Corporate Governance of Finolex cables Ltd.

1. CORPORATE
GOVERNANC
E
PRESENTED TO:
EXTERNAL EXAMINERS.
PRESENTED BY:
Ms. HARSHA D BUDHRANI
SEAT NO.:-

2. Corporate Governance
 Definition
 The framework of rules and practices by which a board of
directors ensures accountability, fairness, and transparency
in a company's relationship with its all stakeholders
(financiers, customers, management, employees,
government, and the community).
 The corporate governance framework consists of (1) explicit
and implicit contracts between the company and the
stakeholders for distribution of responsibilities, rights, and
rewards, (2) procedures for reconciling the sometimes
conflicting interests of stakeholders in accordance with their
duties, privileges, and roles, and (3) procedures for proper
supervision, control, and information-flows to serve as a
system of checks-and-balances.

3. What is Corporate
Governance?
 James McRitchie
 Corporate governance is most often viewed as both the structure
and the relationships which determine corporate direction and
performance. The board of directors is typically central to corporate
governance. Its relationship to the other primary participants,
typically shareholders and management, is critical. Additional
participants include employees, customers, suppliers, and creditors.
The corporate governance framework also depends on the legal,
regulatory, institutional and ethical environment of the community.
Whereas the 20th century might be viewed as the age of
management, the early 21st century is predicted to be more focused
on governance. Both terms address control of corporations but
governance has always required an examination of underlying
purpose and legitimacy. – – James McRitchie, 8/1999

4. History

5.  In July 1945, two young brothers P.P Chhabria and K.P Chhabria
came to Pune from Karachi in search of a livelihood and within six
months set up a small shop selling electrical cables. The retail
business became quite successful. A sizable order in the mid 1950's
from the Defence Department for wire harnesses for trucks and
tanks bolstered their confidence and they decided to manufacture
Cables, themselves.
 Starting as a small-scale industrial unit in 1956, they manufactured
PVC insulated cables for the automobile industry. Finolex brand was
born from "Fine" & "Flexibles" and "O" with an electric arc across it -
signifying the electrical cable business the company was in. Their
relentless search for growth and doughty perseverance saw them
through some difficult times and in 1972 the enterprise turned into a
limited company.

6. CONTINUED…
 Their relentless quest for growth saw the brothers establishing Finolex
Industries Limited (FIL) in 1981. The company sought to manufacture
Rigid PVC Pipes and Fittings at Pune, which find large-scale application in
the agriculture sector. In a shrewd move towards backwards integration,
the company has set up a PVC resin manufacturing facility at Ratnagiri on
the west coast of India.
 The early nineties saw the Finolex Group expanding into new business
domains to manufacture Optic Fibre Cables and Copper Rods. Today the
Group turnover exceeds Rs.30 Billion (about US $ 750 million)
Finolex Cables Ltd (FCL) and Finolex Industries Ltd (FIL) are the two
group companies whose equity shares are listed on the Bombay Stock
Exchange and National Stock Exchange. Global Depository Receipts of
Finolex Cables Limited are also listed on the Luxembourg Stock
Exchange. Professionally managed, with continuous updating of
technology and strict quality controls, Finolex strives for maximum
customer satisfaction. Over the years, it has attained a significant position
on the industrial map of India.

7. Milestones
 Finolex Group was established in 1958 & today has turnover in excess of
Rs 4000 crores with 5 companies and 11 modern state-of-art manufacturing
facilities located at Pune, Ratnagiri, Goa & Uttarakhand
 Finolex Cables Limited, the flagship company of the Finolex group started
its operations with the manufacturing of Automobile Cables in 1958.
 In 1980 , Finolex started manufacturing 1.1 KV PVC insulated Power &
Control Cables, In 1984 , Finolex started manufacturing Jelly Filled
Telephone Cables. Thus Finolex became the first Indian company in Private
Organized Sector to supply JFT cables to DoT. Finolex is also 1st Indian
company to develop & supply Foam Skin Cable to DoT
 In 1993 Finolex Cables became the first cable company to receive ISO
9002 quality certification . In 1996, Finolex diversified its product portfolio &
started manufacturing PVC Sheets. Keeping track of global trends in 1996
Finolex launched two products viz. FR-LSH PVC Insulated Industrial Cables
& Fibre Optic Cables in. Thus Finolex Cables is the first company in India to
introduce FRLS industrial cables

8. Continued…
 As communication was becoming need of hour , in 1998 Finolex
started manufacturing Telephone & Switchboard cables. Further
expanding its product portfolio in 2006 , Finolex launched Electrical
Switches & Compact Fluorescent Lamps (CFL's)
 In 1989 Company won the Harvard Business School – Economic
Times award for Corporate Excellence; it was also declared the winner
of Voice and Data magazine’s Top Telecom Company Award in 2003;
the IIM-LIC Award for Marketing Excellence in 1994-95; Star Performer
Award for outstanding contribution to Engineering Exports during the
year 2005-06 and several other accolades have come its way
 Finolex Cables has also featured in the Top 150 Hidden Champions of
the World by World Link, Geneva. It ranked among the leading
organizations of Business India's Super 500 Corporations. In the
survey conducted by Business Today and Stern Standard, Finolex was
listed among the Best Wealth Creating Companies of India.
 Finolex Cables is the only Superbrand Cable company in India. It has
received Superbrand Status for the 3rd consecutive year.

9. Products

10. Wires &
Cables
Light Duty Cables &
Communication cables
Power & Control Cables
Technical Cables

11. Group Companies:
Finolex Cables Ltd.
Finolex Industries Ltd.
Finolex J-Power Systems Ltd.
Finolex Plasson Industries Ltd.

12. Finolex Cables Ltd
 Finolex Cables Ltd, the flagship company of the Finolex Group was
established in 1958 in Pune. Today, it is India's largest and leading
manufacturer of electrical and telecommunication cables with a turnover
in excess of Rs.16 Billion (about US $ 320 million).
 The company has manufacturing facilities at Pimpri and Urse in Pune
as well as at Goa & Uttarakhand. The company has, over the years,
established its reputation as an innovative leader and quality
manufacturer by continuously upgrading technology, modernizing
manufacturing facilities and maintaining highest standards of quality
and services. Today, the name Finolex has become synonymous with
Quality and enjoys overwhelming confidence of the customers.
Investors have also fancied its stock in view of its phenomenal progress
leading to a manifold increase on investment in stock through the years.
 The company has received the ISO 9002 systems certification across
all product lines and plants. Besides ISO 14001-quality certification has
been accorded to its plants in Urse (JFTC & Co-Axial) and Goa (JFTC
& HW) and Pimpri.

13. Continued…
 Every cable is manufactured using bright annealed
electrolytic grade copper – 99.97% pure manufactured in
house and is insulated with virgin grade PVC (manufactured
by group company Finolex Industries Limited) that is
formulated in-house.
 The company has received several honours such as Harvard
Business School Association of India - Economic Times
award for "corporate excellence"; IIM - LIC award for
'marketing' and the Engineering Export Promotion Council's
'export performance certificate'. Recently, the company was
awarded the Export House status by the Directorate General
of Foreign Trade.

14. Philosophy

15. The Company’s philosophy envisages attainment of
transparency, accountability and propriety in the total
functioning of the Company and in the conduct of its
business internally and externally, including its interactions
with employees, shareholders, deposit holders, creditors,
consumers and institutional and other lenders.
The Company believes that its systems and actions must
be dovetailed for enhancing performance and shareholder
value in the long term.

16. Board of Directors
 Mr. D.K. Chhabria Executive Chairman
 Mr. P.P. Chhabria
Dr. H.S. Vachha
Mr. Atul C. Choksey
Mr. Sanjay K. Asher
Mr. P.G. Pawar
 Mr. S.B. (Ravi) Pandit
 Mr. Pradeep R. Rathi
 Mr. Adi.J. Engineer
 Ms. Namita V. Thapar
 Mr. Mahesh Viswanathan Executive Director & Chief Financial Officer

17. Independent Directors
 Mr. A. J. Engineer
 Mr. P. G. Pawar
 Mr. S. B.(Ravi)Pandit
 Mr. S. K. Asher
 Mr. P. R. Rathi
 Dr. H. S. Vachha
 Mr. A. C. Choksey

18. Code of Conduct

19. The Board of Directors (the “Board”) and the senior
management (“core management team including all
functional heads”) of Finolex Cables Limited (the
“Company”) do affirm and subscribe to the following Code
of Conduct adopted by the Board. All employees of the
Company are exhorted to abide by this Code.

20.  Ethical Conduct / Conflict of Interest
 Transparency
 Financial reporting and records
 Internal Dealings / Gender Friendly workplace
 External Dealings
 Confidentiality of Information
 Health, Safety and Environment
 Regulatory compliance
 Protecting Company’s assets
 Reporting concerns
 Role models

21. Nomination &
Remuneration Policy

22.  The Componies Act, 2013 vide sub- section (3) o
section 178 componies ( Meeting of board and its
power) Rules, 2014 & claues 49of the Listening
Agreement As Ammended by the Securities & Action
Board of India vide Master Circular dated April 17, 2014
I; mandatory of Board of Directors of every Listed
compony to constitute a Nominal & Remuneration
Committee

23. The Nomination & Remuneration
Policy has been formulated with a
view to :-
 Devise a transparent system of determining the
appropriate level of remuneration
 encourage personnel to perform to their highest level
 provide consistency in remuneration throughout the
company &
 Offer incentives on the premise of aligning the
performance of the business with the performance of key
employees & teams with the company

24. Nomination & Remuneration
 The committee shall be formed by the Board of the
Company. It shall consist of three or more non-executive
directors out of which not less than one- half shall be
independent directors. The Board of the Company shall
nominate directors as members of the compony from
time to time.
 The Chairman of the Committee shall be an
independent Director but shall not be the Chairperson of
the Company. He shall be present at the annual
genneral meetimg, to answer the share holder’s queries
but the Chairperson may determine as to who should
answer the queries.

25. The Presently Nominated
Members Of The Committee
Are:-
 Mr. P. R. Rathi, Chairman
 Mr. Sanjay K. Asher, Member
 Mr. P. G. Pawar, Member

26. Whistle Blower
Policy

27. Whistleblowers
Can be employees, suppliers, contractors, clients or any
individual who somehow becomes aware of illegal
activities taking place in a business either through
witnessing the behavior or being told about it.

28. Section 177 of the Companies Act, 2013 as well as well
as Clause 49 of the Listing Agreement between listed
Companies and the Stock Exchanges, inter-alia, provides,
a mandatory requirement, for all listed companies to
establish a mechanism called “ Whistle Blower Policies”
for Directors & Employees to report to the management
the instances of unethical behaviour, actual or suspected
fraud or violation of the Company’s Code of Conduct or
Ethics Policy.

29. Audit Committee

30. Defintion
‘Audit Committee’means the audit committee constituted
by the Board of Directors of the Company in accordance
with the Companies Act and 49 of the Listing Agreement
of the Stock Exchanges.

31. The Chairman Of The audit
Committee Shall :-
 Make a detailed writtern record of the Protected
Discloser such as facts of the matter, findings &
recommendations of Chairman
 The Chairman of the Audit Committee of the Company
shall finalise & submit the report for further action.

32. Protected Disclosure

33. Definition
Means a Concern raised by a written communication
made in good faith that discloses demonstrates information
that may evidence unethical or improper activity and / or
any condition that may prompt occurrence of such
activities.

34. Manner of making Disclosure &
Investigation
Employees can make protected disclosure in writing to the Chairman of the
Audit Committee/ the Ethics Counsellor of the Company, as soon as
possible but not later than 30 consecutive days after becoming aware of the
same to the contact details given below:
 The Audit Commiittee Chairman
Finolex Cables Ltd.
26-27, Mumbai Pune- Road
Pimpri, Pune- 411018
e-mail: homiarvachha@homail.com
 Ethics Counsellor
Finolex Cables Ltd.
26-27, Mumbai Pune- Road
Pimpri, Pune- 411018
e-mail: mahesh_viswanathan@finolex.com

35. INVESTOR
CORRESPONDENCE:

36. The Company’s Share Department provides assistance
to shareholders under the overall supervision of Mr. R
G D’Silva, Company Secretary & Vice President (Legal).
Any query relating to shares and requests for transactions
such as transfers, transmissions, nomination facilities,
issue of duplicate share certificates, change of address
pertaining to physical shares and non-receipt of
dividends/Annual Reports, as also regarding
dematerialization of shares may please be taken up with
the Company or its Share Transfer Agent

37. Contact Persons:-
 Mr. R. G. D’Silva
Company Secretary & Vice President( Legal )
 Mr. Mahadev H Yeske
Deputy Manager – Secretarial
 Mr. Gitesh V Karandikar
Sr. Executive – Secretarial
 Mr. Milind Saraf
Share Transfer Manager