CORPORATE GOVERNANCE REPORT
COMPANY'S PHILOSOPHY ON CODE OF GOVERNANCE:
Riga Sugar Company Limited as a part of Dhanuka Group, has over the years endeavored to follow practice of Corporate Governance. Riga Sugar's business objective and that of its management and employees is to manufacture and market the Company's products so as to create value for consumers, farmers, shareholders, employees, and the national economy. In addition to compliance with regulatory requirements, Riga Sugar Company Limited endeavors to ensure that standards of ethical and responsible conduct are met throughout the organization.
BOARD OF DIRECTORS:-
The Board of Riga sugar Co. Ltd. as on 31st March, 2015 comprises of an Executive Chairman cum Managing Director (CMD) and five other Directors including a Women Director. The day to day affairs of the company is managed by CMD. The composition of the Board is in conformity with section 149 of the Companies Act, 2013 and clause 49 of the Listing agreement entered into with the Stock Exchanges. The Composition, attendance at the Board meeting & last Annual General Meeting, Outside Directorship and other Board Committees are given below
Note 1: number of directorship in other companies excludes directorship in private limited companies, foreign companies and companies incorporated under section 8 of the Companies Act, 2013.
Note 2: Board Committee chairmanship/memberships in other companies include only chairmanships/memberships of Audit Committees and Stakeholders Relationship Committee.
Note 3: Board committee memberships in other companies includes only chairmanships in committees of other companies.
Note 4: Mr.O.P.Dhanuka, CMD is related to Mr.Pankaj Tibrawalla, Director as per section 2(77) of the Companies Act, 2013. Pankaj Tibrawalla is 'son-in-law' of Mr. O.P.Dhanuka.
All the independent directors qualify the conditions for being independent director as prescribed under clause 49. The Board periodically reviews compliance reports of all laws applicable to the Company and necessary steps are being taken to ensure the compliance in law and spirit.
As required under Annexure I to clause 49 of the Listing Agreement with the Stock Exchanges, all the necessary information were placed before the Board from time to time.
The company pays to its non-executive Directors as sitting fees, an amount of Rs.2,500/- per meeting for attending meetings of the Board of Directors.
Code of Conduct
The company has adopted a code of conduct for its non-executive Directors and all non-executive Directors have affirmed compliances with the said code. All senior Management of the company have also affirmed compliance with the Code of Conduct. The code of conduct is also displayed on the website of the company www.rigasugar.com
Maximum tenure of independent directors
The maximum tenure of independent directors is in accordance with the Companies Act, 2013 and clause 49 of the Listing Agreement.
Formal Letter of appointment to independent directors
The company issue a formal letter of appointment to independent directors in the manner as provided in the Companies Act, 2013 and clause 49 of the Listing agreement. The terms and conditions of appointment of independent directors are placed on the company' website.
Pursuant to the provisions of the Companies Act, 2013 and clause 49 of the Listing Agreement, the Board of Directors has carried out an annual performance evaluation of its own performance, and that of its Committee and individual Directors.
A structured questionnaire was prepared after taking into consideration input received from the Directors , covering many aspects of the Board functioning. 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 independent directors. The Nomination and Remuneration Committee also carried out evaluation of every director's performance. The directors expressed their satisfaction with the evaluation process.
Independent Directors meeting
In compliance with schedule IV of the Companies Act, 2013 and revised clause 49 of the Listing Agreement, the independent directors held their separate meeting on 17th March 2015, without the attendance of non-independent directors and members of management to review the performance of non-independent directors and chairman of the Board, assess their quality , quantity and timeliness of flow of information between company Management and the Board .
All Independent Director except Mr. Suyash Borar were present at the meeting. The independent directors present at the meeting deliberated on the above and expressed their satisfaction.
Transaction with Board Members. KMP and Senior Management.
There were no materially significant transactions during the Financial Year with Board Members and Senior Management , including their relatives that had or could have has a potential conflict of interest with the company.The Annual Report of the company contains a certificate duly signed by Managing Director in this regard.
The Audit committee has been constituted in line with provisions of clause 49 of the Listing Agreement and section 177 of the Companies Act, 2013.
The audit Committee has been vested with the following powers:
(a) To investigate any activity within its terms of reference
(b) To seek information from any employee.
(c) To obtain outside legal and other professional advice.
(d) To secure attendance of outsiders with relevant expertise, if it consider necessary.
Role of Audit Committee
(1) 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.
(2) Recommending to the Board, the appointment, remuneration and terms of appointment of the statutory auditor.
(3) Approval of payment of statutory auditors for any other services rendered by the statutory auditors.
(4) Reviewing, with the management, the annual financial statements before submission to the board for approval, with particular reference to:-
(a) Matters required to be included in the Director's 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.
(b) Changes, if any, in accounting policies and practices and reasons for the same.
(c) Major accounting entries involving estimates based on the exercise of judgment by management.
(d) Significant adjustments made in the financial statements arising out of audit findings
(e) Compliance with listing and other legal requirements relating to financial statements
(f) Disclosure of any related party transactions
(g) Qualifications in the draft audit report.
(5) Reviewing , with the management, the quarterly financial statements before submission to the Board for approval.
(6) Reviewing with the management, the statement of uses/application of funds raised through an issue (public issue, rights issue, preferential issue, etc.), the statement of funds utilized for purposes other than those stated in the offer document/ prospectus/notice and the report submitted by the monitoring agency, monitoring the utilization of proceeds of a public or rights issue, and making appropriate recommendations to the Board to take up steps in this matter.
(7) Review and monitor the auditors's independence and performance , and effectiveness of audit process.
(8) Approval or any subsequent modification of transactions of the company with related parties;
(9) Scrutiny of inter-corporate loans and investments;
(10) Valuation of undertakings or assets of the company, wherever it is necessary;
(11) Evaluation of internal financial controls and risk management systems;
(12) Reviewing , with the management, performance of statutory and internal auditors, adequacy of internal control systems;
(13) Reviewing the adequacy of the internal audit function, if any, including the structure of the internal audit department, staffing and seniority of the official heading the department, reporting structure coverage and frequency of internal audit.
(14) Discussion with internal auditors of any significant findings and follow up there on;
(15) Reviewing the finding of any internal investigations by the internal auditors into matters where there is suspected fraud or irregularity or a failure of internal control systems of material nature and reporting the matter to the boards;
(16) Discussion with statutory auditors before the audit commences, about the nature and scope of audit as well post-audit discussion to ascertain any area of concern;
(17) To look into the reasons for substantial defaults in the payment to the depositors , debentures holders, shareholders( in case of non-payment of declared dividend) and creditors;
(18) To review the functioning of Whistle Blower mechanism;
(19) Approval of appointment of CFO after assesiong the qualifications, experience and background, etc. of the candidate;
(20) Carrying out any other function as is mentioned in the terms of reference of the Audit Committee.
The Audit Committee may also review such matters as considered appropriate by it or referred by the Board.
The Audit Committee comprises of 3 directors, all of whom are Independent Directors. All of them are expert in corporate finance, accounts and corporate law. The company secretary acts as secretary of the committee. The CFO, Auditor, Internal Auditor and cost Auditor are the permanent invitee of the audit committee meeting. The Internal auditors report directly to the audit committee.
The Audit Committee of the Company met 4 times during the financial year 2014-15 on 27.05.2014, 11.08.2014, 07.11.2014 and 13.02.2015
The composition and attendance at the audit committee meeting are as follow:-
Name of Members Status No. of Meetings attended
Mr. Sarad Jha (Chairman) Independent & Non-Executive 4
Mr. Suyash Borar -do- 3
Mr.S.K.Goenka -do- 4
Mr.Sarad Jha, Chairman attended the AGM held on 11.09 2014 and replied to the queries to the satisfaction of the shareholders.
Nomination and Remuneration committee
The Remuneration and Remuneration Committee identify 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 carry out evaluation of every directors performance. It shall carry out such other functions as may be required under the companies Act, 2013 and clause 49 of the Listing Agreement. The Nomination and Remuneration Committee comprises of 3 Directors all of whom are non-executive, Independent Directors. The members of the Committee are Mr.S.K.Goenka, Mr. Suyash Borar and Mr. N.C.Majumdar.
During the Financial Year 2014 -15 two Nomination and Remuneration Committee Meeting was held on 27th May, 2014 and 27th March, 2015. The composition and attendance of the members of the Nomination and remuneration Committee are as follow:-
Name of Members Status No. of Meetings attended
Mr.S.K.Goenka - (Chairman) Independent & Non-Executive 2
Mr. Suyash Borar -do- 2
Mr. N.C.Majumdar -do- 2
The Board on the recommendation of the Nomination and Remuneration Committee has framed a Remuneration Policy, providing (a) criteria for determining qualification, positive attributes and independence of directors and (b) a policy on remuneration for directors, key managerial personnel and other employees.
The Company does not have any stock option scheme.
The present appointment of the Managing Director is for a period of three years and is effective from 1st March,2014 to 28th February,2017.
With a view to familiarizing the Independent Directors with the company's operations as required under clause 49 of the Listing Agreement, the company held various programme on continuous basis. The details of familiarization programmes are also placed on the companies website www.rigasugar.com
(i) Share Transfer Committee
The Share Transfer Committee was constituted to deal with various matters relating to share transfer/transmission, issue of duplicate share certificates, approving the split and consolidation request and other matters relating to transfer and registration of shares.
The members of the committee are Mr. O.P.Dhanuka , Mr. S.K. Goenka. and Mrs.Sulekha Dutta. Mr. S.Prasad, Company Secretary is Ex-officio Secretary of the Share Transfer Committee. During financial year 2014-15 10 No. of share transfer committee meetings were held 30.04.2014, 15.07.2014, 31.07.2014, 12.09.2014, 26.09.2014, 31.10.2014, 30.12.2014, 10.01.2015, 31.01.2015 and 28.02.2015. .
(ii) Stakeholders Relationship Committee
In compliance with the provision of section 178 of the Companies Act, 2013 and clause 49 of the Listing Agreement the Board has constituted "Stakeholders Relationship Committee" to look into and resolve the Grievance of security holders of the company related to transfer of shares, non-receipt of annual report and non-receipt of dividend.
During the financial year 2014-15, the Committee met on 07.04.2014, 07.07.2014, 07.10.2014 and 07.01.2015 (four meetings).
Mr. S. Prasad , Company Secretary, is the Compliance Officer. Address: Riga Sugar Co. Ltd. 14, Netaji Subhas Road, Kolkata- 700 001 Phone No. 033 2231 3414/15 Fax: 033 2230 3663 e-mail.:firstname.lastname@example.org
(i) The details of related party transactions is mentioned in note no. 33 of financial statement. There was no materially significant related party transaction, which was considered to have conflict with the interest of the Company at large. The company has disclosed the policy of dealing with the related party transaction on its websites at www.rigasugar.com
(ii) There has been one case of penalty for late filing of Annual Report to BSE within prescribed time limit. There was no other non-compliance, penalties or strictures imposed on the Company by the Stock Exchange, SEBI or any other statutory authority, on any matter relating to the capital markets, during the last three years.
(iii) None of the Non-Executive Directors hold equity shares or convertible instruments of the Company as on 31.03.2015.
(iv) The Company has followed the guidelines of Accounting Standards prescribed under the Companies (Accounting Standard) Rules,2006 in preparation of its financial statements.
(v) Pursuant to section 177(9) of the Companies Act, 2013 and clause 49 of the Listing Agreement, Whistle Blower Policy has been made in Board Meeting dated 25.05.2014.
The Whistle Blower Policy/Vigil Mechanism provides a mechanism for the director/employee to report violations without fear of victimization of any unethical behavior , suspected or actual fraud, violation of the code of conduct etc. which are detrimental to the organization's interest. The Whistle Blower Policy is placed on the companies website www.rigasugar.com During the year no personnel has been denied access to the Audit Committee.
(vi) The company has no unlisted subsidiary company as defined in the clause 49 of the Listing Agreement.
(v) Pursuant to the provisions of clause 49 of the Listing Agreement with the Stock Exchanges, the Managing Director and the CFO have issued a certificate to the Board, for the financial year ended 31st March,2015.
MEANS OF COMMUNICATION
The Quarterly, Half yearly and Annual Results were published in the leading English and Bengali Newspapers such as 'The Financial Express, Business Standard and 'Ekdin' (Bengali). The Half-Yearly reports are not sent to household of shareholders. The Company's Website is www.rigasugar.com Official news release and presentations made to analysts are sent to the Stock Exchanges at Calcutta and Mumbai, where shares of the Company are listed.
The Company's Quarterly Results are available on www.rigasugar.com
As per Clause 52 of the Listing Agreement with stock exchanges, certain documents/information such as quarterly/annual financial results, shareholding pattern and corporate governance are accessible on the website www.rigasugar.com
The Company has designated separate section for redressal of the investor grievances and necessary disclosure to this effect in the Company's website www.rigasugar.com as well the email-id email@example.com
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Industry structure and developments, opportunities and threats, segment-wise or product-wise performance, outlook, risks and concerns of the Company and discussion on financial performance with respect to the operational performance, has been covered in the Director's Report.
The Company has an adequate system of internal controls to ensure that transactions are properly recorded, authorized and reported apart from safeguarding its assets. The internal control system is supplemented by well documented policies, guidelines and procedures and review carried out by the Company's internal audit function which submits reports periodically to the Management and the Audit Committee of the Board.
There has been no material development in Human Resources/Industrial Relations during the period covered by this Annual Report. Your Company has a favorable work environment that motivates performance, customer focus and innovation while adhering to the high degree of quality and integrity. Training programme are being organized to impart further innovative ideas and knowledge as well as to upgrade the skill of the employees. Manpower figures of the Company as on 31.03.2015 was 636.
GENERAL SHAREHOLDERS INFORMATION
(i) Annual General Meeting
Date and Time : 29th September, 2015 at. 10.00 a.m.
Venue : Sitaram Seksaria Sabhagar(Auditorium) Bhartiya Bhasa Parishad, 36A, Shakespeare Sarani, Kolkata- 700 017
Financial Year Calendar for 2015-2016
Results for quarter ending, June, 2015 : second week of August , 2015
Results for quarter ending, September, 2015 : second week of November, 2015
Results for quarter ending, December, 2015 : second week of February, 2016
Results for quarter ending March, 2016 : second week of May, 2016 (Unaudited) OR last week of May, 2016 (if audited)
Date of Book Closure : 26.09.2015 to 29.09.2015
Outstanding ADRs/GDRs Warrants or any convertible instruments, conversion date and likely impact on equity
18,00,000 Equity Share Warrants allotted on 25th September, 2014 on Preferential Allotment basis, pending for conversion within 18 months. On full conversion the equity share will increase from 1,06,43,405 to 1,24,43,405.
LISTING OF EQUITY SHARES ON STOCK EXCHANGES AT
(i) The Calcutta Stock Exchange Limited 7, Lyons range, Kolkata - 700 001
(ii) Bombay Stock Exchange Limited Phiroze Jeejeebhoy Towers Dalal Street, Mumbai - 400 001
Listing fee for the year 2014-15 and 2015-16 has been paid to the above Stock Exchanges.
(i) National Securities Depository Limited
Trade World, 4th Floor, Kamala Mills Compound Senapat Bapat Marg, Lower Parel Mumbai- 400023
(ii) Central Depository Securities Limited Phiroze Jeejeebhoy Towers, 28th Floor Dalal Street
Mumbai- 400 023
• CSE Code 10028038
• BSE Code 507508
• ISIN Code INE 909 C01010
97.62% equity Shares of the Company have been dematerialized as on 31st March,2015.
i) SUGAR UNIT
Dhanuka Gram, P.O.Riga Dist. Sitamarhi Bihar - 843 327
(ii) DISTILLERY UNIT Dhanuka Gram, . P.O.Riga Dist. Sitamarhi Bihar - 843 327
(iii) COUNTRY LIQUOR Kothiya P.O. Mushari Dist. Muzzafarpur
Bihar - 842 001
All share transfer cases should be forwarded to the Registrars & Share Transfer Agents of the company. All communication should be forwarded to the Registered Office of the Company marked to the attention of the Company Secretary- Mr.S.Prasad (Phone No.2231-3414 , E-mail firstname.lastname@example.org)
DECLARATION BY THE MANAGING DIRECTOR ON THE CODE OF CONDUCT
Pursuant to clause 49 of the Listing Agreement with Stock Exchanges, I, O.P.Dhanuka, Managing Director of Riga Sugar Co. Ltd., declare that all the Board Members and senior Executives of the Company have affirmed their compliance with the Code of Conduct of the Company during the financial year 2014-15.
Chairman - Managing Director
Place : Kolkata
date : 29.05.2015