CORPORATE GOVERNANCE REPORT
Ruchi Strips and Alloys Limited (RSAL) has always believed in fair business and corporate practices while dealing with the shareholders, employees, customers, creditors, lenders and others. We have always aimed to build trust with shareholders, employees, customers, suppliers and diverse stakeholders and to meet expectations of various elements of corporate environment. We believe in transparent and fair corporate actions with adequate disclosure and total accountability.
RSAL has been discharging its statutory obligations and duties and has always complied with statutory and regulatory requirements. Given below are the Company's Corporate Governance policies and practices in accordance with the provisions of Clause 49 of the Listing Agreement.
A report on implementation of the Corporate Governance Code of the Listing Agreement by the Company is furnished below:-
1. Company's Philosophy on Corporate Governance
Corporate Governance is the combination of voluntary practices and compliance with laws and regulations leading to effective control and management of the organization. Good Corporate Governance leads to long term shareholder value and enhances interest of other stake holders. It brings into focus the fiduciary and the trusteeship role of the Board to align and direct the actions of the organization towards creating wealth and shareholder value.
2. RSAL Board presently consists of a majority of Non-Executive/Independent Directors, many of whom are acknowledged as leading professionals in their respective fields. The Board comprises of One (1) Executive Director, One (1) Non-Executive Director, Four (4) Independent Directors and two (2) Professional Directors.
Attendance of Directors in Board Meetings and Annual General Meeting
The Board of the Company met four times during the last Financial Year, 2014-15, on the following dates: (1) 29th May, 2014 (2) 13th August, 2014 (3) 8th November, 2014 (4) 7th February, 2015
3. Audit Committee
Audit Committee met four times during the Financial Year 2014-15. The dates are as follows:-(1) 29th May, 2014 (2) 13th August, 2014 (3) 7th November, 2014 (4) 6th February, 2014
The terms of reference of the Audit Committee includes the following:
a) To hold periodic discussion with Statutory Auditors and Internal Auditors of the Company concerning the accounts of the Company, internal control systems, scope of audit and observations of the Auditors/Internal Auditors;
b) To review compliance with internal control systems;
c) To review the quarterly, half-yearly and annual financial results of the Company before submission to the Board;
d) To investigate into any matter in relation to items specified in Section 177 of the Companies Act, 2013 or as may be referred to it by the Board and for this purpose to seek any relevant information contained in the records of the Company and also seek external professional advice, if necessary;
e) To make recommendations to the Board on any matter relating to the financial management of the Company, including the Audit Report.
f) To review Business Risk Management Plan, Management Discussion & Analysis.
g) To review internal audit report relating to internal control weakness.
4. Nomination and Remuneration Committee
The Board has constituted a Nomination and Remuneration Committee to recommend/review the remuneration package of the Managing / Whole Time Director and KMP, if any, based on the performance on defined criteria.
Nomination and Remuneration Committee met three times during the Financial Year 2014-15. The dates are as follows:-
(1) 29th May, 2014 (2) 13th August, 2014 (3) 7th November, 2014
Terms of Reference in brief:
The Nomination and Remuneration Committee ensures effective compliance of Section 178 and Clause 49 of the Listing Agreement. Short particulars of terms of reference are given below;
- Formulate Remuneration Policy and a policy on Board Diversity.
- Formulate criteria for evaluation of Directors and the Board.
- To ensure that the Remuneration Policy shall also include the criteria for determining 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.
- 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 shall carry out evaluation of every Director's performance.
- To ensure that the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate Directors of the quality required to run the Company successfully;
relationship of remuneration to performance is clear and meets appropriate performance benchmarks.
- Remuneration to Directors, Key Managerial Personnel and Senior Management involves a balance
between fixed and incentive pay reflecting short and long term performance objectives appropriate to the working of the Company and its goals.
POLICY FOR APPOINTMENT OF DIRECTORS, KMP AND SENIOR MANAGEMENT EMPLOYEES & THEIR REMUNERATION
The objective of remuneration policy is to attract, motivate and retain qualified and expert individuals that the Company needs in order to achieve its strategic and operational objectives, whilst acknowledging the societal context around remuneration and recognizing the interests of the Company's stakeholders.
2. The Nomination & Remuneration Committee
The Nomination & Remuneration Committee (Committee) is responsible for formulating and making the necessary amendments to the policy for appointment of Directors, KMP and Senior Management Employees & their remuneration from time to time.
The 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 manufacturing, 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.
The committee shall create a resource pool of persons of integrity, expertise & stature who could participate in the board discussions, thereby make contribution to the performance of the company. Thereafter, as & when there is a vacancy on the board, the Chairman of the committee shall formally invite the person in consultation with the members of the committee as well as the chairman of the board. The person shall be appointed on the Board on receiving the consent, in writing. Henceforth, all new Board appointees shall be issued an appointment letter.
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.
CEO & Managing Director - Criteria for selection / appointment For the purpose of selection of the CEO & MD, 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 fulfills such other criteria with regard to age and other qualifications as laid down under the Companies Act, 2013 or other applicable laws.
The Non Executive Directors shall be entitled to receive remuneration by way of sitting fees, reimbursement of expenses for participation in the Board Meetings and Board Committee Meeting. A Non Executive Director shall be entitled to receive sitting fees for each meeting of the Board or Committee 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;
Remuneration for the CEO & Managing Director At the time of appointment or re-appointment, the CEO & Managing Director may be paid such remuneration as may be mutually agreed between the Company (which includes the A&R Committee and the Board of Directors) and the CEO & Managing 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 & Managing Director may comprise only of fixed component. The fixed component may comprise salary, allowances, perquisites, amenities and retrial benefits.
Remuneration for the Senior Management Employees: In determining the remuneration of the Senior Management Employees (just one level below the board) the Committee shall ensure the relationship of remuneration and performance benchmark is clear.
The Managing Director will carry out the individual performance review based on the standard appraisal matrix and shall take into account the appraisal score card and other factors mentioned herein-above, whilst recommending the annual increment, if any and performance incentive to the Committee for its review and approval.
DETAILS OF REMUNERATION TO DIRECTORS:
A. Remuneration to Non- Executive Directors
The Non- Executive Directors are paid remuneration by way of Sitting Fees. The Non- Executive Directors are paid sitting fees for each meeting of the Board or Committee of Directors attended by them. The total amount of sitting fees paid during the Financial Year 2014-15 was Rs. 1,55,000. The Non- Executive Independent Director do not have any material pecuniary relationship or transactions with the Company. Details of sitting fees paid to directors for the year ended 31st March, 2015 :
1. Ms. Puneet Bedi was appointed as an Additional Director of the Company on 13.08.2014.
2. Ms. Ishita Khandelwal was appointed as an Additional Director of the Company on 13.08.2014.
3. Mr. Arvind Mishra ceased from the Board w.e.f. 8th November, 2014.
Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out the annual performance evaluation of its own performance, the Directors individually as well as the evaluation of the working of its Committees.
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 judgment, safeguarding the interest of the Company and its minority shareholders etc. The performance evaluation of the Non-executive and Independent Directors was carried out by the entire Board. All the Nonexecutive and Independent Directors are eminent personalities having wide experience in the field of business, industry and administration.Their presence on the Board is advantageous and fruitful in taking business decisions.
The performance evaluation of the Chairman and the Non Independent Directors was carried out by the Independent Directors. The Directors expressed their satisfaction with the evaluation process.
5. Stakeholders' Relationship Committee
Stakeholders' Relationship Committee met four times during the Financial Year 2014-15.The dates are as follows:-(1) 17th April, 2014 (2) 1st July, 2014 (3) 1st October, 2014 (4) 8th January, 2015
1. Ms. Ishita Khandelwal was appointed as Member of the Committee on 8th November, 2014
2. Mr. Arvind Mishra ceased from the Board w.e.f. 8th November, 2014.
The committee specifically looks into the shareholders and investor's complaints. In addition, the committee also looks into matters, which can facilitate better investor services and relations.
During the period under review, the committee had reviewed the status of investor services rendered by the company. Mr. Deepak Upadhyay, Compliance Officer of the Company. The Committee discussed the various reports placed before it regarding the investor complaints and queries.
During the Financial Year 2014 - 2015, the Company had received 2 complaint related to non receipt of Annual Report and Dividend and 1 complaint related to Dividend Warrant. All the complaints have been resolved to the satisfaction of the shareholder and no complaint was pending as on 31st March, 2015.
7. Related Party Transactions
All transactions entered into with the Related Parties as defined under the Companies Act, 2013 and Clause 49 of the Listing Agreement during the financial year where in the ordinary course of business and on arm's length basis.
There were no materially significant transaction with related parties during the financial year, As required under clause 49, the Company has formulated a policy on dealing with Related Party Transactions. The said Policy is available on the website of the Company at www.ruchistrips.com .
a. Transactions with Promoters, Directors and their relatives, Management or their subsidiaries etc.
The Company has not entered into any transaction of material nature with the Promoters or Directors and/or their relatives or Management and/or their subsidiaries etc. that may have any potential conflict with the interests of the Company. The transactions of purchase and sale of goods, materials
and services made in respect of above parties have been made at prices which are reasonable having regard to prevailing market prices for such goods, materials or services as available with the Company or the prices at which transactions for similar goods, materials or services have been made with other parties. (please refer note no. 25 of Notes to accounts, forming part of the Annual Report).
b. Compliance by the Company
The Company has complied with the requirements of the Stock Exchanges, SEBI and other Statutory Authorities on all matters related to Capital Markets during last three years, except a fine of Rs. 6742 paid to BSE Limited for delay submission of Annual Report for the F. Y. 2013-14.
9. Whistle Blower Policy
Your Company has established a Vigil Mechanism/ Whistle Blower Policy to enable stakeholders (including Directors and employees) to report unethical behavior, actual or suspected fraud or violation of the Company's Code of Conduct. The Policy provides adequate safeguards against victimisation of Director(s)/ employee(s) and direct access to the Chairman of the Audit Committee in exceptional cases. The Protected Disclosures, if any reported under this Policy will be appropriately and expeditiously investigated by the Chairman.
Your Company hereby affirms that no Director/ employee has been denied access to the Chairman of the Audit Committee and that no complaints were received during the year.
The Whistle Blower Policy has been disclosed on the Company's website under the web link www.ruchistrips.com
10. Code of Conduct
The Company has laid down a Code of Conduct for all Board Members and senior management personnel of the Company. The Code of Conduct is available on the website of the company www.ruchistrips.com .
11. Subsidiary Company's Monitoring Framework
The Company is having one material unlisted subsidiary company i.e. RSAL Steel Private Limited as defined under clause 49 of the listing agreement and is required to nominate an independent director of the Company on the Board of subsidiary company. Hence one of the Independent Director of the Company is a Director on the Board of RSAL Steel Private Limited, Wholly Owned Subsidiary of the Company.
The Company monitors performance of subsidiary Company inter alia by the following:
(a) Financial Statements of subsidiary company are reviewed by Audit Committee of the Company at regular intervals.
(b) All Minutes of Board Meetings of the Subsidiary Company are placed before the Company's Board regularly.
The Company has formulated the Material Subsidiary Policy and uploaded on the website of the Company. The said policy is available at www.ruchistrips.com
12. Communication to Shareholders
Quarterly financial results for the Financial Year 2014-15 (1st April, 2014 to 31st March, 2015 were published in the newspapers namely Free Press Journal & Navshakti (both Mumbai Edition). The company has its own website www.ruchistrips.com on which important public domain information are posted. All financial and other vital official news releases are also properly communicated to the concerned Stock Exchange as besides being placed on the website.
13. General Shareholder Information
Annual General Meeting
Date : 23rd September, 2015
Time : 02.30 P.M.
Venue : Sunville Deluxe Pavilion,Sunville Building,9, Dr. Annie Besant Road,Worli, Mumbai – 400018
Financial Calendar 2014-15
Adoption of Quarterly Results of
First quarter : 2nd week of August, 2015
Second quarter : 2nd week of November, 2015
Third quarter : 2nd week of February, 2016
Fourth quarter & Annual : 4th week of May, 2016
Annual General Meeting
for the year ending 31st March, 2015 : 23rd September, 2015
Book closure Dates : 18th September, 2015 to 23rd September, 2015
(Both days inclusive)
Dividend Payment Date :
No dividend is declared for the year 2014-15
14. Listing on Stock Exchanges
The Equity Shares of the Company are listed on Bombay Stock Exchange, Mumbai (BSE). Stock Code
Bombay Stock Exchange, Mumbai
ISIN - INE611C01012
Registrar & Transfer Agent
M/s Sarthak Global Limited 170/10, Film Colony, RNT Marg, Indore - 452001 (M.P.) E-mail: firstname.lastname@example.org
Address of Correspondence
611, Tulsiani Chambers, Nariman Point, Mumbai - 400021
Dematerialization of shares
90.92%of the total equity capital is held in Dematerialized form with National Securities Depository Ltd. and Central Depository Services (India) Limited as on 31st March, 2015
The Company has not issued any ADRs/GDRs
17. Share Transfer System
The Registrar & Share Transfer Agent M/s Sarthak Global Limited deals with Share Transfer both in physical and dematerialized mode. The dematerialized shares are transferable through the depository system. Shares in physical form are processed by the R & TA and approved by Share Transfer and Stakeholders Relationship Committee of Directors of the Company. Physical Shares are transferred within stipulated time.
19. Dematerialization of shares and liquidity
The shares of the Company are under compulsory demat segment and are listed on Bombay Stock Exchange (BSE Limited), Mumbai. The Company's shares are available for trading in the depository systems, of both NSDL and CDSL.