Corporate Governance Report:
Your Company has been practicing the principle of good corporate governance since inception. Good corporate governance comprises of all activities that result in the control of the company in a regular manner which makes management transparent, accountable and fair. In accordance with Clause 49 of the listing agreement with stock exchange and best practices followed by reputed corporations on corporate governance the details of compliance by the Company are as under:
1. Philosophy of the Company on the Code of Governance: -
The Company's philosophy on Corporate Governance envisage attainment of the highest levels of transparency, accountability and equity at all levels of its operation and in all its interactions with its stakeholders including shareholders, employees, Government Agencies and others. The Company strives for excellence with twin objective of enhancing customer satisfaction and shareholder's value.
The Company is committed to achieve the highest standards of Corporate Governance.
2. Board of Directors: -.
The Board of Directors of the Company met Four times during financial year ended 31st March 2015. The Board Meetings were held on 29th May 2014, 12th August 2014, 13th November 2014 and 11th February 2015. The Annual General Meeting of the Company was held on Friday, 5th September 2014 at 10.00 a.m., at Senate Hall, 208, Regent Chambers, Nariman Point, Mumbai 400 021.
The Company has held at least one meeting in every three months and the maximum time gap between any two Board Meetings was not more than 120 days. None of the directors of the Company was a member of more than ten committees or the Chairman of more than five committees across all public limited companies in which he is a Director. None of the Directors of the Company has exceeded maximum number of directorship in other companies.
For the purpose of considering the limit of the Committees as stated above, only Audit Committee and Shareholders/ Investors Grievances Committee across all public limited companies has been considered in accordance with clause 49 of the Listing Agreement.
• Details of Directors being appointed/re-appointed at the Annual General Meeting: -
As required under clause 49 of the Listing Agreement, the details of membership of the Director and other relevant details in respect of Directors who are being recommended for reappointment are given hereunder
*This includes the Chairmanship/Membership only in Audit Committee and the Shareholder's/Investors Grievance Committee
• disclosure of Relationship between directors inter-se None of the Directors are related to each other.
3. Board Committees: -
The Company has constituted Five committees of Directors, namely I.Shareholders/Investor Grievances Committee, 2.Audit Committee 3. Nomination and Remuneration Committee, 4.Risk Management Committee, 5.Corporate Social Responsibility Committee to deal with matters requiring urgent decisions and monitoring of the activities falling within their terms of reference, comprising mainly of non-executive Directors. Each of these committees has their respective charters approved by the Board. The minutes of the meeting are recorded and placed before the Board for its information.
• Shareholders /Investor Grievances Committee: -
The said committee approves issue of duplicate certificates and oversees and reviews all matters connected with transfer of securities of the Company. The Committee also monitors redressal of investor's grievances. The Committee oversees performance of the Registrar and Transfer Agent of the Company and recommends measures for overall improvement in the quality of investor services.
During the year, Five meetings were held on 25th June 2014, 01st October 2014, 31st December 2014, 16th February 2015 and 31st March 2015.
The Board has designated Ms. Monika Agarwal, Director and Company Secretary as the Compliance Officer.
In pursuance of the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992 (duly amended), the Company has formulated the guidelines and Code of Conduct for Prevention of Insider Trading.
The total number of complaints / requests / queries received and replied to the satisfaction of the investors during the year under review was 31.
• Audit Committee: -
The Board of Directors has constituted Audit Committee of Directors to exercise powers and discharge function as stipulated in section 177 of the Companies Act, 2013, Clause 49 of the Listing Agreement with Stock Exchanges and other statutory / regulatory provisions.
During the year 2014-2015, the Committee met four times. The Committee Meetings were held on 29th May 2014, 12th August 2014, 13th November 2014 and 11th February 2015.
Ms. Monika Agarwal, Director and Company Secretary acts as Secretary of the Committee
The terms of reference of the Audit Committee include: -
i) 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.
ii) Recommending 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) 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 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.
v) Reviewing, with the management, the quarterly financial statements before submission to the board for approval.
vi) 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 utilisation of proceeds of a public or rights issue, and making appropriate recommendations to the Board to take up steps in this matter.
vii) Review and monitor the auditor's independence and performance, and effectiveness of audit process.
viii) Approval or any subsequent modification of transactions of the company with related parties.
ix) Scrutiny of inter-corporate loans, investments and guarantee.
x) Valuation of undertakings or assets of the company, wherever it is necessary.
xi) Evaluation of internal financial controls and risk management systems.
xii) Reviewing, with the management, performance of statutory and internal auditors, adequacy of the internal control systems.
xiii) Reviewing the adequacy of 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.
xiv) Discussion with internal auditors, if any, any significant findings and follow up there on.
xv) Reviewing the findings of any internal investigations by the internal auditors, if any, into matters where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the board.
xvi) Discussion with statutory auditors before the audit commences, about the nature and scope of audit as well as post-audit discussion to ascertain any area of concern.
xvii) To look into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders (in case of non payment of declared dividends) and creditors.
xviii)To review the functioning of the Whistle Blower mechanism.
xix) Approval of appointment of CFO (i.e., the whole-time Finance Director or any other person heading the finance function or discharging that function) after assessing the qualifications, experience & background, etc. of the candidate.
xx) Carrying out any other function as is mentioned in the terms of reference of the Audit Committee.
The Audit Committee is vested with powers to investigate any activity of Company or seek information from any employee.
Besides the Committee Members, Senior Executives of accounts, finance, internal audit, statutory auditors were standing invitees for on the spot clarification / explanation.
Nomination and Remuneration Committee: -
In Compliance with Section 178 of Companies Act 2013 the Board renamed the Remuneration Committee as 'Nomination and Remuneration Committee".
During the year the Committee had 1 meeting i.e. on 11th February 2015. Composition of the committee and its attendance is as follows:
The terms of reference of the committee are as follows:
1. Formulation of the criteria for determining qualifications, positive attributes and independence of a director and recommend to the Board a policy, relating to the remuneration of the directors, key managerial personnel and other employees;
2. Formulation of criteria for evaluation of Independent Directors and the Board;
3. Devising a policy on Board diversity;
4. Identifying persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down, and recommend to the Board their appointment and removal.
• risk Management Committee:
Risk Management Committee assist the Board in formulating risk strategy policies and assess the quality, integrity and effectiveness of the risk management systems and also effectively implement and manage the said risk policies and strategies.
The Committee met once in a year to review the robustness of Risk Management policy and report to audit committee and Board on November 13, 2014.
Corporate Social Responsibility Committee
Pursuant to Section 135 of the Companies Act 2013, the Corporate Social Responsibility (CSR) Committee was duly constituted.
During the year, one Meeting was convened on March 03, 2015.
The Company formulated CSR Policy which is uploaded on the website of the company (Weblink:<http://www.shardulsecurities.com/> Corporate%20Social%20Responsibility%20Policy.pdf)
The Terms of reference of the committee broadly comprises of following:
i. To formulate and recommend to the Board, a Corporate Social Responsibility Policy which shall indicate the activities to be undertaken by the company as specified in Schedule VII of the Companies Act 2013;
ii. To recommend the amount of expenditure to be incurred on the activities referred to in Corporate Social Responsibility Policy in a financial year;
iii. To monitor the Corporate Social Responsibility Policy of the company from time to time.
iv. Any other matter/thing as may be considered expedient by the members in furtherance of and to comply with the CSR Policy of the Company.
• INDEPENDENT DIRECTORS' MEETING
During the year under review, the Independent Directors met on February 11, 2015, inter alia to discuss:
i. review the performance of non-independent directors and the Board as a whole;
ii. review the performance of the Chairperson of the company, taking into account the views of executive directors and non-executive directors;
iii. assess the quality, quantity and timeliness of flow of information between the company management and the Board that is necessary for the Board to effectively and reasonably perform their duties.
4. Remuneration Policy
• Remuneration to Non- Executive directors
The Non- Executive Directors are paid remuneration by way of commission and sitting fees. The Total amount of sitting fees paid during the Financial Year 2014-2015 is Rs 2.41 Lakhs. The Directors do not have any material pecuniary relationship or transactions with the Company.
• Remuneration to Executive directors
The appointment and remuneration of Executive Directors including, Whole-time Director is governed by the Board of Directors and shareholders of the Company. The remuneration package of Executive Director comprises of salary, allowances and contribution to Provident and other Retirement Benefit Funds as approved by the Shareholders at the General Meetings. Annual increments are linked to performance and are decided by the Nomination and Remuneration Committee and recommended to the Board for approval thereof. The remuneration policy is directed towards rewarding performance, based on review of achievements and is aimed at attracting and retaining high competency.
Currently, the Company does not have a scheme for grant of stock options.
5. Performance evaluation
Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, 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 and independence of judgment thereby safeguarding the interest of the Company. 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. The board also carried out annual performance evaluation of the working of its Audit, Nomination and Remuneration as well as stakeholder relationship committee. The Directors expressed their satisfaction.
6. Familiarization Programme for Independent director
The Company had conducted various programmes during the financial year to familiarize Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the company operates, business model of the company, etc. Further, the Directors were encouraged to attend the training programmes being organized by various regulators/ bodies/ institutions on above matters. The details of the policy relating to conducting familiarization programmes are displayed on the website of the Company and web link of the same is <http://www.shardulsecurities.com/program%20for%20independent%20directors>. pdf.
7. Subsidiary Company monitoring framework
The Company has one material non listed Indian subsidiary named "Shriyam Broking Intermediary Limited" as defined under clause 49 of the Listing Agreement. The company has formulated the material subsidiary policy and uploaded on the website of the company and Weblink of same is <http://www.shardulsecurities.com/material%20subsidiary%20policy.pdf>
8. disclosure on related party transactions with related parties: -
During the period under review, the Company has not entered into any material transaction with any of its related parties. None of the transactions with any related parties were in conflict with the interests of Company at large.
Details of the transactions with related parties have been disclosed in note no. 22 of notes forming part of financial statements.
As required under Clause 49, the Company has formulated policy on dealing with Related Party Transactions. The Policy is available on the website of the Company and Weblink of same is:.<http://www.shardulsecurities.com/related%20party%20transaction%20policy.pdf>
9. Whistle blower policy:
The Company has established a whistle blower policy and vigil mechanism for directors and employees to report concerns about unethical behavior, actual or suspected fraud or violation of the company's code of conduct policy. The mechanism provides for adequate safeguards against victimization of directors and employees. None of the personnel have been denied access to the Audit Committee of the Board. The details of Whistle Blower Policy are available on the website of the Company www.shardulsecurities.com
10. Code of Business Conduct & Ethics:-
The Company has adopted the model Code of Business Conduct & Ethics for Directors and Senior Management and the same is posted on the Company's website namely: www.shardulsecurities.com .
11. Compliance with Mandatory requirements: -
The Company has complied with the mandatory requirement of the Code of Corporate Governance as stipulated under clause 49 of the Listing Agreement with the Stock Exchanges. The Company has also complied with the requirement of amended clause 49 after it came into force.
12. Means of Communications: -
The quarterly results are published in the Performa prescribed by the Listing Agreement in one English language Newspaper (Free Press Journal) and one Marathi language Newspaper (Navshakti). Management Discussion and Analysis forms part of the Directors' Report. The quarterly results are also available on the Company's website namely www.shardulsecurities.com Declaration on Compliance of the Company’s Code of Conduct:
The Company has framed a specific Code of Conduct for the members of the Board of Directors and the Senior Management Personnel of the Company pursuant to Clause 49 of the Listing Agreement with Stock Exchange to further strengthen corporate governance practices in the Company.
All the members of the Board and Senior Management Personnel of the Company have affirmed due observance of the said Code of Conduct in so far as it is applicable to them and there is no non compliance thereof during the year ended 31st March 2015.
GENERAL SHAREHOLDER INFORMATION
1. annual General Meeting:
Date & Time : 11th September 2015 at 10.00 a.m.
Venue : Senate Hall, 208, Regent Chambers, Nariman Point, Mumbai 400 021.
2. Financial Calendar 2015-16 :
Board Meetings Tentative dates
Results for the quarter ending June 30, 2015: Second week of August, 2015
Results for the quarter ending September 30, 2015 :Second week of November, 2015
Results for the quarter ending December 31, 2015 :Second week of February, 2016
Results for the year ending March 31, 2016 :Last week of May, 2016
3. Book closure dates :
5th September 2015 to 10th September 2015 (Both days inclusive) for payment of dividend.
4. Dividend Payment Date :
On or after 14th September 2015
5. Registered Office :
G-12, Tulsiani Chambers 212, Nariman Point, Mumbai 400 021
6. Equity shares listed on Stock Exchanges at: -
The Stock Exchange, Mumbai
7. Annual listing fees: -
The listing fees to the Stock Exchange Mumbai have been duly paid by the Company up to the financial year 2015-16.
8. Dematerialisation of shares and liquidity: -
94.29% of the Equity Shares have been dematerialized up to 31st March 2015. Trading in Equity Shares of the Company is permitted only in dematerialized form with effect from 24th July 2000 as per notification issued by the Securities and Exchange Board of India (SEBI). The shares of the company are regularly traded at Bombay Stock Exchange. Total number of shares traded during the year 2014-15 were 2,17,761 and its value was Rs. 96,18,783/
9. Stock Code: -
i) Trading symbol at The Stock Exchange, Mumbai (Physical Segment) SHARDUL SECU.
ii) Demat ISIN Number in NSDL & CDSL - Equity Shares - INE037B01012
11. Share Transfer Systems: -
Presently Share Transfer in physical form are processed and share certificate returned within a period of 30 days from the date of receipts, subject to the documents being clear in all respects.
12. Address for Correspondence:
Investors Correspondence for Transfer / dematerialization of shares, payment of dividend on shares and any other query relating to shares.
For Shares held in physical form:
Link Intime India Private Limited
C-13 Pannalal Silk Mills Compound, LBS Road, Bhandup West, Mumbai 400 078
For shares held in demat form:
To the Depository Participant.
14. Compliance officer:
Tel: 022- 40090500 Fax: 022-22846585
Link Intime India Private Limited
Address:C-13 Pannalal Silk Mills Compound, LBS Road, Bhandup West, Mumbai 400078
Tel.No.: 25946970-78 Fax : 25946969 Email: rnt.helpdesk@linkintime