group level.
Ms. Janice Ruskey Maiden, was also appointed as an Additional Non-Executive Director in the Board Meeting held on 13th August, 2014. Ms. Janice Maiden, aged about 56 years, is a Graduate in Textile Engineering from Philadelphia University, Philadelphia, PA, MSE/Executive Masters in Technology Management (EMTM) from University of Pennsylvania, Philadelphia, PA. and has undergone International Business Development Program under INSEAD - General Management Program (CEDEP), Fontaine annual report 2015 Bleu, France. Ms. Maiden has 33 years of rich experience in technology exploration, product and business development.
Pursuant to the provisions of the Companies Act 2013 read with clause 49 of the listing Agreement, Mr. K N Subramaniam and Mr. Mukul Gupta (existing Independent Directors) were appointed as Independent Directors in the Board meeting held on 13th February, 2015.
Mr. K. N. Subramaniam holds a Bachelors degree in Technology (B Tech.,) from University of Madras, and Masters in Business Administration from Indian Institute of Management, Ahmedabad. He has been associated with Automotive industry in India for well over two decades apart from other industries like Oil and Gas, EPC contracts in Water and Waste Water Treatment. He has extensive knowledge and rich experience of Indian Automotive Industry and is well known in the Industry. He had been with Anand Automotive for over 30 years and moved through many of the Group Companies starting from Purolator India Ltd. During the period 1998-2008 he had been President and Director for 3 years and for 7 years as Managing Director and CEO of Gabriel India Ltd.
Mr. Mukul Gupta is a Law Graduate and also has a Bachelors Degree in Economics (Hons) from Meerut University and has been practicing for many years as a Tax Advocate in the field of Sales Tax, Work Contract Tax, VAT and Service Tax. He has been providing Consultancy Services in different areas of tax to large multinationals as well as Reputed Indian Companies. He is presently the National Vice President of the All India Federation of Tax Practitioners and had also held the responsibility as Secretary General for 2009 & 2010 of AIFTP He is the Member of the Supreme Court Bar Association, New Delhi since 1985 and was also the Vice President of the Ghaziabad Tax Bar Association in 2001. He is also involved in giving advice to the Government of Uttar Pradesh with respect to improving the System of Sales Tax and implementation of VAT, which is helpful to Industries and Business in general. He was the President of Rotary Club in 1995-96 and received Presidential Citation for Integrity, Love and Peace. He is Member Governing Council of Center of Agrarian Research & Training.
Dr. Khalid Iqbal Khan was appointed as an Wholetime Director- Legal and Company Secretary in the Board Meeting held on 22nd May, 2015 for a period of 3 years. Dr. Khalid Khan, aged 47 years, is a Company Secretary from the Institute of Company Secretaries of India, Chartered Secretary from the Institute of Chartered Secretaries and Administrators, UK and a Law graduate. He has also done PhD in Corporate Governance. Dr. Khan has 23 years of rich experience at senior level positions in the legal field. He has also completed Mahler Leadership Course.
Dr. Khan has been associated with the Company since November, 2009 as Director - Corporate & Legal Affairs & Company Secretary. Prior to joining the Company, he was Company Secretary of Goodyear India Limited. The Board had considered him the most suitable for the position of Whole Time Director Legal & Company Secretary of the Company.
The terms of appointment as well as familiarisation programme of Independent Directors are available at the Company's website www.federalmogulgoetzeindia.net under the head Investors' Information.
Code of Conduct
We at Federal-Mogul Goetze (India) Limited have laid down a code of conduct for all Board members and senior management of the Company. The code of conduct is available on the website of the Company i.e. www.federalmogulgoetzeindia.net <http://www.federalmogulgoetzeindia.net>. The code has been circulated to all the members of the Board and senior management and they have affirmed compliance with the code of conduct. A declaration signed by the Managing Director to this effect is attached to the Annual Report.
3. AUDIT COMMITTEE
a) Terms of Reference
The current terms of reference of the Audit Committee fully conform to the requirements of Clause 49 of the Listing Agreement as well as Section 177 of the Companies Act, 2013. These broadly include review of internal audit programme, review of financial reporting systems, internal control systems, ensuring compliance with statutory and regulatory provisions, discussions on quarterly, half yearly and annual financial results, interaction with senior management, statutory and internal auditors, recommendation for re-appointment of statutory auditors etc.
b) Composition, name of members and Chairman
Presently, the Audit Committee comprises of two Non-Executive Independent Directors and one Non-Executive Director viz. Mr. Mukul Gupta, Chairman (Non-Executive Independent Director), Mr. K.N. Subramaniam, Member (Non-Executive Independent Director) and Mr. Bernhard Motel, Member (Non- Executive Director).
Representatives of the Management, Finance Department, Company Secretary, Statutory Auditors and Internal Auditors are invitees to the meetings of the Audit Committee.
The Audit Committee meeting was also held on May 22, 2015 to, inter-alia, consider the re appointment of Walker, Chandiok & Co, Chartered Accountants (Firm Registration No. 001076N), as Statutory Auditors of the Company for the financial Year 2016, review of the audited financial results and Annual Accounts for the financial year ended 31st March 2015 with the statutory auditors and recommend the same to the Board for approval.
4. NOMINATION AND REMUNERATION COMMITTEE
At present, the Nomination and Remuneration Committee of the Company comprises of Mr. Mukul Gupta as the Chairman, Mr. K.N. Subramaniam and Mr. Bernhard Motel as Members. The Nomination and Remuneration Committee has been constituted for identifying persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down, recommending to the Board their appointment and removal, carry out evaluation of every director's performance, laying down the criteria for performance evaluation of Independent Directors, determining qualifications, positive attributes and independence of a director and reviewing the remuneration of the Directors, Key Managerial Personnel and other employees. The Nomination and Remuneration policy is in consonance with the existing industry practice.
a) Terms of reference
The current terms of reference of the Nomination and Remuneration Committee fully conform to the requirements of Clause 49 of the Listing Agreement as well as Section 178 of the Companies Act, 2013. These broadly include:
- To lay down criteria and terms and conditions with regard to identifying persons who are qualified to become Directors (Executive and Non-executive) and persons who may be appointed in Senior Management and key managerial positions and to determine their remuneration.
- To determine remuneration based on the Company's size and financial position and trends and practices on remuneration prevailing in peer companies in the auto ancillary industry.
- To carry out evaluation of the performance of Directors, as well as Key Managerial and Senior Management Personnel & Functional Heads
- To provide them reward linked directly to their efforts, performance, dedication and achievement relating to the Company's operations.
- To retain, motivate and promote talent and to ensure long term sustainability of talented managerial persons and create competitive advantage.
b) Meetings and Attendance
Nomination & Remuneration Policy and Evaluation criteria
The Nomination & Remuneration Policy has been formulated :
• to lay down criteria and terms and conditions with regard to identifying persons who are qualified to become Directors (Executive and Non-Executive) and persons who may be appointed in Senior Management and Key Managerial positions and to determine their remuneration.
• to determine remuneration based on the Company's size and financial position and trends and practices on remuneration prevailing in peer companies in the auto ancillary industry.
• to carry out evaluation of the performance of Directors, as well as Key Managerial and Senior Management Personnel & Functional Heads
• to provide them reward linked directly to their efforts, performance, dedication and achievement relating to the Company's operations.
The Nomination and Remuneration Committee has laid down the criteria for evaluation of Independent Directors. The criteria for evaluation consists of following
a. The skills, relevant experience, expertise and personal qualities that will best complement the position ;
b. Potential conflicts of interest and independence;
c. Detailed background information and performance track record;
d. The ability to exercise sound business judgement;
e. availability to attend Board and Committee Meetings; and
f. appropriate experience and/or professional qualifications.
Based on the performance evaluation of Independent Directors done by the Board of Directors in its meeting held on May 22, 2015, the performance of the Independent Directors has been found satisfactory.
5. STAKEHOLDERS' RELATIONSHIP COMMITTEE
• The Stakeholders' Relationship Committee has been constituted to look into the redressal of stakeholders' and investors' complaints like transfer/ transmission/ demat/ remat/ consolidation of shares, issue of duplicate share certificates; loss of share certificates; change of address; non-receipt of Annual Report; Dividend Warrants etc.
• Dr. Khalid Iqbal Khan, Company Secretary of the Company, has been nominated as the Compliance officer for this purpose.
6. Separate Meeting of Independent Directors:
A separate meeting of Independent Directors of the Company was held on 26th March 2015 without the attendance of Non-independent directors & members of management, to interalia :
a. review the performance of non-independent directors and Board as a whole;
b. review the performance of the Chairperson of the Company, taking in to account the views of executive directors and non-executive directors;
c. assess the quality, quantity and timeliness of flow of information between the Company management and Board that is necessary for the Board to effectively and reasonably perform their duties.
All the Independent Directors were present in the meeting.
• Disclosure on materially significant related party transactions i.e. transactions of the Company of material nature, with its promoters, the directors or the management, their subsidiaries or relatives etc. that may have potential conflict with the interests of the Company at large
• Details of number of Shares & Convertible Instruments held by NonExecutive Directors
• Details of non compliance by the Company, penalties and strictures imposed on the Company by Stock Exchanges or SEBI or any statutory authority, on any matter related to capital markets, during the past three years.
• Details of Compliance with mandatory requirements and adoption of the non-mandatory requirements
No materially significant related party transaction i.e. transactions of the Company of material nature, with its promoters, the directors or the management, their subsidiaries or relatives etc. that may have potential conflict with the interests of the Company at large was entered during the financial year ended 31st March 2015.
As on date, no Non-Executive Director holds any share in the Company.
- As on date, the Company is in full compliance with the mandatory requirements of Clause 49. Further, following Non-mandatory requirements are also adopted by the Company :
1. At present, the Chairman of the Board is a Non-executive Independent Director. Who is entitled to sitting fee only for the Board and Committee Meeting held during the year.
2. Separate posts of Chairman and CEO. The Company has appointed non-executive Independent Directors as
3. Reporting of Internal Auditors: The internal auditors report to the audit committee directly.
• Details of Familiarisation programme for Independent Directors www.federalmogulgoetzeindia.net
• Policy on Related Party Transaction www.federalmogulgoetzeindia.net
8. MEANS OF COMMUNICATION
Quarterly/Half-Yearly/Yearly Financial Results of the Company were considered and approved by the Directors and the same were communicated to Stock Exchanges on the same day. During the year under review, these results were generally published in one English Daily i.e. Financial Express (all edition) and one Hindi Daily i.e Jansatta, Delhi.
The results are available on the Company's website at www.federalmogulgoetzeindia.net All the official news releases are made available at the website.
Whether presentations were made to Institutional Investors or to the analysts ? No.
9. GENERAL SHAREHOLDERS INFORMATION
a. 60th Annual General Meeting
- Date and Time: 11th August 2015 at 11.00 A.M. at
- Venue: Mapple Emerald, Crystal Hall, National Highway-8, Rajokri, New Delhi-110038
Financial Calendar (Tentative) :1st January, 2014 to 31st March, 2015
- Results for the quarter/half year ending June 30, 2015 Last week of July 2015
- Results for the quarter/period ending September 30, 2015 :Last week of October 2015
- Results for the quarter/year ending December 31, 2015 :Last week of January, 2016
- Results for the quarter/year ending March 31, 2016 :Last week of May 2016
- Annual General Meeting for the financial year ending March 31, 2016 :Last week of August 2016
Book Closure date Listing on Stock Exchanges
5th August 2015 to 11th August 2015 (both days inclusive)
- Bombay Stock Exchange Limited
Phiroze JeeJee Bhoy Towers, Dalal Street, Mumbai-400001
- The National Stock Exchange of India Ltd.,
Exchange Plaza, Bandra Kurla Complex, Bandra (East) Mumbai.
f. Stock Code
Bombay Stock Exchange-505744
National Stock Exchange-FMGOETZE
ISIN No.-NSDL - CDSL
g. Share Transfer System
- Alankit Assignments Limited, RTA Division, 'Alankit Heights, 1E/13, Jhandewalan Extension, New Delhi 110055 is acting as the Registrar and Transfer Agent for the Equity Shares of the Company, w.e.f. 1st May 2005 to provide services in both Physical and Electronic Mode.
- The authority relating to share transfer has been delegated to the Share Transfer Committee. Presently, the Share Transfer Committee comprises of Dr. Khalid Iqbal Khan, Chairman, Mr. Mukul Gupta and Mr. K.N. Subramaniam as Members.
- Valid share transfers in physical form and complete in all respects are normally approved and registered generally within a period of a fortnight by the Share Transfer Committee. Valid demat requests are cleared twice in a week. The committee met 47 times during the financial year 2014-15 for approving transfers, transmission etc.
- Pursuant to clause 47(c) of the Listing Agreement with the Stock Exchanges, certificates on half yearly basis, have been issued by the Company Secretary in practice for due compliance of share transfer formalities by the Company.
h. Dematerialization of shares and Liquidity
As on 31st March 2015, 99.064% of the Equity Capital of the Company have been dematerialized .The shares of the company are traded on Mumbai Stock Exchange Limited, Mumbai and the National Stock Exchange of India Limited, Mumbai and have good liquidity.
i. Outstanding GDR's / ADR's / Warrants Or any convertible instruments, conversion date and likely impact on equity.
j. Plant Locations :
1. Bahadurgarh Patiala (PUNJAB)
2. Yelahanka Bengaluru (KARNATAKA)
3. SPL 1240-44, RIICO Industrial Area Phase I Extn., Bhiwadi (RAJASTHAN)
4. Plot No. 46, Sector-11, IIE-Pantnagar, Udham Singh Nagar, (UTTARAKHAND)
k. Corporate office:
10th Floor, Tower B, Paras Twin Towers, Sector-54, Golf Course Road, Gurgaon, Haryana 122002, India. Tel No: 0124-478 4530
G-4, J.R Complex, Gate No.-4, Mandoli Delhi - 110093.
Phone : +91-11-71745675, Fax : +91-11-71745670 email: email@example.com Website: www.federalmogulgoetzeindia.net
l. Registrar and Share Transfer Agent
Alankit Assignments Limited
'Alankit Heights' 1E/13, Jhandewalan Extn. New Delhi 110 055 Tel No: 011-23541234, 42541234/ Fax No.: 011-23552001/42541201
m . Compliance Officer :
Dr. Kahlid Iqbal Khan, Company Secretary
10. Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013
The Company has in place an Anti Sexual Harassment Policy in line with the requirements of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaints Committee has been set up to redress the complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under the policy.
The following is a summary of sexual harassment complaints received and disposed off during the year 2014-15
No. of complaints received : Nil
No. of complaints disposed off : Nil
For and on behalf of the Board
Andreas Wilhelm Kolf
Whole Time Managing Director
Whole Time Finance Director & CFO
Place : Gurgaon
Date : 22nd May, 2015