Bayer CropScience Ltd Directors Report.
Your Directors are pleased to present the 61st Annual Report on the business and operations of the Company together with the
Audited Financial Statements along with the Report of the Auditors for the financial year ended March 31, 2019.
|Financial Performance:||(र in Millions)|
|Revenue from Operations||26,857||27,490|
|Profit before Finance Costs, Depreciation and Taxation||4,104||4,482|
|(Less) : Finance Costs||(99)||(113)|
|(Less) : Depreciation and Amortisation Expense||(342)||(331)|
|Profit Before Tax||3,663||4,038|
|(Less) : Tax Expense||(1,287)||(1,037)|
|Profit for the year||2,376||3,001|
|(Less) : Other Comprehensive Income||(580)||(13)|
|Total Comprehensive Income for the year||1,796||2,988|
|Add : Retained Earnings at the beginning of the year||13,520||16,594|
|Add: Changes in fair value of equity instruments through Other Comprehensive|
|Amount available for Appropriation||15,719||19,582|
|Dividend Distribution Tax on Dividend||127||122|
|Transfer to General Reserve||299||290|
|Premium paid on Buyback of Equity shares||-||4,989|
|Transfer to Capital Redemption Reserve||-||11|
|Transaction Cost for Buyback of Equity shares||-||49|
In line with the Dividend Distribution Policy, the Board of Directors have recommended a final dividend ofर 18.00 per Equity Share of र 10 each amounting to र 618 Millions for the financial year ended March 31, 2019, subject to the approval of the members.
The Register of Members will remain closed from Friday, July 12, 2019 to Wednesday, July 24, 2019 (both days inclusive).
The export sale for the financial year ended March 31, 2019 was र 2,567 Millions as compared to र 2,496 Millions during the previous year.
During the year under review, Bayer AG (Acquirer) along with Bayer CropScience Limited (Person acting in Concert) initiated an open offer for acquisition of upto 4,488,315 equity shares of Monsanto India Limited (MIL) representing 26% of the equity share capital of MIL at a price of र 2,926.87 per share in accordance with the relevant provision of the SEBI (Substantial Acquisition of Shares and Takeover) Regulation, 2011. In the said open offer, your Company acquired 1,350,000 equity shares of Monsanto India Limited at a price of र 2,926.87 per share, aggregating to र 3,951 Millions, while acting as Person Acting in Concert as per the resolution passed by the Board of Directors of the Company at their meeting held on May 31, 2018. Pursuant to the said acquisition, your Company now holds 7.82% of the total shareholding of MIL.
Scheme of Amalgamation of Monsanto India Limited with Bayer CropScience Limited:
The Board of Directors of your Company at its meeting held on November 14, 2018, approved the Amalgamation of Monsanto India Limited (MIL) with Bayer CropScience Limited (BCSL) in consideration for equity shares of BCSL. The proposed amalgamation would be carried out vide a Scheme of Amalgamation of MIL with BCSL and their respective shareholders (Scheme) under the provisions of Sections 230 to 232 of the Companies Act, 2013 and other applicable provisions, if any. In consideration for the amalgamation of MIL with BCSL, in terms of the Scheme and basis the Valuation Report issued jointly by S.R. Batliboi & Co LLP and Bansi S. Mehta & Co., Independent Chartered Accountants and fairness opinion provided by ICICI Securities Limited, a Category-I Merchant Banker; BCSL will issue and allot two (2) equity shares of र 10 each credited as fully paid-up of BCSL for every three (3) equity shares of र 10 each held in MIL. BCSL holds 1,350,000 equity shares in MIL (7.82% of the paid up capital of MIL), and on the Scheme becoming effective, the equity shares held by BCSL in MIL shall stand cancelled.
The said Scheme shall be subject to receipt of necessary approvals of the shareholders of both the companies, regulatory authorities and National Company Law Tribunal, Mumbai Bench. The rationale of the said amalgamation is provided in the Scheme and is uploaded on the website of the Company at www.bayer.in.
Your Companys assets continue to be adequately insured against various risks like fire, riot, earthquake, terrorism and the risk of loss of profits arising due to these insurable risks also stands insured, amongst other things. In addition, adequate coverage has been availed to cover public liability, environmental liability and product liability claims. The Company has also taken Directors and Officers liability insurance policy. Stocks are insured whilst in transit and/ or stored in the warehouses. In addition, all the employees are covered against the risk of loss of life, hospitalization and personal accident.
Foreign Exchange Management:
The Companys exposure to foreign exchange risk comprises the risk of fluctuations of a foreign currency versus the local currency. The goal is to reduce the negative impact on the earnings arising from fluctuations in exchange rates in the earnings.
In this drive, majority of the forex transactions with group companies are invoiced in rupee terms effective from January 2018 thereby insulating the Companys books from forex volatility. To mitigate the currency fluctuations for the balance non-group
US dollar denominated transactions, the net exposure of the Company is hedged after taking advantage of the natural hedge on fortnightly basis.
Directors Responsibility Statement:
Pursuant to the provisions of Section 134(3)(c) of the Companies Act, 2013, ("the Act") the Board of Directors, to the best of their knowledge and belief, confirm that:
1. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any; 2. appropriate accounting policies have been selected and applied consistently and such judgments and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2019 and of the profit of the Company for the financial year ended March 31, 2019; 3. proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; 4. the annual accounts have been prepared on a going concern basis;
5. internal financial controls to be followed by the Company have been laid down and that such internal financial controls are adequate and were operating effectively and 6. proper systems to ensure compliance with the provisions of all applicable laws have been devised and that such systems were adequate and operating effectively.
Responsible Care and Quality:
Bayer considers safety as a substantial part of its core values which is also reflected by our group-wide commitment to Safety:
"Act Safe & Sustainable".
The Bombay Chamber of Commerce and Industry awarded Bayer House, Bayers head office situated at Thane as winner of the Office Safety Awards 2018 in the category of 500 and above employees. It was weighed against various pillars of Health,
Safety and Environment management like legal compliance, safe infrastructure, management commitment, environment, health & wellness, safety & emergency preparedness.
Product stewardship, replacement of hazardous materials by lesser hazardous materials, energy and resource conservation are an important part of the development process of products and their manufacturing process at Bayer manufacturing facilities. Hazard identification and risk assessment is conducted for all kinds of manufacturing activity with an objective to manage occupational and process risks. Adequate controls are maintained and monitoring mechanisms are implemented for effective control of risks. Our Active Ingredients (AI) formulation & packing facility based at Himatnagar is certified
9001:2015 Quality Management System and ISO 14001:2015 Environmental Management Systems.
Various awareness sessions including, World Environment Day, National Safety Week, Road Safety Week and Bayer Safety Day were celebrated to create awareness amongst the employees at all levels across the country. Defensive driving training is imparted to the sales employees regularly. Our business partners including warehousing, suppliers and contract manufacturers are regularly audited to improve safety performance.
Corporate Sustainability and Social Responsibility:
Bayer has been acting as a catalyst for societal progress and frontier innovations ever since Friedrich Bayer Junior laid the basis for its initiatives in 1897. Building on the 120 years history, that paved way to our Corporate Societal Engagement (CSE) approach, we seek to find, foster and scale meaningful solutions for social health challenges and the food crisis.
CSE is therefore, the central element in our sustainability model, as we believe that prosperity and sustainable progress are conceivable only within an ecosystem of balanced opportunities and appreciation for science and innovation in society. Our programs and partnerships throughout the globe are the outcomes of system-changing power of creative thinking. Therefore, our programs support novel solutions with impact and capability to solve social issues. The core areas of focus for our approach have been "Education, Science, Health and Social needs". With its sustainable initiatives, Bayer has been supporting local communities with innovative educational and social projects from time to time.
In India, Bayer has built a strong tradition as a responsible corporate citizen. Operational implementation of its initiatives is achieved with the help of non-financial targets and performance indicators throughout the value chain. A clear definition of responsibilities in the corporate structure and the identification of key areas of activity using a materiality analysis enables us to derive expected and effective results.
The Corporate policies ensure that our sustainability principles are consistently embedded in business operations and are implemented through appropriate management systems, committees and processes. The ongoing review & revision of directives and regular internal audits ensure that our management systems are continuously improvising and are in alignment with our corporate policies.
Corporate Societal Engagement:
In India, Bayer has been implementing a comprehensive approach for its Corporate Societal Engagement (CSE) projects. The pillars such as Fostering education, Fostering rural development, Empowering women and Preventive health & sanitation form the foundation of the CSE initiatives.
As a research-based company, we depend heavily on recruiting well-trained Scientists and Societys acceptance of technology. The "Fostering Education" pillar focusses on Education and Science projects. Bayer supports local communities with innovative Social projects that are based on the principle -helping people to help themselves wherein we collaborate with both Government institutions and Non-governmental organizations for an effective reach. The second pillar "Fostering Rural Development", focuses mainly on Community Development programs that are conducted across India aimed at increased awareness about health, hygiene and skill development.
Strong and empowered women help to create a better society and future for any culture. The third pillar - "Empowering
Women" has enabled us to bring out numerous innovative initiatives in the field of woman empowerment. Bayer in India, is working in active collaboration with its partnering institutions to implement a Program for Primary Prevention of Sexual Violence (PPPSV). The goal of PPPSV is to develop approaches for primary prevention of sexual violence in India through medical science and technology. Another initiative of Bayer, Discovering Hands aims to make a positive difference in the area of breast cancer as well as lend a helping hand for the visually challenged blind women in India.
The fourth pillar "Preventive Health & Sanitation" aims to provide targeted assistance in the areas of health and hygiene. Bayer has achieved a substantial reach with the local communities through its Health & sanitation initiatives.
The Company achieved significant milestones in implementing all the four pillars.
Responsible business practices are the foundation of the Bayers sustainable alignment. Risks can be identified and mitigated at an early stage by implementing this alignment in the areas of compliance (e.g. anti-corruption and responsible marketing), human resources policy, product stewardship, health, environmental protection and safety, and supplier management. This is one of the key requirements for the social acceptance of our business. On this basis, we aim to contribute to overcoming global challenges with our innovations, and in doing so, develop additional business opportunities.
The central theme of Bayers social commitment is innovation. As education is an important catalyst in achieving sustainable societal prosperity, Bayer has been making efforts in promoting science and technology in many far-flung rural areas, where educational infrastructure is in a poor shape. Keeping our focus on Vocational skill development, many of our initiatives aim to enhance skills that would help young people become employable. Our Community Development programs are implemented in various parts of the country thereby placing emphasis on enhanced awareness about health, hygiene and skill development. Our sustainable development initiatives are aimed at contributing to one of societys greatest challenges-food security as well. We focus on providing support to farmers in their efforts to increase yields while protecting the environment and thereby improving the quality of life. Bayer is committed to protecting the environment and is constantly working to reduce its impact and undertake innovative product solutions that improve resource and energy efficiency, which is befitting our mission -
"Bayer: Science for a better life."
Business Responsibility Reporting:
Regulation 34(2)(f) of the Securities and Exchange Board of India (Listing Obligations & Disclosure Requirements) Regulation, 2015, inter alia, provides that the annual report of the top 500 listed entities based on market capitalization, shall include a Business Responsibility Report (BRR). A separate section on Business Responsibility forms part of this Annual Report.
Bayers business success is largely based on the knowledge, skills, commitment and satisfaction of its employees. As an employer, we offer wide-ranging individual development opportunities at every level. Alongside professional training, we focus on conveying our corporate values defined as "LIFE"(Leadership,Integrity,Flexibility Efficiency)and establishing a dialogue-oriented corporate culture based on trust, respect for diversity and equal opportunity. Our approach towards structured working conditions include fair treatment at workplace, transparent and equitable compensation system, flexible work-timings and an environment that fosters health. These are the cornerstones of our global human resources strategy, which are designed to safeguard and expand our business activities. They strengthen our competitiveness and reflect our social responsibility to provide secure employment & stable incomes thereby encouraging social cohesion, which enables us to retain the best employees in the Company.
Employee Satisfaction is of great significance to Bayer and we measure employees satisfaction with institutionalized feedback discussions and a Group-wide Employee Survey, which is conducted every two years. This enables us to monitor the effectiveness of our initiatives and improvise. In 2018, a Pulse Survey on Engagement and Focus Behaviours was conducted in order to continue to remain in the right direction, post the encouraging outcome in 2017. The results continued to show similar level of engagement with upward progress on the aspects of Focus Behaviours. Moreover, 75% of respondents also showed belief in the actions taken up by the Company basis the findings of the Survey in 2017.
Attracting, Developing and Retaining the best managers and employees:
Your Company continues to leverage its Employer Value proposition its Employer Brand - Passion to Innovate : Power to Change, which emphasizes on the offerings and the expectations of the Group. It translates Bayers mission statement "Science for a better life" into action. Employees continue to remain the Companys most important assets. Several efforts were undertaken to improve employee capability, build greater engagement with the Company and provide opportunities for growth. These resulted in industry leading benchmarks for being an Employer of Choice. Your Companys Career Facebook and LinkedIn page continues to present Bayer in an engaging manner thereby enhancing its employer brand.
Internships and the Bayer Scholarships paves connection with the student community at a higher level. In 2018, more than 1100 students from 12 institutes applied for the Bayer Scholarships. After a thorough evaluation, wherein the shortlisted students underwent an aptitude test and an interview, 66 students were selected as Bayer Scholars.
Feedback on employee performance:
Bayer encourages a culture of candid feedback to help employees achieve their individual goals. Specific and unbiased feedback forms the basis for positive personal development. This is supported by a Group-wide performance management system. In feedback discussions, employees have the opportunity to receive feedback from their supervisors on fulfilment of their professional and behavioural objectives. significantportion of their variable This assessment also determines compensation.
Wide-ranging career opportunities:
Bayers wide-ranging business activities support in creation of multiple varied opportunities for its employees throughout the Group. Development dialogues between employees and their supervisors nurtures a healthy discussion on the career development perspectives for the employee. Job roles from non-managerial right up to management level are advertised via a globally accessible platform all through the Bayer group providing suitable openings to the employees for internal movement from time to time. Bayer also provides an opportunity to its employees to undertake International assignments, which also supports in employee development. 22 employees from India had participated in International assignments (short term and long term) in 2018.
In line with Bayers talent management philosophy, a number of employees went through various Development centres this year as well. These exercises not only support in building their capabilities, but also provide opportunities for employees to move into different roles and positions. We continuously align our learning and development investments with the business strategies as well as the evolving expectations of our employees. We are geared to create learning opportunities, build careers, and foster an empowering and inclusive culture where our employees find meaning in what they do while they create value for Bayer.
In continuation with the previous years efforts towards creation of opportunities for Learning and development for employees,
Studies in collaboration with WE School and "My Growth My Life" an initiativeslike"NIEV" -Certificate accelerated leadership development program progressed.
Since the roll out of the Bayer Competency Model, the Bayer Competencies Core and Leader, remain linked to People processes, Performance management and Talent development initiatives across the employee life cycle. The Company continues to emphasize and amplify the four focus behaviours - Customer Focus, Experimentation, Collaboration and Trust to ensure that our culture supports our strategy and purpose.
Corporate culture: dialogue, diversity, innovation:
Fairness and respect are vital elements of our corporate culture. It includes observing Group-wide standards of conduct and protecting employees from discrimination, harassment and retaliation. These standards are set forth in our Corporate Policy - "Fairness and Respect at Work." With the help of training videos and our internal website, Bayer employees around the world are provided with relevant guidance and necessary training for employees to practice Fairness and Respect at their respective workplace. Child and forced labour are strictly prohibited at Bayer in accordance with the core labour criteria of the International Labour Organization (ILO). This prohibition is set out in our binding Human Rights Policy and applies Group-wide.
Communication at all levels:
To facilitate open channels of feedback and communication within the organization, on our values, rights, policies and processes, apart from sending regular updates via mailers, blogs, intranet articles, we have instituted town halls, breakfast meets sessions with the Managing Director and Senior Leadership. WeSolve, an internal crowdsourcing platform is created for employees to post their questions relating to internal activities at Bayer. The questions are then answered by employees thereby leading to a wealth of perspectives and possible solutions/ideas. We involve our employees in business processes through active dialogue and prompt information about upcoming changes.
Creating attractive working conditions:
Competitive compensation and variable pay
Our compensation philosophy reflects pay for performance culture and elements based on the Companys shared success, alongside additional benefits. Adjustments are based on continuous benchmarking process, which makes our compensation locally competitive. This includes, among other things, the uniform evaluation of all managerial positions throughout the Group. Bayer voluntarily pays employees on permanent employment contracts in excess of the statutory minimum wage.
At Bayer, individual salaries are based on each employees personal and professional abilities vis--vis their professional assignments. At the managerial level, uniform evaluation of all positions is performed throughout the Group using the internationally recognized Hay method. Our compensation concept also includes variable one-time payments.
We offer our employees flexible working hours, option to work from home and support in childcare beyond the statutory requirements.
Initiatives to promote health and ensure safe working conditions
In 2017, Bayer adopted a new global framework concept to promote employee health and quality of life (BeWell@ Bayer). It expands the core aspect of health into a comprehensive approach. It targets improvements in the daily work environment and is aimed towards helping employees balance their professional and private lives. We aim to provide employees with access to affordable health offerings such as regular medical check-ups, sports programs and on-site medical care.
The Company also offers the employees, through an "Employee Assistance Program" which is a fully confidential support system for requirements in the areas of psychological, marital, financial and legal advice in personal matters.
Awards & Recognition:
The Company has been once again recognized as one of the 100 Best Companies for Women in India in 2018. The study conducted by AVTAR Group & Working Mother aims to recognize and bring into foray the sustained initiatives undertaken by companies to increase women workforce participation.
At Bayer, we have always been committed to creating a culture where everyone can continuously innovate, perform and develop. The above awards are a testament of our commitment to career development of our employees through state of art talent management practices and tools.
During the year under review, Mr. Richard van der Merwe retired from the services of the Company and thereby relinquished his position as the Vice-Chairman & Managing Director and Chief Executive Officer of the Company with effect from November
Dr. Miriam Colling-Hendelkens resigned from the Board as the Non-Executive Non-Independent Director of the Company with effect from February 05, 2019. Mr. Sharad M Kulkarni and Mr. Vimal Bhandari completed their tenure as Non-Executive Independent Directors of the Company and hence ceased to be the Directors of the Company with effect from end of closing hours as on March 31, 2019.
Mr. Ulrich Stefer resigned from the Board as an Executive Director with effect from May 31, 2019 consequent upon his taking over the responsibilities as the Chief Financial Officer of Bayer in Greater China. Mr. Stefer will continue to be the Chief Financial Officer of the Company till June 30, 2019.
The Board of Directors placed on record its warm appreciation for the rich and valuable contribution made by Mr. Richard van der Merwe, Dr. Miriam Colling-Hendelkens, Mr. Sharad M. Kulkarni, Mr. Vimal Bhandari and Mr. Ulrich Stefer during their tenure as Directors of the Company.
Based on the recommendation of the Nomination & Remuneration Committee, the Board of Directors have made the following appointments during the year under review:
Mr. Duraiswami Narain was appointed as an Additional Director with effect from October 23, 2018 and as Managing Director & Chief Executive Officer of the Company with effect from December 01, 2018.
Ms. Ketaki Bhagwati was appointed as an Additional Independent Director with effect from January 15, 2019.
Mr. Jens Hartmann was appointed as an Additional Non-Executive Director with effect from February 04, 2019.
Mr. Rolf Hoffmann was appointed as an Additional Director with effect from June 01, 2019 and as the Whole-time Director and Chief Financial Officer of the Company with effect from July 01, 2019.
In accordance with the provisions of Section 161 of the Act, Mr. Narain, Ms. Bhagwati, Mr. Hartmann and Mr. Hoffmann shall hold officeupto the date of the forthcoming Annual General Meeting of the Company and being eligible, offer their candidature for appointment as Director of the Company. Your approval for Mr. Narains appointment as Managing Director and Chief
Executive Officer, Ms. Bhagwati s appointment as Non-Executive Independent Director, Mr. Hartmanns appointment as Non-Executive Non-Independent Director and Mr. Hoffmanns appointment as Whole-time Director and Chief Financial Officer has been sought in the Notice convening the Annual General Meeting of the Company.
At the forthcoming 61st Annual General Meeting (AGM) of the Company and in accordance with the applicable provisions of the Act, Mr. Peter Mueller, Non-Executive Non-Independent Director retires by rotation and being eligible offers his candidature for re-appointment as Director of the Company.
The Independent Directors hold office for a fixed term of five (5) years and are not liable to retire by rotation.
In accordance with the provisions of Section 149(7) of the Act, Mr. Pankaj Patel and Ms. Ketaki Bhagwati, the Independent Directors of the Company as on March 31, 2019 have given their declarations to the Board that they meet the criteria of independence as laid down under Section 149(6) of the Act and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations") as amended.
Your Company is committed to maintaining highest standards of Corporate Governance and adhering to the Corporate Governance requirements as set out by the Securities and Exchange Board of India (SEBI). As required by Regulation 24 of the SEBI Listing Regulations, a detailed Corporate Governance Report is annexed to this Report. The Company is in full compliance with the requirements and disclosuresthathavetobemadeinthisregard.ACertificatefrom a Company Secretary in whole-time practice, confirming compliance of the Corporate Governance requirements annexedwiththeCorporateGovernanceReport.ACertificateof Corporate Governance from the Chief Executive Officer and Chief Financial Officer of the Company, in terms of the SEBI Listing Regulations, inter alia, confirming the correctness of the financial statements and cash flow statements, adequacy of internal control measures of the Company forms a part of the Corporate Governance Report.
Meetings of the Board:
During the financial year ended March 31, 2019, six (6) Board Meetings were convened and held. The details of which are given in the Corporate Governance Report.
During the financial year ended March 31, 2019, six (6) Audit Committee Meetings were convened and held. The composition of the Audit Committee is given in the Corporate Governance Report. The Board accepted all the recommendations made by the Audit Committee.
Pursuant to the provisions of the Act and SEBI Listing Regulations, the Board and Committee Evaluation was carried out during the year wherein all the members of the Board evaluated the Boards as well as Committees performance based on various parameters. The said parameters are based on the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India.
The Nomination & Remuneration Committee reviewed the performance of the individual directors based on criteria such as constructive inputs in meetings, preparedness on the issues discussed at the meetings, etc. The results of the evaluation were discussed at the Nomination & Remuneration Committee Meetings and were placed at the Board Meeting for the Chairmans review. The Evaluation process primarily focused on the criteria with respect to the overall functioning of the Board as well as the Committees, their composition, governance aspects, etc. The criteria applied in the evaluation process is explained in the Corporate Governance Report.
Nomination and Remuneration Policy:
The Company has in place a Nomination and Remuneration Policy, which is framed in accordance with the provisions of Section 178 of the Act and SEBI Listing Regulations. The Policy provides for appointment and removal of Directors, Key Managerial Personnel and Senior Management employees and their remuneration. The detailed Nomination and Remuneration Policy is available on the website of the Company at www.bayer.in.
Whistle Blower Policy (Vigil Mechanism):
Your Company has adopted a Whistle Blower Policy, as part of vigil mechanism to provide appropriate avenues to the employees as well as any third party to bring to the attention of the management any issue, which is perceived to be in violation of or in conflict with the code of conduct, values, principles and beliefs of the Company. Good Corporate Governance entails that the interest of the employees, shareholders and the society in general, is protected at all times. The established vigil mechanism helps employees to report concerns about any unethical conduct, financial malpractices or any unhealthy practice prevalent in the Company. The employees are encouraged to voice their concerns or issues by way of whistle blowing and the access to the Audit Committee is made available to all employees of the Company. The Company has also provided a dedicated email address - firstname.lastname@example.org for reporting such concerns. The Corporate Compliance Team addresses the whistle blower complaints and places the status of such complaints at the Audit Committee Meeting on a quarterly basis. The details of the Whistle Blower Policy is explained in the Corporate Governance Report and posted on the website of the Company at www.bayer.in.
Code of Conduct:
Your Company has established a Code of Business Conduct ("Code") which is applicable to the members of the Board and all employees of the Company. The Code lays down the standard of conduct, which is expected to be followed by the Directors and employees in their business dealings, and in particular, on matters relating to integrity in the work place, dealing with stakeholders and in business practices. All the Board Members and the Senior Management employees have confirmed compliance with the Code.
Risk Management Policy:
Your Company has adopted a Risk Management Policy, which outlines the risk management framework of the Company. The policy contains the following aspects:
overview of risk management;
roles and responsibilities of the Board of Directors, Audit Committee and other key managerial personnel of the Company with regards to risk management;
structure for identification, escalation and minimization of risks and
procedure for risk identification, escalation and minimization of risks.
The details on risk management policy are given in the Corporate Governance Report.
Corporate Social Responsibility Policy:
A brief outline of the Corporate Social Responsibility (CSR) Policy and the initiatives undertaken by your Company on CSR activities during the financial year ended March 31, 2019 is set out in Annexure "A" to the Directors report. The CSR policy is uploaded on the website of the Company at www.bayer.in.
Internal Control Systems:
Your Company has appropriate internal control systems for business processes with regard to its operations, financial reporting and compliance with applicable laws and regulations. The Audit Committee of the Board of Directors approves the internal audit plan and internal audits are conducted at regular intervals across various locations in line with the approved internal audit plan. Audit observations and follow-up actions are deliberated with the management of the Company as well as the Audit Committee.
Internal Financial Controls:
The Companies Act 2013, introduced regulations with focus on control and compliance requirements, in light of which, the Company has laid down Internal Financial Controls across various processes prevalent in the organisation. These controls have been established at the entity as well as process level and are designed to ensure compliance to internal control requirements, regulatory compliance and enable appropriate recording of financialand operational information. The Company has reviewed the effectiveness of its internal financial controls by adopting a systematic approach to assess the design and its operating effectiveness.
Information pursuant to Section 197(12) of the Companies Act, 2013:
The information as prescribed under the provisions of Section 197(12) of the Companies Act, 2013, read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is set out as an Annexure "E" to the Directors Report. However, as per the proviso to Rule 5, the Directors Report and Financial Statements of the financial year ended March 31, 2019 of your Company are being sent to the Members, excluding the statement giving particulars of employees under Section 197(12). Any Member interested in obtaining a copy of such statement may write to the Company
Secretary at the Registered Office of the Company.
Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo:
The information as required under the provisions of Section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014, with respect to Conservation of Energy, Technology Absorption, Foreign exchange earnings and outgo related matters is enclosed as Annexure "B" to the Directors Report.
Particulars of Loans, guarantees or investments under Section 186 of the Companies Act, 2013:
During the financial year ended March 31, 2019, your Company acquired 1,350,000 equity shares of Monsanto India Limited at a price of र 2,926.87 per share, aggregating to र 3,951 Millions, while acting as Person Acting in Concert as per the resolution passed by the Board of Directors of the Company at its meeting held on May 31, 2018. The Company did not give any loan, guarantee or provide security in connection with any loan to any group company during the year under review.
Related Party Transactions:
In accordance with the relevant provisions of the Companies Act, 2013 and rules framed thereunder as well as Regulation 23 of the SEBI Listing Regulations, your Company has in place a Related Party Transaction Policy. All the transactions entered with related parties are in accordance with the Related Party Transaction Policy and are in the ordinary course of business & at arms length.
Information on transactions entered with the related parties pursuant to Section 134(3)(h) of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014 as prescribed in Form AOC-2 for the financial year ended March 31,
2019 are given under Annexure "C" to the Directors Report.
For and on behalf of the Board of Directors
|Duraiswami Narain||Ulrich Stefer|
|Vice Chairman & Managing Director and||Executive Director &|
|Chief Executive Officer||Chief Financial Officer|
|(DIN: 03310642)||(DIN: 07447177)|
|Mumbai, May 27, 2019|