CORPORATE GOVERNANCE REPORT
(Pursuant to clause 49 of the Listing Agreement)
1. CORPORATE GOVERNANCE PHILOSOPHY :
We believe that good Corporate Governance is a key driver of sustainable corporate growth and long term value creation of our stakeholders. Corporate Governance involves being responsive to aspirations of our stakeholders besides ensuring compliance with regulatory requirements. The Company has always been taking the spirit of various legislations as guiding principles and proposes to go well beyond statutory compliance by establishing such systems and procedures as are required to make the management completely transparent and institutionally sound. We are committed to conduct the business upholding the core values like transparency, integrity, honesty, accountability and compliance of all statutes. We recognize that this is a conscious and continuous process across the Organisation, which enables the Company to adopt best practices as we incorporate improvements based on the past experience.
We believe, Corporate Governance is not just a destination, but a journey to constantly improve sustainable value creation. It is an upward-moving target that we collectively strive towards achieving.
2. BOARD OF DIRECTORS :
The Composition of the Board is in conformity with Clause 49(III) of the Listing Agreement which inter alia stipulates that the Board should have an optimum combination of Executive and Non-Executive Directors with at least one Woman Director and at least 50% of the Board should consist of independent Directors, if the Chairman of the Board is an Executive Director.
This includes directorships held in public limited companies and excludes directorship in private limited companies.
Only two Committee viz. Audit Committee and Stakeholder Relationship Committee
None of the Directors on the Board is a member of more than 10 Committee and they do not act as Chairman of more than 5 Committee across all companies in which they are director.
Resignation of Shri Amit Dhanuka
The independent director Shri Amit Dhanuka resigned from the Board with effect from 31.03.2015. Consequent to his resignation, he also ceased to member of remuneration and nomination Committee. The Board place on record the appreciation for the service rendered by Shri Amit Dhanuka.
Appointment of Smt Mira Agarwal
The Board appointed Smt Mira Agarwal as Additional Independent director on the recommendation of NRC at its meeting held on 31.03.2015._
Scheduling and selection of agenda items for board meetings :
Dates of the board meetings are decided in advance. The board meetings are convened by giving appropriate notice after obtaining the approval of the Chairman and Managing Director. The Board meets at least once in a quarter to review the results and other items on the agenda, once a year for approval of annual budgets and strategy and also on the occasion of the Annual shareholders' Meeting. When necessary, additional meetings are held.
The Chairman of the Board and Company Secretary, in consultation with other concerned members of the senior management, finalise the agenda for Board meetings. Every Board member is free to suggest the inclusion of items on the agenda. All Business heads/ Service heads are advised to schedule their work plans well in advance, particularly with regard to matters requiring discussion/ approval/ decision in the board/ committee meetings.
All such matters are communicated to the Company Secretary in advance so that the same could be included in the agenda for the board meetings.
Board material distributed in advance
The agenda and notes on agenda are circulated to Directors in advance, and in the defined agenda format. All material information is incorporated in the agenda for facilitating meaningful and focused discussions at the meeting. Where it is not practicable to attach any document to the agenda, it is tabled before the meeting with specific reference to this effect in the agenda. In special and exceptional circumstances, additional or supplementary item(s) on the agenda are permitted.
Recording minutes of proceedings at Board and Committee meetings
The Company Secretary records minutes of proceedings of each Board and Committee meeting. Draft minutes are circulated to Board/ Board Committee members for their comments. The minutes are entered in the Minutes Book within 30 days from the conclusion of the meeting.
Post meeting follow-up mechanism
The guidelines for Board and Board Committee meetings facilitate an effective post meeting follow-up, review and reporting process for decisions taken by the Board and Board Committees thereof. Important decisions taken at Board / Board Committee meetings are communicated promptly to the concerned departments / divisions. Action-taken report on decisions/minutes of the previous meeting(s) is placed at the succeeding meeting of the Board/Board Committee for noting.
The Company Secretary, while preparing the agenda, notes on agenda and minutes of the meeting(s), is responsible for and is required to ensure adherence to all applicable laws and regulations, including the Companies Act, 1956/ Companies Act, 2013 read with rules issued there under, as applicable and the Secretarial Standards recommended by the Institute of Company Secretaries of India.
Separate Meeting of Independent Directors
A meeting of the Independent Directors of the Company was held on 20th March, 2015 and the same was attended by Shri A. Venkatesh, Shri A.T.Gowda and Shri Amit Dhanuka.
Procedure at Committee Meetings
The Company's guidelines relating to Board meetings are applicable to Committee meetings as far as practicable. Each Committee has the authority to engage outside experts, advisors and counsels to the extent it considers appropriate to assist in its function. Minutes of proceedings of Committee meetings are circulated to the Directors and placed before Board meetings for noting. Committees of the Board Audit Committee
Powers of Audit Committee
The Audit Committee shall have powers, which should include the following:
1. To investigate any activity within its terms of reference.
2. To seek information from any employee.
3. To obtain outside legal or other professional advice.
4. To secure attendance of outsiders with relevant expertise, if it considers necessary.
Role of Audit Committee
The role of the Audit Committee shall 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, reappointment, replacement, removal, 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 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;
E. Review of information by Audit Committee
The Audit Committee shall mandatorily review the following information:
1. Management discussion and analysis of financial condition and results of operations;
2. Statement of significant related party transactions (as defined by the Audit Committee), 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 internal auditor shall be subject to review by the Audit Committee.
The representatives of statutory auditors are permanent invitees to the Audit Committee Meetings. Executives of Accounts Department, Finance Department, and Internal Audit department and representatives of internal auditors attend Audit Committee Meetings. The internal auditor reports directly to the Audit Committee.
The Chairman of the Audit Committee was not present at the last Annual General Meeting held on 29th September, 2014.
Related Party Transaction Policy
Company has formulated a Policy on Related Party Transactions as per requirements of Listing Agreement. The policy is available on the website of the Company.
Four meetings of the Audit Committee were held during the year as on 29th May, 2014, 13th August, 2014, 13th November, 2014 and 7th February, 2015. The attendance is given on page no. 44 of this Report.
Role of Nomination and Remuneration Committee
1. To identify person who are qualified to become Directors and who may be appointed in Senior Management as per their criteria
2. To recommend to the Board the appointment and removal of the Directors and Senior Management
3. To carry out evaluation of every director's performance
4. To formulate criteria for determining qualification, positive attributes and independence of a Director
5. Devise a policy on Board diversity;
6. To recommend to the Board a policy relating to remuneration for the Directors, Key Managerial Personnel and other employees
7. 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
8. To perform such other functions as may be necessary or appropriate for performance of its duties
Four meetings of the Nomination and Remuneration Committee were held during the year as on 29th May, 2014, 13th August, 2014, 13th November, 2014 and 7th February, 2015. The details of attendance is given on page no. 44 of this Report. The Chairman of the NRC was not present at the last Annual General Meeting held on 29th September, 2014.
Directors' Remuneration / Remuneration policy
The Company has devised a Policy for performance evaluation of Independent Directors, Board, Committees and other individual Directors.
The Company's remuneration policy is directed towards rewarding performance based on review of achievements periodically. The remuneration policy is in consonance with the existing industry practice. The Company has remuneration policy in place the details of which is given in the Board of Director's report.
Three meetings of the Stakeholders Relationship Committee were held during the year as on 29th May, 2014, 13th November, 2014 and 7th February, 2015. The details of attendance is given on page no. 44 of this Report.
The Chairman of the Stakeholder Relationship Committee was present at the last Annual General Meeting held on 29th September, 2014.
During the year not a single complaint was received from the Shareholders and to date there was no outstanding complaints as on 31st March, 2015.
Lata Bagri, Company Secretary and Chief Compliance Officer, is the Compliance Officer for complying with requirements of Securities Laws and Listing Agreements with Stock Exchanges.
Prohibition of Insider Trading
With a view to regulate trading in securities by the directors and designated employees, the Company has adopted a revised Code of Conduct for Prohibition of Insider Trading as per SEBI (Prohibition on Insider Trading Regulation) 2015.
Role and Responsibilities of the Committee includes the following:
• Annually review and assess the Risk Management Policy and associated frameworks, processes and practices of the Company and recommend any proposed changes to the Board for approval.
• Identify the diverse risk faced by the Company, evaluate the probability of their occurrence and ensure that the Company is taking the appropriate measures to achieve prudent balance between risk and reward in order to maximize Shareholders value
• Set tolerance limit and establish adequate review mechanism to control and monitor the risk and assess management's actions to mitigate the exposures in a timely manner.
• Incorporate robust reporting system and adoption of appropriate mitigation process
• Coordinate its activities with the Audit Committee in instances where there is any overlap with audit activities (e.g. internal or external audit issue relating to risk management policy or practice).
• Make regular reports/ recommendations to the Board.
One meeting of the Committee was held during the year as on 20th January, 2015 and the details of attendance is given on page no. 44 of this Report.
The Company does not have any subsidiary Company.
CODE OF CONDUCT
The Board of Directors of the Company adopted the revised Code of Conduct for the purpose of Clause 49 applicable to the Board of Directors and Senior Management Personnel respectively. The revised Code of Conduct have been posted on the website of the Company, i.e. www.glittek.com
Disclosures on materially significant related party transactions, i.e. the Company's transactions that are of material nature, with its Promoters, Directors and the management, their relatives or subsidiaries, among others that may have potential conflict with the Company's interests at large
During the period under review, the Company had not entered into any material transaction with any of its related parties.
None of the transactions with any of related parties were in conflict with the Company's interest. Attention of members is drawn to the disclosure of transactions with related parties set out in Note No. 32 of Financial Statements, forming part of the Annual Report.
All related party transactions are negotiated on an arms-length basis, and are intended to further the Company's interests.
Details of non-compliance by the Company, penalties, strictures imposed on the Company by Stock Exchange or SEBI, or any statutory authority, on any matter related to capital markets, during the last three years
During the last three years, SEBI had imposed fine for late submission of Annual Report 2014 as per clause 31 of the listing agreement. The Company has remitted the fine amount.
WHISTLE BLOWER POLICY / VIGIL MECHANISM
As per section 177(9) of companies act, 2013 and clause 49 of listing agreement, company has formulated a codified Whistle Blower Policy and employees of the Company are encouraged to escalate to level of Audit Committee any issue of concerns impacting and compromising with the interest of Company and its stakeholders in any way. The company is committed to adhere to highest possible standards of ethical, moral and legal conduct and to open communication for which a dedicated email id email@example.com has been established.
The Company affirms during the year under review none of the employees have been denied access to the Audit Committee.
While preparation of the Financial Statements, the Accounting Standards, issued by The Institute of Chartered Accountants of India (ICAI), have generally been followed.
ADOPTION OF MANDATORY AND NON-MANDATORY REQUIREMENTS OF CLAUSE 49
The Company has complied with all mandatory requirements of Clause 49 of the Listing Agreement. The Company has adopted following non-mandatory requirements of Clause 49 of the Listing Agreement:
The Company is in the regime of unqualified financial statements.
REPORTING OF INTERNAL AUDITOR
The Internal Auditor directly reports to the Audit Committee
SEPARATE POST OF CHAIRMAN AND MANAGING DIRECTOR / CEO :
Shri B.K. Agarwala Non-Executive Director is the Chairman and Shri Kamal Kumar Agarwal is the Managing Director of the Company and CEO of the Company and Shri Ashoke Agarwal is the Joint Managing Director of the Company.
MANS OF COMMUNICATION :
The annual, half yearly and quarterly results are submitted to the Stock Exchanges and also published in leading English newspaper Financial Express and Vernacular (Kannad) newspaper Sanjevani in accordance with the Listing Agreement.
The Company's corporate website www.glittek.com provides comprehensive information on GGL's portfolio of business shareholding pattern, information on compliances with corporate norms, Code of Conduct, policies and contact details of Company's employees responsible for assisting & handling investor grievances. The website has entire sections dedicated to GGL'S Profile, history and evolution, its core values, corporate governance and leadership. The entire Report and Accounts as well as quarterly, half-yearly and annual financial results are available in downloadable formats under the section "Financial Details" on the Company's website as a measure of added convenience to investors. The Contents of the Website are updated from time to time.
SEBI Complaints Redress System (SCORES) :
The investor complaints are processed in a centralised web-based complaints redress system. The salient features of this system are: Centralised database of all complaints, online upload of Action Taken Reports (ATRs) by concerned companies and online viewing by investors of actions taken on the complaint and its current status. Your Company's Management Discussion & Analysis of operations for the year ended 31st March, 2015 form part of the Annual Report and is given under the section so captioned.
GENERAL SHAREHOLDERS INFORMATION :
Annual General Meeting is proposed to be held on Tuesday, 29th September, 2015 at 12.30 P.M. at 42, K.I.A.D.B. Industrial Area, Hoskote - 562 114, Bangalore, Karnataka.
Financial Year : April 1st to March 31st
Financial Calendar (tentative)
Financial Year 1st April 2015 to 31st March, 2016
Unaudited results for the quarter ending 30th June,2015 : On or Before 14th August, 2015
25th Annual General Meeting : Wednesday, 30th September, 2015
Unaudited results for the quarter/half year ending 30th September,2015 : On or Before 14th November, 2015
Unaudited results for the quarter/nine months ending 31st December,2015 : On or Before 14th February, 2016
Audited results for the year ending 31st March,2016 : On or Before 30th May, 2016
Date of Book Closure : 23rdSeptember, 2015 to 29th September,2015
Dividend Payment : No Dividend is being recommend
Listing on Stock Exchanges : Bombay Stock Exchange Limited
513528 (The Bombay Stock Exchange Ltd.)
Demat ISIN No. for NSDL & CDSL : INE 741B01027
Registrar and Transfer Agent :
MCS Share Transfer Agent Limited 12/1/5, Manoharpukur Road, Kolkata 700 026 Telephone- (033) 40724052/53, Fax : (033) 40724050, Email : firstname.lastname@example.org
Plant Location : 42, K.I.A.D.B.Industrial Area, Hoskote-562 114 Bangalore, Karnataka
Share Transfer System : Trading in Equity Shares of the Company is permitted in dematerialized form w.e.f. 26.02.2001 for all classes of investors as per notification issued by the Securities and Exchange Board of India (SEBI).
Physical transfer of shares are processed by the Share Transfer Agents and a summary of transfer/transmission of securities of the Company so approved is placed at every Board meeting / Stakeholders' Relationship Committee meeting. The Company obtains from a Company Secretary in Practice half-yearly certificate of compliance with the share transfer formalities as required under Clause 47(c) of the Listing Agreement and files a copy of the said certificate with Stock Exchanges. Share Transfers are registered and returned within 15 days from the date of receipt, if the relevant documents are complete in all respect.
Dematerialisation of Shares: 24731170 equity shares representing 95.27% of the total Equity Capital of the Company are held in dematerialized form with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) as on 31st March, 2015.
In terms of SEBI'S circular no. D&CC/FITTC/CIR-16 dated December 31, 2002, as amended vide circular no. CIR/MRD/DP/30/2010 dated September 6, 2010 an audit is conducted on a quarterly basis by a Company Secretary in practice for the purpose of inter alia, reconciliation of the total amount admitted equity share capital with the depositors and in the physical form with the total issued/paid up equity share capital of the Company. Certificates issued in this regard are placed before Stakeholders Relationship Committee and forwarded to BSE, where the equity shares of the Company are listed
During the year under review, the Company has not issued any ADR's & GDR's, Warrants or any other convertible instruments. The Company has at present no outstanding ADR's / GDR's / Warrants to be converted that has an impact on the equity shares of the Company.
COMPLIANCE CERTIFICATE OF THE AUDITOR
Certificate from the Statutory Auditors confirming compliance with all the applicable mandatory requirement of Corporate Governance as stipulated in clause 49 of the Listing Agreement of the Stock Exchanges forms parts of the Annual Report
Kamal Kumar Agarwal
Date :13th August 2015