Shares and options held by non-executive / independent directors as at March 31, 2011
Equity shares (no.) |
ADS (no.) |
|
N. R. Narayana Murthy |
23,79,672 |
– |
Deepak M. Satwalekar |
56,000 |
– |
Prof. Marti G. Subrahmanyam |
– |
17,500 |
Dr. Omkar Goswami |
12,300 |
– |
Sridar A. Iyengar |
– |
– |
David L. Boyles |
– |
2,000 |
Prof. Jeffrey S. Lehman |
– |
– |
K. V. Kamath |
– |
– |
R. Seshasayee |
– |
– |
Non-executive / independent directors’ remuneration
Section 309 of the Companies Act, 1956, states that a director, who is neither in the whole-time employment of the Company nor a managing director, may be paid remuneration by way of commission, if the Company, by special resolution, authorizes such payment. Members of the Company at the Annual General Meeting held on June 22, 2007, approved payment of remuneration by way of commission to non-executive directors, at a sum not exceeding 1% per annum of our net profits. We have paid R 5.44 crore (US$ 1,218,250) as commission to our non-executive directors. The aggregate amount was arrived at as per the following criteria :
in |
US$ |
|
Fixed Board fee |
0.33 |
75,000 |
Variable fee(1) |
0.11 |
25,000 |
Chairperson of the Board |
0.22 |
50,000 |
Lead Independent Director |
0.13 |
30,000 |
Chairperson – audit committee |
0.13 |
30,000 |
Members – audit committee |
0.09 |
20,000 |
Chairperson – other committees |
0.04 |
10,000 |
Members – other committees |
0.02 |
5,000 |
crore| Notes : | 1 US$ = |
(1)Variable fee is based on the attendance at the Board meeting(s). |
Independent directors based overseas and traveling to India to attend Board meetings will be eligible to receive an additional US$ 10,000 per meeting. This is based on the fact that these independent directors have to spend at least two additional days in travel while attending Board meetings in India.
The Board believes that the above commission structure is commensurate with global best practices in terms of remunerating non-executive / independent directors of a Company of similar size and adequately compensates for the time and contribution made by our non-executive / independent directors.
Memberships in other boards
Executive directors may, with the prior consent of the Chairperson of the Board of Directors, serve on the boards of two other business entities, provided that such business entities are not in direct competition with our business operations. Executive directors are also allowed to serve on the boards of corporate or government bodies whose interests are germane to the future of the IT and software business, or the key economic institutions of the nation, or whose prime objective is benefiting society. Independent directors are not expected to serve on the boards of competing companies. Other than this, there are no limitations except those imposed by law and good corporate governance practices. The outside directorships held by each of our directors are listed in the Composition of the Board and Directorships table in this section.
B. Board meetings
Scheduling and selection of agenda items for Board meetings
Dates for Board meetings in the ensuing year are decided in advance and published as part of the Annual Report. Most Board meetings are held at our registered office at Electronics City, Bangalore, India.
Attendance of directors during fiscal 2011
Name of the director |
No. of meetings |
|
Held |
Attended |
|
N. R. Narayana Murthy |
5 |
5 |
S. Gopalakrishnan |
5 |
5 |
Prof. Marti G. Subrahmanyam |
5 |
5 |
Deepak M. Satwalekar |
5 |
5 |
Dr. Omkar Goswami |
5 |
5 |
Sridar A. Iyengar |
5 |
5 |
David L. Boyles |
5 |
5 |
Prof. Jeffrey S. Lehman |
5 |
5 |
K. V. Kamath |
5 |
5 |
R. Seshasayee |
1 |
1 |
K. Dinesh |
5 |
5 |
S. D. Shibulal |
5 |
5 |
T. V. Mohandas Pai |
5 |
5 |
Srinath Batni |
5 |
5 |
Note : All the above directors attended the Annual General Meeting held on
Availability of information to Board members
The Board has unfettered and complete access to any information within the Company, and to any of our employees. At Board meetings, managers who can provide additional insights into the items being discussed are invited.
Regular updates provided to the Board include :
- Annual operating plans and budgets, capital budgets and updates
- Quarterly results of our operating divisions or business segments
- Minutes of meetings of audit, compensation, nominations, risk management and investor grievance committees as well as abstracts of circular resolutions passed
- The Board minutes of the subsidiary companies
- General notices of interest received from directors
- Dividend data
- Information on recruitment and remuneration of senior officers just below the Board level, including appointment or removal of the CFO and Company Secretary, if any.
- Materially important litigations, show cause, demand, prosecution and penalty notices
- Fatal or serious accidents, dangerous occurrences, and issues related to material effluent or pollution
- Any materially relevant defaults in financial obligations to and by us
- Any issue that involves possible public or product liability claims of a substantial nature
- Details of joint ventures, acquisitions of companies or collaboration agreements
- Transactions that involve substantial payments toward goodwill, brand equity or intellectual property
- Any significant development involving human resources management
- Sale of material nature, of investments, subsidiaries and assets, which are not in the normal course of business
- Details of foreign exchange exposure and the steps taken by the Management to limit risks of adverse exchange rate movement
- Non-compliance of any regulatory, statutory or listing requirements, as well as shareholder services such as non-payment of dividend and delays in share transfer
Discussion with independent directors
The Board’s policy is to regularly have separate meetings with independent directors to update them on all business-related issues and new initiatives. In such meetings, the executive directors and other members of the senior management make presentations on relevant issues.
In addition, our independent directors meet periodically in an executive session that is without the Chairperson, or any of the executive directors, or the Management.
Materially significant related party transactions
There have been no materially significant related party transactions, monetary transactions or relationships between the Company and directors, the Management, subsidiary or relatives, except for those disclosed in the financial statements for the year ended March 31, 2011.