CORPORATE GOVERNANCE REPORT
(A) CORPORATE GOVERNANCE PHILOSOPHY:
We believe in adopting best practices of Corporate Governance and striving for continuous improvement. Our guiding principles and practices followed by all stakeholders are summarized in this Corporate Governance Report. These are articulated through Company's Code of Business Conduct, Corporate Governance Guidelines and charters of various sub-committees of the Board and Company's Disclosure Policy. These policies seek to focus on enhancement of long term shareholder value without compromising on ethical standards and corporate social responsibilities.
Corporate Governance philosophy is put into practice at Gujarat Containers Ltd through the following four layers, namely, • Governance by Shareholders, • Governance by Board of Directors,* Governance by Sub-committees of Board of Directors, and • Governance of the management process
Corporate Governance is about credibility, transparency and accountability of the Board and Management towards shareholders, suppliers, customers, service providers and society at large. The Company is conscious of its responsibility as a good corporate citizen and is committed to high standard of corporate governance practices. Your Company believes that sound Corporate Governance is critical to enhance and retain investors' trust and recognizes the importance of transparency and integrity in dealings at all levels. This is reflected in the well balanced and independent structure of the Company's eminent and well represented Board of Directors. The Company is in compliance with all the mandatory requirements under Clause 49 of the Listing Agreement with the Bombay Stock Exchange. The Company has professionals on its Board of Directors.
(B) BOARD COMPOSITION:
Size and Composition of the Board
The current policy is to have an appropriate mix of Executive and Independent Directors to maintain the independence of the Board, and separate its functions of governance and management. As on March 31, 2015, the Board consists of 7 members, out of which 3 Members are Executive or Whole time Directors and 4 Members are Independent Directors. The Board periodically evaluates the need for change in its composition and size.
(C) Committees of the Board :
Keeping in view of the better Governance and focused discussion, the Board has constituted various committees with specific terms of the reference and scope. The details of the committees constituted by the Board are given below:
(I) Audit Committee:
The Audit Committee of the Board of Directors meets the criteria laid down under Section 177 of the Companies Act, 2013, read with Clause 49 of the Listing Agreement. The terms of reference to the Audit Committee inter alia includes:
• 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;
• Review and monitor the auditor's independence and performance, and effectiveness of audit process;
• Approval or preapproval or any subsequent modification of transactions of the company with related parties except the transactions with a wholly owned subsidiary whose accounts are consolidated with the company and placed before the shareholders at the General Meeting for approval;
• Evaluation of internal financial controls and risk management systems;
• Reviewing, with the management, performance of statutory and internal auditors, adequacy of the internal control systems;
• To review the functioning of the Whistle Blower mechanism.
The composition of the Audit Committee, meetings held, and attendance of the members are given below:
The Chairman and Managing Director, Chief Financial Officer, Statutory Auditors and the Internal Auditors are the invitees to the meetings of the Committee.
The Audit Committee meets with statutory auditors without the presence of management at its meetings.
Mr. Nitin J Thakkar, the Chairman of the Audit Committee, was present at the Annual General Meeting of the Company held on 30th September, 2014.
II) Nomination & Remuneration Committee:
The Nomination & Remuneration Committee of the Board of Directors meets the criteria laid down under Section 178 of the Companies Act, 2013, read with Clause 49 of the Listing Agreement.
The terms of reference to the Nomination & Remuneration Committee are as given below:
• 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;
• Formulation of criteria for evaluation of Independent Directors, Committees of Board and the Board;
• Devising a policy on Board diversity;
• 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;
• To develop and review induction procedures for new appointees to the Board to enable them to become aware of and understand the Company's policies and procedures and to effectively discharge their duties;
• To formulate Employees stock option plans in compliance with the applicable provisions of the Companies Act, 2013 and the Regulations notified by SEBI in this regard, to administer the approved stock option plans including grant, cancellation of options to the eligible employees and to review and modify the existing plans as may be required.
The composition of the Nomination & Remuneration Committee and particulars of meetings attended by the members are given below:
Mr Udaybhai Madhwani, the Chairman of the Nomination and Remuneration Committee, was not present at the Annual General Meeting of the Company held on 30th September, 2014
The broad terms of reference of the Nomination and Remuneration Committee are as under:
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 employee
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. The Company shall disclose the remuneration policy and the evaluation criteria in its Annual Report.
The Governance Policies of the Company contains policy on Remuneration to Directors, KMPs, Senior Management Personnel & Other Employees.
While deciding on the remuneration for Directors, the Board and Nomination & Remuneration Committee consider the performance of the Company, the current trends in the industry, the director's participation in Board and Committee meetings during the year and other relevant factors.
The performance of the Company and individual performance as well employees' potential, criticality and longevity in the grade are considered while determining remuneration to the Employees
The details of remuneration paid to the Directors are given in Form MGT-9 forming part of the Board Report.
III. Stakeholders Relationship Committee:
The Stakeholders Relationship Committee (SRC) of the Board of Directors meets the criteria laid down under Section 178 of the Companies Act, 2013, read with Clause 49 of the Listing Agreement. Mr. Udayi Premjibhai Madhwani, Independent Director is the Chairman of the Committee. Mr. Nitin Thakkar and Mr. Dinesh S Kamdar are the other members of the Committee. Mr. Deepak Patel, the Compliance Officer, attended the Meeting of the Committee. During the year, two meetings were held on 01st August, 2014 & 30th January, 2015 which were attended by all Committee members.
Terms of reference: The SRC looks into redressal of shareholders' and investors' complaints, issue of duplicate / consolidated share certificates and review of cases for refusal of transfer/ transmission of shares and reference to statutory and regulatory authorities. There was no pending Complaint in the opening & closing of the year and the Company had not received any complaints during the year under review.
IV. Corporate Social Responsibility Committee:
The Board of Directors constituted the Corporate Social Responsibility Committee (CSR) of the Board at its meeting held on 17th January, 2015. This Committee meets the criteria laid down under Section 135 of the Companies Act, 2013 and Rules made therein. Mr. Kiran Shah Chairman & Managing Director, is the Chairman of the Committee, Mr. Udayan Madhwani & Mr. Dinesh Kamdar are the other members of the Committee. Mr. Deepak Patel, the Compliance Officer attended the Meeting of Committee. During the year, one meeting were held on 17th January, 2015, which was attended by all the Committee members.
Terms of reference of the CSR Committee are:
• Formulate and recommend to the Board, a CSR policy indicating the activities from the specified list of activities in Schedule VII of the Act.
• Recommend the amount of expenditure to be incurred for the chosen activities.
• Monitor the CSR Policy and activities from time to time
• To carry on such task and activities as may be assigned by the board of directors from time to time.
Related Party transactions:
Details of contract entered in to with related parties by the Company during the year 2014-15, are stated at note No. 30 (F) in the notes to Financial statement of this report.
VII. Whistle Blower Policy / Vigil Mechanism:
The Company has adopted a Whistle Blower Policy, to provide a formal mechanism to the Directors and employees to report their concerns about unethical behavior, actual or suspected fraud or violation of the Company's Code of Conduct or ethics policy. The Policy provides for adequate safeguards against victimization of employees who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company has been denied access to the Audit Committee. The Whistle Blower Policy is posted on the website of the Company www.gujaratcontainers.com
VIII. Code of Conduct:
The members of the board and senior management personnel have affirmed the compliance with the Code applicable to them during the year ended March 31,2015. The Annual Report of the Company contains a Certificate by the CEO and Managing Director in terms of Clause 49 of the listing agreement based on the compliance declarations received from Independent Directors, Non-Executive Directors and Senior Management.
IX Reconciliation of Share Capital Audit:
A qualified practicing Company Secretary carries out a share capital audit to reconcile the total admitted equity share capital with NSDL and CDSL and the total issued and listed equity share capital of the Company. The audit report confirms that the total issued/ paid-up capital is in agreement with the total number of shares in physical form and the total number of dematerialized shares held with NSDL and CDSL.
X Means of Communication:
The quarterly, half-yearly and annual results of the Company are normally published in Western Times in English and in Western Times Gujarati newspapers, having wide circulation. The financial results are also displayed on the Company's website viz. www.gujaratcontainers.com and posted on the BSE Corporate Compliance & Listing Centre (the Listing Centre). Official news releases and presentations are posted on the Company's website.
XI General Shareholder information
Annual General Meeting date, time and venue:
30th September, 2015 at 11.00 a.m at its Registered Office Plot No: 488/489, Savli Highway, Village: Tundav, Ta. Savli, Dist: Baroda
As required under Clause 49(VIII)(E)(1) of the Listing Agreement entered into with the stock exchange, particulars of directors seeking appointment / re-appointment at the forthcoming AGM are given in the Annexure to the notice of the AGM to be held on Wednesday 30th September, 2015.
XIII. Date of book closure : Tuesday, 22nd September, 2015 to Wednesday, the 30th September,2015 (both days inclusive)
XIV. Listing on Stock Exchange : BSE Limited
25th Floor, Phiroze Jeejeebhoy Towers, Dalai Street, Mumbai - 400 001
XV Stock Code on BSE Ltd. : 513507
XVI. ISIN Code in NSDL and CDSL for Equity Shares : INE276I01011
XVII. Corporate identity number : L28120GJ1992PLC017081 (CIN) of the Company
Registrar and Share Transfer Agent:
MCS Share Transfer Agent Ltd 10, Aaram Apratment, 12, Sampatrao colony, Vadodara - 390 007Tel (0265) 2314757, Fax (0265) 2341639 email@example.com
Share transfer system:
43.40 % of the Equity shares of the Company are in electronic form. Transfers of these shares are done through the depositories. As regards transfer of shares held in physical form the transfer documents can be lodged with M/s. MCS Share Transfer Agent Ltd at the above mentioned address.
Dematerialization of shares and Liquidity:
The Company's shares are traded in dematerialized form and are available for trading on both the depositories Central Depository Services (India) Ltd. (CDSL).
Plot No: 488-489, Baroda-Savli Highway, Village:Tundav, Tal: Savli,Dist: Vadodara -391 775 Gujarat.
Plot 2/5, GIDC, Narmada Nagar. Opp. GNFC Corporate Office, Bharuch-392015. Gujarat
e. Address for Correspondence for : MCS Share Transfer Agent Ltd settlement of Shares related At their office address Grievances. 10, Aaram Apratment, 12, Sampatrao colony, Vadodara - 390 007, Gujarat Tel (0265) 2314757, Fax (0265)2341639.