Suchitra Finance & Trading Co. Ltd.

ANNUAL EVALUATION POLICY

1. INTRODUCTION:

“Suchitra Finance & Trading Co. Ltd” (herein after referred to as “the Company”) believes in conducting its affairs in a fair and transparent manner by adopting the highest standards of professionalism, integrity and ethical behavior, in consonance with the Company’s Code of Conduct Policy for its Board of Directors and the Senior Management. Each Director and executive in the Senior Management is expected to comply with the letter and spirit of this Policy.

For this purpose, the Nomination and Remuneration Committee has been obligated under Section 178 of the Companies Act, 2013 to formulate the policy for recommending to the Board of Directors, setting the criteria based on which the performance of every director including the performance of the Board shall be assessed.

2. DEFINITIONS:

  1. “The Act” means the Companies Act, 2013.
  2. “The Company” shall mean “Suchitra Finance & Trading Co. Ltd”.
  3. “The Director” or “The Board”, in relation to the Company, shall mean and deemed to include the collective body of the Board of Directors of the Company including the Chairman of the Company.
  4. “The Independent Director” shall mean an Independent Director as defined under Section 2(47) read with Section 149 (5) of the Act.
  5. “The Committee” or “This Committee” shall mean the Nomination and Remuneration Committee of the Board of Directors framed under the provisions of Section 178 of the Companies Act, 2013.

3. OBJECTIVE:

As one of the most important functions of the Board of Directors is to oversee the functioning of the Company’s top management, this Board Performance Evaluation Process aims to ensure that the individual Directors and the Board of Directors of the Company (the “Board”) as a whole work efficiently and effectively in achieving Company’s objectives. Therefore, this Policy aims at establishing a procedure for the Board to conduct periodic evaluation of its own performance and of its Committees and Individual Directors.

4. EVALUATION PARAMETERS:

The Board of Directors shall take into consideration the following parameters for the purpose of evaluating the performance of a particular director. This Appraisal is mandatory and will be done under the provisions of the clause (p) of Sub section (3) of Section 134.

5. CRITERIA FOR EVALUATION:

Rating Scale shall be 1 to 5 (1 being least effective and 5 being most effective)

RATING SCALE

Scale

Performance

5 Most effective
4 Influential
3 Effective
2 Moderate
1 Least effective

6. CRITERIA FOR PERFORMANCE EVALUATION:

1. FOR INDEPENDENT DIRECTOR

Some of the specific issues and questions that should be considered in the performance evaluation of an Independent Director, (the exercise in which the concerned Director being evaluated shall not be included) are set out below:-

S.NO.

Assessment Criteria

1 Attendance and participation in the meetings and timely inputs on the minutes of the Meetings.
2 Adherence to ethical standards & code of conduct of the Company and disclosure of Non Independence, as and when it exists and disclosure of Interest.
3 Raising of valid concerns to the Board and constructive contribution to resolution of issues at meetings.
4 Interpersonal relations with other Directors and Management.
5 Objective evaluation of Board’s performance, rendering Independent, unbiased opinion.
6 Safeguarding Interest of Whistle Blower under Vigil Mechanism and safeguard of confidential information.

Based on the above criteria each of the Independent Directors has to be assessed by the other Directors (including other Independent Directors) by giving a rating as mentioned above. The total of the ratings so awarded will be averaged over the number of persons who have awarded the ratings.

Assistance in conducting the process of evaluation shall be provided by the person as authorized by the Board and for this purpose, such person shall report to the Board.

2. WHOLE TIME DIRECTOR /MANAGING DIRECTOR/ NON-INDEPENDENT DIRECTOR

Some of the specific issues and questions that should be considered in the performance evaluation of a Whole time Director/ Managing Director/Non-Independent Director (the exercise in which the concerned Director being evaluated shall not be included) are set out below:-

S.NO.

Assessment Criteria

1 Attendance and participation in the meetings and timely inputs on the minutes of the Meetings.
2 Contribution towards growth of the Company.
3 Adherence to ethical standards & code of conduct of the Company.
4 Raising of valid concerns to the Board and constructive contribution to resolution of issues at meetings.
5 Interpersonal relations with other Directors and Management.
6 Objective evaluation of Board’s performance, rendering Independent, unbiased opinion.
7 Safeguarding Interest of Whistle Blower under Vigil Mechanism and safeguard of confidential information.
8 Leadership initiatives, teamwork attributes, supervising and providing technical support to the down line management.

Based on the above criteria each of the Independent Directors has to be assessed by the other Directors (including other Independent Directors) by giving a rating as mentioned above. The total of the ratings so awarded will be averaged over the number of persons who have awarded the ratings.

Assistance in conducting the process of evaluation shall be provided by the person as authorized by the Board and for this purpose, such person shall report to the Board.

3. FOR BOARD OF DIRECTORS

Some of the specific issues and questions that should be considered in the performance evaluation of the entire Board of Directors are set out below:-

S.NO.

Assessment Criteria

1 Is the composition of the Board appropriate with the optimum combination of Knowledge, skill set and potential which commensurate with the organization’s objectives.
2 Members of the Board meet all applicable Independence requirements.
3 The Board of Directors are effective in establishing a Corporate environment that promotes timely and effective disclosure, fiscal accountability, high ethical standards and compliance with applicable laws and regulations.
4 The Board receives regular financial updates and takes all necessary steps to ensure the operations of the organization are sound and reviews the organization’s performance in carrying out the stated mission on a regular basis.
5 The Board of Directors is effective in developing a corporate governance structure that allows and encourages the Board to fulfill its responsibilities.
6 Are sufficient numbers of Board meeting, of appropriate length, being held to enable proper consideration of issues?
7 The information provided to the directors prior to the Board meetings meets expectation in terms of length and level of details and Board members come prepared to meetings.
8 The Company’s systems of control are effective for identifying material risks and reporting material violations of policies and law and the Board is provided with sufficient information about material risks and problems that affects the Company’s business and prospects.
9 Attendance and participation in the meetings and timely inputs on the minutes of the Meetings.
10 Contribution towards growth of the Company.
11 Adherence to ethical standards & code of conduct of the Company.
12 Raising of valid concerns to the Board and constructive contribution to resolution of issues at meetings.
13 Interpersonal relations with other Directors and Management.
14 Objective evaluation of Board’s performance, rendering Independent, unbiased opinion.
15 Safeguarding Interest of Whistle Blower under Vigil Mechanism and safeguard of confidential information.
16 Leadership initiatives, teamwork attributes, supervising and providing technical support to the down line management.

Based on the above criteria each of the Independent Directors has to be assessed by the other Directors (including other Independent Directors) by giving a rating as mentioned above. The total of the ratings so awarded will be averaged over the number of persons who have awarded the ratings.

Assistance in conducting the process of evaluation shall be provided by the person as authorized by the Board and for this purpose, such person shall report to the Board.

7. The performance evaluation process and related tools will be reviewed by the “Nomination and Remuneration Committee” on need basis and the Committee may periodically seek independent external advice in relation to the process.

8. The Committee may amend the Policy, if required, to ascertain its appropriateness as per the needs of the Company. The Policy may be amended by passing a resolution at a meeting of the Nomination and Remuneration Committee.

9. DISCLOSURE:

The Company will disclose the details of its Board Performance Evaluation processes in its Board report and the key features of this Policy would also be included in the Corporate Governance Statement contained in the Annual Report of the company. The Policy will be available in the public domain .i.e. on the website of the Company.