REPORT ON CORPORATE GOVERNANCE
1. Company's philosophy on Code of Governance
The Company's philosophy on Corporate Governance is aimed at assisting the management of the Company in the efficient conduct of the business and to meet its obligations to the stakeholders. The Company firmly believes that practice of Corporate Governance inter alia should aim at meeting the aspirations of the stakeholders and the expectations of the society at large. Accordingly, the Company believes in and has consistently practiced good Corporate Governance. In pursuance of this philosophy, the management adheres to transparency, professionalism and accountability in performance of its role.
2. Board of Directors
a. Composition of Board
As on March 31, 2016, the Company has 9 Directors with one Chairman & Managing Director. Of the 9 Directors, 5 are Independent Non-Executive Directors, 3 are Non-Executive Directors and one Executive Director.
c. No. of meetings of the Board of Directors held and dates on which held
During the financial year, four meetings of Board of Directors were held on April 23, 2015; July 23, 2015; October 20, 2015 and January 21, 2016.
d. The Directors are unrelated to each other except as members of the Board.
e. None of the Non-Executive Directors holds equity shares and convertible instruments of the Company.
f. The familiarization program imparted during the year under review to the Independent Directors is placed on the Company's website viz., www.ipappm.com
3. Audit Committee
Brief description of terms of reference of Audit Committee as per the Charter approved by the Board:
a. Terms of reference
i. Oversight of the Company's financial reporting process and disclosure of its financial information to ensure accuracy and correctness;
ii. Recommendation for appointment, remuneration and terms of appointment of auditors of the Company;
iii. Approval of payment to statutory auditors for any other services rendered by the statutory auditors;
iv. Discussion and review, with the management and auditors, of the annual/quarterly financial statements before submission to the Board, with particular reference to the following:
• Matters required to be included in the Directors' 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;
• Changes, if any, in accounting policies and practices and reasons for the same;
• Major accounting entries involving estimates based on the exercise of judgment by management;
• Significant adjustments made in the financial statements arising out of audit findings;
• Compliance with listing and other legal requirements relating to financial statements;
• Disclosure of any related party transactions;
• Qualifications in the draft audit report;
v. Review the functioning of the whistle blower mechanism;
vi. Evaluation of internal financial controls and risk management systems.
4. Nomination and Remuneration Committee
Brief description of terms of reference of Nomination and Remuneration Committee as per the Charter approved by the Board:
a. Terms of reference
• Identifying the 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 shall carry out evaluation of every Director's performance;
The expression 'Senior Management' means the personnel of the Company who are members of its Core Management Team excluding the Board of Directors, comprising all members of management one level below the Executive Directors including the functional heads;
• Formulating criteria for determining the qualifications, positive attributes and independence of a director and recommend to the Board a policy, relating to the remuneration for the Directors, Key Managerial Personnel and other employees;
• Devise a policy on Board diversity;
• Recommending the remuneration of managerial personnel viz. Managing Director or Whole-time Director.
b. Criteria of making payments to Non-Executive Directors
The Board of Directors at its meeting held on July 22, 2014 approved to pay Non-Executive Directors a sitting fees of Rs.100,000 per meeting for attending the Board Meeting and Rs.75,000 per meeting for attending the Committees of Board Meetings with effect from July 1, 2014.
c. Disclosure with respect to remuneration
In terms of Special Resolution passed by the Members at the 51st Annual General Meeting held on August 27, 2015, Performance Incentive of Rs.59.62 lakhs was paid to Mr. Rampraveen Swaminathan during the financial year ended March 31, 2016.
No other element of remuneration package is paid to the Non-Executive Directors except payment of sitting fees to the Independent Non Executive Directors.
The contract with Executive Director is terminable by giving six months notice on either side. The Company did not issue any stock options during the year.
6. Stakeholders Relationship Committee
a. Ms. Ranjana Kumar, Non-Executive Independent Director is the chairperson of Stakeholders Relationship Committee besides Mr. Rampraveen Swaminathan, Executive Director as Member.
During the financial year, the Stakeholders Relationship Committee met on April 22, 2015 and January 20,
b. The Board designated Mr. C. Prabhakar, Sr. Vice President (Corporate Affairs) & Company Secretary as Compliance Officer.
c. The details of the status of complaints received from the shareholders during the financial year ended
8. Means of Communications
Quarterly, half-yearly and annual financial results are usually published in Business Line (English Version) and vernacular regional newspaper viz. Andhra Prabha. The results are placed on the Company's website: www.ipappm.com
Official news releases are being displayed on the website of the Company. Presentations are proposed to be made to media, analysts, institutional investors etc.
9. General Shareholder Information
a. Date, Time and Venue of Annual General Meeting
Date & time : July 27, 2016 at 12:00 noon
Venue: Cherukuri Subbarao Gannemma Udyana Kalyanavedika Jawaharlal Nehru Road, Rajahmundry - 533 103, East Godavari District, Andhra Pradesh, India
b. Financial calendar (Tentative and subject to change)
Financial year: April 1, 2016 to March 31, 2017
Particulars Period ended On or before
Unaudited Financial Results for the quarter ending : June 30, 2016 : August 14, 2016
Unaudited Financial Results for the quarter ending : September 30, 2016 : November 14, 2016
Unaudited Financial Results for the quarter ending : December 31, 2016: February 14, 2017
Audited Financial Results for the year ending : March 31, 2017 :May 30, 2017
Annual General Meeting for the year ending : March 31, 2017: September 30, 2017
c. Date of payment of Dividend (If any)
Not applicable since the Board did not recommend declaration of dividend.
d. Listing on stock exchanges
BSE Limited (BSE) Phiroze Jeejeebhoy Towers, Dalal StreetMumbai - 400 001
National Stock Exchange of India Limited (NSE) 'Exchange Plaza'Bandra-Kurla Complex Bandra (East), Mumbai - 400 051
The Company paid the annual listing fees for the financial year 2016-17 in April 2016 to BSE and NSE.
e. Stock Code
BSE : 502330
NSE Symbol: IPAPPM Series: EQ
ISIN (for Dematerialization): INE435A01028
i. Registrar and Share Transfer Agent :
Karvy Computershare Private Limited Karvy Selenium Tower B, Plot 31-32, Gachibowli, Financial District, Nanakramguda, Serilingampally Hyderabad - 500 032 Toll Free No. (India) 1800 4250 999 Phone : +91 40 6716 1500 Fax : +91 40 2342 0814 Email : firstname.lastname@example.org Contact Person: Mr. Praveen Chaturvedi, General Manager
j. Share Transfer System
The share transfers are being approved by the authorized persons as per the delegation of powers by the Board, in every 10 days. The average time taken for registering the share transfers is approximately 10 days from the date of receipt of request.
m. No GDRs, ADRs/warrants/convertible instruments have been issued by the Company during the year.
n. Commodity price risk or foreign exchange risk and hedging activities: Furnished as part of the Board's Report in page 27 and under the head 'Management of Risks' in pages 61 to 64.
o. Plant Locations
Rajahmundry - 533 105 East Godavari District Andhra Pradesh
Near Kadiyam Railway Station, M.R.Palem - 533 126, Kadiyam Mandal, East Godavari District, Andhra Pradesh
Address for correspondence from shareholders
Karvy Computershare Private Limited Karvy Selenium Tower B, Plot No 31 & 32, Gachibowli, Financial District, Nanakramguda, Serilingampally Hyderabad - 500 032
Secretarial Department International Paper APPM Limited Rajahmundry - 533 105 East Godavari District, Andhra Pradesh
q. Email IDs for investor grievance redressal:
10. Other Disclosures
a. Disclosure on materially significant related party transactions
During the financial year, there were no materially significant related party transactions that have potential conflict with the interests of the Company at large. The policy on Related Party Transactions is posted on the Company's website viz., www.ipappm.com
b. Details of non-compliance by the Company
There were no penalties, strictures imposed on the Company by the Stock exchanges or SEBI or any statutory authority, on any matter related to capital markets during the last three years.
c. Whistle Blower Policy
The Company has formulated Whistle Blower Policy and established a mechanism for directors and employees to report to the management concerns about unethical behavior, actual or suspected fraud or violation of the company's code of business conduct and ethics policy. This mechanism provides for adequate safeguards against victimization of director(s)/employee(s) who avail of the mechanism and also provide for direct access to the Chairman of the Audit Committee in exceptional cases. The Whistle Blower Policy is posted on the Company's website viz., www.ipappm.com
d. Details of compliance with mandatory requirements and adoption of non-mandatory requirements
The Company has complied with all mandatory requirements specified in Regulation 17 to 27 and clauses of (b) to (i) of Regulation 46 (2) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
The Company has also adopted the following non-mandatory requirements of (1) of Regulation 27 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
1. Shareholder Rights: Half-yearly and other quarterly financial statements are published in newspapers and also posted on Company's website www.ipappm.com
2. Audit Qualifications: The Company is already in the regime of unqualified financial statements. Auditors have raised no qualification on the financial statements of the current financial year;
3. Reporting of Internal Auditor: External consultancy firm was appointed as Internal Auditor of the Company which has direct access to the Audit Committee.
11. Code of Conduct for Directors and members of senior management
The Company adopted a Code of Business Conduct and Ethics for its Directors and members of senior management. The Code has also been posted on the Company's website: www.ipappm.com The Chairman & Managing Director has given a declaration that all the Directors and members of senior management have affirmed compliance with the Code of Conduct.
12. CEO/CFO Certification
A certificate duly signed by Chairman & Managing Director and CFO relating to financial statements and internal controls and internal control systems for financial reporting as per the format provided in Regulation 17(8) of the SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015 was placed before the Board and was taken on record.
13. Equity shares in the Unclaimed Shares Demat Suspense Account
In terms of Regulation 39(4) of SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015, the Company opened a demat account and dematerialized the unclaimed shares. The Company is maintaining the details of shareholding of each individual allottee whose shares are credited to the Unclaimed Shares Demat Suspense Account.