INDIAN RAYON AND INDUSTRIES LIMITED - Aditya Birla Nuvo, Ltd

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Corporate Governance DisclosuresMandatory Recommendations Complied AlreadyØØØØØØ22123The SEBI Committee on Corporate Governance, headed by Mr Kumar Mangalam Birla, submitted its report in November 1999 and thereport was accepted by SEBI in December 1999. The recommendations of the Committee are mandatory for some companies effectivefrom current financial year, including your company. Ahead of the mandatory deadline, from the financial year 1999-2000 onwards,your company had endeavoured to benchmark itself with the guidelines recommended by the SEBI Committee. We continue thisprocess forward even during the year and are glad to inform you that the Company has complied in all material respects themandatory recommendations made by the SEBI Committee, as highlighted in this section.1. The Board should have an optimum combination of executive and non-executive directors and at least 50% of the Board shouldcomprise of non-executive directors. Further, at least one-third of the Board should comprise of independent directors whereChairman is non-executive and at least half of the Board should be independent in case of an executive Chairman.The Board consists fully of non-executive and independent directors, with considerable experience in their respective fields.Independent directors account for 50% of the Board at present and they have no business and/or professional relationshipwith the Company, its promoters, its management and its subsidiaries.2. The Board should set up a committee under the chairmanship of a non-executive/independent director to specifically look intoshareholder issues including like share transfer and redressing of shareholder complaints.Indian Rayon has an Investor Relations & Finance Committee at the Board level. The Committee comprises of Mr P. Murari(Chairman of the Committee), Mr B.L.Shah and Mr H.J.Vaidya, all of whom are Non-executive/Independent directors of theCompany.The Committee meets at frequent intervals to look after the approval of share transfers and other related matters.3. To expedite the process of share transfers, the Board should delegate the power of share transfer to an officer or a committee or to theregistrar and share transfer agents. The delegated authority should attend to share transfer formalities at least once in a fortnight.The Company’s shares are compulsorily traded in the dematerialised form and have to be delivered in the dematerialisedform in all Stock Exchanges. To expedite the transfer process in the physical segment, authority has been delegated to theShare Transfer Committee. Officers of the Company have been authorised to approve transfers of up to 5,000 shares/debentures each in physical form under one transfer deed.The Board has designated the Company Secretary as the Compliance Officer.Details of shareholders complaints received, number of shares transferred as well as average time taken for effecting thesetransfers are highlighted in the “Shareholder Information” section of the Annual Report.4. The Corporate Governance Section of the Annual Report should make disclosures on remuneration paid to directors in all formsincluding salary, benefits, bonuses, stock options, pension and other fixed as well as performance linked incentives paid to theDirectors.Details of remuneration paid to the Directors are highlighted at the beginning of this section. Indian Rayon has a policy ofnot paying commission on profits to any director of the Company.
5. The Board meetings should be held at least four times in a year, with a maximum time gap of four months between any twomeetings and all information recommended by the SEBI Committee should be placed at the Board.ØThe Board of Indian Rayon met 5 times during the year, as detailed aforesaid. The gap between any two meetings was notmore than 3½ months. Agenda papers were circulated to the members well in advance of each meeting. The Companyplaces before the Board the working of all divisions and statements containing status of various matters pursuant toCorporate Governance practices as recommended by the SEBI Committee on Corporate Governance and as required byClause 49 of the Stock Exchange Listing Agreement.6. As part of disclosures related to the Management, the Company should, in addition to the Director’s Report, provide a detailedManagement’s Discussion and Analysis in its Annual Report to shareholders.ØFrom 1998-99 onwards, the Company has been providing a detailed Management’s Discussion and Analysis in its AnnualReport.7. All company related information like quarterly results, presentation made by Companies to analysts may be put on company’sweb-site or may be sent in such a form so as to enable the stock exchange on which the company is listed to put it on its ownweb-site.ØIndian Rayon makes presentation to investors and analysts following the announcement of quarterly results. A copy of thePress Release and Presentations made to analysts are made available on the web-site of the Company (www.indianrayon.com)as well as of the Aditya Birla Group (www.adityabirla.com).8. There should be a separate section on Corporate Governance in the Annual Report, with details on the level of compliance by theCompany. Non-compliance of any mandatory recommendation with reasons thereof and the extent to which the non-mandatoryrecommendations have been adopted should be specifically highlighted.ØIndian Rayon introduced a separate section on Corporate Governance in its Annual Report for the year 1999-2000 and thepractice has been continued even during the year under review.9. The Non-Executive Chairman of the Company should be entitled to maintain an office at the Company’s expense and alsoallowed reimbursement of expenses incurred in performance of his duties. This will enable him to discharge the responsibilitieseffectively. (This is a non-mandatory recommendation)ØAt present, the Chairman does not have separate office in the Company. The Corporate Finance Division of the Companysupports the Chairman in discharging the responsibilities.10. A qualified and an independent “Audit Committee” should be set up by the Board. This would go a long way in enhancing thecredibility of the financial disclosures of a company and promoting transparency.ØIndian Rayon has an active Audit Committee, comprising of the following Independent/Non-Executive Directors:-(1) Ms Tarjani Vakil, Chairperson — Ex-Chairperson and Managing Director of Exim Bank.(2) Mr P. Murari, Member — IAS (Rtd.).(3) Mr B.R. Gupta, Member — Ex-Executive Director of Life Insurance Corporation of India.23
Page 1 and 2: BOARD OF DIRECTORSShri Kumar Mangal
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Page 11 and 12: Benefiting from the shifting focus
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Page 15 and 16: Outlook for Indian Rayon’s Insula
Page 17 and 18: Net ProfitNet Profit has gone up fr
Page 19 and 20: Birla Sunlife Insurance Company Ltd
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Page 29 and 30: Environment ReportENVIRONMENTAL PRO
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Page 67 and 68: REVENUE ACCOUNTFor the period 4th A
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Tax ProvisionThe tax provision as o
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MANAGEMENT REPORTIn accordance with
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BALANCE SHEETAs at 31st March, 2001
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STATEMENT PURSUANT TO SECTION 212 O
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BALANCE SHEETAs at 31st March, 2001
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Shareholder Information1. Annual Ge
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Relative Performance: Indian Rayon
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15. Categories of Shareholding as o
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