1. Concept note on Corporate Governance

2. Concept
Corporate Governance is about the separation of the powers and responsibilities of ownership, governance and management in Companies as:
Ownership belongs to shareholders
Governance is the responsibility of the Board of Directors; and
Management is delegated to the CEO and a team of Officers
to guarantee fairness, accountability and transparency.
Asset Transferred $ 1.6 MM
Goodwill $ 2.0 MM
Head Count 1250
ICD - $ 21 MM
Revenue - $ 1.8 MM per month

3. Legality Codified: Non codified:
Section 303A of the NYSE’s Listed Company Manual (NYSE)
Clause 49 of the Listing agreement (India)
Luxembourg Listing guidelines are silent on this
Non codified:
Practices, procedures, morals and ethics to be followed by Directors and the employees to effectively and efficiently discharge their responsibilities individually and collectively to the stakeholders of the Company
OECD’s (Organization for Economic Cooperation & Development) principles of Corporate Governance provide an international benchmark for best practices in Corporate Governance
Asset Transferred $ 1.6 MM
Goodwill $ 2.0 MM
Head Count 1250
ICD - $ 21 MM
Revenue - $ 1.8 MM per month

4. Executive Summary Qualified and Independent Board
Fiduciary relationship to stakeholders
Board to form and abide by code of conduct
Expert Committees:
Corporate Governance Committee
Compensation / Remuneration Committee
Audit Committee
Shareholders’ Committee
CEO/CFO verification
Corporate Governance Report
Asset Transferred $ 1.6 MM
Goodwill $ 2.0 MM
Head Count 1250
ICD - $ 21 MM
Revenue - $ 1.8 MM per month

5. Composition of the Board
Optimum combination of Executive and Non-executive directors ( Atleast 50 % non executive directors- as per Indian listing agreement)
Majority of Independent directors (NYSE)i.e.:
No material relationship with the Company
Partners, Shareholders and Employees would not be “Independent”
Asset Transferred $ 1.6 MM
Goodwill $ 2.0 MM
Head Count 1250
ICD - $ 21 MM
Revenue - $ 1.8 MM per month

6. Proactive and informed Board
Board to meet at regular intervals to review:
Annual operating plans and budgets and any updates
Capital budgets and any updates
Quarterly results
Minutes of meetings of audit committee and other committees of the board
Information on recruitment and remuneration of senior officers just below the board level, including appointment or removal of Chief Financial Officer and the Company Secretary
Show cause, demand, prosecution notices and penalty notices which are materially important
Fatal or serious accidents
Any material default in financial obligations
Any issue, which involves possible public or product liability
Asset Transferred $ 1.6 MM
Goodwill $ 2.0 MM
Head Count 1250
ICD - $ 21 MM
Revenue - $ 1.8 MM per month
Contd
Board Meeting must be held at least four times in a year , with max gap of 3 months- India

7. Proactive and informed Board contd…
Board to review:
Joint venture or collaboration agreement
Transactions that involve substantial payment towards goodwill, brand equity, or intellectual property
Significant development on Human Resources front
Sale of material nature, of investments, subsidiaries, assets, which is not in normal course of business
Details of foreign exchange exposures and the steps taken by management to limit the risks of adverse exchange rate movement
Non-compliance of any regulatory or statutory nature or listing requirements
Asset Transferred $ 1.6 MM
Goodwill $ 2.0 MM
Head Count 1250
ICD - $ 21 MM
Revenue - $ 1.8 MM per month

8. Corporate Governance (CG) Committee
Committee to comprise independent directors only (NYSE)
Must have a written charter that addresses:
Identification of potential Board members
Framing of Corporate Governance Guidelines of the Company
Framing of Code of Business conduct and ethics
Evaluation of the Board and the Management from CG perspective
Annual performance report of the CG committee
Asset Transferred $ 1.6 MM
Goodwill $ 2.0 MM
Head Count 1250
ICD - $ 21 MM
Revenue - $ 1.8 MM per month

9. Corporate Governance Guidelines
Companies must adopt and disclose Corporate Governance Guidelines addressing:
Director qualification standards
Director responsibilities
Director’s access to Management
Director compensation
Director orientation and continuing education
Management succession
Annual performance evaluation of the Board
Asset Transferred $ 1.6 MM
Goodwill $ 2.0 MM
Head Count 1250
ICD - $ 21 MM
Revenue - $ 1.8 MM per month

10. Code of Business Conduct and Ethics
Companies must adopt and disclose a code of business conduct and ethics for directors, officers and employees, addressing:
Conflicts of interest…Private Interest Vs Corporate Interest
Corporate opportunities…Personal enhancement thru Company resources
Confidentiality
Fair dealing…Not to take Unfair Advantage
Protection and proper use of company assets
Compliance with laws, rules and regulations (including insider trading laws)
Encouraging the reporting of any illegal or unethical behavior
Asset Transferred $ 1.6 MM
Goodwill $ 2.0 MM
Head Count 1250
ICD - $ 21 MM
Revenue - $ 1.8 MM per month
Contd

11. Code of Business Conduct and Ethics
Whistle Blower Policy
Establish a mechanism for employees to report to the management concerns about unethical behavior, actual or suspected fraud or violation of the company’s code of conduct or ethics policy
Adequate safeguards against victimization of employees who avail of the mechanism
Direct access to the Chairman of the Audit committee in exceptional cases
Asset Transferred $ 1.6 MM
Goodwill $ 2.0 MM
Head Count 1250
ICD - $ 21 MM
Revenue - $ 1.8 MM per month

12. Compensation Committee
Committee to comprise independent directors only(NYSE, As per India non mandatory)
Must have a written charter that addresses:
Review and approval of corporate goals and objectives relevant to CEO compensation
Determining CEO’s compensation based on evaluation of goals
Recommendation to the Board on Non-CEO executive officer compensation, Incentive compensation, Equity based plans
Preparation of Annual Compensation Committee Report
Asset Transferred $ 1.6 MM
Goodwill $ 2.0 MM
Head Count 1250
ICD - $ 21 MM
Revenue - $ 1.8 MM per month

13. Audit Committee
Committee to comprise independent directors only(NYSE, In India two third should be independent)
Atleast 3 members
All members to be financially literate and atleast one member as finance expert
Each member to be on the Board of maximum 3 Audit Committees
Must have a written charter that addresses:
Integrity of the financial statements
Compliance with legal and regulatory requirements
Internal auditors’ qualification and independence
Performance of the Internal Audit function and Independent Auditors
Preparation of an Internal Audit Report
Asset Transferred $ 1.6 MM
Goodwill $ 2.0 MM
Head Count 1250
ICD - $ 21 MM
Revenue - $ 1.8 MM per month

14. Role of the Audit Committee
Recommending the appointment and removal of internal and external auditors, fixation of audit fee etc.
Reviewing the annual financial statements before submission to the board, focusing primarily on :
Reviewing the adequacy of internal control systems
Reviewing the adequacy of internal audit function
Discussion with internal auditors, any significant findings and follow up there on
Discussion with external auditors before the audit commences about nature and scope of audit , as well as post-audit discussion to ascertain any area of concern
Reviewing the company’s financial and risk management policies
To look into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders and creditors
Report regularly to the Board of Directors on the above issues
Asset Transferred $ 1.6 MM
Goodwill $ 2.0 MM
Head Count 1250
ICD - $ 21 MM
Revenue - $ 1.8 MM per month

15. Shareholders’ Committee
Special Committee for addressing shareholders’ grievances
Transfer and transmission of shares
Serve as SPOC for all shareholders concerns
Asset Transferred $ 1.6 MM
Goodwill $ 2.0 MM
Head Count 1250
ICD - $ 21 MM
Revenue - $ 1.8 MM per month

16. CEO/CFO Verification
CEO / CFO to certify each year that the Company complies with the Corporate Governance Listing standards
Material non-compliance to be reported directly to the stock exchange
Asset Transferred $ 1.6 MM
Goodwill $ 2.0 MM
Head Count 1250
ICD - $ 21 MM
Revenue - $ 1.8 MM per month

17. To summarize as per OECD
The right Corporate Governance framework should:
protect shareholders’ rights
ensure the equitable treatment of all shareholders
recognize the rights of stake-holders as established by law
encourage active co-operation between the Company and stakeholders
ensure timely and accurate disclosures on all material matters including the financial situation, performance, ownership and governance of the company
ensure the strategic guidance of the company, the effective monitoring of management by the board, and the board’s accountability to the company and the shareholders
Asset Transferred $ 1.6 MM
Goodwill $ 2.0 MM
Head Count 1250
ICD - $ 21 MM
Revenue - $ 1.8 MM per month