CODE OF BUSINESS CONDUCT AND ETHICS FOR MEMBERS OF THE BOARD OF DIRECTORS

 

Directors owe the organization a duty of loyalty. The duty of loyalty requires that directors place the interest of the Company above their own and act in what they reasonably believe is the best interest of the organization.

 

Directors need to exercise leadership by conducting themselves in accordance with high standards of behavior, as a role model for others within the entity.

 

Directors need to adopt, and periodically review, a formal code of conduct defining the standards of behavior to which individual governing body members and all employees of the entity are required to subscribe. The Code of Conduct binds signatories to the highest standard of professionalism and due diligence in discharging their duties. The Code outlines areas of conflict of interest, confidentiality and responsibilities of the signatories.

 

Directors need to establish appropriate mechanisms to ensure that members of the governing body and employees of business entities are not influenced by prejudice, bias and conflict of interest.

 

1. The Chairman of the Board shall communicate to the Annual General Meeting, when it is convened, the result with respect to the significant transactions and contracts in which any Director has a personal interest. Such communication shall be accompanied by a special report from the External Auditor. The business entity shall disclose such transactions in its financial statements / Annual Report.

 

2. Directors shall declare to the Board any personal interest, whether direct or indirect (of ‘connected persons’), they may have in matters brought before the Board. This declaration shall be recorded in the minutes and the interested Directors shall not participate in the debates or voting on the resolutions to be adopted in this respect.

 

3. Also, Directors should not enter into, without the prior approval of the disinterested members of the Board, any transaction or relationship with the company in which they will have a financial or personal interest (either directly or indirectly, such as through a family member or other person or organization with which they are associated), or any transaction or situation which otherwise involves conflict of interest. If any actual or potential conflict of interest arises for a director, or a situation arises giving the appearance of an actual or potential conflict, the director shall promptly inform the Chairman of the Board or the Chairman of the Governance / Remuneration Committee. The Board, after consultation with the company counsel, will take appropriate steps to identify the actual or apparent conflicts and ensure that all directors voting on an issue are disinterested with respect to that issue.

 

4. The Company’s Directors are expected to avoid any actual or apparent conflict between their own personal interests and the interest of the Company. A conflict of interest can arise when a director takes actions or has personal interests that may interfere with his or her objective and effective performance of work for the Company. For example, directors are expected to avoid actual or apparent conflict in dealings with suppliers, customers, competitors, and other third parties.

 

5. Directors are also expected to refrain from taking for themselves or exploiting opportunities discovered through their use of corporate assets or through their positions with the Company unless the Company has already been offered the opportunity and turned it down.

 

6. Directors must maintain the confidentiality of all information so entrusted to them, except when disclosure is authorized or legally mandated. Confidential or proprietary information of the Company, and of other companies, includes any non-public information that would be harmful to the relevant company or useful or helpful to competitors if disclosed.

 

7. Directors are expected to avoid securities transactions based on material, nonpublic information learned through their positions with the Company. Directors are expected to refrain from competing with the Company.

 

8. It is the policy of the company that directors are expected to protect the assets of the Company and use them efficiently to advance the interests of the Company. Those assets include tangible and intangible assets, such as confidential information of the Company. No director should use or disclose at any time during or subsequent to employment or other service to the Company, without proper authority or mandate, confidential information obtained from any source in the course of the Company’s business. Examples of confidential information include nonpublic information about the Company’s plans, earnings, financial forecasts, business forecasts, discoveries, competitive bids, technologies and personnel.

 

9. It is the policy of the Company to take commercial decisions from a commercial standpoint. This would sometimes require the company to seek or engage in holding constructive relationship with organizations and individuals doing business, or seeking to do business with the Company. At times, this may require the giving or receiving of incidental business gifts and entertainment. Directors who are providing or receiving third-party gifts and entertainment on behalf of the Company are expected to exercise good judgment in each case, taking into account considerations that include the character and type of gift or entertainment being offered as well as its purpose. As such, all expenditures for gifts and entertainment provided by the Corporation must be accurately recorded in the books and the records of the Company. Otherwise, no Director or Executive Officer shall solicit or accept gifts, payments, loans, services or any form of compensation from suppliers, customers, competitors or others seeking to do business with the Company.

 

10. Directors should not seek competitive advantages through illegal or unethical business practices. Each Director should endeavour to deal fairly with the Company’s customers, service providers, suppliers, competitors and employees.

 

11. Cases of misconduct should be reported to the Board’s Chairman who will decide on any reactions.

 

12. The Directors should consult with the Company Secretary in case there are any doubts about conflicting or personal interests, use of information obtained through their positions with the Company etc.

 

13. This Code of Conduct does apply to the Company’s Company Secretary.

 

14. Directors should consult with the Chairman of the Board or Chairman Governance / Remuneration Committee if they want to sell or buy 25% or more of their shares in the Company.