Corporate Governance

Long-term shareholders value is inextricably linked to good corporate governance, which in turn, is linked to transparency and accountability. The Company remains committed to good corporate governance and has been consistently improving transparency and accountability to all its stakeholders. The Company’s policies and practices are also unequivocally targeted towards this aim.

BOARD OF DIRECTORS Composition and category of Directors

Attendance of Directors at the Meeting of Board of Directors (BoD) held during financial year 2006-07 and the Annual General Meeting (AGM) held on 17th July, 2006 are as follows :

Five Board Meetings were held during the year. These meetings were held on 18th May, 2006, 17th July, 2006, 18th October, 2006, 29th January, 2007 and 17th March, 2007.

The record of attendance of Directors and Directorships of Public Limited Companies and Membership / Chairmanship ofBoard Committees:

@ Excludes alternate directorships / additional directorships / directorships of private companies / foreign companies.
* Includes only Audit Committee and Shareholders’ Grievance Committee.

COMMITTEES OF BOARD OF DIRECTORS
AUDIT COMMITTEE
Brief description of Terms of Reference :
To oversee the Company’s financial reporting process, to review Directors’ Responsibility Statement, changes, if any, in accounting policies and reasons for the same, qualifications in the draft audit report, performance of statutory and internal auditors, reports of the Company’s internal auditors, cost auditors and financial statements audited by the statutory auditors and also to review the information relating to Management Discussion and Analysis of financial conditions and results of operations, statement of significant related party transactions, management letter(s) of internal control weaknesses, if any, issued by statutory auditors.
Constitution : Constituted by the Board of Directors at its meeting held on
24th January, 2000.
Composition, Names of Members and : Consists of Independent Directors as under :
record of attendance during the year


SHAREHOLDERS’ / INVESTORS’ GRIEVANCE COMMITTEE
Brief description of Terms of Reference :
To specifically look into redressal of complaints like transfer of shares, non-receipt of dividends, non-receipt of annual report etc. received from shareholders / investors and improve the efficiency in investors’ service, wherever possible.
Constitution : Constituted by the Board of Directors at its meeting held on
22nd January, 2001.
Composition, Names of Members and : Consists of Directors as under :
record of attendance during the year



Details of Complaints received etc. during the year 2006-07 :

PROJECT COMMITTEE
Brief description of Terms of Reference :
To evaluate periodically projects proposed to be taken up by the Company, to review said projects and recommend to the Board of Directors (Board) for consideration and approval as also review progress of such approved projects and apprise the Board.
Constitution : Constituted by the Chairman and ratified by the Board of
Directors at its meeting held on 21st July, 2003.
Composition, Names of Members and : Consists of Directors as under :
record of attendance during the year


REMUNERATION COMMITTEE
Brief description of Terms of Reference :
To determine on behalf of the Board and shareholders with agreed terms of reference, the Company’s policy on specific remuneration packages for Executive Directors including pension rights and any compensation payments. To consider and recommend to Board commission/other remuneration package for the Non-Executive Chairman of the Company and such other matters concerning remuneration as may be referred by the Board from time to time.
Constitution : Constituted by the Board of Directors at its meeting held on
29th January, 2007.
Composition, Names of Members and : Consists of Directors as under :
record of attendance during the year

Details of remuneration paid to Executive Directors for Financial Year 2006-07 : (Rs. in Lacs)

Details of commission and sitting fees paid to Non-Executive Directors for Financial Year 2005-06# :
Shri S. S. Marathe : Rs. 4,50,000; Shri D. C. Mehta : Rs. 35,000; Shri A. C. Mehta : Rs. 45,000; Shri R. A. Shah : Rs. 4,00,000; Shri D. Basu : Rs. 5,50,000; Shri N. C. Singhal : Rs. 5,50,000; Industrial Development Bank of India (Shri Aloke Sengupta, Nominee Director) : Rs. 1,00,000; Shri U. P. Jhaveri : Rs. 2,25,000; Shri S. R. Wadhwa : Rs. 1,25,000 and Smt. Parul S. Mehta : Rs. 15,000. (# Remuneration for 2006-07 is yet to be paid) Apart from the above, the Company also pays sitting fees to Non-Executive Directors @ Rs.10,000/- per Director for each meeting.

Shares held by Non-Executive Directors :
Shri C.K. Mehta : 3,64,273 equity shares (0.41%); Smt. Parul S. Mehta : 10,00,100 equity shares (1.13%); Shri R. A. Shah : 7,900 equity shares (0.009%).

ANNUAL GENERAL MEETINGS

Details of last three Annual General Meetings held :

DISCLOSURES :
i. Disclosure on materially significant related party transactions i.e. transactions of the Company of material nature,with its Promoters, Directors or the Management, their subsidiaries or relatives, etc. that may have potential conflict with the interest of the Company at large.
None of the transactions with any of the related parties were in conflict with the interests of the Company.

ii. Details of non-compliance by the Company, penalties, strictures imposed on the Company by Stock Exchange or SEBI or any statutory authority, on any matter related to capital markets during the last three years.
The Company has complied with the requirements of regulatory authorities on matters related to capital markets and no penalties/strictures have been imposed against the Company during the last three years.

iii. Disclosures of the compliance with mandatory requirements and adoption / non-adoption of non-mandatory requirements.
The Company has complied with all the mandatory requirements and adopted part of the non-mandatory requirements.

MEANS OF COMMUNICATION
The Company publishes its financial results every quarter in leading newspapers such as The Economic Times and Maharashtra Times. The results are also displayed on the Company’s Website www.dfpcl.com