Terms and Conditions of Appointment of Independent Directors

Professional Conduct

As an independent director, you shall:

  • Uphold ethical standards of integrity and probity;
  • Act objectively and constructively while exercising his duties;
  • Exercise his responsibilities in a bona fide manner in the interest of the company;
  • Devote sufficient time and attention to his professional obligations for informed and balanced decision making;
  • Not allow any extraneous considerations that will vitiate his exercise of objective independent judgment in the paramount interest of the company as a whole, while concurring in or dissenting from the collective judgment of the Board in its decision making;
  • Not abuse his position to the detriment of the company or its shareholders or for the purpose of gaining direct or indirect personal advantage or advantage for any associated person;
  • Refrain from any action that would lead to loss of his independence;
  • Where circumstances arise which make an independent director lose his independence, the independent director must immediately inform the Board accordingly;
  • Assist the company in implementing the best corporate governance practices.

Duties as a director of the Company

The Companies Act, 2013 and SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015 has prescribed certain duties for directors. Accordingly, a director of the Company shall:

  • Act in accordance with the Company’s Articles of Association;
  • Act in good faith in order to promote the objectives of the Company for the benefit of its members as a whole, and in the best interests of the Company, its employees, the shareholders, the Community and for the protection of environment;
  • Discharge duties with due and reasonable care, skill and diligence and shall exercise independent judgment;
  • Not to be involved in situations of conflicts or possible conflicts with the interests of the Company;
  • Not to achieve and attempt to achieve any undue gain or advantage either to self or to your relatives, partners or associates.

Responsibility. Roles and Functions

  • Responsibility

    As an independent director of the Company, one shall have the same responsibility as that of an6y other directors of the Company. The Board of the Company as a whole is collectively responsible to provide directions and supervision to the Company.

  • Role as an independent director

    The independent directors shall:

    • Help in bringing an independent judgment to bear on the Board‘s deliberations especially on issues of strategy, performance, risk management, resources, key appointments and standards of conduct;
    • bring an objective view in the evaluation of the performance of board and management;
    • scrutinize the performance of management in meeting agreed goals and objectives and monitor the reporting of performance;
    • satisfy themselves on the integrity of financial information and that financial control and the systems of risk management are robust and defensible;
    • safeguard the interests of all stakeholders, particularly the minority shareholders;
    • Balance the conflicting interest of the stakeholders;
    • determine appropriate levels of remuneration of executive directors, key managerial personnel and senior management and have a prime role in appointing and where necessary recommend removal of executive directors, key managerial personnel and senior management;
    • moderate and arbitrate in the interest of the company as a whole, in situations of conflict between management and shareholder‘s interest.
  • Duties

    The independent directors shall—

    • undertake appropriate induction and regularly update and refresh their skills, knowledge and familiarity with the company;
    • seek appropriate clarification or amplification of information and, where necessary, take and follow appropriate professional advice and opinion of outside experts at the expense of the company;
    • strive to attend all meetings of the Board of Directors and of the Board committees of which he is a member;
    • participate constructively and actively in the committees of the Board in which they are chairpersons or members;
    • strive to attend the general meetings of the company;
    • where they have concerns about the running of the company or a proposed action, ensure that these are addressed by the Board and, to the extent that they are not resolved, insist that their concerns are recorded in the minutes of the Board meeting;
    • keep themselves well informed about the company and the external environment in which it operates;
    • not to unfairly obstruct the functioning of an otherwise proper Board or committee of the Board;
    • pay sufficient attention and ensure that adequate deliberations are held before approving related party transactions and assure themselves that the same are in the interest of the company;
    • ascertain and ensure that the company has an adequate and functional vigil mechanism and to ensure that the interests of a person who uses such mechanism are not prejudicially affected on account of such use;
    • report concerns about unethical behaviour, actual or suspected fraud or violation of the company‘s code of conduct or ethics policy;
    • acting within his authority, assist in protecting the legitimate interests of the company, shareholders and its employees;
    • not disclose confidential information, including commercial secrets, technologies, advertising and sales promotion plans, unpublished price sensitive information, unless such disclosure is expressly approved by the Board or required by law.
  • Time Commitment

    An independent director shall devote such time as is prudent and necessary for the proper performance of their role, duties and responsibilities as an Independent Director.

  • Performance Appraisal / Evaluation Process

    As members of the Board, their performance as well as the performance of the entire Board and its Committees will be evaluated annually. Evaluation of each director shall be done by all the other directors. The criteria for evaluation shall be disclosed in the Company’s Annual Report. However, the actual evaluation process shall remain confidential and shall be a constructive mechanism to improve the effectiveness of the Board / Committee.

  • Disengagement

    Independent Directors may resign from the directorship of the Company by giving a notice in writing to the Company stating the reasons for resignation. The resignation shall take effect from the date on which the notice is received by the Company or the date, if any, specified by them in the notice, whichever is later.

    Their directorship on the Board of the Company shall cease in accordance with law. The Company may disengage Independent Directors prior to completion of Term (subject to compliance of relevant provisions of the 2013 Act) upon violating any provisions applicable to independent directors.