CORPORATE GOVERNANCE PRESENTED TO:EXTERNAL EXAMINERS.

PRESENTED BY:Ms. HARSHA D BUDHRANISEAT NO.:-

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.

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

History

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.

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.

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

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.

Products

Wires & Cables

Light Duty Cables & Communication cables

Power & Control Cables

Technical Cables

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

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.

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.

Philosophy

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.

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

 

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

Code of Conduct

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.

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

Nomination & Remuneration Policy

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

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

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.

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

Whistle Blower Policy

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.

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.

Audit Committee

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.

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.

Protected Disclosure

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.

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

INVESTOR CORRESPONDENCE:

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

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