Reserve Bank of India vide their Circular dated May 08, 2007 and July 11, 2007 have issued guidelines on Corporate Governance to non – deposit taking NBFC's with an asset size of Rs. 100 crore or above in order to enable the adoption of best practices and greater transparency in their operations. In view of the above RBI Guidelines, the Company lays down the following set of guidelines / corporate governance practices to create value for the stakeholders viz. the shareholders, employees, customers, society at large etc
(a) The affairs of the Company shall be conducted with integrity, fairness, accountability and transparency. All commitments in its dealings with stakeholders and regulatory authorities shall be met.
(b) Composition of Board of Directors : The Board of Directors of the Company shall have an optimum mix of executive and non-executive directors with the right element of independence on the Board.
(c) Constitution of various Committees : With the objective of attaining accountability, transparency and fairness, following Committees shall be specifically constituted by the Board for the below mentioned purposes to act in accordance with terms of reference specified by the Board:
(i) Audit Committee of the Board to review the company's financial management policies, adequacy of internal control systems and internal audit system, review the annual financial statements with the Management and Auditors, review of the risk management policies, procedures and risk reporting mechanisms, parameters of trading, counterparty/ instrument –wise exposure limits, compliance with the approved / statutory risk polices, procedures, parameters or other risk related matters. The Audit Committee shall comprise of minimum three directors of which majority shall be non-executive directors.
(ii) Asset Liability Management Committee (ALCO) & Risk Management Committee to attend all issues relating to Asset Liability Management, ensuring adherence to the Risk Management Polices approved by the Board / Committees of the Board; drafting of Risk Management Policies on risks associated with the Company's business for approval of the Board etc.
(iii) Management Committee help the Managing Director in decision making by acting as a co-ordination committee of the various departments of the Company. It would deliberate on any matter which has a bearing on the Company's operations and would function as a forum to elicit inputs from all the departmental heads and keep all the departmental heads aware of issues.
(d) Periodicity of the Meetings of Board and Committees: The Board and the Audit Committee shall meet atleast, four times at quarterly intervals and more frequently, if deemed necessary to conduct its business.The ALCO & Risk Management Committee and the Equity Market Committee would met once in a fortnight. The Management Committee would meet once in a month and the Primary Market Committee would meet as when auction is conducted by RBI.
(e) Periodic reporting to Board / Committee thereof: The Company shall place before the Board at quarterly intervals, a report on Review of Business, Internal Audit reports, Risk Review Reports etc. The Company shall also place at regular intervals a Statutory Compliance Certificate in regard to the compliance of the various laws as applicable to the Company.
(f) Connected Lending Relationships: The Company shall comply with the RBI Instructions on lending to Directors, their relatives or Directors of other Companies and their relatives and other entities.
(g) Whistleblower Policy : Clause 49 of the Listing Agreement between listed companies and the Stock Exchanges has been recently amended which, inter alia, provides for a non-mandatory requirement for all listed companies to establish a mechanism called 'Whistle Blower Policy' for employees to report to the management instances of unethical behaviour, actual or suspected, fraud or violation of the Company's code of conduct or ethics policy.
The Company shall be committed to the integrity and fairness of it's own and its Employees. This is relied upon by our shareholders, the financial markets and other stakeholders. The Company, therefore, has a duty to ensure that there is an adequate mechanism to address any complaints related to questionable practices, internal controls, auditing matters, or the reporting of all information to the shareholders, the government or the financial markets. Accordingly, this Whistle Blower Policy has been formulated with a view to provide a mechanism for employees of the Company to approach the Management/Audit Committee of the Company. Such a mechanism should allow for disclosure by employees internally of such matters without fear of reprisal, discrimination or adverse employment consequences as also address their correction and disciplining of those responsible.
Every employee of the Company shall promptly report to the management any actual or possible violation of the Code or an event he becomes aware of that could affect the business or reputation of his or any other group Company."
REPORTING RESPONSIBILITY & INVESTIGATION :
All Protected Disclosures should be addressed to the Principal Officer or Chairman of the Audit Committee of the Company. The contact details of the Principal Officer/ Chairman of the Audit Committee are as under:
Audit Committee Chairman : Shri D Basu, dbasu@stcionline.com |
