REPORT ON CORPORATE GOVERNANCE
In accordance with Clause 49 of the Listing Agreement with the BSE Limited (BSE) on Corporate Governance, the report containing the details of Corporate Governance is as under:
1. Corporate Governance and Statement On Company's philosophy on Code of Governance:
Simmonds Marshall Limited ("the Company") is committed to do business in an efficient, responsible, honest and ethical manner. The core values of the Company's Governance process include independence, integrity, accountability, transparency, responsibility and fairness.
Simmonds Marshall Limited is focused towards its vision of: Inspiring, nurturing and empowering the next generation of professionals. Achieving continuous improvements through innovation and state of the art technology. Committing to highest standards in health, safety, security and environment.
The corporate governance structure specifies the distribution of rights, responsibilities and powers among different participants in the corporation. All strategic decisions regarding investment, diversification, major decisions regarding procurement, commercial and finance are preceded ahead after approval of the Board.
The Company is committed to enhance shareholders value in the fair and transparent manner and has been in the forefront for bench marking itself with the best business practices globally.
Strong Governance has indeed helped the Company to deliver wealth to its shareholders in the form of uninterrupted dividends.
2. BOARD OF DIRECTORS: Composition of the Board
As on March 31,2015 the structure of the Board of the Company maintained an optimum mix of Executive, Non- Executive and Independent Directors and the same is in conformity with the listing requirements. The Board's current strength is 7 members, who are eminent personalities from various walk of life having rich experience in the field of marketing, finance, industry, business and management.
Besides the Chairman, who is an Executive Promoter Director, the Board comprises of 2 Executive Director, 1 Woman Non-Executive Independent Director and 3 Non-Executive Independent Directors.
Number of Board Meetings
The Board meets at regular intervals to discuss and decide on various issues, including strategy related matters pertaining to the business of the Company. The tentative calendar of Board Meetings is circulated to the Directors in advance to facilitate them and to ensure their active participation at the Meetings of the Company. Apart from this, the approval of the Board is obtained through Circulation of Resolution to all the Directors in case some urgent/special situation arises. Such Circular Resolution is also confirmed at the next Board Meeting.
Agenda papers containing all necessary information / documents are made available to the Board in advance to enable the Board to take informed decisions and to discharge its functions effectively. Where it is not practicable to attach the relevant information as a part of agenda papers, the same are tabled at the Meeting of the Board.
The Company has held at least one Board meeting in every three months. The maximum gap between any two meetings was less than four months, as stipulated under Clause 49.
Composition of the Board of Directors has a healthy mix of Executive & Non Executive Directors and ensures the desired level of independence, functioning and decision making.
As mandated by clause 49, none of the Directors are members of more than 10 Board level committees, nor are they Chairman of more than five committees in which they are members.
Table 1 gives the details of the Board as on March 31, 2015.
As mandated by Clause 49, the Independent Directors on SML's Board:
Apart from receiving Sitting fees, do not have any material pecuniary relationships or transactions with the Company, its promoters, its Directors, its senior Management, its subsidiaries and associates, which may affect independence of the Director;
Are not related to promoters or persons occupying Management positions at the Board level or at one level below the Board;
Have not been an executive of the Company in the immediately preceding three financial years;
Are not partners or executives, or were not partners or executives during the preceding three years of any of the following:
Statutory audit firm or the internal audit firm that is associated with the Company, and Legal firm(s) and consulting firm(s) that have a material association with the Company;
Are not material suppliers, service providers or customers or lessors or lessees of the Company, which may affect independence of the Director;
Are not substantial shareholders of the Company i.e. owning two per cent or more of the block of voting shares; Are not less than 21 years of age
INFORMATION SUPPLIED TO BOARD:
The Board has complete access to all information with the Company.
All Board meetings are governed by a structured agenda which is backed by comprehensive background information. Inter-alia, the following information is regularly provided to the Board, as part of the agenda papers well in advance of the Board meetings, or is tabled in the course of the Board meeting: »
Annual operating plans and budgets and any updates. Capital budgets and any updates. Quarterly results for the company.
Minutes of meetings of audit committee and other committees of the board.
The information on recruitment and remuneration of senior officers just below the board level, including appointment or removal of Chief Financial Officer and the Company Secretary.
Show cause, demand, prosecution notices and penalty notices which are materially important.
Fatal or serious accidents, dangerous occurrences, any material effluent or pollution problems.
Any material default in financial obligations to and by the company, or substantial non-payment for goods sold by the company.
Any issue, which involves possible public or product liability claims of substantial nature, including any judgment or order which, may have passed strictures on the conduct of the company or taken an adverse view regarding another enterprise that can have negative implications on the company.
Details of any joint venture or collaboration agreement
Any transactions that involves substantial payment towards goodwill, brand equity, or intellectual property
Significant labour problems and their proposed solutions. Any significant development in Human Resources/ Industrial Relations front like signing of wage agreement, implementation of Voluntary Retirement Scheme etc.
Sale of material nature, of investments, subsidiaries, assets, which is not in normal course of business.
Quarterly details of foreign exchange exposures and the steps taken by management to limit the risks of adverse exchange rate movement, if material.
Non-compliance of any regulatory, statutory or listing requirements and shareholders service such as nonpayment of dividend, delay in share transfer etc.
The Board has an effective post meeting follow up procedure. The Action taken report on the decisions taken in a meeting is placed at the immediately succeeding meeting for information of the Board.
The Board has established procedures to enable the Board to periodically review compliance reports of all laws applicable to the Company, prepared by the Company, as well as steps taken by the Company to rectify instances of non-compliance.
Familiarization Programme For Independent Directors:
The Company has framed a policy for familiarization programme for Independent Director and the same is disclosed on the website of the Company i.e. (www.simmondsmarshall.com)
3. committees of board:
To focus effectively on the issues and ensure expedient resolution of the diverse matters, the Board has constituted a set of Committees of independent Directors with specific terms of reference / scope. The committee operates as empowered agents of the board. The inputs and details required for the decision is provided by the operating managers. The Minutes of the Meeting of all the Committees of the board are placed before the board for discussions / noting.
Details of the committee of the board and other related information are as follows:
3.1 audit committee:
The Company has a qualified and independent Audit Committee comprising of three Directors. The broad terms of reference of the Audit Committee are in consonance with the provisions of Section 177 of the Companies Act, 2013 and Clause 49 of the Listing Agreement. All the members have financial and accounting knowledge.
The Committee acts as a link between the Management, the Internal Auditors, the Statutory Auditors and the Board of Directors of the Company. The Committee focus its attention on monitoring the financial reporting system within the Company, considering Quarterly & Annual Financial Results of the Company and submitting its observations to the Board of Directors before its adoption by the Board, review of the internal control system, audit methodology and process, major accounting policies and practice, compliance with accounting standards. Committee also reviews the legal compliance reporting system.
The Senior Manager - Finance Manager of the Company and the representative of the Statutory Auditors is always invited to attend these meetings.
The terms of reference of the Audit Committee are as under:
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;
Recommendation for appointment, remuneration and terms of appointment of auditors of the company;
Approval of payment to statutory auditors for any other services rendered by the statutory auditors;
Reviewing, with the management, the annual financial statements and auditor's report thereon 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
Reviewing, with the management, the quarterly financial statements before submission to the board for approval;
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;
Review and monitor the auditor's independence and performance, and effectiveness of audit process; Approval or any subsequent modification of transactions of the company with related parties; Scrutiny of inter-corporate loans and investments;
Valuation of undertakings or assets of the company, wherever it is necessary; Evaluation of internal financial controls and risk management systems;
Reviewing, with the management, performance of statutory and internal auditors, adequacy of the internal control systems;
Reviewing the adequacy of internal audit functions
Discussion with internal auditors of any significant findings and follow up there on;
Reviewing the findings 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 a material nature and reporting the matter to the board;
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;
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;
To review the functioning of the Whistle Blower mechanism;
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 and background, etc. of the candidate;
Management discussion and analysis of financial condition and results of operations;
Statement of significant related party transactions (as defined by the Audit Committee), submitted by management, if any;
Management letters / letters of internal control weaknesses issued by the statutory auditors, if any; Internal audit reports relating to internal control weaknesses, if any.
Carrying out any other function as is mentioned in the terms of reference of the Audit Committee. All the members have financial and accounting knowledge.
Head of the Finance and Accounts Department, representative of the Statutory Auditors and other executives as are considered necessary, attend meetings of the Audit Committee.
3.2 nomination and remuneration committee:
In compliance of Section 178 of Companies Act, 2013 the Board renamed the Remuneration Committee as "Nomination and Remuneration Committee". The Nomination and Remuneration Committee currently comprises of Mr. C. B. Bambawale, Independent Director as Chairman, Mr. S. C. Saran and Mr. F. K. Banatwalla as members. All matters relating to review and approval of compensation payable to the executive and non-executive directors are considered by the Nomination and Remuneration Committee and necessary recommendations are made by the Committee to the Board for the approval within the overall limits approved by the Members and as per Schedule V to the Companies Act, 2013.
Terms Of Reference Of Nomination And Remuneration Committee:
Formulate 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.
Act as Selection and Compensation Committee to evaluate suitability of candidates for various senior positions and determine appropriate compensation package for them. Selection of related persons whether or not holding place of profit in the Company to be carried out strictly on merit and where applicable, be subjected to review by the Audit Committee of and/or the Board with approval at each stage being obtained by disinterested Independent Directors only.
Identify 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. Removal should be strictly in terms of the applicable law/s and in compliance of principles of natural justice.
Formulation of criteria for evaluation of Independent Directors and the Board. Devising a policy on the Board diversity.
Recommend to the Board, remuneration including salary, perquisite and commission to be paid to the Company's Executive Directors on an annual basis or as may be permissible by laws applicable.
Recommend to the Board, the Sitting Fees payable for attending the meetings of the Board/Committee thereof, and, any other benefits such as Commission, if any, payable to the Non- Executive Directors.
Setting the overall Remuneration Policy and other terms of employment of Directors, wherever required.
Policy Relating To Remuneration Of Directors, KMP & Senior Management Personnel:
To ensure that the level and components of remuneration is reasonable and sufficient to attract, retain and motivate Directors, KMP and other employees of the quality required to run the Company successfully.
No director/KMP/ other employee is involved in deciding his or her own remuneration.
The trend prevalent in the similar industry, nature and size of business is kept in view and given due weightage to arrive at a competitive quantum of remuneration.
It is to be ensured that relationship of remuneration to the performance is clear & meets appropriate performance benchmarks which are unambiguously laid down and communicated.
Improved performance should be rewarded by increase in remuneration and suitable authority for value addition in future.
Remuneration packages should strike a balance between fixed and incentive pay, where applicable, reflecting short and long term performance objectives appropriate to the Company's working and goals.
Following criteria are also to be considered:-
Responsibilities and duties; Time & efforts devoted; Value addition;
Profitability of the Company & growth of its business;
Analyzing each and every position and skills for fixing the remuneration yardstick; Standards for certain functions where there is a scarcity of qualified resources. Ensuring tax efficient remuneration structures.
Ensuring that remuneration structure is simple and that the cost to the Company (CTC) is not shown inflated and the effective take home remuneration is not low.
Other criteria as may be applicable. Consistent application of remuneration parameters across the organisation.
Provisions of law with regard making payment of remuneration, as may be applicable, are complied.
Whenever, there is any deviation from the Policy, the justification /reasons should also be indicated / disclosed adequately.
The Company pays remuneration to its Chairman, Managing Director and its Whole time Director by way of Salary, perquisites and allowances. Salary is paid within the range as approved by the Shareholders and as per Schedule V to the Companies Act, 2013. The Board approves all the revisions in salary, perquisites and allowances subject to the overall ceiling prescribed by Section 197 and 198 of the Companies Act, 2013.
3.3 risk management policy:
During the year, your Directors have constituted a Risk Management Committee which has been entrusted with the responsibility to assist the Board (a) to ensure that all the current and future material risk exposures of the Company are identified, assessed, quantified, appropriately mitigated, minimized and managed i.e. to ensure adequate systems for risk management and (b) to establish a framework for the company's risk management process and to ensure its implementation (c) to enable compliance with appropriate regulations, wherever applicable, through the adoption of best practices and (d) to assure business growth with financial stability.
A Risk Management Policy was reviewed and approved by the Committee
3.4 stakeholders relationship committee:
The Board of Directors of the Company have renamed the existing Shareholders / Investors Grievance Committee as Stakeholders Relationship Committee in order to align it with the provisions of section 178 of the Companies Act, 2013 and Clause 49 of the Listing Agreement. The Committee has been constituted to strengthen the investor relations and to inter-alia, resolve the grievances of security holders pertaining to transfer of shares, non- receipt of declared dividends, non-receipt of Annual Report, issues concerning de-materialization etc.
The Stakeholders Relationship Committee of the Company comprises of three Independent Directors. Ms. Priya Shetty is the Company Secretary & Compliance Officer of the Company.
The Company has designated the e-mail ID: firstname.lastname@example.org > exclusively for the purpose of registering complaint by investors electronically. This e-mail ID is displayed on the Company's website i.e. (www.simmondsmarshall.com)
During the financial year ended March 31,2015,4 [Four] meetings were held on 30/05/2014,11 /08/2014, 07/11/2014 and 10/02/2015.
(i) Disclosures on materially significant related party transactions that may have potential conflict with the interest of Company at large:
There were no transactions of material nature other than reported under "Related Party Disclosures" that have been entered into by the Company with the promoters, directors, their relatives and the management and in any Company in which they are interested, that may have potential conflict with the interest of the Company.
(ii) Details of non-compliances, penalties etc. imposed on the Company by SEBI or Stock Exchange or any other statutory authority on any matter related to capital market, during the last three years:
The Company has complied with the requirements of the Stock Exchange, SEBI, and other Statutory Authorities on all matters relating to Capital Markets during the last three years.
(iii) Vigil Mechanism /Whistle Blower Policy:
Pursuant to Section 177 (9) of the Companies Act, 2013 and Clause 49 of the Listing Agreement the Company has adopted a Vigil Mechanism/Whistle Blower Policy. The Company believes in professionalism, transparency, integrity and ethical behavior and had thus established a 'Whistle Blower Policy' to facilitate employees to report concerns of any unethical behavior, actual or suspected fraud or violation of the Company's code of conduct or ethics policy. No employee of the company has been denied access to the Audit Committee of the Board of Directors.
(iv) Details Of Compliance With Mandatory Requirement And Adoption Of Non Mandatory Requirement of this Clause:
The Company has complied with all mandatory requirements of Clause 49 of the Listing Agreement with the Stock Exchange and has implemented the following non mandatory requirements:
1) The Board: Not Applicable since the Company has Executive Chairman
2) Shareholders Rights: Presently the company is not sending half yearly communication.
3) Audit Qualification: It is always the company's endeavor to present unqualified financial statements. There are no audit qualifications in the company's financial statement for the year under review.
4) Separate posts of Chairman and CEO: The Company is already having separate posts for Chairman, Managing Director/CEO.
5) Reporting of Internal Auditor: The Internal Auditor is directly reporting to Audit Committee.
6. means of communication
(i) Quarterly results: Results are submitted to Stock Exchange, published in newspapers and uploaded on the Company's website.
(ii) Newspapers wherein results normally prominent: Free Press Journal & Navshakti.
(iii) Any website where displayed: www.simmondsmarshall.com
(iv) Whether it also displays official news releases: No official release was made.
(v) The presentations made to institutional investors or to the analysts : No presentations were made during the year
7. GENERAL SHAREHOLDERS INFORMATION:
7.1 ANNUAL GENERAL MEETING
ANNUAL GENERAL MEETING: 55th Annual General Meeting.
Date, Time and : Wednesday, September 23, 2015 12 Noon.
Venue : Kwality Restaurant, Near TitanShowroom, Mumbai - Pune Road,Chinchwad, Pune - 411 019.
7.2 FINANCIAL CALENDAR:
* Financial reporting for the quarter ended June 30,2014 [Unaudited] :Mid of Aug. 2014
* Financial reporting for the quarter ended Sept.30, 2014 [Uuaudited] : Mid of Nov. 2014
* Financial reporting for the quarter ended Dec. 31, 2014 [Unaudited] : Mid of Feb., 2015
* Financial reporting for the year ended March 31,2015 [Audited] : Mid of May, 2015
* Annual General Meeting for the year ended March 31, 2014 -.End of Sep., 2014
7.3 DATE OF BOOK CLOSURE: 15/09/2015 TO 22/09/2015 [Both days inclusive].
7.4 DIVIDEND PAYMENT DATE: On or After 28/09/2015.
7.5 LISTING ON STOCK EXCHANGES:
The Company's Shares are listed on BSE Limited. The annual listing fee for the year 2015-16 has been paid.
7.6 STOCK CODE OF THE COMPANY:
BSE Limited, Mumbai
Scrip Name : SIMMONDS MARSHALL LIMITED.
Scrip Code: 507998
Electronic Mode (ISIN) : INE657D01021
DEPOSITORY CONNECTIVITY NSDLandCDSL.
ISIN NO. FOR THE COMPANY'S SECURITY : INE657D01021
7.8 REGISTRAR & TRANFER AGENTS UNDER PHYSICAL AND DEMAT MODE:
M/S. SHAREX DYNAMIC (INDIA) PVT. LTD. Unit: [SIMMONDS MARSHALL LIMITED]
Unit No.1, Luthra Ind. Premises, Andheri Kurla Road, Safed Pool, Andheri (East), MUMBAI - 400 072 Tel: 022 2851 5606/2851 5644 Email: email@example.com
7.9 SHARE TRANSFER SYSTEM:
Share Transfer Requests are received at the registered office of the Company as well as directly at RTAs office. RTA does the verification and processing of documents. In order to comply with the requirements of SEBI Circular Nos. CIR/MIRSD/8/2012 dated July 5, 2012 to effect transfer of shares within 15 days, the RTA has been authorised to process, approve and effect transfer of shares on behalf of the Company at fortnightly intervals. The share certificates duly endorsed for transfer are returned to shareholders within stipulated time of 15 days.
7.11 DEMATERIALISATION OF SHARES AND LIQUIDITY:
As on March 31, 2015, 10,518,665 Shares representing 93.92% of total Equity Shares were held in dematerialized form with NSDL and CDSL.
Liquidity: Average Monthly Trading Volume of the Company's Shares on BSE during financial year 2014-15
Number of Trades : 3904
Number of Shares: 298131 Equity Shares
ISIN NO. FOR THE COMPANY'S SECURITY: INE657D01021.
7.12 OUTSTANDING GDR'S /ADR'S / WARRANTS OR ANY CONVERTIBLE INSTRUMENTS, CONVERSION DATE AND LIKELY IMPACT ON EQUITY: NOT APPLICABLE
7.13 PLANT LOCATIONS: Mumbai Pune Road, Kasarwadi, Pune- 411 024.
7.14 ADDRESS FOR CORRESPONDENCE:
SIMMONDS MARSHALL LIMITED
Mumbai Pune Road, Kasarwadi Pune-411 034. E-mail: firstname.lastname@example.org Telephone Nos: 020-30782160
8. CODE OF CONDUCT FOR BOARD MEMBERS AND SENIOR MANAGEMENT: j
The Company has adopted a Code of Conduct for the Directors, Senior Management Personnel and Employees of the Company. The members of the Board and Senior Management of the Company have submitted their affirmation on compliance with the code for the effective period. The Declaration by the Chairman to that effect forms part of this Report.
9. MANAGEMENT DISCUSSIONS & ANALYSIS:
Management Discussion and Analysis Report is given in a separate section forming part of the Directors' Report in this Annual Report.
10. STEPS FOR PREVENTION OF INSIDER TRADING
In compliance of the SEBI (Prevention of Insider Trading) Regulations as amended in 2002, the Company has issued comprehensive guidelines advising and cautioning management staff and other relevant business associates on the procedure to be followed while dealing in equity shares of the Company, and disclosure requirements in this regard.
Further, in compliance with the requirements of the Regulation 8 & Regulation 9 of the amended SEBI (Prohibition of Insider Trading) Regulations, 2015 read with SEBI Circular dated May 11, 2015; the Board of Directors at its meeting held on May 30, 2015 formulated and adopted the Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information and Code of Conduct to regulate, monitor and report trading by its employees and other connected persons. These are being uploaded on the official website of the Company.
11. CEO CERTIFICATION:
As required under Clause 49 of the Listing Agreement a Certificate duly signed by Mr. N.S. Marshall, has been obtained. The Certificate is annexed to this Report.
12. AUDITORS' CERTIFICATE ON CORPORATE GOVERNANCE:
The Company has obtained a Certificate from Auditors of the Company regarding compliance with the provisions relating to the corporate governance laid down in clause 49 of the Listing Agreement with the Stock Exchange. This Certificate is annexed to the report.
All the members of the Board and senior Management Personnel of the Company have affirmed due observation of the code of the conduct, framed pursuant to clause 49 of the Listing Agreement with Stock Exchange is so far as it is applicable to them and there is no non-compliance thereof during the year ended 31st March, 2015.
By order of the Board of Directors
For Simmonds Marshall Limited
Registered Office; Mumbai - Pune Road, Kasarwadi, Pune 411 034
Date : May 29,2015