CORPORATE GOVERNANCE REPORT COMPANY'S PHILOSOPHY ON CORPORATE GOVERNANCE
Corporate Governance is a set of system and practices to ensure that the affairs of the Company are being managed in a way which ensures accountability, transparency and fairness in all its transactions in the widest sense and meet its stakeholder's aspirations and societal expectations. Corporate Governance signifies acceptance by management of the inalienable rights of shareholders as the true owner of the Company and of their own role as trustees on behalf of the shareholders. The Company firmly believes that its affairs shall be conducted by following the best practices and principles, irrespective of its relation to the customers, employees, stakeholders or the community. It endeavors to provide detailed information on various issues concerning the Company's business and financial performance to the shareholders.
The Company is in compliance with the requirement stipulated under Clause 49 of the Listing Agreements entered into with the Stock Exchanges with regard to Corporate Governance.
BOARD OF DIRECTORS
Corporate Governance begins at the top of its Governance structure, its Board of Directors, which comprises of eminent experts who are committed to the key underlying principles and values that constitute the best standards of corporate governance.
The Board of the Company is primarily responsible for protecting and enhancing shareholders' value besides fulfilling the company's obligations towards other stakeholders. The role of the Board of Director to provide strategic superintendence over the Company's management. All statutory and other significant and material information are placed before the Board to enable it to discharge its responsibility of strategic supervision of the Company as trustee of the Shareholders. The Board of the Company is independent in making its decision and committed to address conflict of interest and impress upon the functionaries of the company to focus on transparency, accountability, integrity equality and responsibility.
The Board of Directors ("the Board") of the Company comprises an optimum combination of Executive and Non Executive Independent Directors headed by the Non executive Independent Chairman of the Board. The Board is in conformity with Clause 49 of the Listing Agreement with the Stock Exchange(s).The Board are Board are eminent professionals in business, law, finance and have vast experience in their respective fields which enable them to contribute effectively to the Company in their capacity as members of the Board. No director is related to any other director.
Board Meetings and Attendance:
The Board of Directors overseas the overall functioning of the Company .Board meetings are governed by the structured agenda. All major agenda items are backed up with comprehensive background information to enable the Board to take informed decisions. Agenda papers are circulated at least seven days prior to the Board Meeting. The Board Members in consultation with the Chairman of the meeting may bring up any matter for the consideration of the Board. The dates of Board meetings are fixed in advance in consultation with all the directors individually as per their convenience with objective to ensure the presence of independent directors in the Board Meetings.
During the year, seven Board Meetings were held i.e. May 27, 2014, August 14, 2014, September 12, 2014, September 22, 2014, November 13, 2014, November 21, 2014, and February 13, 2015 respectively. The Board meets at least once in a quarter with a gap of not more than 120 days as prescribed under Clause 49 of the Listing Agreement and the Companies Act, 2013. However, additional meetings are held whenever necessary. The attendance record of the directors at the Board meetings as well as last Annual General Meeting (AGM) held on September 22, 2014are as under:
None of the Directors is a director in the more than ten public companies or acts as independent directors in more than seven listed companies. None of the directors on the Board is a member of more than ten committees and chairman of the five committees as per Clause 49(II)(D)(2) of the Listing Agreement across all the companies in which he/she is a director.
During the year under review the company has not entered into any material transactions with its Non-Executive Directors except related party transaction reported in the financial report. The Company has received the declaration from independent directors of the company confirming their independence pursuant to requirement of Clause 49 of the Listing Agreement.
The brief profile of each Director of the Company are as under: Shri. A. K. Joshi:
Shri A. K. Joshi (DOB-01.01.1958) is Managing Director of the Company. He is agraduate in Commerce and fellow member of the Institute of Chartered Accountants of India (ICAI) having 32 years of rich experience in the field of Banking, Finance and Accounts. He joined the Company in the year 1993 as Dy. General Manager (Finance & Accounts) and inducted on the Board as Executive Director on October 21, 2003 having over three decades of Industrial and corporate experience in different capacity. He is Member of the Audit Committee and Nomination & Remuneration Committee of the Company. He is also Director on the Board of the Golden Reality and Infrastructure Ltd. and Western Express Industries Ltd., the subsidiary of the Company
Shri Jaskaran S. Khurana
Shri Jaskaran S. Khurana (DOB-22.09.1972) is Executive Director of the Company. He is a graduate in Commerce and Masters of Business Administration (MBA). He is looking after the export business and production of the Company and is expert in the field of finance/sales (domestic as well as International Business), production with more than eighteen years of rich experience. He has joined the Dalmia's Group in the year 2007, and the Company in the year 2010 and inducted on the Board as Executive Director on May 23, 2013 of the Company. He is also Member of the Stakeholders Relationship Committee of the Company.
Shri Bharat B. Merchant:
Shri Bharat B. Merchant (DOB-24.06.1948) is a Non-Executive Independent Director of the Company. He is graduate in Arts and did Master of Laws (LL.M) from Cornell University, USA. He is Solicitor and Advocate practicing since 1972. He is a Sole Proprietor of the firm M/s Thakordas and Madgavkar, Advocates & Solicitors, one of the leading legal firms in Mumbai and is actively engaged over forty five years in conducting arbitration, commercial litigation and attending corporate and property matters. He is a Member of the Bombay Incorporated Law Society. He was inducted on the Board on July 26, 2009 as Non Executive Independent Director of the Company. He is a Member of Board of Directors of the Company as also member of the Audit Committee, Stakeholders Relationship Committee and Nomination and Remuneration Committee (NRC) of the Company.
Shri Vijay Kumar Bhandari:
Shri Vijay Kumar Bhandari (DOB-14.10.1943) is a Non-Executive Independent Director of the Company. He is a fellow member of the Institute of Chartered Accountants of India (ICAI) having more than forty three years of rich experience in the fields of Banking and Finance. He worked in the Central Bank of India from 1971 to 2003 and retired as General Manager on October 31, 2003. Since then he is practicing as a Chartered Accountant in Mumbai. He was inducted on the Board on July 31, 2009 of the Company. He is the also the Member of the Audit Committee, Stakeholders Relationship Committee and Nomination & Remuneration Committee of the Company.
Ms. Kokila Panchal:
Ms. Kokila Panchal (DOB-20.09.1948) is a Non-Executive Independent Director of the Company. She is Bachelor in Arts and Laws. She is an Advocate practicing over thirty years in the High Court Mumbai with an expertise in the Property matters. She was inducted on the Board on March 31, 2015 of the Company.
COMMITTES OF THE BOARD A. AUDIT COMMITTEE
The Audit Committee of the Company is constituted in line with and with the terms ofreference of the matters as specified in the provisions of Clause 49 of the Listing Agreements entered into with the Stock Exchanges read with section 177 of the Companies Act, 2013.
Terms of Reference :
The board terms of reference of the Audit Committee are as follows :
(i) Overview of the Company's financial reporting process and disclosure of its financial information to ensure that the financial information reflects a true and fair position and that sufficient and credible information is disclosed.
(ii) Recommending the appointment and removal of Statutory Auditors, fixation of audit fee and also approval for payment for any other services.
(iii) Discussion with Statutory Auditors before the audit commences, nature and scope of audit as well post-audit discussion to ascertain any area of concern.
(iv) Reviewing the financial statement and draft audit report including the quarterly financial information and reports.
(v) Review of the annual financial statement before submission to the Board, focusing primarily on any change in accounting policies, qualifications in draft auditors' report, Compliance with Accounting Standard, Compliance with the stock exchanges and legal requirement concerning financial statements.
(vi) Any related party transactions i.e. transactions of the Company of material nature, with promoters or the management, their subsidiaries or relative etc. that may have potential conflict with the interest of the Company at large.
(vii) Reviewing the Company's financial and risk policies.
(viii) Disclosure of contingent liabilities.
(ix) Reviewing, with the Management, external and internal auditors, the adequacy of internal control system.
(x) Review and discussion with the Internal Auditors regarding the adequacy of the internal audit function, approval of the audit plan and its execution, structure, coverage and frequency of internal audit.
Composition and Attendance :
During the year four meetings of the Audit Committee were held i.e May 27, 2014, August 14, 2014, November 13, 2014 and February 13, 2015. The necessary quorum was present in all the meetings.
The Board of Directors in its meeting held on August 14, 2014 re-constituted the Audit Committee comprising with Shri Bharat B. Merchant, Shri V.K.Bhandari and Shri A.K. Joshi. All the members of Committee possess adequate knowledge of Accounts, Audit and Finance and Non Executive Independent Director of the Company except Shri A.K.Joshi, Managing Director. The Committee invites such of the executives/officers/Managers as it considers appropriate to be present at its meetings. The Statutory Auditors from Lodha & Co. attended all the Audit Committee meetings. Shri Manoj Kumar Srivastava, Company Secretary, attended all the meetings and acted as Secretary of the Audit Committee.
B. NOMINATION AND REMUNERATION COMMITTEE
The Nomination and Remuneration Committee of the Company is constituted in line with the provisions of Clause 49 of the Listing Agreements entered into with the Stock Exchanges read with section 178 of the Companies Act, 2013, read with schedule IV of the Companies Act, 2013.
Terms of reference :
The Nomination & Remuneration Committee (NRC) is to determine overall Company's Policy on Remuneration Packages and other terms and conditions of the appointment of the Executive Directors Non Executive Director and senior management personnel of the Company as well as sitting fees to the Non Executive Directors of the Company within the overall ceiling pursuant to the Companies Act, 2013 including remuneration payable to Managing Director or Whole Time Directors fixed by members of the Company and recommends to the Board of Directors for their approval. The broad terms of reference of the Nomination and Remuneration Committee are as follows :
- Identifying persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down recommend to the Board their appointment and removal and carry out evaluation of every director's performance.
- Formulate the criteria for determining qualifications, positive attributes and independence ofa director and recommending to the Board a policy, relating to the remuneration of the directors key managerial personnel and other employee of the Company.
- Formulate the criteria for evaluation of Independent director and the Board.
- Devising the policy on Board diversity.
- Recommendation to the Board appointment of Key Managerial Personnel (KMP as defined by the Act) and other senior management of the Company.
Composition and Attendance :
During the year, three meeting of the Nomination & Remuneration Committee was held i. e. May 27, 2014, November 13, 2014 and March 16, 2015.
The Board of Directors of the Company in its meeting held on August 14, 2014 re-constituted the Nomination and Remuneration Committee comprising with Shri Bharat B. Merchant Shri V.K.Bhandari and Shri A.K.Joshi. All the members of the committee are Non Executive Independent Directors except Shri A. K. Joshi Managing Director of the Company.
Remuneration Policy :
The Company's Remuneration Policy is driven by the success and performance of the individual employee and the Company. The objective of the remuneration policy of the Company for Directors and Senior management is to focus on enhancing the value, to attract and retain talent for achieving objective of the company. The Remuneration Policy of the Company has been posted on the company's website: www.goldentobacco.in.
The following guidelines which has been followed while formulating the remuneration policy :
i. Ensuring that the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate directors of the quality required to run the Company successfully.
ii. Motivate KMP and Senior Management to achieve excellence in their performance.
iii. Relationship of remuneration to performance is clear and meets appropriate performance benchmarks.
iv. Ensuring that the remuneration to Directors, KMP and Senior Management involves a balance between fixed & incentive pay reflecting short and long-term performance objectives appropriate to the working of the Company and its goals.
The Company's pays remuneration by way of salary, benefits perquisites and other allowances i.e. contribution to provident fund, superannuation fund and gratuity and encashment of leave etc as per the Policy and relevant applicable laws if any. at the end of services /tenure to its Managing Director and the Executive Directors and senior management personnel of the Company. The Remuneration payable to the Managing Director and Executive Directors is governed by the Remuneration package approved by the Board and Members of the Company. The Annual increment is decided by the Nomination and Remuneration Committee within the salary scale approved by the members of the Company. However, the Managing Director and Executive Directors of the Company get a Variable Performance Pay (VPP) based on their performance and as per the Company's Policy. During the year under review no VPP was paid or payable to the Managing Director /Executive Director etc.
The Non-Executive Independent Directors are paid remuneration by way of sitting fees. The Board of Directors has increased the sitting fees payable to the Non Executive Independent Directors on its meeting held on November 13,2014 at Rs. 10,000/ - plus reimbursement of expenses for each meeting of the Board and its Committees meeting attended by them. Sitting fees is being paid to Non-Executive Directors in accordance with the provisions of the Companies Act, 2013 and Articles of Association. No other remuneration is being paid to them by the Company. The Company did not have any pecuniary relationship or transactions with Non-Executive Directors.
Information of Directors' Shareholding as on March 31, 2015 :
Shri Bharat B. Merchant and Shri Vijay Kumar Bhandari, Non Executive Independent Directors holding 100 and 80 shares respectively in the Company. No other director or Key Managerial Personnel (KMP) holds any shares in the Company.
C. STAKEHOLDERS RELATIONSHIP COMMITTEE:
The Stakeholders Relationship Committee of the Company is constituted in line with the provisions of Clause 49 of the Listing Agreements entered into with the Stock Exchanges read with section 178 of the Companies Act, 2013.
The Committee oversees redressal of Shareholders and Investor grievances relating to transfer of shares, non receipt of balance sheet, non receipt of dividend etc. and inter-alia approves transmission of shares, sub division/consolidation / renewal /issue of duplicate share certificate etc.
Terms of Reference:
The broad terms and reference of the Committee is as follows:
i. To review the report submitted by the Registrars and Share Transfer Agents (RTA) of the Company on quarterly basis.
ii. To interact periodically with the Registrars and Share Transfer Agents (RTA) to ascertain and look into the quality of the Company's Shareholders/ Investors grievance redressal system and to review the report on the functioning of the said Investor grievances redressal system.
iii. To follow-up on the implementation of suggestions for improvement.
iv. To periodically report to the Board about serious concerns if any.
v. To consider and resolve the grievances of the security holders of the company.
The Composition of the Stakeholders Relationship Committee is comprised of three Directors.
The Board of Directors in its meeting held on August 14, 2014 reconstituted the Stakeholders Relationship Committee comprising with Shri Bharat B. Merchant, Shri V.K. Bhandari and Shri Jaskaran S. Khurana. All the members are Independent Directors except Shri Jaskaran S. Khurana, Executive Director of the Company.
FAMILIARISATION PROGRAME FOR DIRECTORS
The Company believes that a Board, which is well informed /familiarized with the Company, can contribute significantly to effectively discharge its role of trusteeship. In pursuit to this the directors are updated on a continuing basis on changes/ development in the corporate and the industry as well including the changes in legal and economic environment,to enable them to take well informed and timely decisions. The familiarization programme was held on November 13, 2014 and the same is available on the Company's website www.goldentobacco.in.
Name, Designation and address of Compliance Officer:
Shri Manoj Kumar Srivastava, Company Secretary, Golden Tobacco Limited.
At Darjipura Post Amalityara,
Ph. No. 0265-2540281, FAX-0265-2541700
Email: firstname.lastname@example.org, email@example.com
(i) Material significant related party transactions which may have potential conflict with the interests of the Company: NIL
(ii) Material financial and commercial transactions of senior management, where they may have had personal interest, and which had potential conflict with the interests of the Company at large : NIL
(iii) Details of Non-compliance by the Company, penalties strictures imposed on the Company by the Stock Exchanges or The SEBI or any statutory authority on any matter related to the capital market during the last three years 2012-13, 2013-14 and 2014-15 are respectively : NIL.
(iv) The Company has adopted a Whistleblower Policy and has established the necessary vigil mechanism for employee and directors to report concerns about unethical behavior. No person has been detained access to the chairman of the audit committee. The said policy has also been put up on company's website www.goldentobacco.in
(v) The Company has framed developed Risk Management Policy including for identifying elements of risk which may threaten the existence of the Company which is already operational.
(vi) The Code of Conduct applicable to directors and senior management personnel of the Company and the same has been complied with and they have confirmed their adherence to the provisions of the said Code.
(vii) All mandatory requirements are complied with and the non mandatory provisions are adopted wherever necessary.
Means of Communication
The quarterly financial results of the Company are forwarded to the Stock Exchanges immediately on being approved by the Board of Directors and are also published in widely circulated National Daily and Local Gujarati Daily. The Financial results are also displayed on the Company's website www.goldentobacco.in.
Code of Conduct :
The Company's Code of Conduct as adopted by the Board of Directors, is applicable to Directors and senior management employees of the Company. The Code is derived from the three interlinked fundamental principles i.e. Good Corporate Governance, Good Corporate Citizenship and extremely personnel conduct in relation to the Company's business and reputation. The Code is available on www.goldentobacco.in.
Code of Conduct for Prevention of Insider Trading-2015
The Board of Directors of the Company has formulated, approved and adopted the Golden Tobacco Limited - Code of Conduct for Prevention of Insider Trading -2015 inter alia prohibiting purchase/sale of shares by Directors and designated employees, while in the possession ofUnpublished Price Sensitive Information (UPSI) in relation to the Company's Shares. The Company Secretary acts as the "Compliance Officer" to implement the provisions of the aforesaid Insider Trading Regulations, 2015.
DECLARATION PURSUANT TO CLAUSE 49 OF THE LISTING AGREEMENT :
All the Directors and senior Management of the Company have affirmed compliance with the Golden Tobacco Code of Conduct for the financial year ended March 31, 2015 as required under Clause 49 of the Listing Agreement.
GENERAL SHAREHOLDERS INFORMATION
I. Annual General Meeting
The 59th Annual General Meeting is scheduled to be held on :
Day, Date and Time :
Friday, September 25, 2015 at 12.15 P.M.
At Darjipura, Post- Amaliyara, Vadodara, 390022. GUJARAT
Book Closure Date :
Monday, September 21, 2015 to Friday 25, September, 2015 (both days inclusive)
As required under Clause 49(IV)(G)(I) of the Listing Agreements with the Stock Exchanges, particulars of Directors seeking appointment /reappointment at the forthcoming Annual General Meeting are given in the annexure to the notice of the Annual General Meeting to be held on September 25, 2015.
II. III. Registered Office
At DARJIPURA, POST-AMALIYARA, DIST-VADODARA, GUJARAT-390022
1st April 2015 to 31st March, 2016
IV. Events for the Financial Year 2015-16 are as under:
Audited Annual Results for the year ended March 31, 2015 On 25th May,2015
Unaudited First Quarter Results By 15th August, 2015
Unaudited Second Quarter Results By 15th November, 2015
Unaudited Third Quarter Results By 15th February, 2016
Audited Fourth Quarter Results By 30th May, 2016
V. Listing on Stock Exchanges
Name and Address of the Stock Exchange Stock Code No.
National Stock Exchange of India Ltd.
Exchange Plaza,5th floor, Plot No.C/1, 'G' Block, Bandra - Kurla Complex, Mumbai 400 051. 5251
Bombay Stock Exchange Ltd.
Phiroz Jeejeebhoy Towers,Dalal Street,Mumbai 400 021 500151
VI. ISIN No. :
VII. CIN :
The Company has not issued any GDR's/ADR's and there was no warrant or any convertible instruments outstanding.
X. Share Transfer System
On receipt of the applications for transfers, deletion of names, transmission etc. in physical form and if the same are found to be in order are normally registered by our Registrar and Transfer Agent (RTA) within the stipulated period as mentioned in the Listing Agreement of the Stock Exchanges. Also the shares under objections are returned within the stipulated time frame.
Registrar and Transfer Agent (RTA)
Share Transfer and all other Investor's /Shareholder's related activities are attended and processed by our Registrar and Transfer Agent for lodgment of transfer deeds and any other documents with M/s. Link Intime India Pvt. Ltd., C-13, Pannalal Silk Mills Compound, L.B.S. Marg, Bhandup (West), Mumbai 400 078. Tell. No.(022) 25946970 Fax: (022) 2594 6969.
Email: firstname.lastname@example.org However, shareholders holding shares in the electronic mode should address all correspondence to their respective Depository Participants.
XI. Dematerialization of Shares & Liquidity :
The process of conversion of Shares from physical form to electronic form known as dematerialization. For dematerialization of shares, the shareholders have to open a Demat account with Depository Participant (DP). The shareholders is requi red to fill in a Demat Request Form (DRF) and submit the same along with Share Certificate(s) to the DP. The DP will allocate a Demat request number and shall forward the request, both physically and electronically, through NSDL/CDCL to the R & T A. On receipt of the Demat request electronically and after verification, the shares are dematerialized and an electronic credit of shares is given in the account of the shareholder. As on March 31, 2015, 16123323 i.e. 91.56% of the shares of the Company are in dematerialized form.
XII. PLANT LOCATION OF THE COMPANY :
At Darjipura, Post -Amaliyara, Vadodara, Gujarat-390022.
XIII. ADDRESS FOR CORESPONDENCE
Shareholder's correspondence should be addressed to the Company's RTA at the address mentioned above. The Shareholders having securities in the dematerialized form should give instruction relating to change of address, nomination and /or power of attorney executed by the shareholders directly to their respective Depository Participants. Alternatively shareholders may contact to the Company Secretary at the registered office of the Company or email at email@example.com, firstname.lastname@example.org
In compliance with Listing Agreement executed with the Stock Exchanges, the Company has obtained the certificate regarding compliance of conditions of Corporate Governance from M/s. Lodha & Co. Chartered Accountants, Mumbai, which appears as a part of the Annual Report of the Company.
For Golden Tobacco Limited
Place : Mumbai
Date : May 25, 2015