REPORT ON CORPORATE GOVERNANCE
The Company's philosophy on governance is founded upon and structured on a rich legacy of principles and practices that predicates dealings with stakeholders based on fairness, transparency and ethical behaviour. It seeks to assiduously build mutual trust and confidence as the basis for all working relationships with stakeholders. Implicit in this philosophy is also the recognition and demonstration of a two way communication between the Company and its stakeholders. While the Company welcomes constructive ideas and encourages dissent, it also acts fearlessly and with conviction.
BOARD OF DIRECTORS
Composition of the Board, Directorships & Committee positions held in other Companies and Shares held as on 31st March, 2012 :
As on 31st March, 2012, the Company had eight Directors. Fifty per cent of the Board comprised of Non-executive Independent Directors.
Shri Kashi Prasad Khandelwal joined the Board effective 10th April, 2012.
Shri Basant Kumar Birla, Shri Krishna Gopal Maheshwari and Smt. Manjushree Khaitan are related to one another.
Attendance of Directors at Meetings held during the Financial Year 2011-12
Six Board Meetings were held during the Financial Year ended 31st March, 2012 - on 28th April, 2011, 5th July, 2011, 28th July, 2011, 14th August, 2011, 3rd November, 2011 and 6th February, 2012.
Code of Conduct
The Company has a Code of Conduct applicable to all Board Members and senior management staff for avoidance of conflicts of interest between each of the above individuals and the Company. Each Board Member and senior management staff have to declare their compliance with the Code of Conduct as at the end of each Financial Year. The required declarations in respect of the Financial Year 2011-12 have been received from all Board Members and senior management staff. There were no materially significant transactions during the Financial Year with Board Members and senior management staff, including their relatives, that had or could have had a potential conflict of interest with the Company.
The Code of Conduct is available on the website of the Company.
Terms of Reference
The Audit Committee has been mandated with the same terms of reference as specified in Clause 49 of the Listing Agreements with the Stock Exchanges. The terms of reference also conform to the requirements of Section 292A of the Act.
Composition, Names of Members and Chairman
As on 31st March, 2012 the Audit Committee had four Non-executive Independent Directors as Members.
Five Meetings were held during the Financial Year ended 31st March, 2012 - 28th April, 2011, 28th July, 2011, 14th August, 2011, 3rd November, 2011 and 6th February, 2012.
Shri Kashi Prasad Khandelwal joined the Committee effective 10th April, 2012.
Shri Gautam Ganguli, Secretary of the Company, is the Secretary to the Audit Committee.
Invitees (as and when considered necessary)
a) the Statutory Auditors.
b) the Internal Auditors and Cost Auditors.
c) Shri Kamal Chand Jain, Whole-time Director, Shri Uma Shankar Asopa, Sr. Joint President, Finance and Shri Suresh Sharma, Sr. Joint President, Commercial of the Company.
Shri Prasanta Kumar Mallik, Chairman of the Audit Committee, is a senior Chartered Accountant and a past President of The Institute of Chartered Accountants of India.
Shri Pesi Kushru Choksey and Shri Amitabha Ghosh, Members are also senior Chartered Accountants. Shri Vinay Sah is a Senior Executive with the Life Insurance Corporation of India.
All Members of the Audit Committee are financially literate.
The Chairman of the Audit Committee attended the last Annual General Meeting ("AGM") held on 5th July, 2011.
As on 31st March, 2012, the Remuneration Committee consisted of two Non-executive Independent Directors i.e. Shri Prasanta Kumar Mallik and Shri Pesi Kushru Choksey. Bhagwati Prasad Bajoria, Chairman of the Committee, passed away on 20th February, 2012. Shri Kashi Prasad Khandelwal, Non-executive Independent Director, who joined the Board effective 10th April, 2012 in the casual vacancy so caused, was inducted into the Remuneration Committee from this date. The Committee met once during the Financial Year 2011-12 on 28th April, 2011. All three Committee Members attended the Meeting.
Shri P. K. Mallik is at present the Chairman of the Committee.
The Committee essentially discharges the role assigned to it under Part II, Section II of Schedule XIII of the Act. As a part of this role, it approves, as per parameters set out in the law, the remuneration structure for whole-time director(s) in the event of the Company having insufficient profits during a financial year.
Besides Sitting Fees, Non-executive Directors are also entitled to a commission on profits. Since there was no profit during the Financial Year 2011-12, the question of payment of commission did not arise.
Apart from the above, no other pecuniary relationship or transactions vis-a-vis the Company exist with the Non-Executive Directors.
SHAREHOLDER RELATED COMMITTEES
The Company has two Shareholder related Committees:
i) Share Transfer and Finance Committee
ii) Shareholders'/Investors' Grievance Committee
Details of each of these Committees are appended :
i) Share Transfer and Finance Committee
As on 31st March, 2012, the Committee consisted of Shri Prasanta Kumar Mallik, a Non- executive Independent Director as Chairman and Shri Kamal Chand Jain, Member. Shri Jain was inducted as a Member of the Committee during the Financial Year 2011-12 replacing Shri Deepak Tandon, who resigned effective 15th April, 2011. Bhagwati Prasad Bajoria, a Non-executive Independent Director was the Chairman of the Committee till his demise on 20th February, 2012. Shri Kashi Prasad Khandelwal replaced Bhagwati Prasad Bajoria as a Committee Member effective 10th April, 2012.
The Committee deals with the approval of requests for transfer and transmission of shares in the physical form, issue of duplicate certificates and other shareholder related issues. It also deals with matters relating to finance.
The Committee met 13 times during the Financial Year 2011-12.
ii) Shareholders'/Investors' Grievance Committee
As on 31st March, 2012, the Committee consisted of two Directors as Members viz Shri Prasanta Kumar Mallik, Chairman and Shri Kamal Chand Jain, Member. Bhagwati Prasad Bajoria was also a Member of the Committee till his demise on 20th February, 2012. Shri Kashi Prasad Khandelwal replaced Bhagwati Prasad Bajoria as a Committee Member effective 10th April, 2012. Shri Jain too was inducted as a Member of the Committee during the Financial Year 2011-12 replacing Shri Deepak Tandon who resigned effective 15th April, 2011.
The terms of the Committee are to review Shareholder/Investor grievances. The Committee met thrice during the Financial Year 2011-12 - on 27th July, 2011, 29th December, 2011 and 26th March, 2012. Shri Mallik and Shri Jain attended all three Meetings. Bhagwati Prasad Bajoria attended two meetings.
Shri Gautam Ganguli, Company Secretary, is the Compliance Officer under the Listing Agreement.
Disclosures in relation to the appointments and re-appointments of Directors
As required under Clause 49(IV)(G)(i) of the Listing Agreement, brief profiles of Shri Vinay Sah, Shri Kashi Prasad Khandelwal, Smt. Manjushree Khaitan and Shri K.C. Jain are appended:
a) Shri Vinay Sah, (52), a Non-executive Independent Director nominated by The Life Insurance Corporation of India ("LIC"), is a Post Graduate in Science. He is at present the Zonal Manager (In-charge) of LIC, East Central Zonal Office, Patna. His wealth of expertise in finance and general management is vast. He is not a Director of any other company.
b) Shri Kashi Prasad Khandelwal, (61), a Non-executive Independent Director, is an FCA, LLB. He has a Diploma in Information Systems Audit ("DISA") and Computerised Accounting and Auditing Techniques ("CAAT") from The Institute of Chartered Accountants of India. As a senior practising professional, he is closely associated with the World Bank as a Financial Audit Consultant. He is presently involved with the Emergency Monrovia Urban Sanitation ("EMUS") Project, Liberia. He is also a Director of Balasore Alloys Limited, Ashika Credit Capital Limited and Ashika Global Securities Limited. He is the Chairman of the Remuneration Committees of Ashika Credit Capital Limited and Ashika Global Securities Limited. He is a Member of the Audit Committee and Share holders'/Investors' Grievance Committee of Ashika Credit Capital Limited, Share holders'/Investors' Grievance Committee of Ashika Global Securities Limited and Audit Committee of Balasore Alloys Limited.
c) Smt. Manjushree Khaitan, (56), is a Post Graduate in English Literature. She has attended Executive Development Programmes at the London Business School, U. K. and IMD, Switzerland. She is the Chairperson of Manjushree Plantations Limited and is a Member of its Shareholders'/Investors' Grievance Committee and Remuneration Committee. She has been associated with plantations and various manufacturing units for over two decades. She is a Member of the Board of Governors of Birla Institute of Technology and Science, Pilani ("BITS"). She is also closely associated with several Educational and Cultural Trusts, including the Birla Education Trust of which she is a Trustee.
d) Shri K. C. Jain, (72), a Bachelor of Commerce and Member of The Institute of Chartered Accountants of India, has vast experience in finance, banking and general management over a period of 47 years with the Company. He is a Director of Gondkhari Coal Mining Limited.
Smt. Khaitan and Shri Jain respectively hold 2,39,114 and 2,695 Ordinary Shares of the Company. Shri Sah and Shri Khandewal do not hold any shares.
i) Disclosure on materially significant Related Party transactions :
Details of Related Party transactions during the Financial Year 2011-12 have been set out under Note no. 43 of the Notes to the Financial Statements. None of these transactions have any conflict or potential conflict with the interests of the Company at large.
ii) Details of Non-compliance by the Company, penalties, strictures imposed on the Company by the Stock Exchanges, SEBI or any Statutory Authorities on any matter related to Capital Markets :
The Company has complied with all requirements of the Listing Agreement as well as the regulations and guidelines prescribed by Securities and Exchange Board of India ("SEBI"). No penalties or strictures have been imposed by SEBI, Stock Exchanges or any other Statutory Authorities on any matter relating to the Capital Markets during the last three years.
MEANS OF COMMUNICATION
Financial results, Annual Report etc.:
The quarterly Unaudited Financial Results and the Annual Audited Financial Results as approved and taken on record by the Board are sent to the Stock Exchanges where the Company's shares are listed and then published in various leading national newspapers, viz Business Standard / Mint (English — all editions) and Dainik Statesman (Bengali). The Results are also posted on the Company's website www.kesocorp.com . All official releases and other related information are also displayed on this website. Should any presentation relating to the Company's working be made to analysts, a copy of such presentation is also hosted on the website.
The quarterly Unaudited Results and the Annual Financial Results along with the Report on Segment Revenue, Results and Capital Employed, Balance Sheet, Profit & Loss Account / Statement of Profit & Loss, Directors' Report, Auditor's Report, Cash Flow Statement, Corporate Governance Report, Management Discussion and Analysis and the Shareholding Pattern etc. can also be accessed by investors from the Company's website at www.kesocorp.com .
Management Discussion and Analysis
The Management Discussion and Analysis, as reviewed by Audit Committee, is part of this Annual Report.
GENERAL SHAREHOLDER INFORMATION
Time :11.00 a.m.
Date :11th July, 2012
Venue:"Kala-Kunj", 48, Shakespeare Sarani, Kolkata-700 017
The Financial Year of the Company is from 1st April to 31st March.
Date of Book Closure
30th June, 2012 to 11th July, 2012 (both days inclusive)
Dividend payment date
On or after 18th July, 2012
Stock Exchanges related information
a. Listing on Stock Exchanges:
The Ordinary Shares of the Company are listed on :
• BSE Limited ("BSE"),
Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai-400 001
• National Stock Exchange of India Limited ("NSE"),
Exchange Plaza, Bandra-Kurla Complex, Bandra(E), Mumbai-400 051
• The Calcutta Stock Exchange Ltd. ("CSE"),
7, Lyons Range, Kolkata-700001
• Societe de la Bourse de Luxembourg, Societe Anonyme/R.C.B. 6222,B.P.165, L-2012 Luxembourg
b. Stock Codes for:
Luxembourg Stock Exchange :492532205
There are no arrears in payment of Listing Fees.
c. ISIN No. for the Company's Ordinary Shares in Demat Form:
d. Depository Connectivity :
National Securities Depository Limited and Central Depository Services (India) Limited
Registrar and Share Transfer Agents :
MCS Limited (Unit: Kesoram Industries Ltd.)
77/2A, Hazra Road, Kolkata-700 029
Phone Nos.: +91 33 2454-1892/1893, Fax No.: +91 33 2454-1961 e-mail : firstname.lastname@example.org
Subject to documentation being in order, transfer requests of Ordinary Shares lodged with the Company/Registrars in physical form are processed no later than three weeks from the date of receipt. Individual share transfer requests in physical form below 10,000 shares are dealt with and approved at the level of Company Executives. Individual requests for transfers of above 10,000 shares in physical form are referred to the Share Transfer and Finance Committee for approval.
Dematerialisation and Rematerialisation
Requests for Dematerialisation and Rematerialisation should be sent either to the Company's Registrar and Share Transfer Agents or to the Share Department at Birla Building, 8th Floor, 9/1, R N Mukherjee Road, Kolkata - 700 001
Dematerialisation of shareholding
The Company's Ordinary Shares are compulsorily traded in the dematerialisation form. As on 31st March, 2012, 436.30 lakh Ordinary Shares of the Company representing 95.38% of the total Ordinary Shares issued were held in dematerialised form. Investors have an option to dematerialise their Ordinary Shares either with National Securities Depository Limited or Central Depository Services (India) Limited.
70,41,875 Ordinary Shares of the Company were held as Global Depository Receipts as on 31st March, 2012.
The Code of Internal Procedure & Conduct under the SEBI (Prohibition of Insider Trading) Regulations, 1992, as amended, is in full force and effect.
Sedam, Dist.Gulbarga Karnataka-585222
Phone +918441-276005/277403, Fax +918441-276139
Storage and Packing Unit :
Survey No.296/7/4, I.D.A Bollaram Village, Jinnaram Mandel,
Medak Dist. - 502325, Andhra Pradesh.T-3 MIDC Chincholi, Taluk : MohalSolapur-413255, Maharastra State
10-3-316/2, Crystal Towers, 2nd Floor, Above Andhra Bank, Masab Tank, Hyderabad 500028, A. P.
Phone +9140-23342296/8056 Fax +9140-23344109/7821
Run under the name & style of- Vasavadatta Cement
Basantnagar, Dist.Karimnagar Andhra Pradesh-505187
Phone +918728-228122/228125/ 228156 Fax +918728-228160
10-3-316/2, Crystal Towers,2nd & 3rd Floors,Above Andhra Bank, Masab Tank,Hyderabad 500028, A. P.
Phone +9140-23348896/7843/ 7613Fax +9140-23344109/23347821 E-mail: email@example.com
Run under the name & style of- Kesoram Cement
Automobile Tyres and Tubes
P.O. Chhanpur, Via.Kuruda,Dist. Balasore, Orissa, Pin.756056
Phone +916782-254259/780/620 Fax +916782-254225 E-mail: firstname.lastname@example.org
Gram Khedimubarakpur, Tehsil Laksar, Dist. Haridwar, Uttarakhand-247 663
Phone +911332- 256000/256001 Fax +911332- 255177 E-mail :email@example.com
7th Floor, Birla Building 9/1, R. N. Mukherjee Road, Kolkata-700001
Phone +9133-2262 4411-13 Fax +9133-2262 4359 E-mail:ho@birlatyre. com
Run under the name & style of -Birla Tyres
Rayon &Transparent Paper
P.O. Nayasarai, Rly. Station: Kuntighat,On Howrah-Katwa route,Dist.Hooghly, West Bengal-712513
Phone +9133-26846431-34/ 26846457 Fax +9133-26846461
“Industry House”, 11th Floor 10, Camac Street, Kolkata-700017
Phone +9133-2282-4721-24 Fax +9133-2282-8879 E-mail: firstname.lastname@example.org
Run under the name & style of - Kesoram Rayon
Spun Pipes & Foundries(under suspension of work)
P.O Adcconagar,Bansberia, Dist.Hooghly, West Bengal-712121 Phone +9133-2634-6465
“Industry House”, 12th Floor 10, Camac Street,Kolkata-700017
Phone +9133-2282-2476 Fax +9133-2282-9370
Run under the name & style of - Kesoram Spun Pipes & Foundries
Heavy Chemicals(under suspension of work)
19, B. T. Road, Khardah, P.O. Balaram Dharma Sopan, Kolkata-700116
Phone +9133-2553-2879/5183 Fax +9133-2553-3860/2583-9218 E-mail:email@example.com
“Industry House” 10, Camac Street,Kolkata-700017
Run under the name & style of - Hindusthan Heavy Chemicals
Address for Correspondence For routine matters:
For any assistance regarding share transfers and transmissions, change of address, non-receipt of dividend, duplicate / missing Share Certificates, demat and other matters, investors are welcome to get in touch with the Share Department of the Company at the address given below:
Kesoram Industries Ltd.
9/1, R. N. Mukherjee Road Kolkata-700001
Phone No. +91 33 2210-1545 Fax No. +91 33 2210-9455 E-mail :firstname.lastname@example.org
Registrar & Share Transfer Agents :
(Unit: Kesoram Industries Ltd.) 77/2A, Hazra Road, Kolkata-700 029
Phone Nos.: +91 33 2454-1892/1893 Fax No.: +91 33 2454-1961
E-mail : email@example.com
For Redressal of Complaints and Grievances:
The Secretary Telephone Nos. +91 33 2243-5453, 2242-9454/2248-6607
Kesoram Industries Limited Fax No.+91 33 2210-9455
Birla Building E-mail : firstname.lastname@example.org
9/1, R.N. Mukherjee Road Kolkata-700001
Compliance Certificate of the Auditors
The Company has obtained a Certificate from a practising Company Secretary confirming that it is in compliance with the conditions of Corporate Governance as stipulated in Clause 49 of the Listing Agreement.
B. K. Birla Chairman
K. C. Jain Whole-time Director
Gautam Ganguli Company Secretary
K. G. Maheshwari
P. K. Choksey
P. K. Mallik
Manjushree Khaitan Vinay Sah
K. P. Khandelwal
Date : 28th April, 2012