REPORT ON CORPORATE GOVERNANCE
1. GOVERNANCE PHILOSOPHY
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.
2. BOARD OF DIRECTORS
Composition of the Board, Directorships & Committee positions held in other Companies and shares held as on 31st March, 2015:
The following persons are/were related as per the provisions of the Act:
(i) Basant Kumar Birla and Manjushree Khaitan;
(ii) Basant Kumar Birla and Krishna Gopal Maheshwari.
Attendance of Directors at Meetings held during the Financial Year 2014 - 15
Six Board Meetings were held during the Financial Year ended 31st March, 2015 - on 29th April, 2014, 26th June, 2014, 8th July, 2014, 8th August, 2014, 14th November, 2014 and 12th February, 2015.
No Commission was paid to the Directors during the Financial Year 2014 - 15.
Kamal Chand Jain was appointed a Whole-time Director at the Annual General Meeting held on 11th July, 2012 for a period of three years. His term expired as at close of business on 31st March, 2015. His appointment has been further renewed by the Board for a further period of one year effective 1st April, 2015. A Special Resolution seeking Members' approval for his re-appointment has been included in the Notice convening the Ninety-sixth Annual General Meeting.
The above remuneration being within the limits set out in Section II of Part II of Schedule V of the Act, a Special Resolution seeking Members' approval for his appointment and remuneration has been included in the Notice convening the Ninety-sixth Annual General Meeting.
Apart from the above, no other pecuniary relationships (including stock options) or transactions vis-a-vis the Company exists with any Director.
Code of Conduct
The Company has a Code of Conduct applicable to all Board Members and Senior Management staff for avoidance of conflict of interest between each of these individuals and the Company. Each Board Member and Senior Management staff have declared their compliance with the Code of Conduct as at 31st March, 2015. There were no materially significant transactions during the Financial Year with Board Members and Senior Management, 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.
3. AUDIT COMMITTEE
Terms of Reference
The Audit Committee has been mandated with the same terms of reference as specified in Clause 49 of the Listing Agreement. The terms of reference also conform to the requirements of Section 177 of the Act.
Composition, Names of Members and Chairman
As on 31st March, 2015 the Audit Committee had seven non-Executive Independent Directors as Members with Pesi Kushru Choksey as the Chairman of the Committee.
Four Meetings were held during the Financial Year ended 31st March, 2015 on 29th April, 2014, 8th August, 2014, 14th November, 2014 and 12th February, 2015.
The quorum for an Audit Committee Meeting is two Members personally present. The Company Secretary acts as the Secretary to the Audit Committee.
The following were invited to Audit Committee Meetings:
a) the Statutory Auditors.
b) the Internal Auditors.
c) the Cost Auditors, as and when necessary.
d) Kamal Chand Jain, Whole-time Director; Arvind Kumar Singh, Chief Executive Officer-Business Operations; Tridib Kumar Das, Chief Financial Officer; Uma Shankar Asopa, Chief of Treasury and Accounts and Suresh Sharma, Chief-Secretarial & Investor Services.
Pesi Kushru Choksey, Amitabha Ghosh and Kashi Prasad Khandelwal, Members of the Committee are senior Chartered Accountants with expert knowledge in finance, accounting and audit. Vinay Sah is a senior executive of the Life Insurance Corporation of India. Lee Seow Chuan is a fellow member of the Association of International Accountants, UK. Sudip Banerjee is an Honours graduate in Economics and holds a Management Diploma from the All India Management Association. All Members of the Committee are therefore financially literate.
The Chairman of the Audit Committee attended the last Annual General Meeting ("AGM") held on 8th July, 2014.
4. NOMINATION AND REMUNERATION COMMITTEE
The name of the Remuneration Committee was changed to Nomination and Remuneration Committee as per the provisions of Section 178 of the Act and Clause 49(IV) of the Listing Agreement. As on 31st March, 2015, the Nomination & Remuneration Committee consisted of four Members, two Non-executive Independent Directors viz. Pesi Kushru Choksey and Kashi Prasad Khandelwal, nominee Director Vinay Sah and the Executive Vice Chairperson, Manjushree Khaitan as Members.
The Committee met five times during the Financial Year 2014-15 on 29th April, 2014, 8th July, 2014, 8th August, 2014, 14th November, 2014 and 12th February, 2015. Pesi Kushru Choksey chaired these Meetings.
The terms of reference of the Nomination and Remuneration Committee traverses the areas covered under Clause 49(IV) of the Listing Agreement and Section 178 of the Act.
The Nomination and Remuneration Policy: This Policy formulated and recommended by the Committee to the Board was approved on 29th April, 2015. The Policy is attached as Annexure III to the Directors' Report.
The performance of individual Board Members was subject to peer evaluation during the Financial Year based upon, amongst other parameters attendance, contribution to Meetings, participation and exercise of independent judgment.
5. STAKEHOLDERS' RELATIONSHIP COMMITTEE
At its Meeting held on 29th April, 2014, the Board constituted a Stakeholders Relationship Committee. The terms of reference of this Committee are as envisaged in the Companies Act as well as Clause 49 of the Listing Agreement.
The Committee met three times during the Financial Year 2014-15 on 8th July, 2014, 14th November, 2014 and 12th February, 2015. Amitabha Ghosh chaired these Meetings.
The terms of reference of the Committee cover all the areas as mentioned under Clause 49(VIII)(E)(4) of the Listing Agreement and Section 178 of the Companies Act, 2013.
6. CORPORATE SOCIAL RESPONSIBILITY COMMITTEE
As required under Section 135 of the Act, a Corporate Social Responsibility Committee was constituted on 29th April, 2014 with Amitabha Ghosh, Kamal Chand Jain as Members and Manjushree Khaitan as the Chairperson. The terms of reference of this Committee are aligned with the requirements of Section 135 of the Act.
7. SEPARATE MEETING OF INDEPENDENT DIRECTORS
As per stipulations in Section VII of the Code for Independent Directors in Schedule IV of the Act and as per the Listing Agreement, a separate Meeting of the Company's Independent Directors was held on 12th February, 2015.
8. FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS
The familiarisation programme for independent Directors is available on the website of the Company under the weblink<http://www>. kesocorp. com/DOCS/management corner.php#slide__5.
9. COMPLIANCE OFFICER
Gautam Ganguli, Company Secretary, is the Compliance Officer under the Listing Agreement and other applicable SEBI Regulations and Rules.
10. DISCLOSURES IN RELATION TO THE APPOINTMENTS AND RE- APPOINTMENTS OF DIRECTORS
As required under Clause 49(VIII)(E)(1) of the Listing Agreement, brief profiles of Vinay Sah, Lee Seow Chuan, Kamal Chand Jain and Amolak Preet Singh are appended :
i) Vinay Sah (Non- Executive Nominee Director) DIN 02425847 : Vinay Sah was appointed a Director on 3rd November, 2011. He is 56 years of age and is nominated by Life Insurace Corporation of India. He holds a Masters degree in Statistics from Lucknow University, India. He is also the Executive Director (Mktg./PD) of Life Insurance Corporation of India, Western Zone, Mumbai. He has more than 30 years of experience in the fields of insurance and management. He holds no other Directorships and holds no shares in the Company.
ii) Lee Seow Chuan (Non-Executive Independent Director) DIN 02696217: Lee Seow Chuan was appointed an Additional Director on 8th August, 2014. He is 67 years of age and a Singapore national. A reputed finance professional and a fellow member of the Association of International Accountants, UK, he has spent over two decades managing the finances of the Dairy Farm Group, the last eleven years being as South Asia Finance Director of one of the Group's key Companies. He holds no other Directorship and holds no shares in the Company.
(iii) Kamal Chand Jain (Whole-time Director) DIN 00029985: Kamal Chand Jain was appointed a Whole-time Director for three years effective 1st April, 2012. Upon the expiry of his tenure, he was re-appointed a Whole-time Director for a further period of one year effective 1st April, 2015. He is 76 years old with a Bachelors degree in Commerce. He is also a Member of The Institute of Chartered Accountants of India. With over 50 years of experience he has spent much of his work career in the Company's cement business. Both the Company's cement plants owe their origin to him. He is a Director of Mangalam Cement Limited and Gondhkari Coal Mining Limited. He is also a Member of the Audit Committee, Share Transfer Committee, Stakeholders Relationship Committee and Risk Management Committee of Mangalam Cement Limited. He has no shareholding in the Company.
iv) Amolak Preet Singh (Whole-time Director) DIN 07019247: Amolak Preet Singh was appointed a Whole-time Director of the Company for a period of three years effective 1st December, 2014. He ceased employment with the Company effective close of business hours 14th January, 2015. He is 48 years of age and is a qualified Engineer with a Masters in Business Administration. He began his career with Bajaj Auto Limited, moving thereafter to Kennametal India. After spending several years with this Company, he relocated to Singapore and joined Leitz Tooling Asia. As the Managing Director of Leitz Tooling, he has overseen operations in Australia, New Zealand, China, Korea, Taiwan as well as the ASEAN countries. He holds no shares in the Company.
1. The Audit Committee in its Meeting held on 8th August, 2014 has approved the Related Party Transaction Policy which is placed on the website of the Company. The weblink is <http://www.kesocorp.com/DOCS/> management_corner.php# slide_5.
2. Transactions with Related Parties, as per requirements of Accounting Standard 18, are disclosed in the Notes to Accounts annexed to the Financial Statements. There are no materially significant transactions with Related Parties viz. Promoters,
Directors or the Management or their relatives or Subsidiaries that had potential conflict with the Company's interest. Appropriate disclosure as required by the Accounting Standard (AS 18) has been made in the Annual Report. Particulars of Related Party Transactions in terms of Section 188(1)(b) read with Section 134(3)(h) of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014 in Form AOC 2 has been disclosed in the Directors' Report.
3. The Company has complied with all relevant Accounting Standards notified by the Companies (Accounting Standards) Rules, 2006 while preparing the Financial Statements.
4. There are/were no pecuniary relationships or transactions of Non-Executive Directors vis-a-vis the Company which has or could have potential conflict with the interests of the Company at large.
5. The Company has complied with all requirements of the Listing Agreement as well as the regulations and guidelines prescribed by the Securities and Exchange Board of India ("SEBI") except for non-submission of audited financial results for the financial year ended 31st March, 2015 under Clause 41(I)(d) and unaudited quarterly results for the quarter ended 30th June, 2015 under Clause 41(I)(c) of the Listing Agreement with the Stock Exchanges. The Company has paid penalties levied by the Stock Exchanges owing to its inability to file Audited Financial Results with the Stock Exchanges within 30th May, 2015. The Company's shares have been presently moved by the Stock Exchanges to the trade to trade category. No other penalties or strictures have been imposed on the Company by Stock Exchanges or SEBI or any statutory authority on any matter related to capital markets during the last three years.
6. The Company has in place a mechanism to inform Board Members about risk assessment and mitigation plans and periodical reviews to ensure that critical risks are controlled by the executive management. No Risk Management Committee has been constituted since this is not mandated for the Company under the Listing Agreement.
7. As at close of business 31st March, 2015, the Company had a material unlisted subsidiary. The Policy on Material Subsidiaries is available on the Company's website for which the web link is <http://www.kesocorp.com/DOCS/> management_corner.php# slide_5.
8. Independent Directors have confirmed to the Company that they meet the criteria of 'Independence' as stipulated under Clause 49 of the Listing Agreement.
9. The Company has adopted a Whistle Blower Policy that has been placed on the website of the Company at the weblink
http://www.kesocorp.com/DOCS/management_corner.php#slide_5 <http://www.kesocorp.com/DOCS/management_corner.php%23slide_5>. The Policy contains guidelines to be followed by whistle blowers.
10. The status of compliance with non-mandatory recommendations of the Clause 49 of the Listing Agreement with Stock Exchanges is provided below:
a) Non-Executive Chairman's Office: The Non-Executive Chairman maintains an office at the Company's Head Office.
b) Shareholders' Rights: As the quarterly and half yearly financial performance are published in the news papers and are also posted on the Company's website, the same are not being sent to the shareholders.
c) Audit Qualifications: The Company's financial statement for the year 2014-15 does not contain any audit qualification.
d) Separate posts of Chairman and CEO: The Chairman of the Board is a Non-executive Director and his position is separate from that of the CEO.
e) Reporting of Internal Auditor: The Internal Audit Team reports to the Audit Committee.
12. MEANS OF COMMUNICATION
(i) 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 / filed with the Stock Exchanges where the Company's shares are listed and then published in various leading national newspapers, viz. Financial Express / Business Standard (English - all editions) and Dainik Statesman / Ekdin (Bengali editions). 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.
The quarterly Unaudited Financial Results and the Annual Financial Results along with the Report on Segment Revenue, Results and Capital Employed, Balance Sheet, 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 www.kesocorp.com .
(II) Management Discussion and Analysis
The Management Discussion and Analysis, as reviewed by the Audit Committee, is part of this Annual Report.
13. GENERAL SHAREHOLDER INFORMATION
• Next AGM
Time 11.00 A.M.
Date 12th December, 2015
Venue “Kala-Kunj”, 48, Shakespeare Sarani, Kolkata-700 017
• The Company's Financial Year
The Financial Year of the Company is from 1st April to 31st March.
• Date of Book Closure
6th December, 2015 to 12th December, 2015 (both days inclusive)
• Stock Exchange related information
a. Listing on Stock Exchanges:
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-700 001
Societe de la Bourse de Luxembourg, Societe Anonyme/R.C.B.6222, B.P.165, L-2013 Luxembourg (for GDRs)
Privately-placed Secured Redeemable Non-Convertible Debentures
BSE Limited("BSE"), Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai- 400 001
i) Equity Shares
Luxembourg Stock Exchange 492532205
ii) Secured Redeemable Non-Convertible Debentures (privately placed)
There are no arrears in payment of Listing Fees.
c. ISIN No. for the Company's Listed Securities
Equity Shares in Demat Form INE087A01019
Secured Redeemable Non-Convertible Debentures (privately placed) INE087A07644
National Securities Depository Limited and Central Depository Services (India) Limited.
Registrar and Share Transfer Agent:
MCS Share Transfer Agent Limited
(Unit: Kesoram Industries Ltd.)
12/1/5, Manoharpukur Road, Kolkata -700 026
Phone Nos.: +91 33 40724051 to 54 Fax No.: +91 33 40724050 E-mail: email@example.com
Share Transfer System
Subject to documentation being in order, transfer requests of Equity Shares in the physical form lodged with the Share Department of the Company/Registrar and Share Transfer Agent are processed no later than fifteen days from the date of receipt. Individual share transfer requests in physical form are dealt with and approved at the level of Company Executives.
j. Dematerialisation and Rematerialisation
Requests for Dematerialisation and Rematerialisation should be sent either to the Company's Registrar and Share Transfer Agent or to the Share Department of the Company at Birla Building, 8th Floor, 9/1, R N Mukherjee, Road, Kolkata-700 001.
k. Dematerialisation of shareholding
The Company's Equity Shares are compulsorily traded in dematerialised form. 10,83,08,215 Equity Shares of the Company representing 98.67% of the total Equity Shares issued were held in dematerialised form as on 31st March, 2015. Investors have an option to dematerialise their Equity Shares either with National Securities Depository Limited or Central Depository Services (India) Limited.
l. Outstanding GDRs
70,41,875 Equity Shares of the Company were held as Global Depository Receipts as on 31st March, 2015.
m. Insider Trading
The Code of Internal Procedure & Conduct under the SEBI (Prohibition of Insider Trading) Regulations, 2015, has been effective 15th May, 2015 and the Company has implemented the same.
n. Plant Locations
Factory Location Sedam, Dist. Gulbarga Karnataka-585222
Phone: +91-8441-276005/277403 Fax: +91-8441-276139 E-mail: firstname.lastname@example.org
Section Storage and Packing
Unit: T-3 MIDC Chincholi, Taluk: Mohal Solapur-413255, Maharastra State Phone : +91-217-2357060
City Office 613 to 616, White House, Block III, 6th Floor, 6-3-1192/1/1, Kundanbagh, Begumpet, Hyderabad - 500016 (Telangana)
Phone : +91-40-43344555 Fax: +91-40-43344534
Run under name & style of Vasavadatta Cement
Basantnagar, Dist. Karimnagar Andhra Pradesh-505187
Phone : +91-8728 -228152/228121 Fax: +91-8728-228160 E-mail: email@example.com
613 to 616, White House, Block III, 6th Floor, 6-3-1192/1/1, Kundanbagh, Begumpet, Hyderabad - 500016 (Telangana)
Phone : +91-40-43344555 Fax: +91-40-43344534
Run under name & style of Kesoram Cement
Section Automobile Tyres and Tubes
Factory Location At/P.O. Chhanpur, Via. Kuruda, Dist. Balasore, Odisha, Pin-756056
Phone: +91-6782-255259/780/620 Fax: +91-6782-255225 E-mail: btbls@ birlatyres.org
City Office 7th Floor, Birla Building 9/1, R. N. Mukherjee Road, Kolkata-700001
Phone: +91-33-2262 4411-13, +91-33-22624355-57. Fax: +91-33-2262 4359 E-mail:ho@birlatyre. Com
Run under name & style of Birla Tyres
Section Rayon & Transparent Paper
Factory Location P.O. Nayasarai, Rly. Station: Kuntighat, On Howrah-Katwa Route, Dist. Hooghly, West Bengal-712513
Phone: +91-33-26846431-34 Fax : +91-33-26846461 E-mail: firstname.lastname@example.org
City Office "Industry House", 11th Floor 10, Camac Street, Kolkata-700017
Phone: +91-33-22824721-24 Fax: +91-33-22828879 E-mail: email@example.com
Run under name & style of Kesoram Rayon
Section Spun Pipes & Foundries (under suspension of work)
Factory Location P.O. Adcconagar, Bansberia, Dist. Hooghly West Bengal-712121 Phone: +91-33-26346465
City Office "Industry House", 10, Camac Street, Kolkata-700017 Phone : +91-33-22822476 Fax: +91-33-22829370
Run under name & style of Kesoram Spun Pipes & Foundries
Section Heavy Chemicals (under suspension of work)
Factory Location 19, B. T. Road, Khardah, P.O. Balaram Dharma Sopan, Kolkata-700116 Phone : +91-33-25535183
City Office "Industry House", 10, Camac Street, Kolkata-700017
Run under name & style of Hindustan Heavy Chemicals
o. Address for Correspondence
(a) For routine matters:
Any assistance regarding share transfer and transmission, change of address, non-receipt of dividend, duplicate / missing Share Certificate, 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 Limited 8th Floor, Birla Building 9/1, R. N. Mukherjee Road, Kolkata-700 001 Phone No.: +91-33-22101545 Fax No.: +91-33-22109455 E-mail :firstname.lastname@example.org
Registrar and Share Transfer Agent:
M/s. MCS Share Transfer Agent Limited (Unit: Kesoram Industries Ltd.) 12/1/5, Manoharpukur Road, Kolkata 700 026 Phone Nos.: +91-33-40724051 to 4054 Fax No.: +91-33-40724050 E-mail: email@example.com
For Redressal of Complaints and Grievances:
The Company Secretary Kesoram Industries Limited 8th Floor, Birla Building 9/1, R. N. Mukherjee Road Kolkata-700001.
Telephone Nos. +91 -33-22435453,+91-3 3 -22429454+91-33-22135121
Fax No. : +91-33-22109455
E-mail : firstname.lastname@example.org
15. CERTIFICATE FROM CHIEF EXECUTIVE OFFICER-BUSINESS OPERATIONS / WHOLE-TIME DIRECTOR (WTD) AND CHIEF FINANCIAL OFFICER (CFO)
A Certificate has been issued by the CEO/WTD and CFO as required under Clause 49(IX) of the Listing Agreement.
16. COMPLIANCE CERTIFICATE FROM A PRACTISING COMPANY SECRETARY
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.
Kamal Chand Jain Whole-time Director
Arvind Kumar Singh CEO - Business Operations
Tridib Kumar Das Chief Financial Officer
Gautam Ganguli Company Secretary
Manjushree Khaitan Executive Vice Chairperson
Kashi Prasad Khandelwal Directors
Sudip Banerjee Directors
Date : 19th October, 2015