1. CORPORATE GOVERNANCE

2.  WHAT IS CORPORATE GOVERNANCE – PROCESSES AND STRUCTURE BY WHICH BUSINESS AND AFFAIRS OF CORPORATE SECTOR IS DIRECTED AND MANAGED  OBJECTIVE OF CORPORATE GOVERNANCE a) TO BUILD UP AN ENVIRONMENT OF TRUST AND CONFIDENCE AMONGST THOSE HAVING COMPETING AND CONFLICTING INTEREST b) TO ENHANCE SHAREHOLDERS’ VALUE AND PROTECT THE INTEREST OF OTHER STAKEHOLDERS BY ENHANCING THE CORPORATE PERFORMANCE AND ACCOUNTABILITY

3. GLOBAL INITIATIVES TO IMPOSE CORPORATE GOVERNANCE  SIR ADRIAN CADBURY COMMITTEE – TO ADDRESS THE ISSUES RELATED TO CORPORATE GOVERNANCE IN UNITED KINGDOM  CORPORATE GOVERNANCE REPORT OF SINGAPORE GOVERNMENT  SARBANES-OXLEY ACT, 2002 BY THE AMERICAN CONGRESS WHICH CAME INTO EFFECT IN JULY 2002 – TO ADDRESS ALL THE ISSUES ASSOCIATED WITH CORPORATE FAILURES TO ACHIEVE QUALITY GOVERNANCE AND TO RESTORE INVESTORS’ CONFIDENCE

4. IMPLEMENTATION OF CORPORATE GOVERNANCE IN INDIA  SHRI KUMAR MANGALAM COMMITTEE – CONSTITUTED IN MAY 1999 TO PROMOTE AND RAISE THE STANDARD OF CORPORATE GOVERNANCE IN INDIA MANDATORY RECOMMENDATIONS OF BIRLA COMMITTEE:  APPLIES TO LISTED COMPANIES WITH PAID UP CAPITAL OF Rs.3 CRORE AND ABOVE  COMPOSITION OF BOARD OF DIRECTORS – OPTIMUM COMBINATION OF EXECUTIVE & NON-EXECUTIVE DIRECTORS  AUDIT COMMITTEE – WITH 3 INDEPENDENT DIRECTORS WITH ONE HAVING FINANCIAL AND ACCOUNTING KNOWLEDGE.

5. MANDATORY RECOMMENDATIONS OF BIRLA COMMITTEE  REMUNERATION COMMITTEE  BOARD PROCEDURES – ATLEAST 4 MEETINGS OF THE BOARD IN A YEAR WITH MAXIMUM GAP OF 4 MONTHS BETWEEN 2 MEETINGS. TO REVIEW OPERATIONAL PLANS, CAPITAL BUDGETS, QUARTERLY RESULTS, MINUTES OF COMMITTEE’S MEETING.  DIRECTOR SHALL NOT BE A MEMBER OF MORE THAN 10 COMMITTEE AND SHALL NOT ACT AS CHAIRMAN OF MORE THAN 5 COMMITTEES ACROSS ALL COMPANIES  MANAGEMENT DISCUSSION AND ANALYSIS REPORT COVERING INDUSTRY STRUCTURE, OPPORTUNITIES, THREATS, RISKS, OUTLOOK, INTERNAL CONTROL SYSTEM  INFORMATION SHARING WITH SHAREHOLDERS

6. NON-MANDATORY RECOMMENDATIONS OF BIRLA COMMITTEE  ROLE OF CHAIRMAN  REMUNERATION COMMITTEE OF BOARD  SHAREHOLDERS’ RIGHT FOR RECEIVING HALF YEARLY FINANCIAL PERFORMANCE  POSTAL BALLOT COVERING CRITICAL MATTERS LIKE ALTERATION IN MEMORANDUM ETC  SALE OF WHOLE OR SUBSTANTIAL PART OF THE UNDERTAKING  CORPORATE RESTRUCTURING  FURTHER ISSUE OF CAPITAL  VENTURING INTO NEW BUSINESSES

7. IMPLEMENTATION OF RECOMMENDATIONS OF BIRLA COMMITTEE  BY INTRODUCTION OF CLAUSE 49 IN THE LISTING AGREEMENT WITH STOCK EXCHANGES PROVISIONS OF CLAUSE 49  COMPOSITION OF BOARD - IN CASE OF FULL TIME CHAIRMAN, 50% NON-EXECUTIVE DIRECTORS AND 50% EXECUTIVE DIRECTORS  CONSTITUTION OF AUDIT COMMITTEE – WITH 3 INDEPENDENT DIRECTORS WITH CHAIRMAN HAVING SOUND FINANCIAL BACKGROUND. FINANCE DIRECTOR AND INTERNAL AUDIT HEAD TO BE SPECIAL INVITEES AND MINIMUM 3 MEETINGS TO BE CONVENED. RESPONSIBLE FOR REVIEW OF FINANCIAL PERFORMANCE 0N HALF YEARLY/ANNUALLY BASIS; APPOINTMENT/ REMOVAL/REMUNERATION OF AUDITORS; REVIEW OF INTERNAL CONTROL SYSTEMS AND ITS ADEQUACY

8. CLAUSE 49 REQUIREMENTS  REMUNERATION OF DIRECTORS – REMUNERATION OF NON-EXECUTIVE DIRECTORS TO BE DECIDED BY THE BOARD. DETAILS OF REMUNERATION PACKAGE, STOCK OPTIONS, PERFORMANCE INCENTIVES OF DIRECTORS TO BE DISCLOSED  BOARD PROCEDURES – ATLEAST 4 MEETINGS IN A YEAR. DIRECTOR NOT TO BE MEMBER OF MORE THAN 10 COMMITTEES AND CHAIRMAN OF MORE THAN 5 COMMITTEES ACROSS ALL COMPANIES  MANAGEMENT DISCUSSION & ANALYSIS REPORT – SHOULD INCLUDE:  INDUSTRY STRUCTURE & DEVELOPMENTS  OPPORTUNITIES & THREATS  SEGMENT WISE OR PRODUCT WISE PERFORMANCE

9. CLAUSE 49 REQUIREMENTS  MANAGEMENT DISCUSSION & ANALYSIS REPORT – TO INCLUDE:  OUTLOOK  RISKS & CONCERNS  INTERNAL CONTROL SYSTEMS & ITS ADEQUACY  DISCUSSION ON FINANCIAL PERFORMANCE  DISCLOSURE BY DIRECTORS ON MATERIAL FINANCIAL AND COMMERCIAL TRANSACTIONS WITH THE COMPANY  SHAREHOLDERS INFORMATION - BRIEF RESUME OF NEW/RE-APPOINTED DIRECTORS, QUARTERLY RESULTS TO BE SUBMITTED TO STOCK EXCHANGES AND TO BE PLACED ON WEB-SITE, PRESENTATION TO ANALYSTS

10. CLAUSE 49 REQUIREMENTS  SHAREHOLDERS’/INVESTORS GRIEVANCE COMMITTEE UNDER THE CHAIRMANSHIP OF INDEPENDENT DIRECTOR. MINIMUM 2 MEETINGS IN A YEAR  REPORT ON CORPORATE GOVERNANCE AND CERTIFICATE FROM AUDITORS ON COMPLIANCE OF PROVISIONS OF CORPORATE GOVERNANCE AS PER CLAUSE 49 IN THE LISTING AGREEMENT

11. RECENT DEVELOPMENTS  COMMITTEE HEADED BY SHRI NARESH CHANDRA CONSTITUTED IN AUGUST 2002 TO EXAMINE CORPORATE AUDIT, ROLE OF AUDITORS, RELATIONSHIP OF COMPANY & AUDITOR  RECOMMENDATION OF NARESH CHANDRA COMMITTEE:  RECOMMENDED A LIST OF DISQUALIFICATIONS FOR AUDIT ASSIGNMENTS LIKE DIRECT RELATIONSHIP WITH COMPANY, ANY BUSINESS RELATIONSHIP WITH CLIENT, PERSONAL RELATIONSHIP WITH DIRECTOR  AUDIT FIRMS NOT TO PROVIDE SERVICES SUCH AS ACCOUNTING, INTERNAL AUDIT ASSIGNMENTS ETC. TO AUDIT CLIENTS  AUDITOR TO DISCLOSE CONTINGENT LIABILITIES & HIGHLIGHT SIGNIFICANT ACCOUNTING POLICIES

12. RECENT DEVELOPMENTS  RECOMMENDATION OF NARESH CHANDRA COMMITTEE:  AUDIT COMMITTEE TO BE FIRST POINT OF REFERENCE FOR APPOINTMENT OF AUDITORS\  CEO & CFO OF LISTED COMPANY TO CERTIFY ON FAIRNESS, CORRECTNESS OF ANNUAL AUDITED ACCOUNTS  REDEFINITION OF INDEPENDENT DIRECTORS – DOES NOT HAVE ANY MATERIAL, PECUNIARY RELATIONSHIP OR TRANSACTION WITH THE COMPANY  COMPOSITION OF BOARD OF DIRECTORS  STATUTORY LIMIT ON THE SITTING FEE TO NON- EXECUTIVE DIRECTORS TO BE REVIEWED  RECOMMENDATIONS HAVE FORMED PART OF COMPANIES (AMENDMENT) BILL, 2003 (YET TO BE PASSED)

13. RECENT DEVELOPMENTS  SEBI CONSTITUTED A COMMITTEE HEADED BY SHRI N. R. NARAYANA MURTHY TO REVIEW EXISTING CODE OF CORPORATE GOVERNANCE  RECOMMENDATIONS:  STRENGHTENING THE RESPONSIBILITIES OF AUDIT COMMITTEE  IMPROVING QUALITY OF FINANCIAL DISCLOSURES  UTILISATION OF PROCEEDS FROM IPO  TO ASSESS & DISCLOSE BUSINESS RISKS  FORMAL CODE OF CONDUCT FOR BOARD  WHISTLE BLOWER POLICY TO BE PALCE IN A COMPANY PROVIDING FREEDOM TO APPROACH THE AUDIT COMMITTEE  SUBSIDIARIES TO BE REVIEWED BY AUDIT COMMITTEE OF HOLDING COMPANY

14. CORPORATE GOVERNANCE - ULTIMATE OBJECTIVE TO ATTAIN HIGHEST STANDARD OF PROCEDURES AND PRACTICES FOLLOWED BY THE CORPORATE WORLD SO AS TO HAVE TRANSPARENCY IN ITS FUNCTIONING WITH AN ULTIMATE AIM TO MAXIMISE THE VALUE OF VARIOUS STAKEHOLDERS.