Report on Corporate Governance
(Pursuant to Regulation 72 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015)
1. The Company's philosophy on Code of Corporate Governance
The Company's philosophy on Corporate Governance is to conduct its affairs in a manner, which is ethical and transparent with all stakeholders in the Company, including shareholders, lenders, creditors, and employees. To this end, the Company's philosophy on Corporate Governance is to Endeavour to ensure:
• That systems and procedures which monitor compliance with laws, rules, and regulations are in place in each area of its business.
• That relevant information regarding the Company and its operation is disclosed, disseminated and easily available to its stakeholders.
Your Company's policy is aimed at adhering to all the laws, rules, regulations meant for Corporate Governance at all times and have the best management team that can also effectively monitor corporate decisions for sustained growth.
2. Board of Directors
The Company's policy is to have an appropriate mix of Executive and Independent Directors to maintain the independence of the Board.
a. Number of Board Meetings
During the financial year under review, six Board Meetings were held on 29th May, 2015, 15th July, 2015, 25th July, 2015, 4th September, 2015, 13th November, 2015, 28th January, 2016.
b. Criteria for performance evaluation:
The Nomination and Remuneration Committee lays down the criteria for performance evaluation of Directors. The annual evaluation of Directors is made on the following criteria:
i. Attendance for the meetings, participation and independence during the meetings;
ii. Interaction with Management;
iii. Role and accountability of the Board and
iv. Knowledge and proficiency
c. Meeting of Independent Directors
The meeting of Independent Directors' was held on Thursday, 31st March 2016 to discuss, inter-alia:
(a) the performance of Non Independent Directors and the Board as a whole;
(b) the performance of the Chairman of the Company, taking into account the views of Executive Director and Non-Executive Directors;
(c) the quality, quantity and timeliness of flow of information between the management and the Board that is necessary for the Board to effectively and reasonably perform its duties.
d. Familiarisation program for Independent Directors
• Independent Directors of the Company are made aware of their role, rights and responsibilities at the time of their appointment, through a formal letter of appointment, which also stipulates various terms and conditions of their engagement. Further copies of Code of Conduct and Policies adopted by the Board as per regulatory provisions are made available to Independent Director at the time of joining.
• During quarterly Board Meetings, all Board Members are updated on regular basis, by way of presentations where Directors have an opportunity to interact with senior management personnel. Presentations cover, inter alia, quarterly and annual results, budgets, review of internal audit report, information on business performance, operations, financial parameters, senior management change, major litigations, compliances, risk management and regulatory scenarios and such other areas as may arise from time to time.
• The same is available on company's website www.ggdandekar.com
e. Code of Conduct
The Company has laid down a Code of Conduct for all Board Members and Senior Management Personnel. The Code of Conduct is available on the Company's website viz., www.ggdandekar.com >. All the Board Members and Senior Management Personnel have affirmed compliance with the Code of Conduct. A declaration to this effect signed by the Executive Director forms part to this Report.
f. Information supplied to the Board
Among others, this includes:
• Review of annual operating plans of business, capital budgets, updates;
• Quarterly results of the Company and its operating divisions or business segments;
• Material important show cause, demand, prosecution and penalty notices;
• Fatal or serious accidents, dangerous occurrences, any material effluent or pollution problems;
• 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;
• Significant development in human resources and industrial relation fronts;
• Non-compliance of any regulatory, statutory provision or listing requirements as well as shareholders service such as non-payment of dividend and delay in share transfer.
• Information on recruitment and remuneration of senior officers just below the Board level, including appointment or removal of Chief Financial Officer or Company Secretary.
3. Audit Committee
As at 31st March, 2016, the Audit Committee comprises of Four Non-Executive Directors, among which 3/4th of the members are Independent. The Company Secretary acts as the Secretary to the Committee. The Executive Director also attends the Audit Committee Meetings. The representatives of the Internal Auditors and Statutory Auditors are also invited to the meetings.
During the financial year under review, four meetings of the Committee were held on 29th May 2015, 15th July 2015, 13th November 2015 and 28th January 2016.
b. Terms of Reference
The terms of reference of the Audit Committee include the matters specified under Regulation 18 read with Schedule II of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 as well as those in Section 177 of the Companies Act, 2013 and inter-alia includes the following:
1. Oversight of the Company's financial reporting process and the disclosures 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) Qualification in 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 utilization of proceeds of a public or rights issue, and making appropriate recommendations to the Board to take up steps in this matter.
7. Reviewing and monitoring the auditor's independence and performance, and effectiveness of audit process.
8. Approving or any subsequently modifying transactions of the company with related parties.
9. Scrutinizing inter-corporate loans and investments.
10. Ensuring valuation of undertakings or assets of the company, wherever it is necessary.
11. Evaluating 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. Discussing with internal auditors 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. Discussing with statutory auditors before the audit commences, about nature and scope of audit as well as post-audit discussion to ascertain any area of concern.
17. Looking into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders (in case of non-payment of declared dividends) and creditors.
18. Reviewing 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. Mandatorily reviewing the following information:
a. Management discussion and analysis of financial condition and results of operations;
b. Statement of significant related party transactions (as defined by the Audit Committee) submitted by the management;
c. Management letters / letters of internal control weaknesses issued by the statutory auditors;
d. Internal audit reports relating to internal control weaknesses; and
e. The appointment, removal and terms of remuneration of the Internal Auditor.
21. Carrying out any other function as is mentioned in the terms of reference of Audit Committee as amended from time to time by the Listing Regulations and Companies Act, 2013.
c. Powers of Audit Committee
• To investigate any activity within its terms of reference.
• To seek information from any employee.
• To obtain outside legal or other professional advice.
• To secure attendance of outsiders with relevant expertise, if it considers necessary.
4. Nomination and Remuneration Committee
As at 31st March, 2016, the Nomination and Remuneration Committee comprises of three Non-Executive Directors, majority of whom are Independent. The composition is in conformity with Regulation 19 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
During the financial year under review, four meetings of the Committee were held on 29th May, 2015, 15th July 2015, 25th July 2015 and 13th November 2015.
b) Terms of Reference
The terms of reference of the Nomination and Remuneration Committee include the matters specified under Regulation 19 read with Schedule II Part D of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 as well as those in Section 178 of the Companies Act, 2013 and inter-alia includes the following:
i. 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;
ii. Formulation of criteria for evaluation of Independent Directors and the Board;
iii. Devising a policy on Board diversity;
iv. 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.
v. Formulation of policy relating to the remuneration for the directors, key managerial personnel 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) Remuneration to Directors
1. Remuneration to Directors
The Board has, on the recommendation of the Nomination and Remuneration Committee adopted the Nomination and Remuneration Policy for selection and appointment of Directors, Senior Management and their remuneration. The copy of the same has been attached as Annexure II to the Directors' Report.
The Company pays remuneration by way of salary, perquisites and allowances (fixed component) and commission (variable component) to its Executive Director. The commission to the Executive Director is decided by the Nomination and Remuneration Committee on determination of the profits for the financial year and is also approved by the Board of Directors. The remuneration to the Executive Director is in accordance with the provisions of the Companies Act, 2013 and rules thereof and within ceiling prescribed thereunder.
Upon the recommendation of the Nomination and Remuneration Committee and based on the performance of the Company, the Board of Directors decide the remuneration to Non-Executive Directors by way of commission.
The sitting fee of Rs. 5,000/- per meeting of the Board and any committee thereof, attended by the Non-Executive Directors is payable to them.
5. Share Transfers Cum Shareholders' / Investors' Grievance and Stake Holders Relationship Committee
The Share Transfers Cum Shareholders' / Investors' Grievance and Stake Holders Relationship Committee has been constituted to look into investor's complaints like transfer of shares, non-receipt of Balance Sheet, non-receipt of declared dividends, etc. and redressal thereof. The Committee is headed by Mr. Madhav R. Chandrachud, Non-executive and Non - Independent Director, with Mr. Nihal G. Kulkarni, Non-Executive Director and Mr. Mangesh S. Joshi, Executive Director, being the other members of the Committee.
During the financial year under review, two meeting of Transfers Cum Shareholders' / Investors' Grievance and Stake Holders Relationship Committee Meeting were held on 29th May, 2015 and 25th July, 2015.
Mr. Saurabh Somani, Company Secretary is the Compliance Officer. The Compliance Officer can be contacted at: G. G. Dandekar Machine Works Limited
211/A, MIDC Butibori Industrial Area, Kinhi Village, Tah. Hingna, Dist. Nagpur 441122 Tel.: (07104) 667300; Fax: (07104) 667302 E-mail: email@example.com
With reference to Regulation 6(2)(d) of the SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015 the Company has designated exclusive e-mail id for the investors as firstname.lastname@example.org to register their grievances, if any. This has been initiated by the Company to resolve such Investors' grievances immediately. The Company has displayed the said e-mail id on its website for the use of investors.
During the year ended 31st March 2016, one complaint was received and replied to the satisfaction of the shareholders and there were no complaints outstanding as on 31st March 2016.
6. MEANS OF COMMUNICATION
a. Quarterly results
The Quarterly and Half Yearly results are published in national and local dailies, namely Financial Express (English) and Loksahi Varta (Marathi), having wide circulation. Since the results of the Company are published in the newspapers, half yearly reports are not sent individually to the shareholders.
The Company's results and official news releases are displayed on the Company's website namely www.ggdandekar.com
b. The BSE Corporate Compliance and Listing Centre (the 'Listing Centre')
The Listing Centre of BSE is web based application designed by BSE respectively for the Corporate. All periodicals compliance filings like shareholding pattern, corporate governance report, quarterly results etc. are filed electronically on the Listing Centre of BSE.
c. The Management Discussion and Analysis Report forms part of this Annual Report.
7. GENERAL SHAREHOLDER INFORMATION
a. Annual General Meeting
Corporate Identification Number (CIN)
Annual General Meeting
Date and Day : Tuesday, 9th August 2016 Time : 11:00 am
Venue : 211/A, MIDC Butibori Industrial Area, Kinhi Village, Tah. Hingna, Dist. Nagpur 441122
5th August 2016 to 9th August 2016 (Both days inclusive)
Last date of receipt of proxy forms
7th August 2016
Financial Year 2015-16
During the year the financial results were announced as under:
First quarter : 15th July, 2015
Second quarter : 13th November, 2015
Third quarter : 28th January, 2016
Annual : 24th May, 2016
International Security Identification Number (ISIN)
Name and address of stock exchange where shares are listed
BSE Limited (BSE),
Phiroze Jeejeebhoy Towers Dalal Street Mumbai- 400001
Stock Code 505250
Designated E-mail address for investor services
Dematerialization of Shares and Liquidity
Dematerialisation of shares and liquidity (as on 31st March 2016) :44,52,667
Outstanding GDRs / ADRs / Warrants or any Convertible instruments, conversion date and likely impact on equity or any Convertible instruments
The Company has not issued GDRs / ADRs / Warrants or any Convertible instruments,
Share Transfer System
The applications for transfer of shares lodged at the Company's Registrar and Share Transfer Agents in physical form are processed within 15 days of receipt of the valid and complete documents in all respects. After such processing, the Registrar and Share Transfer Agent will issue share certificate to the concerned shareholder within 15 days of receipt of certificate for transfer. Shares under objection are returned within a stipulated period of time. The transfer applications are approved periodically by the senior management of the Company.
Pursuant to the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a certificate on half yearly basis is issued by the Practicing Company Secretary for compliance with share transfer formalities by the Company.
Registrar and Share Transfer Agent (R & T Agent)
The entire work of the Company, relating to processing of transfer of shares has been given to an outside agency i.e., Link Intime India Private Limited being a SEBI Registered R & T Agent. The contact details are as follows -
Link Intime India Private Limited
'Akshay' Complex, Block No. 202, 2nd Floor, Off Dhole Patil Road, Pune - 411 001 Tel: (020) 2616 1629 / 2616 0084 Email: email@example.com
IV. Shareholder References
• Permanent Account Number (PAN)
Shareholders holding shares in the physical form are informed that as per SEBI's guidelines, it is mandatory to furnish copy of PAN Card in the following cases:
a) Transferees' PAN Cards for transfer of shares,
b) Surviving joint holders' PAN Cards for deletion of name of deceased shareholder,
c) Legal heirs' PAN Cards for transmission of shares,
d) Joint holders' PAN Cards for transposition of shares.
• Email Address
In order to enable us to further extend our support towards paperless compliance as a part of Green Initiative in the Corporate Governance, which was introduced by the Ministry of Corporate Affairs (MCA) in the year 2011, the shareholders who have not registered their e-mail addresses, so far, are requested to register their e-mail addresses.
In respect of shares held in physical form, shareholders are requested to register their e-mail addresses with the Company / R & T Agent (with Depository Participants in case of shares held in dematerialized form).
• Dematerialization of shares
Shareholders are requested to dematerialize their physical share holdings through any of the nearest Depository Participants (DPs) in order to avoid hassles involved with physical shares such as possibility of loss / mutilation of share certificate(s), and to ensure safe and speedy transaction in securities.
• Register Your National Electronic Clearing Services (NECS) Mandate
The Reserve Bank of India (RBI) has initiated NECS for credit of Dividend directly to the Bank Account of shareholders. Shareholders holding shares in electronic mode are requested to register their latest Bank Account details with their Depository Participant and in physical form with the Company's R & T Agent viz. Link Intime India Private Limited.
• Address for correspondence
Shareholders' correspondence should be addressed to Link Intime India Private Limited, Registrar and Share Transfer Agent, at the address mentioned above. Shareholders can also email their queries / grievances to the following email address: firstname.lastname@example.org
• CEO / CFO Certification
The CEO/CFO certificate signed by Mr. Mangesh S. Joshi, Executive Director and Mr. Sanket S. Gunjikar, Chief Financial Officer was placed before the meeting of the Board of Directors held on 24th May 2016.
8. OTHER DISCLOSURES
The Company has complied with the other disclosure requirements of Schedule V of the Regulations.
a. Related Party Transactions
During the Financial Year under review, there was no materially significant related party transaction made by the Company, as defined in Regulation 23 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, that may have potential conflict with the interest of the Company at large. Transactions with the related parties are disclosed in Note no. C-3 to the Financial Statements in the Annual Report.
b. Details of capital market non-compliance, if any
There have been no instances of non-compliances by the Company on any matters related to capital markets, during the last three years. Neither penalties have been imposed nor any strictures imposed on the Company by the Stock Exchanges, The Securities Exchange Board of India (SEBI) or any other statutory authority, on any matter related to capital markets.
c. Whistle Blower Policy / Vigil Mechanism
The Company has formulated and implemented the Whistle Blower Policy / Vigil Mechanism ('the Policy'). This has provided a mechanism for directors and employees of the Company and other persons dealing with the Company to report to the Chairman of the Audit Committee; any instance of unethical behavior, actual or suspected fraud or violation of the Company's code of conduct.
The policy has also been uploaded on the Company's website at <http://www.ggdandekar.com/Code_Of_Conduct/Whistle_Blower_Policy.pdf>
d. Policy for determining 'material' subsidiaries
Since Company does not have any subsidiary during the year under review, it was not required to formulate policy for determining 'material' subsidiaries and accordingly disseminate the information about the same on website of the Company as required under Regulation 46 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
e. Related Party Transactions Policy
Company was not required to formulate policy for Related Party Transactions.
9. Listing Fees
The Annual Listing Fees for the year under review have been paid to BSE Limited, where the Company's shares are listed.
Further the correspondence address of the Stock Exchanges is as follows:
BSE Limited 1st Floor, P. J. Towers, Dalal Street, Fort, Mumbai 400 001
10. Commodity price risk or foreign exchange risk and hedging activities
The Company is not having any Commodity price risk or foreign exchange risk and not involved in hedging activities.
11. Disclosures of the compliance with corporate governance
The requirements specified in Regulation 17 to 27 and clauses (b) to (i) of sub-Regulation (2) of Regulation 46 have been complied in the section on corporate governance of the annual report.
12. DISCRETIONERY REQUIREMENTS
1. Shareholder Rights
Since the Company publishes its quarterly results in newspapers (English and Marathi) having wide circulation, and since the results are also displayed on the website of the Company and the Stock Exchanges, the Company does not send any communication of half yearly performance to the shareholders.
2. Statutory Auditors qualifications
There are no qualifications on the Financial Statements of the Company for the year ended 31st March 2016.
3. Disclosure under Schedule VI of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 in respect of unclaimed shares
Pursuant Schedule VI of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has sent reminders to those shareholders, whose share certificates have returned undelivered by the postal authorities due to insufficient / incorrect information and are lying with the Company. These share certificates will be sent to eligible shareholders, if these shareholders submit necessary documents to the Company.
As on 31st March 2016, the total unclaimed equity shares are 31,530
13. PARTICULARS OF APPOINTMENT / RE-APPOINTMENT OF NON - EXECUTIVE DIRECTORS
The brief resumes and other details relating to the Directors who are proposed to be appointed / re-appointed, as required to be disclosed under Regulation 36(3) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, form part of the Explanatory Statement to the Notice of the Annual General Meeting.