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Policy
PREAMBLE:

With the notification of Section 135 of the Companies Act, 2013 read with Companies (Corporate Social Responsibility Policy) Rules, 2014 every company having net worth of rupees five hundred crore or more, or turnover of rupees one thousand crore or more or a net profit of rupees five crore or more during any financial year shall constitute a Corporate Social Responsibility Committee of the Board consisting of three or more directors, out of which at least one director shall be an independent director.

The said Corporate Social Responsibility Committee shall formulate a policy on Corporate Social Responsibility Policy to the Board for adopting the same by the Board.

The Company, which is required to constitute a Corporate Social Responsibility Committee as state in Section 135 of the Companies Act, 2013 shall spend in every financial year atleast 2% of the average net profits of the Company made during three immediately preceding financial years. The amount of 2% as specified above shall be spent strictly as per the Corporate Social Responsibility Policy as approved by the Board in accordance with the recommendations received from the Corporate Social Responsibility Committee, duly constituted under Secretion 135 of the Companies Act, 2013.

PHILOSOPHY:

For Pennar Industries Limited (hereinafter referred to as “Pennar”) Corporate Social Responsibility is not just a statutory requirement under the Companies Act, 2013 but Pennar recognises it as (CSR) its responsibility towards the society as a good corporate house.

Corporate Social Responsibility is strongly connected with the principles of Sustainability; an organization should make decisions based not only on financial factors, but also on the social and environmental consequences. Therefore, it is the core corporate responsibility of Pennar to practice its corporate values through its commitment to grow in a socially and environmentally responsible way, while meeting the interests of its stakeholders.

Pennar recognizes that its business activities have wide impact on the society in which it operates, and therefore an effective practice is required giving due consideration to the interests of its stakeholders including shareholders, customers, employees, suppliers, business partners, local communities, and society at large. Pennar endeavours to make CSR a key business process for sustainable development. Pennar is responsible to continuously enhance shareholders wealth; it is also committed to its other stakeholders to conduct its business in a more accountable manner that creates a sustained positive impact on society. Pennar is committed towards aligning with nature; and has adopted eco-friendly practices.

Pennar believes that in the strategic context of business, enterprises possess, beyond mere financial resources, the transformational capacity to create game-changing development models by unleashing their power of entrepreneurial vitality, innovation and creativity. Such Corporate Social Responsibility ("CSR") projects are replicable, scalable and sustainable, with a significant multiplier impact on sustainable livelihood creation and environmental replenishment. These initiatives are independent of the normal conduct of Pennar’s business. Programmes, projects and activities (collectively “CSR Programmes”) carried out in this regard are the subject matter of this Policy.

As a corporate entity, Pennar is committed towards sustainability. Ongoing dialogues with shareholders provide valuable approach with an objective that each business decision takes into account it’s social and environmental impacts.

The activities under Schedule VII of the Companies Act, 2013 as amended from time to time are as follows:-

  • eradicating hunger, poverty and malnutrition, promoting health care including preventive health care and sanitation including contribution to the Swach Barat Kosh set-up by the Central Government for the promotion of sanitation and making available safe drinking water:
  • promoting education, including special education and employment enhancing vocation skills especially among children, women, elderly, and the differently abled and livelihood enhancement projects;
  • promoting gender equality, empowering women, setting up homes and hostels for women and orphans; setting up old age homes, day care centres and such other facilities for senior citizens and measures for reducing inequalities faced by socially and economically backward groups;
  • ensuring environmental sustainability, ecological balance, protection of flora and fauna, animal welfare, agro forestry, conservation of natural resources and maintaining quality of soil, air and water including contribution to the Clean Ganga Fund set-up by the Central Government for rejuvenation of river Ganga;
  • protection of national heritage, alt and culture including restoration of buildings and sites of historical importance and works of art; setting up public libraries; promotion and development of traditional arts and handicrafts:
  • measures for the benefit of armed forces veterans, war widows and their dependents;
  • training to promote rural sports, nationally recognised sports, paralympic sports and Olympic sports;
  • contribution to the P me Minister's National Relief Fund or any other fund set up by the Central Government for socio-economic development and relief and welfare of the Scheduled Castes, the Scheduled Tribes, other backward classes, minorities and women;
  • contributions or funds provided to technology incubators located within academic institutions which are approved by the Central Government;
  • rural development projects;
  • slum area development.

IMPLEMENTATION:

The Investment in the Corporate Social Responsibility activity shall be as determined by the Board from time to time on the recommendation of the Corporate Social Responsibility Committee.

The Board can undertake the Corporate Social Responsibility activities as approved by the Corporate Social Responsibility Committee on its own, through registered trust, through registered society or through any other form/means as may allowed under the applicable laws.

GOVERNANCE:

Every year, the Corporate Social Responsibility Committee will place for the Board's approval, a Corporate Social Responsibility Plan delineating the Corporate Social Responsibility Programmes to be carried out during the financial year. The Board will consider and approve the Corporate Social Responsibility Plan with any modification that may be deemed necessary. However the Board is empowered to make changes to such Corporate Social Responsibility Plan from time to time at the recommendation of the Corporate Social Responsibility Committee.

The Corporate Social Responsibility Committee will assign the task of implementation of the Corporate Social Responsibility Plan and timeframes to such persons or bodies as it may deem fit.

The persons/bodies to which the implementation is assigned will carry out such Corporate Social Responsibility Programmes as determined by the Corporate Social Responsibility Committee and report back to the Corporate Social Responsibility Committee on the progress.

The Corporate Social Responsibility Committee shall review the implementation of the Corporate Social Responsibility Programmes once a quarter and issue necessary directions from time to time to ensure orderly and efficient execution of the Corporate Social Responsibility Programmes in accordance with this Policy.

Once in every six months the Corporate Social Responsibility Committee will provide a status update to the Board on the progress of implementation of the approved Corporate Social Responsibility Programmes carried out during the six month period.


CORPORATE SOCIAL RESPONSIBILITY EXPENDITURE

Corporate Social Responsibility expenditure will include all expenditure, incurred by the Company on Corporate Social Responsibility Programmes undertaken in accordance with the approved Corporate Social Responsibility Plan. Any income arising from Corporate Social Responsibility Programmes will be netted off from the Corporate Social Responsibility expenditure and such net amount will be reported as Corporate Social Responsibility expenditure.

BACKGROUND

As per Section 178 of the Companies Act, 2013 and Clause 49 IV of the of the listing Agreement every listed Company is required to Constitute a Nomination and Remuneration Committee comprising of atleast three directors all of whom shall be non-executive directors and atleast half shall be Independent and the Chairman of the Nomination and Remuneration Committee shall be an Independent Director. The said Nomination and Remuneration Committee shall set a policy to formulate criteria for determining qualifications, positive attributes and independence of a director and recommend to the Board a policy, relating to the remuneration of the directors, key managerial personnel and other employees, criteria for evaluation of Independent Directors and the Board and policy for Board diversity.

QUALIFICATIONS FOR APPOINTMENT OF DIRECTORS

Subject of the Companies Act, 2013 and all other applicable laws the Company while appointing its Directors shall consider the following:

  • The person to be appointed as Director shall bequalified to be appointed as directors.
  • The person to be appointed as Director should be a Person of eminence, standing and knowledge with significant achievements in business, professions and/or public service.
  • The person to be appointed as Director of the Company should possess requisite business literacy/skill.
  • The person to be appointed as Director should possess the requisite qualifications to perform his role and to meet the objectives of the Company.
  • The person to be appointed as Director should be able to adapt to changes in their industry and quickly make adjustments to operations if need be.
  • The person to be appointed as Director should be open to learning.
  • The person to be appointed as Director should possess requisite communication skills to execute his task as Director.
  • The person to be appointed as Director should possess effective leadership qualities.
  • The person to be appointed as Director should possess strong ethics and kindness to treat people with respect.

Additional requirements for Independent Directors:
  • in the opinion of the Board, is a person of integrity and possesses relevant expertise and experience;
  • is or was not a promoter of the company or its holding, subsidiary or associate company;
  • is not related to promoters or directors in the company, its holding, subsidiary or associate company;
  • apart from receiving director's remuneration, he should not have any material pecuniary relationship with the company, its holding, subsidiary or associate company, or their promoters, or directors, during the two immediately preceding financial years or during the current financial year;
  • none of his relatives shall have any pecuniary relationship or transaction with the company, its holding, subsidiary or associate company, or their promoters, or directors, amounting to two per cent. or more of its gross turnover or total income or fifty lakh rupees or such higher amount as may be prescribed, whichever is lower, during the two immediately preceding financial years or during the current financial year;
  • neither he nor his relative shall hold the position of a key managerial personnel or is or has been employee of the company or its holding, subsidiary or associate company in any of the three financial years immediately preceding the financial year in which he is proposed to be appointed;
  • neither he nor his relative has been an employee or proprietor or a partner of a firm of auditors or company secretaries in practice or cost auditors of the company or its holding, subsidiary or associate company; or any legal or a consulting firm that has or had any transaction with the company, its holding, subsidiary or associate company amounting to ten per cent or more of the gross turnover of such firm, in any of the three financial years immediately preceding the financial year in which he is proposed to be appointed.
  • he along with his relatives should not hold two per cent or more of the total voting power of the company.
  • neither he nor his relative should be a Chief Executive or director, by whatever name called, of any non-profit organisation that receives twenty-five per cent or more of its receipts from the company, any of its promoters, directors or its holding, subsidiary or associate company or that holds two per cent or more of the total voting power of the company
  • neither he nor his relative should be a material supplier, service provider or customer or a lessor or lessee of the company.

POSITIVE ATTRIBUTES OF DIRECTORS
  • Directors are to demonstrate integrity, credibility, trustworthiness, ability to handle conflict constructively, and the willingness to address issues proactively.
  • Actively update their knowledge and skills with the latest developments in the industry, market conditions and applicable legal provisions.
  • Willingness to devote sufficient time and attention to the Company’s business and discharge their responsibilities.
  • To assist in bringing independent judgment to bear on the Board’s deliberations especially on issues of strategy, performance, risk management, resources, key appointments and standards of conduct.
  • Ability to develop a good working relationship with other Board members and contribute to the Board's working relationship with the senior management of the Company.
  • To act within their authority, assist in protecting the legitimate interests of the Company, its shareholders and employees.

CRITERIA FOR APPOINTMENT OF KMP/SENIOR MANAGEMENT
  • Should possess the required qualifications, experience, skills & expertise to effectively discharge their duties and responsibilities.
  • Should practice and encourage professionalism and transparent working environment.
  • Should build teams and carry the team members along for achieving the goals/objectives and corporate mission.
  • Should adhere strictly to code of conduct laid down by the Company.

CRITERIA FOR EVALUATION OF INDEPENDENT DIRECTORS AND BOARD

INDEPENDENT DIRECTORS
  • How well prepared and well informed the Independent directors for board meetings?
  • Is the attendance of Independent directors at meetings satisfactory?
  • Do the Independent directors show willingness to spend time and effort learning about the company and its business?
  • Do the Independent directors willing to participate in events outside board meetings such as site visits?
  • What has been the quality and value of Independent director's contributions at board meetings?
  • What has been their contribution to the development of (i) Strategy and (ii) risk management?
  • How successfully the Independent directors brought their knowledge and experience to bear in the consideration of strategy?
  • How effectively the Independent directors probed to test assumptions?
  • Where necessary, how resolute are they in holding to their views and resisting pressure from others?
  • How effectively have they followed up matters about which they have expressed concern?
  • How good are their relationship with other board members, the company secretary and senior management?
  • How actively and successfully do they refresh their knowledge and skill?
  • Are they up-to-date with the latest developments in areas such as the corporate governance framework and financial reporting and in the industry and market conditions?
  • How well do they communicate with other board members, senior management and others?
  • Can they present their views convincingly, yet diplomatically?
  • Do they listen to the views of others?

BOARD OF DIRECTORS
  • How well has the board performed against any objective that was set?
  • What has been the contribution of the board to the development strategy?
  • What has been the contribution of the board to ensuring robust and effective risk management?
  • Is the composition of the board and its committees appropriate?
  • Do these have the right balance of knowledge and skills to maximize performance?
  • Are relationships inside and outside the board working effectively?
  • How has the board responded to any problems or crises that arose?
  • Could / should these have been foreseen?
  • Are the matters specifically reserved for the board the right ones?
  • How well does the board communicate with the management team, employees and others?
  • How effective is its use of the Annual General Meeting and the annual report?
  • Is the board as a whole up to date with the latest developments in the regulatory environment and the market?
  • How effective are the board's committees (for example, in their role, their composition and their interaction with the board)?
  • Does the board receive the right amount and quality of timely information?
  • How well does management respond to request from the board for clarification or additional information?
  • Do the board and the board committees hold enough meetings of suitable length to get through their business properly?
  • Is time used effectively?
  • Is board procedure flexible and is the conducive to effective performance?

EVALUATION OF PERFORMANCE

The performance evaluation of independent directors shall be done by the entire Board ofDirectors (excluding the director being evaluated).

The independent directors of the company shall hold at least one meeting in a year, without the attendance of non-independent directors and members of management. All the independent directors of the company shall strive to be present at such meeting.

The independent directors in the meeting shall, inter-alia:

  • review the performance of non-independent directors and the Board as a whole;
  • review the performance of the Chairperson of the company, taking into account the views of executive directors and non-executive directors;
  • assess the quality, quantity and timeliness of flow of information between the company management and the Board that is necessary for the Board to effectively and reasonably perform their duties.

DEVIATIONS FROM THIS POLICY

Deviations on elements of this policy in extraordinary circumstances, when deemed necessary in the interests of the Company, will be made if there are specific reasons to do so in an individual case.

REVIEW OF THIS POLICY

The Nomination Committee will review this Policy, as appropriate, to ensure the effectiveness of this Policy.


REMUNERATION POLICY

The Remuneration Policy of M/s. Pennar Industries Limited (the “Company”) is designed to attract, motivate and retain manpower in a competitive and international market. The policy reflects the Company's objectives for good corporate governance as well as sustained long-term value creation for shareholders.

The Remuneration Policy applies to the Company's senior management, including its Key Managerial Person and Board of Directors.

Guiding principles

The guiding principle is that the remuneration and the other terms of employment shall be competitive in order to ensure that the Company can attract and retain competent Executives.

- The remuneration policy for executives reflects the overriding remuneration philosophy and principles of the Company. When determining the remuneration policy and arrangements for Executive Directors/ KMP’s, the Remuneration Committee considers pay and employment conditions with peers in the competitive market to ensure that pay structures are appropriately aligned and that levels of remuneration remain appropriate in this context.

- The Committee while designing the remuneration package considers the level and composition of remuneration to be reasonable and sufficient to attract, retain and motivate the person.

- The Remuneration Committee while considering a remuneration package must ensure a balance between fixed and incentive pay reflecting short and long term performance objectives appropriate to the working of the company and its goals.

- The Committee considers that a successful remuneration policy must ensure that a significant part of the remuneration package is linked to the achievement of corporate performance targets.

Reward principles and objectives

The Company’s remuneration policy is guided by a common reward framework and set of principles and objectives as more fully and particularly envisaged under section 178 of the Companies Act 2013, interalia principles pertaining to determining qualifications, positives attributes, integrity and independence etc.

Reward policies

Attract and retain: Remuneration packages are designed to attract high-calibre executives in a competitive global market and remunerate executives fairly. The remuneration shall be competitive and based on the individual responsibilities and performance.

Motivate and reward: Remuneration is designed to motivate delivery of key business strategies, create a strong performance-orientated environment and reward achievement of meaningful targets over the short- and long-term.

The principal terms of non-monetary benefits: The Executives will be entitled to customary non-monetary benefits such as company car and company health care, communication facilities etc. In addition in individual cases company housing and other benefits may also be offered.

Executive Remuneration - Board of Management

Executive remuneration is proposed by the Committee and subsequently approved by the Board of Directors. Executive remuneration is evaluated annually against performance and benchmarked with international companies, are similar to M/s. Pennar Industries Limited. Benchmark information is obtained from internationally recognized compensation service consultancies. In determining packages of remuneration, the Committee may take the advice of the Chairman/ Managing Director of the Company.

Further, the Company while deciding the remuneration package of the senior management members takes into consideration the following items:

(a) employment scenario

(b) remuneration package of the industry and

(c) remuneration package of the managerial talent of other industries.

The annual variable pay of senior managers is linked to the performance of the Company in general and their individual performance for the relevant year measured against specific Key Result Areas, which are aligned to the Company's objectives.

The Non-Executive Directors (NEDs) are paid Sitting Fees for attending the meetings, as per the resolution passed by the Board of Directors dated 27.05.2010. The details of the sitting fees paid to the NEDs are annexed hereunder:

Sl No Nature of Meeting Amount in INR
1. Board Meeting 5,000
2. Committee Meeting(s) 3,500

The Company pays remuneration by way of salary, perquisites and allowances (fixed component) and commission (variable component) to Executive Chairman, Vice-Chairman & Managing Director and the Whole-Time Director. Salary is paid within the range approved by the Shareholders. Annual increments effective 1st April each year, as recommended by the Remuneration Committee, are approved by the Board. The ceiling on perquisites and allowances as a percentage of salary is fixed by the Board. Within the prescribed ceiling, the perquisites package is approved by the Remuneration Committee. Commission is calculated with reference to net profits of the Company in a particular financial year and is determined by the Board of Directors at the end of the financial year based on the recommendations of the Remuneration Committee, subject to overall ceilings stipulated in the Companies Act, 2013 and the rules made thereunder. Specific amount payable to such directors is based on the performance criteria laid down by the Board which broadly takes into account the profits earned by the Company for the year.

Disclosure of Information

Information on the total remuneration of members of the Company's Board of Directors, Executive Board of Management and senior management may be disclosed in the Company's annual financial statements.

Approval of the Remuneration Policy

This Remuneration Policy shall apply to all future employment agreements with members of Company's Senior Management including Key Managerial Personnel and Directors. The Remuneration Policy is binding on the Board of Directors including its provisions on stock options. The Remuneration Policy shall be of guidance for the Board.

Dissemination

The Company's Remuneration Policy shall be published on its website.

1. INTRODUCTION

This Policy is in terms of revised Clause 49 of the Listing Agreement with the Stock Exchanges which provides that all the listed companies shall formulate a Board diversity policy. The Nomination and Remuneration Committee on the recommendation of the Board of Directors may review and amend this Policy from time to time.

2. POLICY OBJECTIVE

To ensure a transparent Board nomination process with the diversity of thought, experience, knowledge, perspective and gender in the Board.

3. COMPOSITION OF THE BOARD:

3.1 EXECUTIVE AND NON-EXECUTIVE DIRECTORS:

The Board of Directors shall have optimum combination of executive and non-executive Directors.Not less than 50% of the directors on the Board shall be Non-executive Directors.

3.2 INDEPENDENT DIRECTORS:

If the chairman of the Board is non-executive director, non-promoter and is not related to the promoters or person occupying management positions at the Board level or at one level below the Board at least one-third of the Board should comprise of Independent Directors.

In any other case atleast 50% of the directors on the Board shall be Independent Directors.

An Independent director shall hold office for a term of upto five consecutive years on the Board of a Company, but can be appointed as Independent director for second term of five consecutive years with the approval of shareholders obtained by way of special resolution.

No Independent director shall be appointed for more than two consecutive terms, but such independent director shall be eligible for appointment after the expiration of three years of ceasing to become an independent director.

Provided that an independent director shall not, during the said period of three years, be appointed in or be associated with the company in any other capacity, either directly or indirectly.

For the purpose of this policy Independent Director means the Independent Director as defined in Clause 49 of the listing Agreement.

3.3 WOMAN DIRECTOR:

Subject to the provisions of the applicable laws from time to time the Board of Directors of the Company shall comprise of atleast one woman director. The Company shall comply with this clause on or before 31.03.2015 or such other extended period as may be allowed under the applicable laws.

3.4 EXPERIENCE AND EXPERTISE:

The Board shall have optimum combination of directors having experience in various fields.

The Board should comprise of atleast one director having experience in the Industry.

The Board should have atleast one director having financial/accounting expertise.

The Board should have atleast one director having reasonable experience in the administration.

However if the Company have a single director having all the above expertise then appointment of such person shall be sufficient compliance of this clause 3.4.

Selection of candidates will be based on a range of diversity perspectives, including but not limited to gender, age, cultural and educational background, ethnicity, professional experience, skills, knowledge and length of service. The ultimate decision will be based on merit and contribution that the selected candidates will bring to the Board.

4. REVIEW OF THIS POLICY

The Nomination Committee will review this Policy, as appropriate, to ensure the effectiveness of this Policy.

5. DISCLOSURES

The Board’s composition (including gender, ethnicity, age etc.) will be disclosed in the Annual Report.

Policy on Familiarization Programme for Independent Directors, Role, Responsibility and Rights of Independent Directors

INTRODUCTION

Section 149 of the Companies Act, 2013 read with Clause 49 of the listing Agreement every listed Company is required to appoint Independent Directors. Independent Directors constitute such category of Directors who are expected to have impartial and objective judgement for the proper functioning of the Company. Independent Directors play an important role in maintaining a transparent working environment in corporate regime.

PROCESS OF FAMILIARISATION WITH THE COMPANY

An important aspect of board effectiveness is the appropriate attention to development and training of non-executive directors on the lines of management development and training. The company sees director induction as a first step of the board’s continuing improvement. It is the company’s firm belief that investment in board development strengthens the board as well as the individual directors. Directors are regularly updated on changes in policies and programmes, laws and the general business environment.

The company ensures that non-executive directors are familiarized with the company, their roles, rights, responsibilities in the company, nature of the industry in which the company operates and the business model of the company, through various programmes and at regular intervals.

At the time of induction and subsequently on a sustained and regular basis, the independent directors are provided an overview of:

a. Introduction, company history and genesis.

b. Overview of company operations comprising details of the company’s service business units and business model, clientele and functional service offerings.

c. Key financial highlights

d. Details of the group (comprising the subsidiaries, joint ventures and associate companies).

e. Board of directors and committees of the board, their operations, charter and functioning Key management personnel details

f. Highlights of the HR, Quality and Innovation functions

g. Corporate governance practices, processes and procedures, including board and committee functioning

h. Corporate social responsibility initiatives

i. Business responsibility initiatives of the company

In addition, all regulatory and statutory changes that occur are also periodically brought to the notice of the non-executive directors.

All non-executive directors also get to interact with the senior management of the company. The Executive Chairman, Managing Director & CEO, the heads of the service business units, HR, Quality, Innovation and Finance interact with the non-executive directors. Besides, they also have a walkthrough of the company’s business.


ROLE OF INDEPENDENT DIRECTORS

The role of the Independent Directors is:

a. To help in bringing an Independent Judgement to bear on Board’s deliberations especially on issues of strategy, performance, risk management, resources, key appointments and standards of conduct.

b. To bring an objective view in evaluation of the performance of board and management.

c. To scrutinize the performance of management in meeting agreed goals and objectives and monitor the reporting of performance.

d. To satisfy themselves on the integrity of financial information and that the financial controls and the systems of risk management are robust and defensible.

e. To safeguard the interest of all the shareholders of the Company.

f. To balance the conflicting interest of the shareholders and management.

g. To play important role in appointment, removal and determination of appropriate remuneration of executive/whole-time/managing directors, key managerial personnel and senior management personnel.

h. To ensure the effectiveness of the Board as the oversight body to oversee what the management does.

i. To identify the most critical issues for the board to deal with.

j. To assist the board in achieving consensus on important issues.

k. To play the role of a facilitator outside the board room especially on contentious issues.

l. To work with CEO/CFO/Managing Director/Whole-time Director to prioritise issues, set the agenda and enable it to focus on substantive issues.

m. To ensure that board conversations do not veer in the direction of certain unwanted topics/individual preferences.

n. To provide candid feedback to CEO/CFO/Managing Director/Whole-time Director.


RESPONSIBILITIES OF INDEPENDENT DIRECTORS

The responsibility of the Independent Directors is:

a. To undertake appropriate induction and regularly update and refresh their skills, knowledge and familiarity with the Company.

b. To seek appropriate clarification or amplification of important and, where necessary, take and follow appropriate professional advice and opinion of outside experts at the expense of the company.

c. To strive to attend all meetings of the Board of Directors and Board Committees of which he is a member/chairman and participate constructively and actively in the committees of the Board.

d. To strive to attend the General Meetings of the Company.

e. Where they have concerns about the running of the Company or proposed action, ensure that those are addressed by the Board/Committee.

f. To pay sufficient attention and ensure adequate deliberations are held before approving the related party transactions and ensure that same are in the interest of the Company.

g. To ascertain and ensure that the Company has an adequate functional vigil mechanism and to ensure that the interest of person who uses such mechanism is not prejudicially affected on account of such use.

h. To report about unethical behaviour, actual or suspected fraud, violation of company’s code, ethics and policies.

i. Not to disclose the confidential information and price sensitive information to any third party and should not use such information for personal benefit.

j. Not to compete with the businesses of the company and its subsidiaries and shall not solicit employees of the company and its subsidiaries for their own businesses or businesses of their associates, relative and friends.


RIGHTS OF INDEPENDENT DIRECTORS

a. Right to receive the notice and agenda papers of the Board Meetings and Committee Meetings in which he is member/chairman.

b. Right to attend and vote in the Board Meetings and Committee Meetings in which he is a member/chairman.

c. Right to be appointed on various committees.

d. Right to demand information on every business matter.

e. Right to seek clarification/justification.

f. Right to dissent.

g. Right to meet the CFO/CEO/Managing Director/Whole-time Director and financial heads of the Company to seek financial information to give his consent/approval.

h. Right to summon CFO/CEO/Managing Director/Whole-time Director and financial heads to the Board Meetings and Committee Meetings in which he is a member to understand on the financial transactions/contract before giving their consent/approval.


REVIEW OF THIS POLICY

The Board shall review this Policy, as appropriate, to ensure the effectiveness of this Policy.


DISCLOSURES

The Board’s composition (including gender, ethnicity, age etc.) will be disclosed in the Annual Report.

Policy For Determining Material Subsidiaries

PREAMBLE AND OBJECTIVE

The Board of Directors of the Company (“Pennar Industries Limited”), in pursuance of Clause 49 of the Listing Agreement and other applicable provisions (including any statutory enactments / amendments thereof), adopted the following policy for determining ‘material’ subsidiariesand is intended to ensure governance of material subsidiary companies.


DEFINITIONS

"Audit Committee" means Audit Committee constituted by the Board of Directors of Pitti Laminations Limited, from time to time, under Section 177 of the Companies Act, 2013 and the Listing Agreement.

“Board of Directors” or “Board” means the Board of Directors of M/s. Pennar Industries Limited, as constituted from time to time.

“Holding company”, in relation to one or more other companies, means a company of which such companies are subsidiary companies;

“Material non-listed Indian subsidiary” shall mean an unlisted subsidiary, incorporated in India, whose income or net worth (i.e. paid up capital and free reserves) exceeds 20% of the consolidated income or net worth respectively, of the listed holding company and its subsidiaries in the immediately preceding accounting year.

“Material subsidiary” means a subsidiary, “if the investment of the Company in the subsidiary exceeds twenty per cent of its consolidated net worth as per the audited balance sheet of the previous financial year or if the subsidiary has generated twenty per cent of the consolidated income of the Company during the previous financial year.

“Policy” means Policy for determining Material Subsidiaries.

“Significant transaction or arrangement” shall mean any individual transaction or arrangement that exceeds or is likely to exceed 10% of the total revenues or total expenses or total assets or total liabilities, as the case may be, of the material unlisted subsidiary for the immediately preceding accounting year.

“Subsidiary” shall mean a subsidiary as defined under the Companies Act, 2013.

Any other term not defined herein shall have the same meaning as defined in the Companies Act, 2013, the Listing Agreement or any other applicable regulation.


CRITERIA FOR DETERMINING THE MATERIAL SUBSIDIARIES

A subsidiary of the Company shall be regarded as Material Subsidiary if it falls under the definition provided above.

The Audit Committee shall on annual basis review such details / information as may be required to determine the ‘Material Subsidiaries’.


GUIDING PRINCIPLES

“Material Subsidiary” and "Material non listed Indian subsidiary" of the Company would be identified, if any, as one time exercise and such exercise shall be done during each financial year and the conclusion placed before the Audit Committee and the Board of the Company. The identification should happen soon after preparation of annual accounts and the outcome should be placed before the Audit Committee or Board, as the case may be, in the meeting where the Annual Audited Accounts of the Company are considered.


INVESTMENTS IN SUBSIDIARIES

Approval of the Board is required to invest more 20% of the consolidated income or net worth respectively, of the listed holding company and its subsidiaries in the immediately preceding accounting year in a subsidiary of the Company.

The Managing Director/Whole-time Director shall provide the following details to the Board to consider the above referred investment:

a. Name of the Company in which M/s. Pennar Industries Limited proposes to invest.

b. Profile of the Company.

c. Objects of the Investment.

d. Future prospects of the company in which M/s. Pennar Industries Limited proposes to invest.

e. Advantages of such investments.

While considering the proposal to invest as above the Board shall consider the following:

a. Whether the company/business in which the M/s. Pennar Industries Limited proposes to invest have potential to increase the profitability.

b. Whether such investment is for profit or strategic advantages.

c. Whether the objectives set out for such investments can be achieved.

d. Whether any alternate investment opportunity is available to achieve the objects set out for such Investments.

GOVERNANCE OF MATERIAL SUBSIDIARIES

At least one independent director on the Board of Directors of M/s. Pennar Industries Limitedshall be appointed as a director on the Board of Directors of a material non-listed Indian subsidiary company.

The Audit Committee shall review the financial statements, in particular, the investments made by the unlisted subsidiary company.

The minutes of the Board meetings of the unlisted subsidiary company shall be placed at themeeting of the Board.

To bring it to the attention of the Board, a statement of all significant transactions and arrangements entered into by the unlisted subsidiary company shall be periodically placed before the Board of Directors.

The Company shall not dispose of shares in its material subsidiary which would reduce the shareholding by the Company (either on its own or together with other subsidiaries) to less than 50% or cease the exercise of control over the subsidiary without passing a special resolution in its General Meeting except in cases where such divestment is made under a scheme of arrangement duly approved by a Court/Tribunal.

The Company shall not sell, dispose and lease of assets amounting to more than twenty percent of the assets of the material subsidiary on an aggregate basis during a financial year without prior approval of shareholders by way of special resolution, unless the sale/disposal/lease is made under a scheme of arrangement duly approved by a Court/Tribunal.


DISCLOSURE

The policy shall be disclosed on the company's website (www.pennarindia.com)and a web link thereto shall be provided in the Annual Report of the Company.


POLICY REVIEW, ETC

The Board of Directors of the Company may subject to applicable laws is entitled to amend, suspend or rescind this Policy at any time. Any difficulties or ambiguities in the Policy will be resolved by the Board of Directors in line with the broad intent of the Policy. The Board may also establish further rules and procedures, from time to time, to give effect to the intent of this Policy.

In the event of any conflict between the provisions of this policy and of the applicable law dealing with the related party transactions, such applicable law in force from time to time shall prevail over this policy.

1. BACKGROUND

The Board of Directors (the “Board”) of the Company has adopted the following policy and procedures with regard to Related Party Transactions.

The Audit Committee will review and amend this policy from time to time. This policy is to govern transactions between the Company and its Related Parties based on the laws and regulations that are applicable to the Company.


2. PURPOSE

The Company is listed on the Bombay Stock Exchange. This policy is framed as per requirement of Clause 49 of the Listing Agreement entered by the Company with the Stock Exchange and intended to ensure the proper approval and reporting of related party transactions. The Company is required to disclose each year in the Financial Statements certain transactions between the Company and Related Parties as well as policies concerning transactions with Related Parties.


3. DEFINITIONS

“Arm’s length transaction” means a transaction between two related parties that is conducted as if they were unrelated, so that there is no conflict of interest.

“Audit Committee” means Audit Committee constituted by the Board of Directors of M/s. Pennar Industries Limited, from time to time, under Section 177 of the Companies Act, 2013 and the Listing Agreement.

“Board of Directors” or “Board” means the Board of Directors of M/s. Pennar Industries Limited, as constituted from time to time.

“Company” means M/s. Pennar Industries Limited.

“Key Managerial Personnel” means the Managing Director, the Company Secretary, the Chief Financial Officer and such other officers/employees of the Company as defined in section 2(51) of the Companies Act, 2013.

“Material Related Party Transaction” means a transaction with a Related Party where the transaction/transactions to be entered into individually or taken together with previous transactions during a financial year, exceeds ten percent of the annual consolidated turnover of the company as per the last audited financial statements of the company.

“Policy” means Policy on Related Party Transactions.

“Related Party”, means-


With reference to the Company:
  • i) a director or his relative;
  • ii) a key managerial personnel or his relative;
  • iii) a firm, in which a director, manager or his relative is a partner;
  • iv) a private company in which a director or manager is a member or director;
  • v) a public company in which a director or manager is a director or holds along with his relatives, more than two per cent. of its paid-up share capital;
  • vi) any body corporate whose Board of Directors, managing director or manager is accustomed to act in accordance with the advice, directions or instructions of a director or manager;
  • vii) any person on whose advice, directions or instructions a director or manager is accustomed to act:
  • Provided that nothing in sub-clauses (vi) and (vii) shall apply to the advice, directions or instructions given in a professional capacity;
  • viii) any company which is-
    • a. a holding, subsidiary or an associate company of such company; or
    • b. a subsidiary of a holding company to which it is also a subsidiary;
  • ix) such other person as may be prescribed;

Parties are considered to be related if at any time during the reporting period one party has the ability to control the other party or exercise significant influence over the other party in making financial and/or operating decisions as defined in the Accounting Standard 18 or such other entity/entities as may defined in the applicable accounting standard from time to time.

"Relative", with reference to any person, means anyone who is related to another, if—

  • a) sale, purchase or supply of any goods or materials;
  • b) they are members of a Hindu Undivided Family;
  • c) they are husband and wife; or
  • d) A person shall be deemed to be the relative of another, if he or she is related to another in the following manner, namely:-
  • i) Father (includes step-father).
  • ii) Mother (includes the step-mother).
  • iii) Son (includes the step-son).
  • iv) Son’s wife.
  • v) Daughter.
  • vi) Daughter’s husband.
  • vii) Brother (includes the step-brother)
  • viii) Sister (includes the step-sister).

“Related party transaction” is a transfer of resources, services or obligations between a company and a related party, regardless of whether a price is charged, including:

  • e) sale, purchase or supply of any goods or materials;
  • f) selling or otherwise disposing of, or buying, property of any kind;
  • g) leasing of property of any kind;
  • h) availing or rendering of any services;
  • i) appointment of any agent for purchase or sale of goods, materials, services or property;
  • j) such related party's appointment to any office or place of profit in the company, its subsidiary company or associate company; and
  • k) underwriting the subscription of any securities or derivatives thereof, of the company:

“Subsidiary” shall mean a subsidiary as defined under the Companies Act, 2013.

"Transaction" with a related party shall be construed to include single transaction or a group of transactions in a contract

Any other term not defined herein shall have the same meaning as defined in the Companies Act, 2013, the Listing Agreement, Accounting Standard 18 or any other applicable regulation.


4. IDENTIFICATION OF RELATED PARTY TRANSACTIONS

Every Director and Key Managerial Personnel shall, as may be applicable to them, provide a declaration containing the necessary details of related parties covered in the definition of related party and relatives to the Company Secretary upon their appointment and on an annual basis. Also, provide declarations if there has been a change in the details from the last declaration made under this policy.

The Chief Financial Officer and the Managing Director are jointly responsible in identifying the potential related party transactions and provide necessary information in advance to the Company Secretary for initiating the process to obtain the necessary approvals of the Audit Committee/Board/Shareholders. Further, the Chief Financial Officer and the Managing Director are responsible for providing additional information about transaction that the Board / Audit Committee may request, for being placed before the Audit Committee / Board.


5. DEALING WITH RELATED PARTY TRANSACTIONS

The Board shall fulfill the function of monitoring and managing potential conflicts of interest of management, board members and shareholders, including misuse of corporate assets and abuse in related party transactions.

The Company shall comply with applicable provisions of the Companies Act, 2013, Rules made there under, the Listing Agreement and other applicable law in force from time to time in dealing with the Related Party Transactions.


6. APPROVAL PROCESS

Audit Committee:

All Related Party Transactions shall require prior approval of the Audit Committee. Accordingly, all proposed Related Party Transactions must be reported to the Audit Committee for prior approval by the Committee.

The Managing Director/Whole-time Director of the Company shall provide to the Committee all relevant material information of the Related Party Transaction, including the terms of the transaction, the business purpose of the transaction, the benefits to the Company and to the Related Party, and any other relevant matters. In determining whether to approve a Related Party Transaction, the Committee will consider the following factors, among others, to the extent relevant to the Related Party Transaction:

  • i) the name of the related party and nature of relationship;
  • ii) the nature, duration of the contract and particulars of the contract or arrangement;
  • iii) the material terms of the contract or arrangement including the value, if any;
  • iv) any advance paid or received for the contract or arrangement, if any;
  • v) the manner of determining the pricing and other commercial terms, both included as part of contract and not considered as part of the contract;
  • vi) whether all factors relevant to the contract have been considered, if not, the details of factors not considered with the rationale for not considering those factors;
  • vii) the persons/authority approving the transaction; and
  • viii) any other information relevant or important for the Committee to take a decision on the proposed transaction.

In determining whether to approve a Related Party Transaction, the Committee will consider the following factors, among others, to the extent relevant to the Related Party Transaction:

  • i) Whether the terms of the Related Party Transaction are fair and on arm’s length basis to the Company and would apply on the same basis if the transaction did not involve a Related Party;
  • ii) Whether the Related Party Transaction would affect the independence of the Director/KMP;
  • iii) Whether the proposed transaction includes any potential reputational risk issues that may arise as a result of or in connection with the proposed transaction; and
  • iv) Whether the Related Party Transaction is in the nature of conflict of interest for any Director or Key Managerial Personnel of the Company, taking into account the size of the transaction, the overall financial position of the Director or other Related Party, the direct or indirect nature of the Directors, Key Managerial Personnel’s or other Related Party’s interest in the transaction and the ongoing nature of any proposed relationship and any other factors the Board/Committee deems relevant.

Subject to the provisions of the applicable laws the Audit Committee will have the discretion to approve/modify/recommend/refer the proposed related party transaction for the approval of Board of Directors or Shareholders.

And, in the event such transaction, contract or arrangement is not in the ordinary course of business or at arm's length, the Company shall comply with the provisions of the Companies Act 2013 and the Rules framed thereunder and obtain approval of the Board or its shareholders, as applicable, for such contract or arrangement.

Subject to the provisions of applicable laws from time to time, in exceptional cases, where a prior approval is not taken due to an inadvertent omission or due to unforeseen circumstances, the Committee may ratify the transactions in accordance with this Policy.


6.1 Omnibus approval

The Audit Committee may grant omnibus approval for Related Party Transactions proposed to be entered into by the company subject to the following conditions:

  • a) The Audit Committee shall lay down the criteria for granting the omnibus approval in line with the policy on Related Party Transactions of the company and such approval shall be applicable in respect of transactions which are repetitive in nature.
  • b) The Audit Committee shall satisfy itself the need for such omnibus approval and that such approval is in the interest of the company;
  • c) Such omnibus approval shall specify (i) the name/s of the related party, nature of transaction, period of transaction, maximum amount of transaction that can be entered into, (ii) the indicative base price / current contracted price and the formula for variation in the price if any and (iii) such other conditions as the Audit Committee may deem fit;
  • d) Provided that where the need for Related Party Transaction cannot be foreseen and aforesaid details are not available, Audit Committee may grant omnibus approval for such transactions subject to their value not exceeding Rs.1 crore per transaction.
  • e) Audit Committee shall review, atleast on a quarterly basis, the details of Related Party Transactions entered into by the company pursuant to each of the omnibus approval given.
  • d) Such omnibus approvals shall be valid for a period not exceeding one year and shall require fresh approvals after the expiry of one year.

6.2 Board

The consent of the Board of Directors is required by a resolution at a meeting of the Board for entering into any contract or arrangement with a related party with respect to the transactions defined in the related party transaction.

Where any director is interested in any contract or arrangement with a related party, such director shall not be present at the meeting during discussions on the subject matter of the resolution relating to such contract or arrangement.


6.3 Shareholders

Transactions not in ordinary course of business or not at arm’s length:

All Related Party Transactions in excess of the limits prescribed under the Companies Act, 2013, which are not in the Ordinary Course of Business or not at Arms’ Length shall also require the prior approval of the shareholders through special resolution and no member of the company shall vote on such special resolution, if such member is a related party.

Material Related Party Transaction:

All material Related Party Transactions shall require approval of the shareholders through special resolution and the related parties shall abstain from voting on such resolutions.


EXEMPTION FROM APPLICABILITY OF THE POLICY

Notwithstanding the foregoing, but subject to the provisions of the applicable laws from time to time, this policy shall not apply to the following Related Party Transactions shall not require approval of Audit Committee or Shareholders:

  • i) Transactions entered into between the Company and its wholly owned subsidiary whose accounts are consolidated with the Company and placed before the shareholders at the general meeting for approval.
  • ii) Any transaction that involves the providing of compensation to a director or Key Managerial Personnel in connection with his or her duties to the Company or any of its subsidiaries or associates, including the reimbursement of reasonable business and travel expenses incurred in the ordinary course of business.
  • iii) Any transaction in which the Related Party’s interest arises solely from ownership of securities issued by the Company and all holders of such securities receive the same benefits pro rata as the Related Party.

8. DISCLOSURE

Details of all material transactions with related parties shall be disclosed quarterly along with the compliance report on corporate governance.

The company will make disclosures in compliance with the Accounting Standard and other applicable law on “Related Party Disclosures” in its Annual Report.

The policy shall be disclosed on the company's website (www.pennarindia.com) and a web link thereto shall be provided in the Annual Report of the Company.


9. POLICY REVIEW, ETC.

The Board of Directors of the Company may subject to applicable laws is entitled to amend, suspend or rescind this Policy at any time. Any difficulties or ambiguities in the Policy will be resolved by the Board of Directors in line with the broad intent of the Policy. The Board may also establish further rules and procedures, from time to time, to give effect to the intent of this Policy.

In the event of any conflict between the provisions of this policy and of the applicable law dealing with the related party transactions, such applicable law in force from time to time shall prevail over this policy.

(Pursuant to the Section 177 of the Companies Act, 2013)
1. Preamble

The Company has adopted the Code of Ethics & Business Conduct, which lays down the principles and standards that should govern the actions of the Company and its employees. Any actual or potential violation of the Code, howsoever insignificant or perceived as such, would be a matter of serious concern for the Company. The role of the employees in pointing out such violations of the Code cannot be undermined. Accordingly, this Vigil Policy (“the Policy”) has been formulated with a view to provide a mechanism for employees of the Company to raise concerns of any violations of legal or regulatory requirements, incorrect or misrepresentation of any financial statements and reports, etc.

2. Objectives

The Company is committed to adhere to the highest standards of ethical, moral and legal conduct of business operations. To maintain these standards, the Company encourages its employees who have concerns about suspected misconduct to come forward and express these concerns without fear of punishment or unfair treatment. This policy aims to provide an avenue for employees to raise concerns of any violations of legal or regulatory requirements, incorrect or misrepresentation of any financial statements and reports, etc.


3. Purpose

The Vigil policy intends to cover serious concerns that could have grave impact on the operationsand performance of the business of the Company.The policy neither releases employees from their duty of confidentiality in the course of theirwork, nor is it a route for taking up a grievance about a personal situation.


4. Scope and Applicability

All directors, officers and employees of M/s. Pennar Industries Limited (PIL) and its subsidiaries are eligible to make ProtectedDisclosures under the Policy.

The Policy covers malpractices and events which have taken place/ suspected to take placeinvolving:

  • a) Abuse of authority
  • b) Breach of contract
  • c) Negligence causing substantial and specific danger to public health and safety
  • d) Manipulation of company data/records
  • e) Financial irregularities, including fraud or suspected fraud or Deficiencies in Internal Controland check or deliberate error in preparations of Financial Statements or Misrepresentation offinancial reports.
  • f) Any unlawful act whether Criminal/ Civil
  • g) Pilferation of confidential/propriety information
  • h) Deliberate violation of law/regulation
  • i) Wastage/misappropriation of company funds/assets
  • j) Breach of Company Policy or failure to implement or comply with any approved Company Policy
  • k) Policy should not be used in place of the Company grievance procedures or be a route for raisingmalicious or unfounded allegations against colleagues.

5. Definitions

5.1 “Audit Committee”: means the Audit Committee constituted pursuant to the provisions ofthe Section 177(1) of the Companies Act, 2013.

5.2 “Company” means, “M/s. PennarIndistries Limited”

5.3 “Disciplinary Action” means any action that can be taken on the completion of /during theinvestigation proceedings including but not limiting to a warning, imposition of fine,suspension from official duties or any such action as is deemed to be fit considering thegravity of the matter.

5.4 “Ethical Behavior”: Being in accordance with the accepted principles of right and wrong ofthat govern the conduct of a profession including but not restricted to financial improprietyand accounting malpractices.

5.5 “Good Faith”: An employee shall be deemed to be communicating in good faith if thereis a reasonable basis for communication of unethical and improper practices or any otheralleged wrongful conduct. Good Faith shall be deemed lacking when the employee does nothave personal knowledge on a factual basis for the communication or where the employeeknew or reasonably should have known that the communication about the unethical andimproper practices or alleged wrongful conduct is malicious, false or frivolous.

5.6 “Nodal Officer or Investigation Committee”: means an officer or Committee of personswho is/are nominated/ appointed to conduct detailed investigation of the disclosure receivedfrom the Vigil blower and recommend disciplinary action. Presently, Nodal Officer of theCompany is Mr. Aditya Rao, Managing Director. The Committee, if appointed, should include Senior Level Officersof HR, Internal Audit / Finance and a representative of the Division/ Department where thealleged malpractice has occurred.

5.7 “Policy”: means, vigil policy

5.8 “Professional Behavior”: Exhibiting a courteous, conscientious and generally businesslikemanner at the workplace that strives to maintain a positive regard to others while avoidingexcessive display of the deep feeling.

5.9 “Protected Disclosure”: The reporting of any such unethical activity or violation to theCommittee by a Vigil blower as defined above made in good faith would constitute aprotected disclosure.

5.10 “Subject Employee”: means an employee against or in relation to whom a protecteddisclosure is made under this policy.

5.11 Unethical Alleged Activities shall mean and include the following:

  • Violation of any law or regulations, policies including but not limited to corruption,bribery,Theft, fraud, coercion and willful omission.
  • Rebating of Commission/benefit or conflict of interest.
  • Procurement frauds.
  • Mismanagement, Gross wastage or misappropriation of company funds/assets.
  • Manipulation of Company data/records.
  • Misappropriating cash/company assets;
  • Providing any confidential or proprietary information related to any stream (forexample R&D, Finance, Marketing, IT, Supply Chain, Human Resources and farmersor Customers/Vendors relation etc).
  • Unofficial use of Company’s property/human assets.
  • Activities violating the Company policies. (Including Code of Conduct)
  • A substantial and specific danger to public health and safety.
  • An abuse of authority or fraud
  • An act of discrimination.

The above list is illustrative and should not be considered as exhaustive.

5.12 “Vigil blower”: An employee who exposes or makes a disclosure of the unethical andimproper practices within an organization in the hope of stopping it.


6. Reporting Allegations of Unethical Activities:

The procedure for reporting and dealing with disclosures is given in annexure 1.


7. Procedure to Investigate Alleged Unethical Activities:

The following investigation process shall be adhered to in case the compliant or protected disclosure isfiled:

  • 7.1 The Nodal Officer in consultation with Executive Chairman will determine whether the concern or complaintactually pertains to a compliance or ethical violation through majority within 10 business daysof receipt of the complaint.
  • 7.2 If the Nodal Officer decides that the complaint is not valid, the rationale for the decision shallbe communicated to the complainant.
  • 7.3 If the Nodal Officer determines that the complaint is a valid compliance violation, anInvestigation Committee (identified by the Audit Committee) shall investigate the allegedviolation.
  • 7.4 Investigation Committee shall file a report of the findings to the Audit Committee along withany supporting evidence.
  • 7.5 The Investigation Committee will take all reasonable efforts to ensure that the investigationprocess is completed within 30 days from the day of the receipt of complaint. If not, it shalljustify the need for extension to the Audit Committee.
  • 7.6 The Audit Committee will make a decision based on the findings reported by the Investigation committee.
  • 7.7 Prompt, appropriate and corrective action will be taken by the Audit Committee against theaccused.
  • 7.8 It is the discretion of the Audit committee to inform the decision/action taken on thecomplainant.

8. Documentation and Reporting
  • 8.1 The investigation report will be filed in the format attached in Annexure - II.
  • 8.2 All documentation pertaining to the complaint including but not restricted to the investigationreport, corrective action taken and evidence will be maintained for a period of 3 years by theNodal Officer.
  • 8.3 All complaints received will be kept confidential and will be shared only on a ‘Need toKnow’ basis.
  • 8.4 The Nodal Officer shall submit a report to the Audit Committee on a quarterly basis whichincludes number of complaints received, accepted and status of pending complaints.

9. Roles and Responsibilities
  • 9.1. Roles and Responsibility of Vigil blower:
  • 9.1.1. Vigil blowers provide initial information related to a reasonable belief that an unethicalactivity has occurred.
  • 9.1.2. Vigil blower must provide all factual corroborating evidence, as is available/possible, toenable commencement of an investigation. An investigation will not be undertaken withoutverifiable support.
  • 9.1.3. Vigil blowers have a responsibility to be candid with the Nodal Officer and Investigationcommittee. The person should be prepared to be interviewed by the Investigation Committee.
  • 9.1.5. The Vigil blowers will not be immune to disciplinary action if he is found guilty of or is aparty to the allegations.

9.2 Roles and Responsibility Investigation Participant
  • 9.2.1. All employees who are interviewed, asked to provide information or otherwise participate inan investigation have a duty to fully cooperate with the investigators.
  • 9.2.2. Participants should refrain from discussing or disclosing the investigation or their testimonywith anyone not connected to the investigation. In no case should the participant discuss withthe investigation subject the nature of evidence requested or provided or testimony given toinvestigators unless agreed to by the investigators.
  • 9.2.3. Requests for confidentiality by participants will be honored to the extent possible within thelegitimate needs of law and the investigation.
  • 9.2.4. Participants are entitled to protection from retaliation for having participated in aninvestigation.

10. Vigil blower Protection
  • 10.1. The identity of the Vigil Blower, subject employee and any other Employee assisting theinquiry/ investigation, shall be kept confidential at all times, except during the course of anylegal proceedings, where a disclosure/statement is required to be filed.
  • 10.2. The PIL, as apolicy, strongly condemns any kind of discrimination, harassment or any otherunfair employment practice being adopted against the Vigil blowers for disclosures made underthis policy. No unfair treatment shall be vetted out towards the Vigil Blower by virtue of his/herhaving reported a disclosure under this policy and the Company shall ensure that full protectionhas been granted to him/her against:
  • 10.2.1. Unfair employment practices like retaliation, threat or intimidation oftermination/suspension of services, etc.
  • 10.2.2. Disciplinary action including transfer, demotion, refusal of promotion, etc.
  • 10.2.3. Direct or indirect abuse of authority to obstruct the Vigil blower’s right to continueperformance of his duties/functions during routine daily operations, including makingfurther disclosures under this policy. However, action will be taken against Vigil blowersmaking baseless allegations.

11. Disciplinary Action when allegations are proved:
  • 11.1 In case the Protected Disclosure is proved, as per the findings of the Committee, Disciplinary actionmay be taken up to and including termination and also ensure preventive measures to avoid reoccurrenceof the matter.
  • 11.2 In case the Protected Disclosure is not proved, the matter shall beextinguished.
  • 11.3 During the investigation period or at any time thereafter, if any employee is found to be(a) retaliating against the complainant; (b) coaching witnesses; or (c) tampering with evidence, then itwould lead to severe disciplinary action including termination of employment.
  • 11.4In exceptional cases, where the Vigil Blower is not satisfied with the outcome of the investigation andthe decision, he or she can make a direct appeal to the Chairman of the Audit Committee.

12. Action on false information/complaints given

An employee, who knowingly makes false allegations of unethical & improper practices or allegedwrongful conduct, shall be subject to disciplinary action, up to and including termination ofemployment, in accordance with Company rules, policies and procedures. Further, this policy maynot be used as a defense by an employee against whom an adverse personnel action has been takenindependent of any disclosure of information by him and for legitimate reasons or cause underCompany rules and policies.


13. Amendments to this policy

This policy may be amended or modified at any time for the time being in force in consultation withthe Audit Committee.


Annexure I

PROCEDURE FOR REPORTING & DEALING WITH DISCLOSURES
  • How should a Disclosure be made and to whom?

    A Disclosure should be made in writing. Letters can be submitted by hand-delivery, courier or by postaddressed to the Nodal Officer appointed by the Company. E-Mails can be sent to the email id:aditya@pennarindia.com.

    Whilst, a disclosure should normally be submitted to the Nodal Officer, itmay also be submitted directly to the Chairman of the Audit Committee, when the Vigil blower feelsit necessary under the circumstances.However, disclosures against any senior level employees should be sent directly to the Chairman of the Company.

  • Is there any specific format for submitting the Disclosure?

    While there is no specific format for submitting a Disclosure, the following details MUST bementioned:

    (a) Name, address and contact details of the Vigil blower (add Employee ID if the Vigil blower is anemployee).

    (b) Brief description of the Malpractice, giving the names of those alleged to have committed or aboutto commit a Malpractice. Specific details such as time and place of occurrence are also important.

    (c) In case of letters, the disclosure should be sealed in an envelope marked “Vigil Blower” andaddressed to the Nodal Officer OR Chairman, depending on position of the person against whomdisclosure is made.

  • What will happen after the Disclosure is submitted?

    (a) The Nodal Officer shall acknowledge receipt of the Disclosure as soon as practical (preferablywithin 07 days of receipt of a Disclosure), where the Vigil blower has provided his/her contact details.

    (b) The Nodal Officer will proceed to determine whether the allegations (assuming them to be trueonly for the purpose of this determination) made in the Disclosure constitute a Malpractice bydiscussing with the Chairman.


Annexure-II

Investigation Report

To

The Chairman

Audit Committee

1. Nature of Complaint received:

2. Background:

Brief paragraph to set scene i.e. individuals involved, working arrangements etc.

3. Outline process:

Describe actions taken to investigate.

4. Employee(s) Response:

Explanation given.

5. Supplementary Evidences:

Brief details of any witness statement(s) or corroborative evidence (if available).

6. Findings and Evaluation:

Identify whether the investigation has revealed evidence of misconduct. If so, identify the allegedmisconduct (i.e. what rules or standards relating to his/her employment are the employee isalleged to have broken?). The investigating officer should not come to a conclusion about whetheror not the employee has actually committed the alleged offence. This is for the hearing officer todetermine (if it is decided the case should progress to hearing) after a full hearing of all theevidence, including the employee’s response to the allegations.

7. Appendices:

Include all information relevant to the investigation (i.e. witness statements and copies of anyrelevant documentation)

photo gallery
PENNAR INDUSTRIES LIMITED, an ISO 9001:2008 accredited company was established in 1988, as a standalone cold rolling unit...
At Pennar, we recognize how business growth is closely associated with community uplift, workplace safety and environment protection...
Leadership factor: The Company has a strong management team with rich engineering experience. It is headed by Mr. Nrupender Rao...
AGM-2013 Strategic Goals