CORPORATE GOVERNANCE REPORT
1. CORPORATE GOVERNANCE PHILOSOPHY
The Company subscribes fully to the principles and spirit of sound Corporate Governance and embodies the principles of fairness, transparency, accountability and responsibility into the value systems driving the Company. It has been the constant endeavor of the Company to create an environment for efficient conduct of the business and to enable management to meet its obligation to all its stakeholders, including amongst other, shareholders, customer, employees and the community in which the Company operates.
2. BOARD OF DIRECTORS
The Board comprises of Eight Directors, of which two are Executive and six are Non-Executive Directors. The Chairman of the Board, is an Executive Director. The Number of Independent Director is 50% of the total number of Directors. The Company, therefore, meets with the requirements relating to the Composition of Board of Directors. The Non-Executive Directors are eminent professionals with experience in industry, management, finance, research and law who bring in a wide range of skills expertise and experience to the Board.
(b) Board Meetings:
Six Board Meetings of the Company were held during the year ended March 31st 2009 on the following dates:
02-06-2008, 06-08-2008, 29-08-2008, 30.09.2008, 24-10-2008, 27.01.2009.
The gap between two Board Meetings did not exceed 4 months.
The notice for the Board Meeting and the detailed agenda papers are circulated to all the Directors well in advance to enable them to attend and take an informed decision at the Meetings. The information as required under Annexure-IA to clause 49 of the Listing Agreement is made available to the Board.
The minutes of the proceedings of each Board and committee meeting are properly recorded and entered into minutes book. There is effective post meeting follow-up, review and reporting process for decision taken by the Board.
3. COMMITTEES OF BOARD OF DIRECTORS:
3.1 AUDIT COMMITTEE
(a) Composition of Audit Committee Meeting:
The Audit Committee comprised of Mr.P.G.Shah as Chairman. Mr.P.G.Shah is independent Director and has been appointed as member and Chairman of Audit Committee from 30.10.2007. Mr.P.G. Shah-M.S.in Chemical Engineering is having over 37 years experience in Industry, Corporate Finance & Accounts. Mr.K.Ravindranth is Electronics and Radio Engineer having more than 27 years of experience including working as Director with the Company. Dr.Yancy Riddle is PhD having experience in materials science and engineering.
Mr.Ashok K.Jani, Executive Chairman , Mr.Peter Flood-Chief Executive Officer, G.M. Finance, GM. Accounts and Company Secretary remain present at the meeting of the Audit Committee. Internal Auditor and Mr.J.C.Bhatt, Statutory Auditors attends the meetings of the Audit Committee as Invitees.
Mr.P.G Shah Chairman of the Committee :- Independent Non-Executive
Mr.K.Ravindranath:- Non-independent Non-Executive
Dr.Yancy Riddle* :- Independent Non-Executive
* Dr.Yancy Riddle was representative by his Alternate Director at the Committee Meeting.
(b) Terms of Reference
The terms of reference/powers of the Audit Committee are in accordance with Clause 49 of the Listing Agreement and includes: Reviewing management discussion and analysis and the financial and operating results of the operations. Reviewing with the Management, quarterly, half yearly and annual financial statements before submission to the Board. Discussions with the management and the statutory auditors the scope and programme of internal audit. Reviewing with the management, the statutory and internal auditors, adequacy of internal checks and controls within the Organization and initiate discussion on the risk management practices. Recommending to the Board of Directors reappointment of statutory and internal auditors and fees payable to them. Discussion with the management findings in the internal audit reports and suggested" steps to be taken to overcome the weaknesses observed in the internal controls. Deliberations on the applicability, compliance and impact of various Accounting Standards and guidelines issued by the Institute of Chartered Accounts of India from time to time. Reviewing the Accounting Policies followed by the Company. Reviewing of the significant related party transactions. Reviewing the compliance with the regulatory requirements concerning the financial statements. Reviewing the functions of the Whistle Blow Mechanism. Reviewing the compliance with listing and other legal requirements relating to financial statements.
(c) Meeting held during the year:
During the year from 1sl April 2008 to 31st March 2009, Four (4) meetings of Audit Committee were held on the following dates:
02.06.2008, 06.08.2008, 24.10.2008, 27.01.2009
3.2 SHAREHOLDERS GREIVANCE AND SHARE TRANSFER COMMITTEE:
(a) Composition of the Share Grievance of the Share Grievance and Share Transfer Committee Meeting:
The Chairman of the Committee is an Independent Non-Executive Director. During the year Twelve (12) meetings of Share Grievance and Share Transfer Committee were held. The Attendance and the Composition of the Directors of the Committees is as follows:
Mr.P.G Shah Chairman of the Committee :- Independent Non-Executive
Mr.Umesh Gala :- Independent Non-Executive
Mr.Ashok K.Jani :- Promoter Executive
(b) Terms of Reference:
• To review the existing Investors Redressal System and suggest measures for improvement.
• To review the report of Registrars and Share Transfer Agents about investor's grievances and action taken for redressal thereof.
• To suggest improvement in investor's relations.
• To consider and take on record the Certificate from practicing Company Secretary under Clause 47(c) of the Listing Agreement.
• To consider appointment/reappointment of Registrars and Share Transfer Agents and review terms and conditions of their appointments, their remuneration, service charges, fees etc.
• To consider and take on record Secretarial Audit certificates issued by practicing Company Secretary certifying aggregate number of equity shares held in depositories and in physical form tally with the total number of shares in Company's issued, listed and admitted share capital.
• To approve transfer of shares, splitting and consolidation of shares, issuance of duplicate shares and reviewing shareholder's complaint's and resolution thereof.
(c) Number of Complaint pending with the Company:
During the financial year the Company/Registrar and Share Transfer Agents, Sharex Dynamic (India) Private Limited received nil letters/complaints. As on 31st March 2009 there were no complaints pending with the Company/ Registrar and Share Transfer Agents.
(d) Number of shares pending for Transfer:
All the valid share transfers requests received during the year were duly attended to and processed in time. There were no valid requests pending for share transfer as on 31st March 2009.
3.3 REMUNERATION COMMITTEE:
The Chairman of the Committee is an Independent Non-Executive Director. During the year no meetings were held. Composition of the Directors of the Committees is as follows:
Mr. Umesh Gala Chairman of the Committee :- Independent Non -Executive
Dr. Yancy Riddle :- Independent Non -Executive
Mr. P.G.Shah :- Independent Non -Executive
(b) Terms of Reference:
The Committee reviews and recommends the revision in salary and perquisites of the Executive Directors based on the financial performance of the Company ,trend in the industry, qualification, experience of the concerned managerial person. The Committee also has power to review and recommend payment of remuneration to Non-Executive Directors.
a) There is no materially significant related party transaction i.e. transactions of the Company of material nature, with its promoters, directors or the management, their subsidiaries or relatives, etc. that may have potential conflict with the interests of the Company at large. Attention of members is drawn to disclosure of transactions with related parties set out in notes of accounts schedule L forming part of the Annual Report. The Company's major related party transaction is with wholly Owned Subsidiary based on business exigencies. All related party transactions are at arms length basis and are only intended to further the interests of the Company.
b) Multi Arc Coatings & Straps Limited, a wholly owned subsidiary of the Company was incorporated on 23-12-2005.The Company has nominated its representatives on the Board of the subsidiary Company. Mr.Pravin G-Shah-Independent Director has been nominated on the Board of the subsidiary from 30.10.2007.
5. MEANS OF COMMUNICATION:
(a) Quarterly Financial Results of the Company are forwarded to the Bombay Stock Exchange Ltd. and published in leading English and Marathi News paper. Half-yearly report is not sent to each shareholder as the results the Company are published in the newspapers.
(b) The Company has not made any presentation to any Institutional Investors/analyst during the year
(c) The Company has its own website and all the vital information relating to the Company and its products is displayed on the website. Address of the website is www.multi-arcindia.com.
(d) Annual Report containing inter alia, Audited Annual Report, Financial Statements, Directors Report, Auditors Report and other important information is circulated to the members and others entitled thereto. The Management Discussion and Analysis Report forms a part of the Annual Report.
6. GENERAL SHAREHOLDERS INFORMATION
1. AGM: Date, time and venue :-
30th September 2009 at 4.00 p.m. at Chatwani Baug, 2nd Floor, 7, Gokhale Road, Vile Parle (East), Mumbai - 400 057
2. Financial Calendar Tentative :-
1st April 2009 to 31st March 2010
First Quarter Results :- July 2009
Second Quarterly Results :- October 2009
Third Quarterly Results :- January 2010
Fourth Quarterly Results :- April 2010
3. Date of Book Closure :- 29th September, 2009
4. Dividend Payment Date :- N.A.
5. Listing on Stock Exchanges :- The Company is listed on Bombay Stock Exchange Ltd.
6. ISIN No :- INE 399B01016
7. BSE Stock code :- 513685
8. Listing Fees :- Annual Listing fees for the year 2009-10 has been paid by the Company to Bombay Stock Exchange, Limited.
9. Registrar & Share Transfer Agent :-
Sharex Dynamic (India) Private Limited
17-B, Dena Bank Building, 2nd Floor, Horniman Circle, Fort, Mumbai - 400001
10. Share Transfer System :-
The Company's shares are traded in the Stock Exchange compulsorily in demat mode. Shares Transfer of securities in physical form are registered and duly transferred share certificates are dispatched within 15 days of receipt, if the transfer documents are in order .Transfers are approved every 15 days. The Board has delegated authority for approving transfer/transmission etc. to Share holders Grievance and Share Transfer Committee. The summary of shares transfer/transmission as approved by the Share holders Grievance and Share Transfer Committee is placed at every Board Meeting. The Company obtains from a Company Secretary in Practice half yearly certificate of Compliance with share transfer formalities as required under clause 47(C) of the Listing Agreement with the Stock Exchange and files a copy of the certificate with the Stock Exchange.
11. Coating Centres :-
126/1 ,GIDC,Umargam, Dist.Valsad, Gujarat- 396171
Tel. No. :(0260) 27464143
71-A, Sipcot Industrial Complex, Phase-1, Hosur-635126 Tamil Nadu
Tel.: (04344) 396399
Ground Floor,National Highway No.8, Village Vadadla, Dist: Bharuch , Gujarat -392015
12. Address for Correspondence :-
Multi-Arc India Limited
14,Lumbini Palace .V.S.Khandekar Marg, Vile-Parle (East), Mumbai - 400057 Contact Person : Mr. K.Gagavani
Tel.No. (022) 26115630/26115974 Fax No. 26166185
Sharex Dynamic (India) Private Limited
17-B, Dena bank Building, 2nd Floor, Horniman Circle, Fort, Mumbai - 400001
Contact Person: Mr.T.Sasikumar
Fax. No. (022) 26411349
7. CODE OF CONDUCT
The Board has formulated a code of conduct for the Board members and senior management of the Company. All Board members and senior management personnel have affirmed their compliance with the code as on 31st March 2009 to the Company.
It is hereby affirmed that all Directors and Senior management personnel have complied with the code of conduct framed by the Company and a confirmation to that effect has been obtained from Directors and Senior management members.
8. CEO/CFO CERTIFICATION
A certificate from the Chief Executive Officer on the financial statements of the Company as required under clause 49 of the Listing Agreement was placed before the Board.
9. WHISTLE BLOWER MECHANISM:
The Company promotes ethical behaviour in all its business activities and has put in place mechanism of reporting illegal and unethical behaviour. Employees are free to report violations of laws, rules & regulations or unethical conduct to their superiors. The reports received from any employee will be reviewed by the Audit Committee. It is ensured that the whistle blowers are not subjected to any discriminatory practices.
10. COMPLIANCE CERTIFICATE OF THE AUDITORS
Certificate from the Statutory Auditors of the Company confirming Compliance with the conditions of Corporate Governance as stipulated under clause 49 of the listing Agreement is annexed hereto forming part of Annual Report.
The Company complies with Non-Mandatory requirements stipulated under clause 49 in respect of remuneration committee and Whistle Blower Policy.