REPORT ON CORPORATE GOVERNANCE
1. Company’s philosophy on Corporate Governance
The Company provides detailed information on various issues concerning the Company’s business / performance, to its shareholders. The fundamental philosophy of Corporate Governance in the Company is to achieve business excellence and dedicate itself for meeting its obligations to the shareholders.
The Company believes that good Corporate Governance is a continuous process and strive to improve the same to meet shareholder’s expectations. The Board of Directors of the Company has adopted the Code of Conduct for its members and senior management executives.
The Meeting of the Board of Directors are scheduled well in advance and generally held at the Company’s office at Nariman Point, Mumbai. The notice confirming the meeting and the detailed agenda is sent well in advance to all the Directors. There were six Board Meetings held during the financial year ended 31st March 2016, namely on 5th May 2015, 18th May 2015, 3rd August 2015, 29th October 2015, 29th January 2016 and 17th March 2016.
Attendance, Other Directorship & Membership
Membership and Attendance of each Director at the Board of Directors’ Meetings held during the year and the last Annual General Meeting and the number of other Directorship/ Membership of Board Committees as on 31st March 2016:
Remuneration of Directors
During the year under review the Company has paid Rs. 62.00 lacs towards remuneration (details of which are provided in the extract of the annual return form MGT 9 ‘Annexure C’ to the Directors’ Report) to Mr. Mahendra V. Doshi, Executive Chairman of the Company pursuant to the special resolution passed by members on June 10, 2014. At present, Independent Directors are not paid any remuneration except sitting fess for attending Board Meetings.
Sitting Fees paid to Directors for attending Board Meetings
1. Mr. Sajid Mohamed Rs. 80,000/-
2. Mr. Vineet N. Suchanti Rs. 1,20,000/-
3. Mr. Hariharan Padmanabhan Nil
4. Mr. Pratik M. Doshi Rs. 1,20,000/-
5. Mr. Sayanta Basu Nil
6. Mr. M. V. Doshi Nil
7. Mrs. Anjali Suresh Rs. 1,20,000/-
3 Audit Committee
The Board has set up the Audit Committee with two Independent Directors Mr. Vineet N. Suchanti, Mrs. Anjali Suresh and one Promoter Director Mr. M. V. Doshi. Mr. Vineet N. Suchanti is the Chairman of the Audit Committee and was present at the last
Annual General Meeting.
Audit Committee meetings were held on 5th May 2015, 18th May 2015, 3rd August 2015, 29th October 2015, and 29th January 2016. All the members have attended the aforesaid meetings. The Statutory Auditors were the invitees to the above meetings. The scope of activities and powers of Audit Committee includes the areas prescribed under the Regulation 18 of SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015, and section 177 of the Companies Act, 2013.
4. Stakeholders Relationship Committee
Stakeholders Relationship Committee has been constituted pursuant to the section 178 of the Companies Act, 2013 and Regulation 20 of SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015,The said Committee is having two Independent Directors Mrs. Anjal Suresh and Mr. Vineet Suchanti. Mrs. Anjali Suresh is appointed as the Chairperson of the Committee. Mr. Girish Innani, General Manager (Legal) & Company Secretary of the Company is Compliance Officer. During the year under review, 2 shareholders’ letters/complaints were received about non receipt of Dividend Warrant/s and 1 letter for non receipt Share Certifi cate after transfer. The Committee meetings were held on 30th June 2015, 5th October 2015 and 2nd January 2016. There is no complaint which has remained un-addressed. No transfer of shares is pending as on date.
M/s. V. R. Associates, Practicing Company Secretaries is conducting Reconciliation of Share Capital Audit, for the Company.
5. Nomination and Remuneration Committee
The Nomination and Remuneration Committee has been constituted by the Company. Mr. Vineet N. Suchanti is the Chairman of the Committee and Mr. Sayanta Basu and Mrs. Anjali Suresh are the members of the Committee.
The terms of reference of the Nomination and Remuneration Committee cover all the areas mentioned under Part D Schedule II read with regulation 19 of SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015 and section 178 of the Companies Act, 2013. The broad terms of reference of the Nomination and Remuneration Committee therefore include recommending a policy relating to remuneration and employment terms of Executive Chairman, directors and senior management personnel, adherence to the remuneration/ employment policy, also to prepare, administrate and monitor Company’s Employees Stock Options Plans /Scheme from time to time, as finally approved by the Board of Directors. Preparing the criteria and identify persons who may be appointed as directors or senior management of the Company, preliminary evaluation of every Director's performance, Board diversity, compliance of the Code for Independent Directors referred to in Schedule IV of the Companies Act, 2013, compliance with the Company's Code of Conduct by Directors and employees of the Company, reporting non-compliances, in case if any, to the Board of Directors, recommending draft of the report required under Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 which will form part of the Directors Report to Shareholders, monitor loans to employees and any other matters which the Board of Directors may direct from time to time. During the financial year ended March 31, 2016, two meetings of the Nomination and Remuneration Committee were held on 30th July 2015 and 18th March 2016. All the members have attended the aforesaid meetings. At present, Directors are not paid any fees for attending any Committee Meetings. Policy for selection and Appointment of Directors and their Remuneration
Criteria of selection of Non-executive Directors
The Non-executive Directors shall be of high integrity with relevant expertise and experience so as to have a diverse Board with Directors having expertise in the fields of marketing, finance, taxation, law, governance and general management. In case of appointment of Independent Directors, the Committee shall satisfy itself with regard to the independent nature of the Directors vis-a-vis the Company so as to enable the Board to discharge its function and duties effectively.
The Committee shall ensure that the candidate identified for appointment as a Director is not disqualified for appointment under Section 164 of the Companies Act, 2013.
The Committee shall consider the following attributes / criteria, whilst recommending to the Board the candidature for appointment as Director.
i. Qualification, expertise and experience of the Directors in their respective fields;
ii. Personal, Professional or business standing;
iii. Diversity of the Board.
In case of re-appointment of Non-executive Directors, the Board shall take into consideration the performance evaluation of the Director and his engagement level.
A Non-executive Director shall be entitled to receive sitting fees for each meeting of the Board attended by him, of such sum as may be approved by the Board of Directors within the overall limits prescribed under the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and reimbursement of expenses for participation in the Board meetings.
CEO & Executive Chairman / Director – Criteria for selection / appointment
For the purpose of selection of the CEO & Executive Chairman / Director the Committee shall identify persons of integrity who possess relevant expertise, experience and leadership qualities required for the position and shall take into consideration recommendation, if any, received from any member of the Board.
The Committee will also ensure that the incumbent fulfils such other criteria with regard to age and other qualifications as laid down under the Companies Act, 2013 or other applicable laws. Remuneration for the CEO & Executive Chairman / Director At the time of appointment or re-appointment, the CEO & Executive Chairman / Director shall be paid such remuneration as may be mutually agreed between the Company (which includes the Committee and the Board of Directors) and the CEO & Executive Chairman / Director within the overall limits prescribed under the Companies Act, 2013.
The remuneration shall be subject to the approval of the Members of the Company in General Meeting.
The remuneration of the CEO & Executive Chairman / Director comprises of fixed and variable component as per the provisions of Companies Act, 2013. The fixed component comprises salary, allowances, perquisites, amenities and retiral benefits. Remuneration Policy for the Senior Management Employees In determining the remuneration of the Senior Management Employees the Committee shall ensure the relationship of remuneration and performance benchmark is clear.
The Executive Chairman will carry out the individual performance review based on the respective defined objectives, qualification, expertise, experience and other factors whilst recommending the annual increment and performance incentive to the Committee for its review and approval.
6. Corporate Social Responsibility (CSR) Committee:
As required under section 135 of the Companies Act, 2013 the Company has formed a CSR committee consisting of the following members
The committee met 2 times during the financial year ended March 31, 2016. All the members have attended the aforesaid CSR Committee meetings.
7. Performance Evaluation Of The Board
A separate exercise was carried out to evaluate the performance of individual Directors including the Chairman of the Board, who were evaluated on parameters such as level of engagement and contribution, independence of judgement, safeguarding the interest of the Company and its minority shareholders etc.
The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman and the Non-independent Directors was carried out by the Independent Directors who also reviewed the performance of the Secretarial Department. The Directors expressed their satisfaction with the evaluation process.
8. Independent Directors Meeting
During the year under review, the Independent Directors met on March 18, 2016, inter alia, to discuss:
1. Evaluation of the performance of Non Independent Directors and the Board of Directors as a Whole;
2. Evaluation of the performance of the Chairman of the Company, taking into account the views of the Nonexecutive Directors.
3. Evaluation of the quality, content and timelines of flow of information between the management and the Board that is necessary for the Board to effectively and reasonably perform its duties.
All the Independent Directors were present at the meeting.
1. The related party detail are disclosed in the notes to financial statements. The Register of Contracts containing the transactions in which Directors are interested is regularly placed before the Board for its approval.
2. During the last three years, there were no strictures or penalties imposed either by Securities and Exchange Board of India or the Stock Exchange or any regulatory authority for non-compliance of any matter related to the capital market.
3. No personnel have been denied access to the Chairman or members of the Audit Committee. The mechanism of Whistle Blower Policy is in place.
4. To the extent possible, the Company has complied with the mandatory requirement of this clause.
5. The Company has complied with all applicable Accounting Standards in preparation of its financial statements pursuant to the amended Schedule III of Companies Act, 2013.
11. Means of Communication
1. The financial results of all four quarters were published in The Financial Express and Mumbai Lakshyadeep dailies. These were not sent individually to the shareholders.
2. The Company’s results or official news are displayed on a web site www.lkpsec.com
3. There were no presentations made to the institutional investors or to the analysts.
4. The Management, Discussion and Analysis Report forms a part of this Annual Report.
12. General Shareholder Information
AGM Date, Friday 10th June 2016
Time and Venue : at 10.30 a.m. M. C. Ghia Hall, Bhogilal Hargovindas Building, 18/20, K. Dubash Marg, Mumbai 400 001, Maharashtra, India.
Financial Calendar : April to March
Announcement of Audited / Un-audited Results (tentative)
1st Quarter - First week of August
2nd Quarter - First week of November
3rd Quarter - First week of February
4th Quarter - First week of May
Book Closure : Monday, 6th June, 2016 to Friday 10 June, 2016 (both days inclusive).
Dividend Dividend which remains unpaid or unclaimed declared by the Company for the year ended on March 31, 2009 at the Annual General Meeting held on June 02, 2009 will be transferred to the Investor Education and Protection Fund of the Central Government around 7th July, 2016 pursuant to the provisions of section 124 of the Companies Act, 2013. Thereafter no claim shall lie against the Company on these dividend from the shareholders.
Listing on Stock Exchange
B S E Limited, Mumbai (Code-507912). The Company has paid the listing fees for the period from 1st April 2016 to 31st March 2017. The Company is taking up the matter with appropriate authority of the Stock Exchange, Ahmedabad subsequent to their refusal for accepting voluntary delisting application.
Demat ISIN No. for Depositories : INE 724A01017
Registrar & share Transfer Agent
M/s. Adroit Corporate Services Private Limited 19, Jafarbhoy Industrial Estate, 1st Floor, Makawana Road, Marol Naka, Andheri ( East), Mumbai 400 059. Tel. No.022- 28590942
Share Transfer System
The Company’s Shares are traded on BSE Limited compulsorily in the dematerialized form. However, all requests received for transfer of shares for off market transaction in physical form furnishing with a copy of PAN card of the transferee(s) in compliance with the SEBI circular in that behalf, are processed by the Registrar and Transfer Agents and are approved by Share Transfer Committee on weekly basis. The Share Transfers are registered and returned within period of 15 days from the date of lodgment, if documents are complete in all respects.
Dematerialization of equity Shares and liquidity
As on 31st March 2016, 96.49 % of the Company’s total shares represented by 1,17,69,330 shares were held in dematerialized form.
Out-standing GDR/Warrants/Convertible Instruments The Company has no out-standing GDR/Warrants/Convertible Instruments.
Address for correspondence
LKP Finance Limited 203, Embassy Centre, Nariman Point, Mumbai 400 021
For and on behalf of Board of Directors
(M. V. Doshi)
Date: 2nd May, 2016
Place : Mumbai