REPORT ON CORPORATE GOVERNANCE
I) CORPORATE GOVERNANCE PHILOSOPHY
At Sterling Biotech Limited, we view sound corporate governance as an integral part of our efforts to enhance shareholders value. We endeavor to safeguard the interests of investors, customers, suppliers and lenders and build the confidence of society in general. We adopt a philosophy of Professionalism, transparency and accountability in all areas.
II) BOARD OF DIRECTORS (BOARD)
The Board comprises of 6 Directors of whom 4 are Non-executive Directors and a majority of them being independent. All Directors are eminent industrialists and/or professionals with experience in overall management, finance and law, who bring a wide range of skills and experience to the Board.
b. Number of Board Meetings
During the year under review the Board of Directors met 7 times on the following dates: 28-02-2014,15-05-2014, 24-05-2014, 14-08-2014, 25-10-2014, 14-11-2014 and 31-12-2014.
d. Remuneration of Directors
Shri Nitin Sandesara – Rs. 12.00 Lacs (Salary)
Shri Chetan Sandesara – Rs. 24.00 Lacs (Salary)
No remuneration paid to non-executive directors. None of the non-executive directors hold any shares in the Company.
III) CODE OF CONDUCT
The Board lays down code of conduct for Board members and senior management of the Company and is posted on the website of the Company. The Board members and senior management personnel affirm compliance to the code of conduct.
IV) COMMITTEE OF DIRECTORS
The involvement of Non-executive Directors in providing guidance on policy matters to the operating management is formalized through constitution of committees of the Board. The Committees provide periodical and regular exchange of information and ideas between the Directors and the Operating Management. The Board constituted following committees:
The Committee reviews the Company's financial reporting process, disclosure norms, internal control systems, accounting policies and practices, reports of the Company's Internal Auditors, quarterly/half yearly financial statements as well as its financial risk policies. It also recommends appointment of statutory auditors, fixes audit fees and reviews internal control systems, scope for observations of the auditors and adequacy of the internal audit function. During the year under review, the committee met four times on 28-02-2014 (Adoption of Annual Accounts), 15-05-2014, 14-08-2014 and 14-11-2014 and the meeting was attended by all the Directors of the Audit Committee namely Shri R. B. Dixit-Chairman,Shri V. D. Joshi - Member and Shri P. B. Mehta - Member.
STAKEHOLDERS RELATIONSHIP COMMITTEE
The name of the Investors/Shareholders grievance committee changed to Stakeholders Relationship Committee. The Committee comprises of Shri R. B. Dixit - Chairman, Shri P. B. Mehta - Member and Shri N. B. Patel - Member. The Committee redresses shareholder and investors complaints like a delay in transfer of shares, non-receipt of dividend, non-receipt of balance sheet etc. During the year the committee met one times.
NOMINATION AND REMUNERATION COMMITTEE
The Board of Directors had constituted a Remuneration Committee in the year 2003. The Board at its meeting held on May 15, 2014, had approved the change in name of the committee to Nomination & Remuneration Committee, in accordance with section 178 of the Companies Act, 2013. The Nomination and Remuneration Committee comprises Shri R. B. Dixit, Shri P. B. Mehta and Shri N. B. Patel to recommend and review the remuneration package of Directors based on performance, industry practice and defined criteria. During the year, the Committee met One times.
The aggregate value of salary and perquisites payable for the year ended 31st December, 2014 to Nitin Sandesara, Managing Director is Rs. 12 lacs and to Chetan Sandesara. Joint Managing Director is Rs. 24 lacs.
1. As required under the Companies Act, the Directors disclose the name of the Companies/ Parties in which they are interested. In terms of Accounting Standard AS-18, details of related party transaction during the year have been set out under Note 27 B annexed to the Balance Sheet and Profit and Loss Account. However, they are not having any potential conflict with the interests of the Company at large.
2. There has been no non-compliance of any legal requirements nor have there been any strictures imposed by any stock exchange or SEBI, on any matters relating to the capital market, over the last three years.
The Company's activities expose it to a variety of risks including market risk, sales risk, raw material risk, regulatory risk, product liability and liquidity risk etc. The Company's overall risk management seeks to minimise potential adverse effects on its performance.
A Risk Management Steering Committee of the Company has been formed headed by Mr. Chetan Sandesara as Chairman of the Committee and also represented by the functional heads as Chief Risk officers. The Committee embraces the identification, assessment, mitigation, monitoring and reporting of material risks faced by the Company.
VII) MEANS OF COMMUNICATION
a. Quarterly / Annual financial results are forwarded to the Stock Exchanges where the shares of the Company are listed and published in the Free Press Journal in English and the Nav Shakti paper in Marathi.
b. A Management Discussion & Analysis Report is annexed to the Directors’ Report to the Shareholders.
VIII) GENERAL SHAREHOLDER INFORMATION
A. ANNUAL GENERAL MEETING:
th Date : 30th day of June, 2015
Time : 10.30 A.M.
Venue : Bhakti Kala Kshetra, International Society for Krishna Consciousness (ISKCON),
Founder Acharya : His Divine Grace A.C.
Bhaktivedanta Swami Prabhupada, Hare Krishna Land, Juhu, Mumbai - 400 049.
B. DATE OF BOOK CLOSURE:
Tuesday, the 23rd day of June, 2015 to Tuesday, the 30 day of June, 2015 (both days inclusive)
C. FINANCIAL CALENDAR 2015:
Unaudited Results – Qtrly. March 2015 : May 2015
Unaudited Results – Qtrly. June 2015 : August 2015
Unaudited Results – Qtrly. September 2015 : November 2015
Audited Accounts – March 2016 : April/May 2016
Annual General Meeting : June 2016 (Next Year)
D. STOCK EXCHANGES WHERE SECURITIES ARE LISTED
The Company’s equity shares are listed on the BSE and NSE. Global Depository Receipts (GDRs) and Foreign Currency Convertible Bonds due 2019 are listed on the Luxembourg Stock Exchange. 12.00% Secured Redeemable Non-Convertible Debentures are listed on the Bombay Stock Exchange Limited (BSE) in Debt Segment.
Name of Stock Exchange Code/Symbol
Bombay Stock Exchange Limited (BSE) (Equity) 512299
National Stock Exchange of India Limited (Equity) STERLINBIO
Luxembourg Stock Exchange (GDRs) CUSIP No. : 85916G108
Common Code : 017757709
ISIN : US85916G1085
Luxembourge Stock Exchange (FCCBs) CUSIP No. : 85916G108
Common Code : 104680640
ISIN : XS1046806409
Bombay Stock Exchange Limited (BSE) (Debentures) 945828
F. SHARE TRANSFER SYSTEM
Our RTA is Link Intime India Pvt. Ltd., Share sent for physical transfers are registered and returned within a stipulated time frame, if the documents filed are clear in all respects. Officers/ Directors of the Company have been authorized to approve transfers. Trading in equity shares of the Company is permitted only in dematerialized form w.e.f. 26-02-2001. All requests for dematerialization of shares are processed and the confirmation is given to the respective depositories, i.e. National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) within a stipulated time frame. Upto 31-12-2014, 95.75% equity shares of the company have been dematerialized.
Total Number of shares transferred in the non-dematerialized form during the year 2014 i.e. from 01.01.2014 to 31.12.2014 were 6,500.
H. DEMATERIALISATION OF SHARES
ISIN Number for Equity Shares of the Company in NSDL & CDSL: INE324C01038
Total No. of Shares dematerialized upto 31-12-2014 : 264,058,215
With NSDL 164,037,973
With CDSL 100,020,242
I. OUTSTANDING GDRS, FCCBS OR OTHER CONVERTIBLE AND NON-CONVERTIBLE INSTRUMENTS
As of date, the Company has the following outstanding instruments:
7,610,460 GDRs representing in aggregate 45,662,763 equity shares of Rs. 1/- each.
(a) Zero Coupon FCCB due 2019 aggregating to USD 201.235 Million. FCCBs are convertible into equity shares at the option of the bond holders at a price of Rs. 60/- per share and fixed rate of exchange is Rs. 48.00.
The outstanding but matured FCCBs if converted into equity shares will increase the equity capital by approx 160,988,002 equity shares and post conversion capital of the Company would reach approx 433,035,990 equity shares of Rs. 1 each.
(a) 12.00% Secured Redeemable Non-Convertible Debentures due 2015 of Rs. 300 Crores.
J. PLANT LOCATION
1. ECP Road, Village Karakhadi – 391 450, Tal. Padra, Dist. Baroda, Gujarat.
2. Village Masar, Jambusar Road, Tal. Padra, Dist. Vadodara, Gujarat
3. Sandyanalla, Sholur Gram Panchayat, Ottacamund, Dist. The Nilgiries, Tamilnadu
K. ADDRESS FOR CORRESPONDENCE
Shareholders can correspond at the Registered Office of the Company at Mumbai and / or Registrar &Transfer Agent (RTA) - Link Intime India Pvt. Ltd., Unit: Sterling Biotech Limited, C-13, Pannalal Silk Mills Compound, L.B.S. Marg, Bhandup (W), Mumbai - 400 078.
Ph.: 022-2594 6970 Fax: 022-2594 6969, Email: email@example.com .
Investor complaints may be addressed to: firstname.lastname@example.org .
Whistle Blower Policy
Sterling Biotech believes in the conduct of the affairs of its constituents in a fair and transparent manner by adopting highest standards of professionalism, honesty, integrity and ethical behavior. In order to inculcate accountability and transparency in its business conduct, the Company has been constantly reviewing its existing systems and procedures. Your Company has approved a whistle blower policy which will enable all employees, directors and other stakeholders to raise their genuine concerns internally in a responsible and effective manner if and when they discover information which they believe shows serious malpractice or irregularity within the Company and/or to report to the management instances of unethical behavior, actual or suspected, fraud or violation of Company's code of conduct or ethics policy.