REPORT ON CORPORATE GOVERNANCE
COMPANY'S PHILOSOPHY ON CORPORATE GOVERNANCE
Corporate Governance is set of systems and practices to ensure that the operations of the Company are being managed in a way which ensures fairness, integrity, transparency and accountability in its dealings with its customers, stakeholders, dealers, lenders, government and employees. Company has guiding principles laid out through its Code of business conduct, duly adopted by directors and senior management personnel which has been posted on website of Company (www.gnrl.in ).
1. ETHICS/GOVERNANCE POLICIES:
At Gujarat Natural Resources Limited, we strive to conduct our business and strengthen our relationships in a manner that is dignified, distinctive and responsible. We adhere to ethical standards to ensure integrity, transparency, independence and accountability in dealing with all stakeholders. Therefore, we have adopted various codes and policies to carry out our duties in an ethical manner. Some of these codes and policies are:
S Code of Conduct
S Vigil Mechanism and Whistle Blower Policy
S Policy on Materiality of Related Party Transactions and on Dealing with Related Party Transactions
¦ Board Performance Evaluation Policy
S Familiarization of Independent Directors Policy
S Policy for Selection of Directors and determining Directors Independence
S Remuneration Policy for Directors, Key Managerial Personnel and other Employees
S Policy for determining Material Subsidiaries.
S Risk Management Policy
S Sexual Harassment Policy
2. BOARD OF DIRECTORS:
> Composition of the Board of Directors
The Company's policy is to maintain optimum combination of Executive and Non-Executive Directors Pursuant Clause 49 (II) (A) of the Listing Agreement. The composition of the Board and category of Directors are as follows:
Number of Board Meetings and Attendance of Directors:
During the financial year 2014 - 15, 8 (Eight) Board Meetings were held on 29/05/2014, 14/08/2014, 02/09/2014, 14/11/2014, 25/11/2014,19/01/2015,14/02/2015,and 30/03/2015.
The composition of Directors and the attendance at the Board Meeting during the year 2014-2015 and last Annual General Meeting are as under:
3. BOARD COMMITTEES:
As per the requirement of the Companies Act, 2013 read with Rules and amended clause 49 of the Listing Agreement, various Board committees have been formed for better governance and accountability viz. Audit Committee, Nomination and Remuneration Committee, Stakeholders' Relationship Committee.
The terms of reference of each committee are determined by the Board as per the requirement of law and their relevance is reviewed from time to time.
A. AUDIT COMMITTEE:
As a measure of good Corporate Governance and to provide assistance to the Board of Directors in fulfilling the Board's responsibilities, an Audit Committee had been constituted by the Board. The terms of reference of this committee covers matters specified under clause 49 of the Listing Agreement and Section 177 of the Companies Act, 2013 and other matters referred by the Board from time to time. Committee lays emphasis on adequate disclosures and compliance with all relevant statues.
Main areas are deliberated as under.
a. To provide an open avenue of communication between the independent auditors, internal auditors and the Board of Directors (BOD).
b. To oversee the work of the independent auditors for the purpose of preparing or issuing an audit report or related work.
c. Relying on the review and discussions with the management and the independent auditor, the Audit Committee believes that the Company's financial statements are fairly presented in conformity with Generally Accepted Accounting Principles in all material aspects.
d. To consider and review the adequacy of internal control including computerized information system controls an periodically to the Board of Directors on significant activities.
B. NOMINATION AND REMUNERATION COMMITTEE:
Pursuant to the provisions of Section 178 of the Companies Act, 2013 and Clause 49 of the Listing Agreements, the Board of Directors of the Company constituted "Nomination and Remuneration Committee".
Policy on Directors' Appointment and Remuneration
1.1 Appointment criteria and qualifications
a) A person who is proposed to be appointed as Director of the Company should be eligible to be appointed as Director and must hold Director Identification Number issued by the Central Government and possess such qualification, expertise and experience as prescribed under the Act.
b) Without prejudice to generality of the above, a person who is proposed to be appointed as an Independent Director shall also be subject to compliance of provisions of Section 149(6).
c) KMP or Senior Management personnel shall have adequate qualification, expertise and experience in the relevant field for which the appointment is proposed to be made.
d) The Committee has discretion to decide whether qualification, expertise and experience possessed by a person is sufficient / satisfactory for the concerned position.
1.2 Term / Tenure
a) Managing Director/Whole-time Director/Manager (Managerial Personnel)
The Company shall appoint or re-appoint any person as its Managerial Personnel for a term not exceeding five years at a time. No re-appointment shall be made earlier than one year before the expiry of term.
b) Independent Director
- An Independent Director shall hold office for a term of up to five consecutive years on the Board of the Company and will be eligible for reappointment on passing of a special resolution by the Company and disclosure of such appointment in the Board's report.
- No Independent Director shall hold office for more than two consecutive terms, but such Independent Director shall be eligible for appointment after expiry of three years of ceasing to become an Independent Director. Provided that an Independent Director shall not, during the said period of three years, be appointed in or be associated with the Company in any other capacity, either directly or indirectly.
The Committee shall carry out evaluation of performance of every Director, KMP and Senior Management Personnel at such interval as deemed fit.
The Committee may recommend the Board for removal of a Director, KMP or Senior Management Personnel for reasons recorded in writing. The Procedure for removal of any Director shall be as per the provisions of the Act in this regard. 2.1 Remuneration Policy
a) The remuneration / compensation / commission etc. to the Managerial Personnel will be determined by the Committee and recommended to the Board for approval which shall be subject to the prior/post approval of the shareholders of the Company and Central Government, wherever required.
b) The remuneration and commission to be paid to the Managerial Personnel shall be in accordance with the percentage / slabs / conditions as per the provisions of the Act.
c) Increments to the existing remuneration / compensation structure may be recommended by the Committee to the Board which should be within the limits approved by the Shareholders in the case of Managerial Personnel. Criteria for Performance Evaluation of Independent Directors. The Criteria for performance evaluation of Independent Directors is disclosed in the Board's Report.
Details of Remuneration paid to Directors during the year:
A. Executive Directors
The remuneration paid to Directors during the financial year ended 31st March, 2015 is as follows:
Mr. Shalin A. Shah (MD) Rs. 7,50,000/-
B. Non Executive Directors
No sitting fees haS been paid to Non - Executive Directors for attending any meetings during the financial year ended 31st March, 2015.
C. STAKEHOLDERS' RELATIONSHIP COMMITTEE:
Pursuant to the provisions of Section 178 of the Companies Act, 2013 and Clause 49 of the Listing Agreements, the Board of Directors of the Company reconstituted and renamed Shareholders'/Investors' Grievances Committee as "Stakeholders Relationship Committee".
No. of Shareholders' complaints received so far: 11
No. of complaints not solved to the satisfaction of shareholders: Nil
No. of pending complaints: Nil
4. INDEPENDENT DIRECTORS' FAMILIARISATION PROGRAMME & Independent Directors' Meeting:
As per requirements under the Listing Agreement, the Company undertook familiarization Programme for Independent Directors in order to familiarize them with business model, management structure, product portfolio, Industry overview, manufacturing operations, internal control system and processes, risk management framework, functioning of various divisions, HR Management etc.
During the year under review, the Independent Directors met on 14th November, 2015, inter alia, to discuss:
* Evaluation of the performance of Non Independent Directors and the Board of Directors as a whole;
* Evaluation of the performance of the Chairman, taking into account the views of the Executive and NonExecutive Directors;
* Evaluation of quality, content and timelines of flow of information between the Management and the Board that is necessary for the Board to effectively and reasonable perform its duties.
All Independent Directors were present at the Meeting.
5. SHAREHOLDING OF NON-EXECUTIVE NON-PROMOTER DIRECTORS
None of the Non-Executive Non-Promoter Directors hold any shares in the Company.
6. DISCLOSURE OF RELATIONSHIPS BETWEEN DIRECTORS INTER-SE
Mr. Ashok C. Shah, Non-Executive Director is the father of Mr. Shalin A. Shah, Managing Director. No other Director of the Company is related to any other Director.
7. POSTAL BALLOT:
During the year, the Company had not sought approval from the shareholders through Postal Ballot. The Company had provided e-voting facility at the time of Annual General Meeting for the year ended 31st March, 2014. The Company had appointed Mr. Chintan K. Patel, Practising Company Secretary to act as Scrutinizer for the entire e-voting process.
i. There are no materially significant related party transactions that may have potential conflict with the interest of the Company at large
ii. There were no instances of non-compliance nor have any penalties/strictures imposed by Stock Exchanges or SEBI or any other statutory authority on any matters related to capital market, during last 3 financial years.
iii. Whistle Blower Policy
In terms of Clause 49 of the Listing Agreements, the Company has established vigil mechanism for directors, employees and other stakeholders to report concerns about unethical behavior, actual or suspected fraud or violation of the Company's code of conduct or ethical policy.
iv. Details of Compliance with Mandatory requirements and adoption of Non-mandatory requirements of Clause 49
The Company complies with all the mandatory requirements of Clause 49 of the Listing Agreement on Code of Corporate Governance.
a) Office for non-executive Chairman at company's expense: No
b) Half-yearly declaration of financial performance to each household of shareholders: Not complied
c) Audit Qualifications: Complied as there are no audit qualifications
d) Separate posts of Chairman & CEO: Not applicable
e) Reporting of Internal Auditors directly to Audit Committee: Complied
9. MEANS OF COMMUNICATION:
Board of Directors approves and takes on record Unaudited Quarterly Results and Audited Annual Results in the prescribed form and announces forthwith the results and intimate to the Bombay Stock Exchange Ltd. where the Company's shares are listed. The results are also published in two newspapers, one in English and the other in Regional Language.
10. ADDITIONAL INFORMATION TO SHAREHOLDERS
a. Annual General Meeting:
Date: 30th September, 2015
Time: 11.00 a.m.
Address: 8, Sigma Corporate, Nr. Mann Party Plot, S. G. Highway, Ahmedabad - 380 054
b. Calendar of Financial Year ended 31st March, 2015
The meetings of Board of Directors for approval of quarterly financial results during the Financial Year ended 31st March, 2015 were held on the following dates:
First Quarter Results: 14th August, 2014
Second Quarter and Half yearly Results: 14th November, 2014
Third Quarter Results: 14th February, 2015
Fourth Quarter and Annual Results: 30th May, 2015
c. Tentative Calendar for financial year ending 31st March, 2016_
Unaudited Results for the quarter ended 30/06/2015 Second Week of August, 2015
Unaudited Results for the quarter ended 30/09/2015 Second Week of November, 2015
Unaudited Results for the last quarter ended 31/12/ 2015 Second Week of February 2016
Audited Results for the quarter ended 31/03/ 2016 Fourth Week of May 2016
Annual General Meeting for the year ending 31st March, 2016 September 30, 2016
d. Date of Book Closure
24th September, 2015 to 30th September, 2015 (both days inclusive) for Annual General Meeting and dividend.
e. Regd. Office
8, Sigma Corporate, Nr. Mann Party Plot, S. G. Highway, Ahmedabad - 380 054.
f. Equity shares of the Company are listed on BSE Limited Stock Exchange.
g. Scrip Code:- 513536 (BSE), Scrip ID: GNRL, ISIN : INE207H01018
h. Share Transfer System
Applications for transfer of shares held in physical form are received at the office of the Registrars and Share Transfer Agents of the Company, Purva Sharegistry (India) Pvt. Ltd. All valid transfers are processed within 15 days from the date of receipt
i. Dematerialization of Shares and liquidity
The shares of the company are permitted for demat on NSDL and CDSL
j. Outstanding GDRs / ADRs / Warrants or Conversion instruments, Conversion date and like impact on equity- Not applicable
k. Investors' correspondence:
For transfer / dematerialization of shares, Change of Address, Change in Status of investors, payment of dividend on shares and other query relating to the shares of the Company:
PURVA SHAREGISTRY (INDIA) PVT. LTD. (Unit : Gujarat Natural Resources Limited)
Shiv Shakti Industrial Estates, Unit No. 9, J. R. Boricha Marg, Lower Parel (E), Mumbai - 400 011.
l. Share Transfer System
Shares in physical form sent for registering transfer, to the Registrar and Shares Transfer Agents, Purva Sharegistry (India) Pvt. Ltd. are registered and returned within a period of 15 days from the date of receipt, if the documents are in order in all respects. The Share Transfer Committee of the Company meets as often as required.