CORPORATE GOVERNANCE REPORT
I. WYETH'S PHILOSOPHY ON CODE OF CORPORATE GOVERNANCE
Corporate Governance at Wyeth is not just adherence to mandatory rules and guidelines. Your Company is guided by its nine Core Values in its day-to-day decision-making. Relying on these values your Company constantly strives to maintain high standards and earn the trust of all its stakeholders. The requisite standards of corporate governance have been fully complied by the Company.
II. BOARD OF DIRECTORS
The Board of Directors provides strategic direction and thrust to the operations of the Company.
0 Composition of the Board of Directors
During the financial year under review, the Board was headed by the Non-Executive Independent Chairman, Mr. Pradip Shah, and comprised of eminent persons with considerable professional experience in varied fields. The Board comprised of one executive Director and seven Non-executive Directors of whom five were independent Directors. The size and composition of the Board, therefore, complied with the corporate governance norms under the Listing Agreement with the Stock exchanges, the Articles of Association of the Company and applicable laws.
Mr. D. E. Udwadia and Mr. Pradip Shah resigned effective 26th August, 2014 and 30th September, 2014 respectively. The present strength of the Board is six Directors consisting of one executive Director and five Non-executive Directors of whom three are independent Directors. None of the Directors are related to each other.
0 Board Meetings
The Board meets at least once every quarter. The gap between two Board Meetings does not exceed four months.
During the period 1st April, 2013 to 31st March, 2014 ('financial year under review'), the Company held five Board Meetings as under:
(i) 14th May, 2013 (ii) 30th July, 2013 (iii) 1st November, 2013 (iv) 23rd November, 2013 (v) 27th January, 2014
The details of composition of the Board of Directors, the number of Board Meetings held, their attendance thereat and at the last Annual General Meeting ('AGM'), and the number of Directorships, Memberships and / or Chairmanships held by each Director of the Board as on 31st March, 2014, are set out below:
(2) The necessary disclosures regarding committee positions have been made by all the Directors. None of the Directors is a Member of more than 10 committees and Chairman of more than 5 committees across all Indian public limited companies in which he is a Director. Number of Chairmanships / Memberships of committees includes only Chairmanships / Memberships of Audit Committee and Shareholders' / Investors' Grievance Committee.
III. BOARD COMMITTEES
During the financial year under review, the Board had four Committees viz., the Audit Committee, Shareholders' / Investors' Grievance Committee, Share Transfer Committee and Remuneration Committee. The Board decides the terms of reference of these Committees.
(A) AUDIT COMMITTEE
? Five Audit Committee Meetings were held during the financial year under review and the gap between two Meetings did not exceed four months. These Meetings were held on:
(i) 14th May, 2013 (ii) 30th July, 2013 (iii) 30th October, 2013 (iv) 23rd November, 2013 (v) 27th January, 2014
? The details of the composition of the Audit Committee and the attendance of the Directors at the Audit Committee Meetings are as under:
? Mrs. N. N. Thakore, Company Secretary & Legal Director, has been designated as Compliance Officer.
? The Company has designated email@example.com as the e-mail ID on which investors may register their complaints.
? During the year under review, the terms of reference of the Shareholders' / Investors' Grievance Committee covered the matters specified under Clause 49 of the Listing Agreement with the Stock Exchanges.
? The Board of Directors notes the Minutes of the Shareholders' / Investors' Grievance Committee Meetings at Board Meetings.
? The Board of Directors has on 28th April, 2014, renamed the said Committee as Stakeholders' Relationship / Investors' Grievance Committee.
(C) SHARE TRANSFER COMMITTEE
Members: Mr. K. K. Maheshwari Mr. Aijaz Tobaccowalla
Mr. S. Sridhar (Appointed effective 6th October, 2014) Mr. D. E. Udwadia (Resigned effective 26th August, 2014) Mr. Pradip Shah (Resigned effective 30th September, 2014) The Chairman is elected at each meeting.
The Share Transfer Committee inter alia, deals with matters relating to transfers/ transmissions / transposition/ consolidation / rematerialization / issue of share certificates in exchange for sub-divided / consolidated / defaced share certificates / issue of duplicate share certificates. The Meetings of the Share Transfer Committee are need based. The Company Secretary has been empowered by the Board to approve transfers / transmissions of shares, split / consolidation and other allied matters up to a limit of 1000 shares per individual item. At each meeting, the Board is apprised of the details of matters approved by the Company Secretary / Share Transfer Committee.
The Company's Registrar and Share Transfer Agent, Karvy Computershare Private Limited (KCPL) has adequate infrastructure to process the share transfers. The share transfers received are processed and share certificates are issued within 15 days from the date of receipt, subject to the transfer instrument being valid and complete in all respects. Dematerialization requests are processed within 15 days from the date of receipt, to give credit of the shares through the Depositories. In compliance with the Listing Agreement, a practicing Company Secretary audits the System of Transfer and a Certificate to that effect is issued every six months.
The Board of Directors notes the Minutes of the Share Transfer Committee Meetings at Board Meetings.
(D) REMUNERATION COMMITTEE AND REMUNERATION TO DIRECTORS
? The Remuneration Committee inter alia, reviews and recommends the remuneration and commission/ performance incentive of Managing / Whole-time Directors based on the performance parameters for the individuals and the Company, subject to the limits approved by the Members and as permitted by law. The terms of reference of the Remuneration Committee include the matters specified in Clause 49 of the Listing Agreement with the Stock Exchanges. The current Managing Director does not receive any remuneration from the Company. Further, the Company does not have a Whole-time Director at present. In view of this, no Meeting of the Remuneration Committee was held during the year under review.
? The Board of Directors notes the Minutes of the Remuneration Committee Meetings at Board Meetings.
? The Remuneration Policy is directed towards rewarding performance. It is aimed at attracting and retaining high caliber management talent by evaluating their performance based on their potential, leadership skills and actual performance during the year, considering the prevailing internal and external business environment and at the same time giving importance to the prevailing competitive market practices.
? The Board of Directors has on 28th April, 2014, renamed the said Committee as Nomination and Remuneration Committee and revised its terms of reference.
? Executive Directors
Agreement appointing Mr. Aijaz Tobaccowalla as Managing Director of the Company is for a period of three years commencing from 16th August, 2012 up to 15th August, 2015. As per the terms of the Agreement, either party may terminate the Agreement by giving the other three months prior writtennotice. Mr. Tobaccowalla, also being the Managing Director of Pfizer Limited receives remuneration from the said Company. No remuneration is paid to him as Managing Director of the Company. In case of early termination of the Agreement, there is no provision for payment of severance fees.
? Employees Stock Option Scheme
The Company does not have a scheme for grant of stock options. Mr. Aijaz Tobaccowalla, Mr. Vivek Dhariwal and Mr. S. Sridhar are eligible for stock options granted by the Parent Company.
? Performance Linked Incentive
No Performance Incentive was paid to any Director of the Company for the year ended 31st March, 2014.
? Non-Executive Directors
0 Criteria for payment of remuneration to Non-Executive Directors:
The remuneration to Non-Executive Directors comprises of sitting fees and fixed commission. The criteria for payment of remuneration to Non-Executive Directors is the time devoted or participation made by them at Board / Committee Meetings based on their knowledge and expertise and the overall financial performance of the Company. The remuneration is fixed by the Board of Directors.
0 The Resident Indian Non-Executive Directors, receive compensation in the form of commission on net profits. The commission shall not exceed 3% of the net profits of the Company, subject to a limit of Rs. 1 crore (Rupees one crore) per annum in case there is no Managing and / or Whole-time Director at any time. The commission shall not exceed 1% of the net profits of the Company, subject to a limit of Rs. 75 lakhs (Rupees seventy-five lakhs) per annum so long as the Company has a Managing and / or Whole-time Director.
0 During the year ended 31st March, 2014, the Company paid Rs. 17,60,701/- to the law firm M/s Udwadia Udeshi & Argus Partners as fees for professional services that were provided by them on specific legal matters entrusted by the Company to them from time to time. Mr. D. E. Udwadia is a founder partner of the above firm. The Board does not consider the firm's association with the Company to be of a material nature so as to affect the independence of judgment of Mr. Udwadia as a Director of the Company. Mr. Udwadia has resigned as Director of the Company effective 26th August, 2014.
0 Mr. S. S. Lalbhai holds 1,275 shares in the Company. None of the other Non-Executive Directors hold any shares in the Company.
0 Besides dividend on equity shares, if any, held by the Directors, and payments as mentioned above, no other payments have been made nor have transactions of a pecuniary nature been entered into by the Directors with the Company.
(E) CORPORATE SOCIAL RESPONSIBILITY COMMITTEE
Pursuant to Section 135 of the Companies Act, 2013 ("the Act") and Rules made thereunder, the Board of Directors on 28th April, 2014 has constituted a Corporate Social Responsibility Committee.
IV. CHIEF EXECUTIVE OFFICER (CEO) / CHIEF FINANCIAL OFFICER (CFO) CERTIFICATION
As required under Clause 49(V) of the Listing Agreement with the Stock Exchanges, a certificate from the Managing Director and the Acting Chief Financial Officer on the integrity of the Financial Statements and the Cash Flow Statement and the Internal Control Systems for financial reporting for the year ended 31st March, 2014, was placed before the Board at its Meeting held on 28th April, 2014.
(a) Related Party Transactions
0 The Company has not entered into any materially significant related party transactions with its Subsidiaries, Promoters, Directors, Management, or relatives etc. that may have potential conflict with the interests of the Company at large.
0 The Company has received disclosures from senior managerial personnel confirming that they have not entered into any material, financial and commercial transactions in which they or their relatives may have a personal interest.
0 Transactions with related parties as per requirements of Accounting Standard 18 are disclosed in Note 34 to the financial statements in the Annual Report and they are not in conflict with the interest of the Company at large.
0 The Audit Committee has reviewed the related party transactions as mandatorily required under relevant provisions of the Listing Agreement entered into with the Stock Exchanges. The said transactions are in the ordinary course of business and at arm's length basis.
(b) Compliances by the Company
The Company has complied with the requirements of the Stock Exchanges, SEBI and other statutory authorities on all matters relating to capital markets during the last three years. No penalties or strictures have been imposed on the Company by the Stock Exchanges, SEBI or other statutory authorities relating to the above.
(c) Code of Conduct
The Company is committed to conducting its business in conformity with ethical standards and applicable laws and regulations. The Board has adopted a Code of Conduct including a Business Ethics Policy for its Designated Persons. Designated Persons mean Directors and Officers in Management Cadre - M9 and above. The said Code is available on the Company's website- www.wyethindia.com .
The Company has for the year ended 31st March, 2014, received from all Designated Persons, a declaration of compliance with the Code. A certificate from Mr. Aijaz Tobaccowalla, Managing Director, to this effect forms part of this Report. Employees of the Company also affirm compliance with the Code of Conduct as applicable to them.
(d) Risk Management framework
The Company has in place a mechanism to inform the Board about the risk assessment and minimization procedures and periodical review to ensure that management controls risk through means of a properly defined framework.
(e) Management Discussion and Analysis
The Management Discussion and Analysis forms a part of the Board's Report. All matters pertaining to industry structure and developments, opportunities and threats, segment-wise / product-wise performance, outlook, risks and concerns, internal control systems and adequacy, discussion on financial and operational performance and material developments in human resources are discussed in the said Report.
(f) Adherence to Accounting Standards
The Company follows the Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006 and in the preparation of the financial statements, the Company has not adopted a treatment different from that prescribed by any Accounting Standard.
(g) Mandatory Requirements
The Company has complied with all mandatory requirements of Clause 49 of the Listing Agreement with the Stock Exchanges. The adoption of non-mandatory requirements is provided in this Report.
VI. MEANS OF COMMUNICATION
(a) Financial Results
The Quarterly, Half-Yearly and Annual Financial Results were published in all editions of the Financial Express in English and in Marathi, in the Mumbai edition of the Navshakti respectively. The said Financial Results are also available on the Company's website - www.wyethindia.com . These are made available to Members on request.
(b) Presentation to Institutional Investors / Analysts
No presentation was made to institutional investors or to analysts during the year under review. The official news releases are displayed on the Company's website.
VII. GENERAL SHAREHOLDER INFORMATION
(a) Date, time and venue of the Annual General Meeting
Date : 10th November, 2014
Time : 3.00 P. M.
Venue : Yashwantrao Chavan Pratishthan Auditorium, General Jagannath Bhosale Marg, Next to Sachivalaya Gymkhana, Mumbai - 400 021.
(b) Financial Year
The Company observes 1st April to 31st March as its financial year. Financial Calendar
First Quarter Results : 25th July, 2014
Second Quarter Results* : Second week of November, 2014
Third Quarter Results* : Second week of February, 2015
Fourth Quarter and Annual Results* : Last week of May, 2015
(c) Dates of Book Closure :
31st October, 2014 to 10th November, 2014 (both days inclusive).
(d) Dividend Payment Date
The Board of Directors ("Board") had declared an interim dividend of Rs. 145.00 (1450%) per equity share and the same was paid on 17th December, 2013. The dividend payout aggregated to Rs. 32944.09 lakhs and the corporate dividend tax paid by your Company amounted to Rs. 5598.85 lakhs. Keeping in mind the substantial payout by way of interim dividend, your Directors did not recommend any further dividend for the year ended 31st March, 2014.
(e) Listing on Stock Exchanges
The Company is listed on the BSE Limited and The National Stock Exchange of India Limited. The annual listing fees have been paid and there is no outstanding payment towards the Stock Exchanges, as on date.
(f) Stock Code
BSE Limited - 500095
The National Stock Exchange of India Limited - WYETH
(g) International Securities Identification Number (ISIN)
The Company's scrip forms a part of SEBI's Compulsory Demat Segment bearing ISIN No. INE378A01012.
(h) Corporate Identity Number (CIN)
The Company's CIN, allotted by the Ministry of Corporate Affairs, Government of India, is L85190MH1947PLC005963. The Company is registered at Mumbai in the State of Maharashtra, India.
(i) Address for Correspondence
All Members' correspondence should be forwarded to Karvy Computershare Private Limited, the Registrar and Share Transfer Agent of the Company or to the Secretarial Department of the Company at the following addresses.
j) Registrar and Share Transfer Agent's Address:
Registered Office Address:
Karvy Computershare Private Limited
Unit: WYETH LIMITED
Plot No. 17 - 24,Vittalrao Nagar, Near Image Hospital, Madhapur, Hyderabad - 500 081.
Toll Free No. : 1-800-3454-001 Tel.: 040 4465 5000 Fax: 040 2342 0814
Level 6, Platina, Plot No. C-59, 'G' Block, Bandra-Kurla Complex, Bandra (E), Mumbai 400 098.
Tel: 022 2657 4000 Fax: 022 2657 4100
Website: www.wyethindia.com E-mail: firstname.lastname@example.org
k) Share Transfer System
The Company Secretary / Share Transfer Committee processes and approves the transfer requests received. The Company's Registrar, Karvy Computershare Private Limited has adequate infrastructure to process the share transfers.
l) Outstanding GDRs / ADRs / Warrants or any convertible instruments etc.
As on date, the Company has not issued these types of securities.
Plot No. L-137, Phase III, Verna Industrial Estate, Verna - 403 722, Goa.
m) Dematerialization of Shares and Liquidity
The shares of the Company form part of the Compulsory Demat Segment. The Company has established connectivity with both the Depositories viz. National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) through its Registrar, Karvy Computershare Private Limited.
X. NON-MANDATORY REQUIREMENTS
The Company has implemented the following Non-Mandatory requirements recommended under Clause 49 of the Listing Agreement with the Stock Exchanges:
a) Nomination and Remuneration Committee
A Nomination and Remuneration Committee reviews and takes decisions on compensation of Executive Directors of the Company. The Chairman of the Nomination and Remuneration Committee is an Independent Director.
b) Whistle Blower Policy
The Company has put in place a mechanism for all stakeholders to report to the Management, genuine concerns, illegal or unethical practices, actual or suspected fraud or violation of the Company's Code of Conduct or Ethics Policy. The said Policy provides for adequate safeguards against victimization of those who avail of the mechanism.