Mar 31, 2023
The Board of Directors are pleased to present the Companyâs 65th Annual Report on business and operations, together with the Audited Financial Statements along with the Report of the Auditors for the financial year ended March 31,2023.
('' in Million) |
||
Particulars |
2022-23 |
2021-22 |
Revenue from Operations |
51,397 |
47,344 |
Other Income |
639 |
546 |
Total Income |
52,036 |
47,890 |
Profit Before Tax and Exceptional Item |
8,863 |
7,883 |
Add: Exceptional Items (Refer Note 46 to Financial Statement) |
1,038 |
585 |
Profit Before Tax |
9,901 |
8,468 |
(Less): Tax Expense |
(2,319) |
(2,015) |
Profit for the year |
7,582 |
6,453 |
Add/(Less): Other Comprehensive Income |
(86) |
29 |
Total Comprehensive Income for the year |
7,496 |
6,482 |
Add: Retained Earnings at the beginning of the year |
20,465 |
21,220 |
Amount available for Appropriation |
27,961 |
27,702 |
Appropriations: |
||
Dividend declared |
1,124 |
1,124 |
Transfer to General Reserve |
645 |
495 |
Interim Dividend |
4,494 |
5,618 |
In line with the Dividend Distribution Policy, the Board of Directors have recommended a Final Dividend of '' 30 per Equity Share of '' 10 each amounting to '' 1,348 Million for the financial year ended March 31, 2023. The Final Dividend is subject to approval of the members at the ensuing Annual General Meeting of the Company. Further, the Special Dividend of '' 100 per Equity Share of '' 10 each amounting to '' 4,494 Million as recommended by the Board of Directors was paid on December 08, 2022.
The total Dividend for the financial year 2022-23, including the proposed Final Dividend, amounts to '' 130 per Equity Share of '' 10 each.
The Register of Members will remain closed from Saturday, August 05, 2023, till Saturday, August 12, 2023 (both days inclusive).
Material changes and commitments
There has been no material change and commitment, affecting the financial performance of the Company which occurred between the end of the financial year of the Company to which the financial statements relate and the date of this Report.
The export Sales for the financial year ended March 31, 2023 was '' 1,863 Million as compared to '' 1,775 Million during the previous year.
Your Companyâs assets continue to be adequately insured against various risks like fire, riot, earthquake 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.
The Companyâs 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 the exchange rates. In this endeavor, the majority of the forex transactions with group companies are invoiced in rupee terms effective from January 2018, thereby insulating the Companyâs books from forex volatility. To mitigate the currency fluctuations for the balance non-group US dollar denominated transactions, the net exposure of the Company, if required, is hedged, after taking advantage of the natural hedge, on fortnightly basis.
Directorsâ Responsibility Statement
Pursuant to the provisions of Section 134(3)(c) of the Companies Act, 2013, (âthe Actâ), 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 31,2023, and of the profit of the Company for the financial year ended March 31,2023;
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. t he 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.
During the period under review, India faced the third wave of the COVID-19 pandemic primarily caused by the Omicron variant. Though the case load was high, the severity was significantly lower than the second wave led by the Delta variant. However, BCSL continued to stay vigilant to prevent any escalation in cases at our sites, while being focused on delivering seeds and crop protection products to farmers, in accordance with the Companyâs vision of âHealth for All, Hunger for Noneâ.
The Companyâs Crisis Management Team remained alert and prepared for any surge in the pandemic. The Company monitored the external situation and government notifications and issued periodic advisories to employees to inform them of the COVID-19 precautions to be taken. The Company continued the special COVID-19 policies of providing a flexible, workplace for employees, enhanced medical care and insurance facilities and special holistic health promotion initiatives to foster holistic health & wellbeing.
Health, Safety & Environment (HSE)
The Company aspires to make an impact in sustainability that helps people and our planet thrive along relevant Environmental, Social and Governance (ESG) topics. Our Sustainability, Safety, Health and Environment (SSHE) ambition is to make Bayer the healthiest & safest place to work while protecting our environment and generating impact in sustainability around the world.
At Bayer, we respect and care for the environment and the safety, health and wellbeing of people, whether they are employees, contractors, visitors or communities where we work, and the regulatory compliance is paramount. The Company continuously improves its business processes while meeting or exceeding legal and regulatory HSE requirements. The Company provides an environment for open and transparent communication of HSE matters and
concerns. The Company recognizes that the skills and involvement of its employees are essential for fulfilling its HSE principles and commitments. We impart all the required onsite training and defensive driver training to take care of our employees when at our sites and on the road.
The Companyâs major sites are certified to various HSE management systems as follows:
⢠ISO 14001:2015 Environmental management system: Himatnagar active ingredient formulation, filling & packing (FFP) site; Silvassa FFP site and Shamirpet (Hyderabad) corn seeds processing site.
⢠ISO 45001:2018 Occupational Health and Safety management system; Shamirpet corn seeds processing site and R&D breeding site at Bengaluru.
By implementing these management systems, the sites foster a culture of continual improvement using the PDCA model (Plan-Do-Check-Act) in collaboration with our internal and external stakeholders. The Company has introduced an easy-to-use digital tool for robust HSE incident reporting and action tracking with Artificial Intelligence capabilities.
Led by the objective to create awareness amongst employees and to engage them for SSHE programs, the World Environment Day, India National Safety Week, Road Safety Week, International Self-Care Day, World Mental Health Day and Bayer Health and Safety Day are celebrated across the Company.
The Company also ensures safe operations in its value chain by periodically reviewing and handholding third party warehouses, suppliers and contract manufacturers.
With a presence for over 125 years in India, we have made significant contributions towards advancing agriculture, public health, and sustainability. The Company is constantly working to improve the quality of life in communities and collaborate to solving social challenges.
At Bayer, we want to contribute to a world where everyone has access to sufficient food and can live a healthy life. Accordingly, our corporate charitable giving to partners helps drive positive societal change supporting our purpose âScience for a better lifeâ and fueling our vision âHealth for all, Hunger for noneâ.
The programs under the Companyâs Corporate Societal Engagement (CSE) function are also aligned with the global objectives of Bayer, with the aim to promote societal progress by supporting initiatives that tackle the root-cause of issues and ideas with the potential to make a lasting impact for change.
The Company believes in the system-changing power of innovation and focus on identifying new opportunities in rural livelihoods through women-centric approaches. The Company works for the upliftment of aspirational districts, deliver innovative technology-based solutions to bridge the healthcare gap in the country and drive unified community engagement projects around education, access to water and gender equality.
Business Responsibility and Sustainability Reporting
Regulation 34(2)(f) of the Securities and Exchange Board of India (Listing Obligations & Disclosure Requirements) Regulations, 2015, inter alia, provides that the annual report of the top 1000 listed entities based on market capitalization, shall include a Business Responsibility and Sustainability Report (BRSR) describing initiatives taken by the Company from an environmental, social and governance perspective. A separate Section on BRSR forms part of this Annual Report.
The Companyâs success is built on the knowledge, passion and commitment of our people. As an employer, we offer our colleagues wide-ranging developmental opportunities and our âLIFEâ (Leadership, Integrity, Flexibility and Efficiency) values, continue to guide us as we passionately work towards our vision âHealth for all, hunger for noneâ. Bayer is focused on promoting an open dialog and feedback-oriented culture, based on trust, diversity, equity and inclusion.
In line with the global human resource strategy, the Company continues to provide an environment where fairness and respect guides all actions at the workplace. At Bayer, we continue to provide our employees with a transparent and equitable compensation system, flexible working hours and an increased focus on employee health and well-being, enabling us to retain the best-in-class employees for the company.
Measuring Employee Satisfaction
To map the employee satisfaction levels, BCSL has a system of institutionalized feedback discussions and Employee Surveys, which enables it to monitor
the effectiveness of its initiatives and accordingly improvise. To capture the sentiments of the employees, the Company conducts surveys, and our latest engagement was 4.1 on a scale of 5.
The Company offers a broad range of opportunities to fulfill the employeesâ professional aspirations and fully leverage their potential. BCSL helps its employees to build a varied and meaningful career in a community of highly talented and diverse minds to make a meaningful difference to society. At the very heart of the Companyâs HR policy, the focus remains on attracting, developing and retaining the best managers and employees.
To truly reach the Companyâs vision, we have identified the need to transform. As we drive this transformation, we must change the way we work for the better - from how we lead and build teams, to how we prioritize, operate, and make decisions. The Company has the potential to become not just better, but the best life science company and our shared purpose pushes us to always go for better.
To achieve this, we must Engage, Shape, Perform (E.S.P.):
⢠Engage to create a truly global, highly engaged organization at top performance
⢠Shape our business and organization to seize the opportunities of the future
⢠Perform to deliver on all our stakeholder commitments and on our ambitions
E.S.P. fosters ONE Bayer culture that cuts across our businesses unifying and enhancing other transformational efforts to achieve Companyâs collective success.
To grow our leadership pipeline, the Company has Bayer Leadership Academy, which is designed to build future-ready leaders at all levels. The portfolio consists of ONE Bayer Learning & Development and offers cross-divisional, global, scalable and right development experiences at the right time.
In the broad portfolio of Bayerâs development options, Mentoring and Coaching lets employees benefit from othersâ experience and receive expert guidance on development matters. Both happen on an individual, one-to-one basis and need oneâs personal commitment since they themselves drive their own development.
The Company nurtures its internal talent by providing equal opportunities for growth, through a transparent and globally accessible platform for advertizing job roles, right up to Management level. This platform facilitates internal movement within and outside of the country. The Company continues to focus on women talent and amongst the new hires, we have hired almost 30% women in the past year.
As in the past years, the Company has continued to maintain a well-crafted, fair and transparent compensation policy. The policy is based on continuous benchmarking and evaluation. The Companyâs compensation policy also provides variable pay program which is based on Company and Individual performance. Flexible working hours has the option to work from home and support childcare beyond the statutory promoting healthy work-life balance to employees. To promote good health and ensure safe working conditions, the Company since the last 3 years has been following a global framework concept to promote employee health and quality of life (BeWell@ Bayer). It also strives to provide employees with access to affordable health offerings, such as regular medical check-ups, sports programs, and on-site medical care.
In addition to the Companyâs annual insurance plan for employees, a Digital-wallet scheme with a healthcare provider for Out-Patient Department (OPD) benefits that secures employees out-of-pocket expenses and covers expenses arising from doctor, consultations, prescribed diagnostics, health check-ups etc. has been introduced.
An âEmployee Assistance Programâ - a fully confidential support system for requirements in the areas of psychological, marital, financial and legal advice in personal matters, further helps nurture the well-being of the employees.
The Company introduced special attention to welfare during the pandemic, various measures were undertaken to support employees. Measures like enhanced insurance cover, workshops for mental health, delivering masks at employeeâs residences, celebrating Bayer COVID Heroes, COVID pulse surveys, infrastructure assistance for work from home, frequent leadership connect etc.
All these initiatives were based on providing care with empathy and the employees appreciated it.
The Company has been recognized, once again featured in the 100 Best Companies for Women in India and also has been certified as a Great Place to Work by the Great Place to Work Institute.
Divestment of Environmental Science Business
As a part of a global organizational transformational strategy, Bayer AG decided to globally divest its Environmental Science Professional business in February 2021 with the aim to sharpen its focus on its core agricultural business, accelerate its strategy implementation and allow the Environmental Science Professional business to find the growth resources it needs under new ownership. Bayer AG decided to sell its Environmental Science Professional business to Cinven on March 10, 2022, and entered into definitive agreement for the said purpose.
During the year under review, the Companyâs Environmental Science Professional business along with the assets and liabilities was sold to 2022 ES Discovery India Private Limited, as a going concern, on a slump sale basis as per the Income Tax Act, 1961, for a consideration of '' 1,111 Million. 2022 ES Discovery India Private Limited, was incorporated as a special purpose legal entity under the provisions of the Act by Bayer and the said legal entity was acquired by the entities controlled by Cinven.
During the year under review, none of the Directors were appointed or resigned and hence there were no changes in the Board Composition of the Company.
At the forthcoming 65th Annual General Meeting (AGM) of the Company and in accordance with the applicable provisions of the Act, Mr. Brian Naber, 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 5 (five) years and are not liable to retire by rotation.
In accordance with the provisions of Section 149(7) of the Act, Mr. Pankaj Patel, Ms. Ketaki Bhagwati, Mr. Sekhar Natarajan and Dr. Harsh Kumar Bhanwala, the Independent Directors of the Company as on March 31, 2023, have given their declarations to the Board that they meet the criteria of I ndependence 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 (âSEBI Listing Regulationsâ) as amended.
Pursuant to the provisions of Section 203 of the Act, the Key Managerial Personnel of the Company as on March 31,2023, are Mr. Duraiswami Narain, Vice Chairman & Managing Director and CEO, Mr. Simon Britsch, Executive Director & Chief Financial Officer, Mr. Simon Wiebusch, Whole-time Director and Mr. Nikunjkumar Savaliya, Company Secretary of the Company.
The Company is committed to maintaining the highest standards of Corporate Governance and ensuring adherence to the Corporate Governance requirements, as set out by the Securities and Exchange Board of India (SEBI). As required by Regulation 34 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 disclosures that must be made in this regard. A Certificate from a Company Secretary in whole-time practice, confirming compliance of the Corporate Governance requirements by the Company, is annexed with the Corporate Governance Report. A Certificate of 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, as well as adequacy of Internal Control Measures of the Company, also forms a part of the Corporate Governance Report.
During the financial year 2022-23, five Board Meetings were convened and held. The details of the Board Composition and Board Meetings are given in the Corporate Governance Report.
During the financial year 2022-23, four Audit Committee Meetings were convened and held. The composition of the Audit Committee and the details of the Audit Committee Meetings are 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 Boardâs as well as Committeeâs 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 Chairmanâs 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 Board evaluation process is explained in the Corporate Governance Report.
Consolidated Policy - Nomination and Remuneration, Board Diversity & Performance Evaluation
The Company has a comprehensive Consolidated Policy for Nomination & Remuneration, Board Diversity and Performance Evaluation in place. The said Consolidated Policy lays down the criteria for each of the responsibilities of the Nomination & Remuneration Committee (NRC). The NRC shall be guided by the said Consolidated Policy while discharging its duties on behalf of the Company. This policy for selection and appointment of Directors, Senior Management and their remuneration, includes the criteria for determining qualifications, positive attributes, independence of a director and other matters as required. The policy is framed in accordance with the provisions of Section 178 of the Act and Regulation 19 of the SEBI Listing Regulations. The detailed policy is available on the Companyâs website at www.bayer.in.
Whistle Blower Policy (Vigil Mechanism)
As a responsible and transparent corporate citizen, BCSL has adopted a Whistle Blower Policy, as part of its 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 that 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 well-established vigil mechanism at BCSL provides all employees the opportunity to report, without fear, their concerns about any unethical conduct, financial malpractices or any unhealthy practice that may be prevalent in the Company. The employees are encouraged to voice their concerns or issues by way of whistle blowing, and the Company provides them with access to the Audit Committee. The Company through its global mechanism has also provided hotline number(s) and a dedicated weblink www.convercent.com/report for reporting such concerns. The Corporate Compliance Team addresses the whistle blower complaints and presents the status of such complaints at the Audit Committee meetings held on a quarterly basis.
The details of the Whistle Blower Policy are explained in the Corporate Governance Report and posted on the Companyâs website at www.bayer.in.
The Company has in place a Code of Conduct (âCodeâ) which is applicable to the members of the Board and the Senior Management of the Company. The Code lays down the standard of conduct expected to be followed by the Directors and Senior Management in their business dealings and on matters relating to integrity in the workplace, dealings with stakeholders and in business practices. This Code is intended to provide guidance to the Board of Directors and Senior Management of the Company to manage the affairs of the Company in an ethical manner and is formulated in accordance with the requirements of the Act and SEBI Listing Regulations.
All the Board Members and the Senior Management employees (as defined in the Code of Conduct) have confirmed compliance with the Code.
A comprehensive Risk Management Policy, outlining the risk management framework of the Company, is in place, to provide guidance on identification and mitigation of the various risks that the Company may face in the conduct of its business.
The policy covers the following key aspects:
⢠Overview of risk management
⢠Roles and responsibilities of the Board of Directors, Audit Committee, Risk Management
Committee and other key managerial personnel of the Company with regards to risk management
⢠Structure and procedure for identification, escalation and minimization of risks
More details of the 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 the Company on CSR activities during FY 2022-23, is set out in Annexure âAâ to the Directorsâ Report. The CSR policy is uploaded on the Companyâs website at www.bayer.in.
Conservation of Energy, TechnologyAbsorption and Foreign ExchangeEarnings 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 âBâ to the Directorsâ Report.
Your Company has appropriate internal control system 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.
In line with the regulations laid down in the Companies Act 2013, with respect to controls evaluation, the Company has established a robust Internal Financial Controls framework across various processes prevalent in the organization. Internal controls have been put in place at both, the entity and process levels and are designed to ensure compliance to internal control requirements as well as regulatory compliance. They also enable appropriate recording of financial and operational information. The Company has reviewed the effectiveness of its
Internal Financial Controls framework by adopting a systematic approach, which enables it to assess the design and the operating effectiveness of these controls.
Particulars of loans, guarantees or investments under Section 186 of the Companies Act, 2013
During the financial year ended March 31, 2023, the Company did not give any loan, guarantee or provided security in connection with any loan to any group company.
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, the Company has in place a Related Party Transaction Policy. All the transactions entered with related parties during the year are in accordance with the Related Party Transaction Policy and are in the ordinary course of business & at armâs-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 31,2023, are given under Annexure âCâ to the Directorsâ Report.
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 Annexure âDâ to the Directorsâ Report. However, as per the proviso to Rule 5, the Directorsâ Report and the Financial Statements of the financial year ended March 31, 2023, of the 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.
Prevention of Sexual Harassment at Workplace
Your Company has a policy on prevention of sexual harassment to ensure harassment-free workspace for the employees. Sexual harassment cases are dealt as per the prevention of sexual harassment policy.
Annual Return
In accordance with the provisions of Section 92 of the Act, the Annual Return of the Company is hosted on the website of the Company at www.bayer.in.
Compliance with Secretarial Standards
The Board of Directors affirms that the Company has complied with the applicable Secretarial Standards (SS) issued by the Institute of Companies Secretaries of India (SS-1 and SS-2), respectively relating to meetings of the Board and its Committees, which have mandatory application during the year under review.
Reporting of Fraud by Auditors
During the year under review, neither the statutory auditors nor the secretarial auditors reported to the Audit Committee of the Board, under Section 143(12) of the Act, any instances of fraud committed against the Company by its officers or employees, the details of which would need to be mentioned in the Report.
Management Discussion & Analysis Report
A detailed review of operations, performance and future outlook of your Company is given separately under the head Management Discussion & Analysis Report.
An Internal Committee (IC) has been set up by the Company to redress complaints received regarding sexual harassment. This policy is applicable to all its employees (permanent, contractual, temporary and trainees).
The following is a summary of sexual harassment complaints received and disposed of during financial year 2022-23:
Particulars |
Details |
Number of complaints pending as at the beginning of the financial year |
Nil |
Number of complaints filed during the financial year |
1 |
Number of complaints disposed during the financial year |
Nil |
Number of complaints pending as at the end of the financial year |
1* |
*The complaint was received on March 25, 2023, and the inquiries are still on-going. |
Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board has appointed M/s. BNP & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company for the financial year ending March 31,2023. The Secretarial Audit Report for the financial year ended March 31, 2023, is enclosed as Annexure âEâ to this Directorsâ Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark. The Company is in compliance with the Secretarial Standards specified by the Institute of Company Secretaries of India.
Pursuant to the provisions of Section 148 of the Act read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company in respect of âInsecticidesâ are required to be audited. The Directors have, on the recommendation of the Audit Committee, appointed M/s. D.C. Dave & Co. to audit the cost accounts of the Company pertaining to âInsecticidesâ for the financial year ending March 31, 2024. As required under the provisions of the Act, the remuneration payable to the Cost Auditor is to be placed before the Members in the Annual General Meeting for ratification. Accordingly, a resolution for seeking membersâ ratification for the remuneration payable to M/s. D.C. Dave & Co. is included at Item No. 4 of the Notice convening the Annual General Meeting.
M/s. Deloitte Haskins & Sells LLP, Chartered Accountants (ICAI Firm Registration No. 117366W/W-100018), are the Statutory Auditors of the Company, pursuant to the provisions of Section 139 of the Act and as per their appointment at the 64th Annual General Meeting held on August 22, 2022, they held office for a period of 5 (five) years i.e. from the conclusion of the 64th Annual General Meeting till the conclusion of the 69th Annual General Meeting.
For the year ended March 31, 2023, the Company paid a consolidated sum of '' 14 Million to the Statutory Auditors.
The Company has formulated its Dividend Distribution Policy based on the parameters laid down by SEBI Listing Regulations. The same is enclosed as Annexure âFâ to the Directorsâ Report and is also available on the Companyâs website at www.bayer.in.
a. There have been no significant and material orders passed by the Regulators, Courts or Tribunals which impact the going concern status and Companyâs operations in future.
b. The Internal Complaints Committee constituted in terms of the said Act, continues to be in place.
c. The Company has not accepted any deposit from the public falling within the ambit of Section 73 of the Act and the Companies (Acceptance of Deposits) Rules, 2014.
d. There was no change in the share capital or the nature of business of the Company.
e. There is no application or proceeding pending under the Insolvency & Bankruptcy Code, 2016 against the Company.
The Board of Directors wishes to thank the employees of the Company for their exemplary dedication and valued contribution, as well as their unwavering support. The Directors would like to express their grateful appreciation for the co-operation and assistance extended by all the valued stakeholders of the Company, viz. customers, government authorities, financial institutions, banks, shareholders, suppliers and other business associates. The Company also acknowledges the consistent support and guidance of its promoters.
For and on behalf of the Board of Directors
Duraiswami Narain Simon Britsch
Vice Chairman & Managing Executive Director & Director and CEO CFO
(DIN: 03310642) (DIN: 09194547)
Mumbai Germany
May 24, 2023
Mar 31, 2022
The Board of Directors are pleased to present the Companyâs 64th Annual Report on business and operations, together with the Audited Financial Statements along with the Report of the Auditors for the financial year ended March 31,2022.
('' in Million) |
||
Particulars |
2021-22 |
2020-21 |
Revenue from Operations |
47,344 |
42,613 |
Other Income |
546 |
638 |
Total Income |
47,890 |
43,251 |
Profit before Finance Costs, Depreciation and Taxation |
8,657 |
8,755 |
(Less): Finance Costs |
(129) |
(126) |
(Less): Depreciation and Amortisation Expense |
(645) |
(735) |
Profit Before Tax and Exceptional Item |
7,883 |
7,894 |
Add: Exceptional Items (Refer Note 46 to Financial Statement) |
585 |
51 |
Profit Before Tax |
8,468 |
7,945 |
(Less): Tax Expense |
(2,015) |
(3,014) |
Profit for the year |
6,453 |
4,931 |
Add: Other Comprehensive Income |
29 |
16 |
Total Comprehensive Income for the year |
6,482 |
4,947 |
Add: Retained Earnings at the beginning of the year |
21,220 |
21,898 |
Amount available for Appropriation |
27,702 |
26,845 |
Appropriations: |
||
Dividend declared |
1,124 |
1,124 |
Transfer to General Reserve |
495 |
456 |
Interim Dividend |
5,618 |
4,045 |
In line with the Dividend Distribution Policy, the Board of Directors have recommended a Final Dividend of '' 25 per Equity Share of '' 10 each amounting to '' 1,124 Million for the financial year ended March 31, 2022. The Final Dividend is subject to approval of the members at the ensuing Annual General Meeting of the Company. Further, the Special Dividend of '' 125 per Equity Share of '' 10 each amounting to '' 5,618 Million as recommended by the Board of Directors was paid on November 30, 2021.
The total Dividend for the financial year 2021-22, including the proposed Final Dividend, amounts to '' 150 per Equity Share of '' 10 each.
The Register of Members will remain closed from Saturday, August 06, 2022 till Saturday, August 13, 2022 (both days inclusive).
The export Sales for the financial year ended March 31, 2022 was '' 1,775 Million as compared to '' 1,736 Million during the previous year.
Your Companyâs 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, hospitalisation and personal accident.
The Companyâs 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 the exchange rates. In this endeavour, the majority of the forex transactions with group companies are invoiced in rupee terms effective from January 2018, thereby insulating the Companyâs books from forex volatility. To mitigate the currency fluctuations for the balance non-group US dollar denominated transactions, the net exposure of the Company, if required, is hedged, after taking advantage of the natural hedge, on fortnightly basis.
Directorsâ Responsibility Statement
Pursuant to the provisions of Section 134(3)(c) of the Companies Act, 2013, (âthe Actâ) 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 judgements 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, 2022 and of the profit of the Company for the financial year ended March 31, 2022;
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. t he 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.
During the period under review, the COVID-19 pandemic continued to be a challenge and India grappled with the devastating second wave. BCSL brought Bayerâs vision of âHealth for all, Hunger for noneâ to life also during the pandemic. The Company delivered business continuity during the pandemic by making seeds and crop protection products available to farmers. This helped to ensure that the health crisis did not turn into a hunger crisis.
The Companyâs Crisis Management Team ensured seamless cross-functional collaboration for effective COVID-19 management that extended from employees and associates to the entire value chain and our communities. The Company initiated special COVID-19 policies to create a flexible, workplace for employees, provide enhanced medical care and insurance facilities and special holistic health promotion initiatives. The CSR initiatives in India continued to focus on protecting health by organising vaccination camps, setting up oxygen concentrator banks, distributing masks, PPE kits and other medical supplies to frontline healthcare workers, doctors, farmers and local communities.
During the year, the Company received the most prestigious Global Safety Performance award from Bayer Global in November 2021 for its effective COVID-19 management. The Companyâs efforts were also featured in a COVID-19 industry compendium as a best practice.
Health, Safety & Environment (âHSEâ)
The Company aspires to make an impact in sustainability that helps people and our planet thrive along relevant Environment, Social and Governance (ESG) topics. Our Sustainability, Safety, Health and Environment (âSSHEâ) ambition is making Bayer the healthiest and safest place to work while protecting our environment and generating impact in sustainability around the world.
Your Company respects and cares for the environment and the safety, health and wellbeing of people, whether they are employees, contractors, visitors or neighbours around the world. The Company
continuously improves its business processes while meeting or exceeding legal and regulatory SSHE requirements and provides an environment for open and transparent communication of SSHE matters and concerns. The Company recognizes that the skills and involvement of its employees are essential for fulfilling its SSHE principles and commitments.
The Companyâs major sites are certified to various HSE management systems as follows:
⢠ISO 14001:2015 Environmental Management System: Himatnagar active ingredient formulation, filling & packing (FFP) site; Silvassa FFP site and Shamirpet (Hyderabad) corn seeds processing site
⢠I SO 45001:2018 Occupational Health and Safety Management System: Shamirpet corn seeds processing site and R&D breeding site at Bengaluru
By implementing these management systems, the sites foster a culture of continual improvement using the PDCA model (Plan-Do-Check-Act) in collaboration with our internal and external stakeholders.
Led by the objective to create awareness amongst employees and to engage them for SSHE programs, the World Environment Day, India National Safety Week, Road Safety Week, International Self-Care Day and Bayer Health and Safety Day are celebrated across the Company. In addition, BCSL imparts all required onsite training and defensive driver training to take care of our employees when at our sites and on the road. The Company also ensures safe operations in its value chain by periodically reviewing and creating awareness for third party warehouses, suppliers and contract manufacturers.
With a history of 125 years in India and with core competencies in the area of agriculture, the Company provides solutions to some of the worldâs most pressing challenges and committed to advancing Indian agriculture and promoting India as a key provider for agricultural solutions globally.
Our corporate charitable giving to partners helps drive positive societal change supporting our purpose âScience for a better lifeâ and fueling our vision âHealth for all, Hunger for noneâ.
Our initiatives focus on fostering and scaling meaningful solutions for social health challenges and Companyâs work in the thematic areas of Agriculture, and Community Development helps deliver on its social commitments.
The programs under the Companyâs Corporate Societal Engagement (CSE) function are also aligned with the global objectives of Bayer, while pursuing a long-term, well-planned, multi-stakeholder participatory approach result in creating a measurable impact on targeted communities.
Business Responsibility Reporting
Regulation 34(2)(f) of the Securities and Exchange Board of India (Listing Obligations & Disclosure Requirements) Regulations, 2015, inter alia, provides that the annual report of the top 1000 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.
People potential continues to be a strategic pillar for BCSL and the organisation remains committed to enable its employees to continuously focus on their growth in knowledge and skill development. âLIFEâ (Leadership, Integrity, Flexibility and Efficiency) our values, continue to guide the right kind behavior and attributes as we passionately work towards our vision âHealth for all, Hunger for noneâ.
The Company strives to provide fair treatment at workplace, a transparent and equitable compensation system, flexible work timings, and an environment that ensures health and well-being. Aligning itself to the Groupâs global human resources strategy, BCSL has structured its people philosophy to providing secure employment and stable incomes, thereby encouraging social cohesion, which enables it to retain the best employees in the Company.
Measuring Employee Satisfaction
To map the employee satisfaction levels, BCSL has a system of institutionalized feedback discussions and Employee Surveys, which enables it to monitor the effectiveness of its initiatives and accordingly improve. To capture the sentiments of the employees, the Company conducts quarterly pulse surveys, and in the third quarter of the financial year, we had an engagement score of 84%.
At the heart of the Companyâs Human Resource Policy is its focus on attracting, developing and retaining the best employees, and providing them with wide-ranging career opportunities. To strengthen the talent attraction efforts of the Company, it has now implemented a
technology platform which provides a state of art experience to the talents, while they apply for positions in the organisation. Artificial Intelligence also plays an important part in the talent attraction efforts and the Company has also invested in an artificial intelligence platform to proactively reach out to candidates who can be looked at current as well as future career opportunities within the Company.
In todayâs age and in the new normal, growth will be characterized by learning and the organisation has also launched a portal which brings a variety of learning tools at the fingertips of employees. Employees can now decide on a topic and learn more about it through concepts, video, 2-minute reads etc. and all of this when they choose to. The Company this year also launched a global mentoring tool where employees can nominate themselves as mentors and mentees and build their perspectives by leveraging the strength of Bayerâs global multi-cultural network.
In our constant endeavor to build on peopleâs capabilities, two blended learning programs were also launched for the commercial teams. These two programs, ACE and STEP UP had virtual masterclasses and the learning was continued on an app. Providing bit sized learning content through an app, ensured that the Sales colleagues were engaged with the learning throughout the course duration and also provided the flexibility to learn at any place, any time.
The Company continues to grow its internal talent through its internal job board by advertising job roles, right up to Management level, via a globally accessible platform across the Group, to facilitate internal movement within and outside of the country. The Company continues to focus on women talent and amongst the new hires, we have hired almost 28% women.
The Company has a well-crafted compensation policy, based on continuous benchmarking and evaluation, and voluntarily pays employees on permanent employment contracts more than the statutory minimum wage. The compensation concept also includes variable one-time payments. Flexible working hours, options to work from home, and support in childcare beyond the statutory requirement combine to provide a healthy work-life balance to employees. To promote good health and ensure safe working conditions, the Company has, since the last two years, been following
a global framework concept to promote employee health and quality of life (BeWell@Bayer). It also strives to provide employees with access to affordable health offerings, such as regular medical check-ups, sports programs, and on-site medical care. An âEmployee Assistance Programâ - a fully confidential support system for requirements in the areas of psychological, marital, financial, and legal advice in personal matters, further helps nurture the well-being of the employees.
In the last year, as the Company paid special attention to welfare during the pandemic, various measures were undertaken to support employees. The measures included enhanced insurance coverage, resilience workshops for mental health, delivering masks at employeeâs residences, celebrating Bayer COVID-19 Heroes, COVID-19 pulse surveys, infrastructure assistance for work from home, frequent leadership connect etc.
In addition to this, to support all the spouses of the employees who succumbed to COVID-19, we partnered with an external agency and joined their âNot Aloneâ initiative. The #NotAlone community was launched as a response to the devastating second wave of COVID-19 in May 2021, which saw many women lose their primary breadwinners to the virus. For the women and their families this was a particularly difficult time when they were alone coping with grief, social challenges, financial insecurities, succession and inheritance processes and faced difficulties in restarting their lives. The initiative was fueled by generosity and compassion from people who volunteered to be part of this program. While some needed counseling, others needed help with getting upskilled, getting jobs or even help with getting alternative accommodation. But all needed an anchor, who could provide them the safe space, to grieve and be themselves, as they slowly started rebuilding their lives.
The Key Pillars of the Initiative are:
1-1 Anchors: Every woman gets an Anchor who remains in touch with her throughout the program and connects her back to the community resources.
Grief Counseling: The therapists actively intervene when women exhibit signs of depression, intense emotional disturbance or even suicidal thoughts and have provided 1-1 grief counseling.
Financial Awareness: #NotAlone provided a helping hand to unravel the financial issues they faced, through volunteers from the Banking and Financial sector.
Volunteers also helped women understand how to plan for their short-term and long-term financial goals through individual and group sessions.
Education, Entrepreneurship and Employment:
We try to connect suitable resumes with interested employers, prepping these women for interviews and facilitating upskilling workshops.
All these initiatives were based on providing care with empathy and the employees appreciated it.
The Company has been recognized, once again featured in the 100 Best Companies for Women in India and also has been certified as a Great Place to Work by the Great Place to Work Institute.
Proposed Divestment of Environmental Science Business
As a part of a global organizational transformational strategy, Bayer AG decided to globally divest its Environmental Science Professional business in February 2021. With this planned divestment, the CropScience division will be able to sharpen its focus on its core agricultural business, accelerate its strategy implementation and allow the Environmental Science Professional business to find the growth resources it needs under new ownership.
Bayer AG decided to sell its Environmental Science Professional business to Cinven on March 10, 2022 and entered into definitive agreement for the said purpose.
The announcement will not have any immediate impact on our business continuity globally, including in India and South Asia. Business continuity for the Environmental Science Professional business and commitment to our customers and stakeholders remains our key priority.
Based on the recommendation of the Nomination & Remuneration Committee, the Board of Directors have made the following appointments/re-appointments during the year under review:
⢠Mr. Simon Britsch was appointed as an Additional Executive Director & Chief Financial Officer with effect from September 01,2021.
⢠Mr. Simon Wiebusch was appointed as an Additional Whole-time Director with effect from December 17, 2021.
⢠Mr. Brian Naber was appointed as an Additional Non-Executive Non-Independent Director with effect from January 01,2022.
In accordance with Regulation 17(1C) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, shareholdersâ approval for the above-mentioned appointment of directors was obtained through Postal Ballot with effect from March 19, 2022.
Further during the year under review, Mr. Rolf Hoffmann, Executive Director and Chief Financial Officer (CFO) has resigned with effect from August 31, 2021, Mr. Jens Hartmann has resigned with effect from December 31, 2021 and Dr. Sara Boettiger has resigned with effect from March 24, 2022. The Board of Directors placed on record its warm appreciation for the rich and valuable contributions made by Mr. Hoffmann, Mr. Hartmann and Dr. Boettiger during their tenure as Directors of the Company.
At the forthcoming 64th Annual General Meeting (AGM) of the Company and in accordance with the applicable provisions of the Act, Dr. Thomas Hoffmann, 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 5 (five) years and are not liable to retire by rotation.
In accordance with the provisions of Section 149(7) of the Act, Mr. Pankaj Patel, Ms. Ketaki Bhagwati, Mr. Sekhar Natarajan and Dr. Harsh Kumar Bhanwala, the Independent Directors of the Company as on March 31, 2022 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 (âSEBI Listing Regulationsâ) as amended.
Pursuant to the provisions of Section 203 of the Act, the Key Managerial Personnel of the Company as on March 31, 2022 are Mr. Duraiswami Narain, Vice Chairman & Managing Director and Chief Executive Officer, Mr. Simon Britsch, Executive Director & Chief Financial Officer, Mr. Simon Wiebusch, Whole-time Director and Mr. Nikunjkumar Savaliya, Company Secretary of the Company.
The Company is committed to maintaining the highest standards of Corporate Governance and ensuring adherence to the Corporate Governance requirements,
as set out by the Securities and Exchange Board of India (SEBI). As required by Regulation 34 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 disclosures that must be made in this regard. A Certificate from a Company Secretary in whole-time practice, confirming compliance of the Corporate Governance requirements by the Company, is annexed with the Corporate Governance Report. A Certificate of 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, as well as adequacy of Internal Control Measures of the Company, also forms a part of the Corporate Governance Report.
During the financial year 2021-22, seven Board Meetings were convened and held. The details of the same are given in the Corporate Governance Report.
During the financial year 2021-22, six 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 Boardâs as well as Committeeâs 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 Chairmanâs 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 Board evaluation process is explained in the Corporate Governance Report.
Consolidated Policy - Nomination and Remuneration, Board Diversity & Performance Evaluation
The Company has a comprehensive Consolidated Policy for Nomination & Remuneration, Board Diversity and Performance Evaluation in place. The said Consolidated Policy lays down the criteria for each of the responsibilities of the Nomination & Remuneration Committee (NRC). The NRC shall be guided by the said Consolidated Policy while discharging its duties on behalf of the Company. The Policy is framed in accordance with the provisions of Section 178 of the Act and Regulation 19 of the SEBI Listing Regulations. The detailed Policy is available on the Companyâs website at www.bayer.in.
Whistle Blower Policy (Vigil Mechanism)
As a responsible and transparent corporate citizen, BCSL has adopted a Whistle Blower Policy, as part of its 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 that 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 well-established vigil mechanism at BCSL provides all employees the opportunity to report, without fear, their concerns about any unethical conduct, financial malpractices or any unhealthy practice that may be prevalent in the Company. The employees are encouraged to voice their concerns or issues by way of whistle blowing, and the Company provides them with access to the Audit Committee. The Company through its global mechanism has also provided hotline number(s) and a dedicated weblink www.convercent.com/report for reporting such concerns. The Corporate Compliance Team addresses the whistle blower complaints and presents the status of such complaints at the Audit Committee meetings held on a quarterly basis.
The details of the Whistle Blower Policy are explained in the Corporate Governance Report, and also posted on the Companyâs website at www.bayer.in.
Code of Conduct
The Company has in place a Code of Conduct (âCodeâ) which is applicable to the members of the Board and the Senior Management of the Company. The Code lays down the standard of conduct expected to be followed by the Directors and Senior Management in their business dealings, and on matters relating to integrity in the workplace, dealings with stakeholders,
and in business practices. This Code is intended to provide guidance to the Board of Directors and Senior Management of the Company to manage the affairs of the Company in an ethical manner and is formulated in accordance with the requirements of the Act and SEBI Listing Regulations.
All the Board Members and the Senior Management employees (as defined in the Code of Conduct) have confirmed compliance with the Code.
A comprehensive Risk Management Policy, outlining the risk management framework of the Company, is in place, to provide guidance on identification and mitigation of the various risks that the Company may face in the conduct of its business.
The policy covers the following key aspects:
⢠Overview of risk management;
⢠Roles and responsibilities of the Board of Directors, Audit Committee, Risk Management Committee and other key managerial personnel of the Company with regards to risk management;
⢠Structure and procedure for identification, escalation and minimization of risks.
The details of the Risk Management Policy are given in the Corporate Governance Report.
The Company has formulated its Dividend Distribution Policy based on the parameters laid down by SEBI Listing Regulations. The same is enclosed in Annexure âFâ to the Directorsâ Report, and is also available on the Companyâs website at www.bayer.in.
Corporate Social Responsibility Policy
A brief outline of the Corporate Social Responsibility (CSR) Policy, and the initiatives undertaken by the Company on CSR activities during FY 2021-22, is set out in Annexure âAâ to the Directorsâ Report. The CSR policy is uploaded on the Companyâs website at www.bayer.in.
Your Company has an appropriate internal control system 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.
In line with the regulations laid down in the Companies Act, 2013, with respect to control and compliance requirements, the Company has established robust Internal Financial Controls across various processes prevalent in the organisation. These controls have been put in place at both, the entity and process levels, and are designed to ensure compliance to internal control requirements, as well as regulatory compliance. They also enable appropriate recording of financial and operational information. The Company has reviewed the effectiveness of its Internal Financial Controls by adopting a systematic approach, which enables it to assess the design and the operating effectiveness of these controls.
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 Annexure âDâ to the Directorsâ Report. However, as per the proviso to Rule 5, the Directorsâ Report and the Financial Statements of the financial year ended March 31,2022 of the 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 âBâ to the Directorsâ Report.
Particulars of Loans, guarantees or investments under Section 186 of the Companies Act, 2013
During the financial year ended March 31, 2022, the Company did not give any loan, guarantee or provided security in connection with any loan to any group Company.
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, the Company has in place a Related Party Transaction Policy. All the transactions entered with related parties during the year are in accordance with the Related Party Transaction Policy and are in the ordinary course of business and at armâs length. During the year under review, the Board reviewed the Related Party Transaction Policy as per the SEBI Listing Regulations and made relevant changes to bring it in line with the various recent amendments.
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 31,2022, are given under Annexure âCâ to the Directorsâ Report.
Prevention of Sexual Harassment at Workplace
Your Company has a policy on prevention of sexual harassment to ensure harassment-free workspace for the employees. Sexual harassment cases are dealt as per the Prevention of Sexual Harassment Policy. An Internal Committee (IC) has been set up by the Company to redress complaints received regarding sexual harassment. This Policy is applicable to all its employees (permanent, contractual, temporary and trainees).
The following is a summary of sexual harassment complaints received and disposed off during financial year 2021-22:
Number of complaints pending as at |
|
the beginning of the financial year |
Nil |
Number of complaints filed during the financial year |
Nil |
Number of complaints disposed during the financial year |
Nil |
Number of complaints pending as at the end of the financial year |
Nil |
In accordance with the provisions of Section 92 of the Companies Act, 2013, the Annual Return of the Company is hosted on the website of the Company at www.bayer.in.
Compliance with Secretarial Standards
The Board of Directors affirms that the Company has complied with the applicable Secretarial Standards
(SS) issued by the Institute of Companies Secretaries of India (SS-1 and SS-2), respectively relating to meetings of the Board and its Committees and general meetings, which have mandatory application during the year under review.
Reporting of Fraud by Auditors
During the year under review, neither the statutory auditors nor the secretarial auditors reported to the Audit Committee of the Board, under Section 143(12) of the Act, any instances of fraud committed against the Company by its officers or employees, the details of which would need to be mentioned in the Report.
Management Discussion & Analysis Report
A detailed review of operations, performance and future outlook of your Company is given separately under the head Management Discussion & Analysis Report.
Pursuant to the provisions of Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company in respect of âInsecticidesâ are required to be audited. The Directors have, on the recommendation of the Audit Committee, appointed M/s. D.C. Dave & Co. to audit the cost accounts of the Company pertaining to âInsecticidesâ for the financial year ending March 31, 2023. As required under the provisions of the Act, the remuneration payable to the Cost Auditor is to be placed before the Members in the Annual General Meeting for ratification. Accordingly, a resolution for seeking membersâ ratification for the remuneration payable to M/s. D.C. Dave & Co. is included at Item No. 6 of the Notice convening the Annual General Meeting.
M/s. Deloitte Haskins & Sells LLP, Chartered Accountants (ICAI Firm Registration No. 117366W/W-100018), are the Statutory Auditors of the Company, pursuant to the provisions of Section 139 of the Companies Act, 2013, and pursuant to their appointment, the first term of five years as the Statutory Auditors of the Company shall be completed at the ensuing 64th Annual General Meeting of the Company and being eligible they can be re-appointed for a further term of 5 (five) years i.e. from the conclusion of the 64th Annual General Meeting till the conclusion of the 69th Annual General Meeting. Accordingly, a resolution for re-appointment of M/s. Deloitte Haskins & Sells LLP is included at Item No. 4 of the Notice convening the Annual General Meeting.
For the year ended March 31, 2022, the Company paid a consolidated sum of '' 12 Million to the Statutory Auditors and all their entities.
Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board has appointed M/s. BNP & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company for the financial year ended March 31, 2022. The Secretarial Audit Report for the financial year ended March 31, 2022 is enclosed as Annexure âEâ to this Directorsâ Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark. The Company is in
compliance with the Secretarial Standards specified by the Institute of Company Secretaries of India.
The Board of Directors wishes to thank the employees of the Company for their exemplary dedication and valued contribution, as well as their unwavering support. The Directors would like to express their grateful appreciation for the co-operation and assistance extended by all the valued stakeholders of the Company, viz. customers, government authorities, financial institutions, banks, shareholders, suppliers and other business associates. The Company also acknowledges the consistent support and guidance of its promoters.
For and on behalf of the Board of Directors
Chairman (DIN: 00131852)
Mar 31, 2021
The Board of Directors are pleased to present the Company''s 63rd Annual Report on business and operations, together with the Audited Financial Statements along with the Report of the Auditors for the financial year ended March 31, 2021.
('' in Million) |
||
Particulars |
2020-21 |
2019-20 |
Revenue from Operations |
42,613 |
36,094 |
Other Income |
638 |
660 |
Total Income |
43,251 |
36,754 |
Profit before Finance Costs, Depreciation and Taxation |
8,755 |
7,924 |
(Less) : Finance Costs |
(126) |
(138) |
(Less) : Depreciation and Amortisation Expense |
(735) |
(653) |
Profit Before Tax and Exceptional Item |
7,894 |
7,133 |
(Less) : Exceptional Items# |
(51) |
(1,302) |
Profit Before Tax |
7,945 |
5,831 |
(Less) : Tax Expense |
(3,014) |
(1,086) |
Profit for the year |
4,931 |
4,745 |
(Less) : Other Comprehensive Income |
(16) |
(182) |
Total Comprehensive Income for the year |
4,947 |
4,563 |
Add : Retained Earnings at the beginning of the year |
21,898 |
18,897 |
Amount available for Appropriation |
26,845 |
23,460 |
Appropriations: |
||
Dividend declared |
1,124 |
1,016 |
Dividend Distribution Tax |
- |
216 |
Transfer to General Reserve |
456 |
330 |
Interim Dividend |
4,045 |
- |
* Exceptional items consist of i) Expense in relation to/ (reversal of provision for) separation of employees arising from restructuring measures due to amalgamation of Monsanto India Limited with Bayer CropScience Limited and Bayer 2022 global efficiency programme.
In line with the Dividend Distribution Policy, the Board of Directors have recommended Final Dividend of '' 25 per Equity Share of '' 10 each amounting to '' 1,124 million for the financial year ended March 31, 2021. The Final Dividend is subject to approval of the members at the ensuing Annual General Meeting of the Company. Further, an Interim Dividend of '' 90 per Equity Share of '' 10 each amounting to '' 4,045 million as recommended by the Board of Directors was paid on July 10, 2020.
The total Dividend for the financial year 2020-21, including the proposed Final Dividend, amounts to '' 115 per Equity Share.
The Register of Members will remain closed from Thursday, July 29, 2021 till Thursday, August 05, 2021 (both days inclusive).
The Company''s 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, hospitalisation and personal accident.
The Company''s 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 the exchange rates.
In this endeavour, majority of the forex transactions with group companies are invoiced in rupee terms effective from January 2018, thereby insulating the Company''s books from forex volatility. To mitigate the currency fluctuations for the balance non-group US dollar-denominated transactions, the net exposure of the Company, if required, is hedged, after taking advantage of the natural hedge, on fortnightly basis.
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 judgements 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 31,2021 and of the profit of the Company for the financial year ended March 31, 2021;
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. t he 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.
The world at large, including India, is still grappling with the COVID-19 pandemic and BCSL, as a responsible corporate citizen, is doing its bit in curtailing the spread of the deadly virus by ensuring that all its sites and locations, across India, strictly adhere to the COVID-19 safety protocols. With the objective to enhance the health and well-being of BCSL''s most valuable resource i.e. employees, the Company has undertaken various initiatives and conducted several virtual sessions, aimed at increasing the awareness towards the safety precautions as well as building behavioural changes, so that our employees act as safety ambassadors for their immediate family and society at large.
Over the period under review, BCSL has adopted various measures to serve the basic needs of people and help them fight against the COVID-19 pandemic around the globe. The Company catered to production and supply of agri-inputs including seeds, crop-protection and advisory, and provided immediate assistance for smallholder farmers across India through its ''Better Farms, Better Lives'' initiative. Other than this, its CSE initiatives in India focussed on protecting health by distributing masks, PPE kits and other medical supplies to frontline healthcare workers, doctors, farmers and local communities. The Company also partnered with the Government of Maharashtra and provided it with financial aid for the development of a digital tool for assessment and overall management of the pandemic.
During the year, the Company received an award from Grant Thornton Bharat SABERA 2020, under the category ''Responsible Business of the Year''. The award acknowledges BCSL''s commitment towards sustainable development, being inclusive, ethical, transparent, and effectively engaging with stakeholders in the Companyâs CSE efforts to fight COVID-19.
BCSL cares for the environment and the safety, health and well-being of people, whether they are employees, contractors, visitors or neighbours around its sites. The Company aims to enable safe and healthy workplaces and to protect people and environment, at the same time, ensuring responsible use of resources to support sustainable corporate growth. At the core of BCSL''s Health, Safety & Environment
(HSE) programmes is âHazard Identification and Risk Assessment'', which is conducted for all kinds of routine and non-routine manufacturing activities with an objective to eliminate or mitigate all occupational safety and process risks. Adequate controls are then implemented and monitoring mechanisms are put in place for effective control of risks.
The Companyâs major sites are certified by various
HSE Management Systems as follows:
⢠ISO 14001:2015 Environmental Management System: Himatnagar active ingredient formulation, filling & packing (FFP) site; Silvassa FFP site and Shamirpet (Hyderabad) corn seeds processing site
⢠OHSAS 18001:2007 Occupational Health
& Safety Management System: Silvassa glyphosate herbicide formulation site and Shamirpet corn seeds processing site
⢠ISO 45001:2018 Occupational Health and
Safety Management System: Bengaluru R&D breeding site
By implementing these management systems, BCSL''s sites foster a culture of continual improvement using the PDCA model (Plan-Do-Check-Act), in collaboration with internal and external stakeholders.
Led by the objective to create awareness amongst employees and to engage them with BCSL''s HSE programmes, the World Environment Day, National Safety Week, Road Safety Week and Bayer Safety Day are celebrated across the Company. In addition, BCSL imparts all the required onsite training and defensive driver training to ensure employee safety, when at sites and on the road. The Company also ensures safe operations in its value chain by periodically reviewing its warehouses, suppliers and contract manufacturers.
At BCSL, science and innovation are at the heart of every process and endeavour. With a history of more than a century in India and core competencies in the areas of healthcare and agriculture, the Company provides solutions to some of the world''s most pressing challenges. Its corporate charitable giving to partners helps drive positive societal change supporting BCSL''s purpose "Science for a better life" and fuelling its vision "Health for all, Hunger for none", particularly contributing towards its global ambitious sustainability goals, which are aligned with the United Nations
Sustainable Development Goals, such as combating hunger and providing health care; empowering women; redoubling efforts to reduce greenhouse gases; and tackling the impacts of climate change.
The programmes under BCSL''s Corporate Societal Engagement (CSE) function are aligned with its global objectives and adopt a long-term, well planned, multi-stakeholder participatory approach which results in creating a measurable impact on targeted communities.
Regulation 34(2)(f) of the Securities and Exchange Board of India (Listing Obligations & Disclosure Requirements) Regulations, 2015, inter alia, provides that the annual report of the top 1000 listed entities based on market capitalisation, shall include a Business Responsibility Report (BRR). A separate section on Business Responsibility forms part of this Annual Report.
BCSL follows a people-centric philosophy, with its employees at the core of its business and growth strategy, facilitating them with adequate opportunities for knowledge enhancement and skill development. Led by the Company''s core values of "LIFE" (Leadership, Integrity, Flexibility and Efficiency), the Company continually strives to provide fair treatment at workplace, a transparent and equitable compensation system, flexible work timings, coupled with a positive work environment which encourages the employees to unleash their potential, deliver best performance and enhances their health and well-being.
The Company''s Human Resource Policy is centred around the progressive growth of its employees through active engagement, professional trainings and an open environment for performance assessment and feedbacks. This, in alignment with Group''s global human resources strategy, strengthens the Company in its objective of providing secure employment & stable incomes, thereby encouraging social cohesion, which enables it to retain the best employees in the Company.
To map the employee satisfaction levels, BCSL has in place a system of institutionalised feedback discussions and Employee Surveys, which enables it to monitor the effectiveness of its initiatives and
accordingly improvise. To capture the sentiments of the employees during the integration phase, the Company conducted quarterly pulse surveys in the third quarter of the financial year which showed an engagement of 84%.
At the heart of the Company''s HR Policy is its focus on attracting, developing, and retaining the best managers and employees, and providing them with wide-ranging career opportunities. To strengthen the Talent Attraction efforts of the Company, it has now implemented a technology platform which provides a state-of-the-art experience to the talents, while they apply for positions in BCSL. Cognisant of the significant role played by Artificial Intelligence in the Talent Attraction efforts, the Company has also invested in an Artificial Intelligence platform which enables it to proactively reach out to candidates who can be looked at for the current as well as future career opportunities within the Company.
In today''s age and in the new normal, growth will be characterised by learning. Fully aware of this, BCSL has launched a portal which brings a variety of learning tools at the fingertips of employees and allows them to decide on a topic and learn more about it through concepts, video, 2-minute read etc. The Company, this year, also launched a global mentoring tool, where employees can nominate themselves as mentors and mentees and build their perspectives by leveraging the strength of this global multi-cultural network.
In a constant endeavour to build on people''s capabilities, two blended learning programmes, ACE and STEP UP, were also launched for the commercial teams. Virtual master classes were organised for these programmes, providing bit-sized learning content through an application, to ensure that the sales team remains engaged in the leaning process throughout the duration of the course, with the flexibility to learn anytime, at any place.
The Company nurtures its internal talent, providing them with equal opportunities to growth, through a transparent and globally accessible platform of advertising job roles, right up to the Management level. The platform lists down the available job roles across domestic and international locations, facilitating the employees to undertake international assignments and enjoy greater exposure. The Company continues
to focus on women talent and has hired almost 28% women amongst the new hires.
BCSL has a well-crafted compensation policy, based on continuous benchmarking and evaluation, and voluntarily pays employees on permanent employment contracts more than the statutory minimum wage. The compensation concept also includes variable one-time payments. Flexible working hours, option to work from home, and support in childcare beyond the statutory requirement combine to provide a healthy work-life balance to employees. To promote good health and ensure safe working conditions, the Company has, since the last 2 years, been following a global framework concept to promote employee health and quality of life (BeWell@Bayer). It also strives to provide its employees with access to affordable health offerings, such as regular medical check-ups, sports programmes, and on-site medical care. An "Employee Assistance Programâ, a fully confidential support system for requirements in the areas of psychological, marital, financial, and legal advice in personal matters, further helps nurture the well-being of the employees.
In the last year, the Company paid special attention to welfare during the pandemic and various measures were undertaken to support employees. Measures like enhanced insurance cover, Resilience workshops for Mental Health, delivering masks at employee''s residences, celebrating Bayer COVID-19 Heroes, COVID-19 pulse surveys, infrastructure assistance for work from home, frequent leadership connect etc. were based on providing care with empathy and were widely appreciated by the employees.
The Company has been recognised, for the fourth time in row, as Best Employer by Kincentric, based on a study backed with engagement research of multiple organisations. The study methodology involved a long rigorous process, vetted by a panel of external, independent jury members, representing eminent business leaders and academicians. The Company has also once again featured in the 100 Best Companies for Women in India. The Employers Federation of India also recognised the Company by conferring the National Award for Excellence in Employee Relations. Internally, the Company received the Crop Science Global Inclusion and Diversity Award for its ''Gender Smart Agriculture''.
As a part of a global organisational transformational strategy, Bayer AG plans to globally divest its Environmental Science Professional business. With this planned divestment, the CropScience division will be able to sharpen its focus on its core agricultural business, accelerate its strategy implementation and allow Environmental Science Business to find the growth resources it needs under new ownership.
Bayer AG will seek an acquirer who shares the Company''s vision of creating an independent, sustainable, industry leader and who is committed to the long-term growth and success of Environmental Science. In this set-up, Environmental Science would be able to accelerate its innovation engine, bringing new chemistries, knowledge and stewardship, as well as digital and data-enabled solutions to our customers.
The announcement will not have any immediate impact on our business continuity globally, including in India and South Asia. Business continuity for the Environmental Science business and commitment to our customers and stakeholders remains our key priority. Bayer AG will work hard to identify an acquirer who will provide long-term growth opportunities for our business, employees and shares our commitment to building strong, lasting relationships with our stakeholders.
In respect of certain past years, with a view to give certainty and effectively close long-pending disputes and litigations under the Income Tax Act, 1961, the Company had filed an application under The Direct Tax Vivad Se Vishwas Act, 2020 ("VSV Act") and related rules. Consequent to the tax authority''s order under VSV Act in December 2020, the Board at its Meeting held on February 11, 2021 decided to accept the order passed under the VSV Act and recognised an additional tax expense of '' 1,272 million (net) for the quarter and nine months ended December 31, 2020.
Based on the recommendation of the Nomination and Remuneration Committee, the Board of Directors have made the following appointments/re-appointments during the year under review:
⢠Dr. Sara Boettiger was appointed as an Additional Non-Executive Non-Independent Director with effect from February 12. 2021.
⢠Dr. Harsh Kumar Bhanwala was appointed as an Additional Non-Executive Independent Director with effect from February 12, 2021.
⢠Mr. Pankaj Patel was re-appointed as a Non-Executive Independent Director for a second term of five consecutive years.
The said appointments shall be subject to approval of the shareholders at the forthcoming Annual General Meeting of the Company.
In accordance with the provisions of Section 161 of the Act, Dr. Boettiger and Dr. Bhanwala shall hold office up to the date of the forthcoming Annual General Meeting of the Company and being eligible, offer their candidature for appointment as Director of the Company.
Mr. Pankaj Patelâs first term of appointment as a Non-Executive Independent Director concludes on September 11, 2021 and is eligible for
re-appointment for another term of five consecutive years subject to approval of the Members by Special Resolution. BCSL has sought the approval of all shareholders for Dr. Boettiger''s appointment as Non-Executive Non-Independent Director, Dr. Bhanwala''s appointment as Non-Executive Independent Director for a term of five consecutive years and Mr. Pankaj Patel''s re-appointment as Non-Executive Independent Director for a second term of five consecutive years.
At the forthcoming 63rd Annual General Meeting (AGM) of the Company and in accordance with the applicable provisions of the Act, Dr. Thomas Hoffmann, 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, Ms. Ketaki Bhagwati, Mr. Sekhar Natarajan and Dr. Harsh Kumar Bhanwala, the Independent Directors of the Company as on March 31, 2021 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.
Pursuant to the provisions of Section 203 of the Act, the Key Managerial Personnel of the Company as on March 31, 2021 are Mr. Duraiswami Narain, Managing Director & Chief Executive Officer, Mr. Rolf Hoffmann, Executive Director & Chief Financial Officer and Mr. Nikunjkumar Savaliya, Company Secretary.
The Company is committed to maintaining the highest standards of Corporate Governance and ensuring adherence 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 disclosures that must be made in this regard. A Certificate from a Company Secretary in whole-time practice, confirming compliance of the Corporate Governance requirements by the Company, is annexed with the Corporate Governance Report. A Certificate of 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, as well as adequacy of Internal Control Measures of the Company, also forms a part of the Corporate Governance Report.
During the financial year 2020-21, six Board Meetings were convened and held. The details of the same are given in the Corporate Governance Report.
During the financial year 2020-21, five 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 Board''s as well as Committee''s 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 and 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 and Remuneration Committee Meetings and were placed at the Board Meeting for the Chairman''s review. The evaluation process primarily focussed 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 Board evaluation process is explained in the Corporate Governance Report.
Consolidated Policy - Nomination and Remuneration, Board Diversity & Performance Evaluation
During the year under review, the Board reviewed the existing policy on Nomination & Remuneration and Performance Evaluation and adopted a Consolidated Policy for Nomination & Remuneration, Board Diversity and Performance Evaluation, thereby making the policy more comprehensive. The said Consolidated Policy lays down the criteria for each of the responsibilities of the Nomination and Remuneration Committee ("NRC"). The NRC shall be guided by the said Consolidated Policy while discharging its duties on behalf of the Company. The Consolidated Policy is framed in accordance with the provisions of Section 178 of the Act and Regulation 19 of the SEBI Listing Regulations. The detailed Consolidated Policy is available on the Company''s website at www.bayer.in.
As a responsible and transparent corporate citizen, BCSL has adopted a Whistle Blower Policy, as part of its 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 that 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 well-established vigil mechanism at BCSL provides all employees the opportunity to report, without fear, their concerns about any unethical conduct, financial malpractices or any unhealthy practice that may be prevalent in the Company. The employees are encouraged to voice their concerns or issues by way of whistle blowing, and the Company provides them with access to the Audit Committee. The Company has also provided hotline number(s) and dedicated weblink
www.convercent.com/report for reporting such concerns. The Corporate Compliance Team addresses the whistle blower complaints and presents the status of such complaints at the Audit Committee meetings held on a quarterly basis.
The details of the Whistle Blower Policy are explained in the Corporate Governance Report, and also posted on the Company''s website at www.bayer.in.
The Company has in place a Code of Conduct ("Code") which is applicable to the members of the Board and Senior Management of Company. The Code lays down the standard of conduct expected to be followed by the Directors and Senior Management in their business dealings, and on matters relating to integrity in the workplace, dealings with stakeholders, and in business practices. This Code is intended to provide guidance to the Board of Directors and Senior Management of the Company to manage the affairs of the Company in an ethical manner and is formulated in accordance with the requirements of Companies Act, 2013 and SEBI Listing Regulations. During the year under review, the Board has reviewed and updated the Code for Board and Senior Management during its meeting held on February 11, 2021.
All the Board Members and the Senior Management employees have confirmed compliance with the Code.
A comprehensive Risk Management Policy, outlining the risk management framework of the Company, is in place, to provide guidance on identification and mitigation of the various risks that the Company may face in the conduct of its business.
The policy covers the following key 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 minimisation of risks; and
⢠Procedure for risk identification, escalation and minimisation of risks.
The details of the Risk Management Policy are given in the Corporate Governance Report.
The Company has formulated its Dividend Distribution Policy based on the parameters laid down by SEBI Listing Regulations. The same is enclosed in Annexure "G" to the Directors'' Report, and the same is also available on the Company''s website at www.bayer.in.
A brief outline of the Corporate Social Responsibility ("CSR") Policy, and the initiatives undertaken by the Company on CSR activities during 2020-21, is set out in Annexure "A" to the Directors'' Report. The CSR Policy is uploaded on the Company''s website at www.bayer.in.
The Company has implemented 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.
In line with the regulations laid down in the Companies Act, 2013, with respect to control and compliance requirements, the Company has established robust Internal Financial Controls across various processes prevalent in the organisation. These controls have been put in place at both, the entity and process levels, and are designed to ensure compliance to internal control requirements, as well as regulatory compliance. They also enable appropriate recording of financial and operational information. The Company has reviewed the effectiveness of its Internal Financial Controls by adopting a systematic approach, which enables it to effectively assess its design and operating effectiveness.
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 Annexure "E" to the Directors'' Report. However, as per the proviso to Rule 5, the Directors'' Report and the Financial Statements of the financial year ended March 31, 2021 of the 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.
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.
During the financial year ended March 31, 2021, the Company did not give any loan, guarantee or provided security in connection with any loan to any group company.
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, the Company has in place a Related Party Transaction Policy. All the transactions entered with related parties during the year are in accordance with the Related Party Transaction Policy and are in the ordinary course of business & at arm''s length. During the year under review, the Board reviewed the Related Party Transaction Policy as per the SEBI Listing Regulations and made relevant changes to bring it in line with the various amendments brought in during the last few years.
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 31,2021, are given under Annexure "C" to the Directors'' Report.
The Company has a policy on Prevention of Sexual Harassment at Workplace to ensure a harassment-free workspace. Sexual harassment cases are dealt as per the Prevention of Sexual Harassment Policy and Internal Committees (IC) have been set up by the Company to redress such complaints. This Policy is applicable to all its employees (permanent, contractual, temporary and trainees).
During the financial year 2020-21, a Web Based Training ("WBT") on Prevention of Sexual Harassment based on the local legislation of Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 was extended to all employees (including IC members) of the Company. Further, a global WBT on the topic of sexual harassment and how to report non-compliance was also available for employees of the Company.
The following is a summary of sexual harassment complaints received and disposed off during financial
year 2020-21:
Particulars |
Details |
Number of complaints pending as at the beginning of the financial year |
Nil |
Number of complaints filed during the financial year |
1 |
Number of complaints disposed during the financial year |
1 |
Number of complaints pending as at the end of the financial year |
Nil |
The details forming part of the extract of the Annual Return of the Company in Form MGT 9, for the financial year ended March 31, 2021, as per the provisions of Section 92 of the Act, is enclosed as Annexure "D" to the Directors'' Report. The same is available on the Company''s website at www.bayer.in.
The Board of Directors affirms that the Company has complied with the applicable Secretarial Standards (SS) issued by the Institute of Companies Secretaries of India (SS1 and SS2), respectively relating to meetings of the Board and its Committees, which have mandatory application during the year under review.
During the year under review, neither the statutory auditors nor the secretarial auditors reported to the Audit Committee of the Board, under Section 143(12) of the Act, any instances of fraud committed against the Company by its officers or employees, the details of which would need to be mentioned in the Report.
A detailed review of operations, performance and future outlook of your Company is given separately under the head Management Discussion & Analysis Report.
Pursuant to the provisions of Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company in respect of ''Insecticides'' are required to be audited. The Directors have, on the recommendation of the Audit Committee, appointed M/s. D.C. Dave & Co. to audit the cost accounts of the Company pertaining to âInsecticidesâ for the financial year ending March 31, 2022. As required under the provisions of the Act, the remuneration payable to the Cost Auditor is to be placed before the Members in the Annual General Meeting for ratification. Accordingly, a resolution for seeking membersâ ratification for the remuneration payable to M/s. D.C. Dave & Co. is included at Item No. 7 of the Notice convening the Annual General Meeting.
M/s. Deloitte Haskins & Sells LLP, Chartered Accountants (ICAI Firm Registration No. 117366W/W-100018), are the Statutory Auditors of the Company, pursuant to the provisions of Section 139 of the Companies Act, 2013, and as per their appointment at the 59th Annual General Meeting of the Company held on August 23, 2017, for a period of five years.
For the year ended March 31, 2021, the Company paid a consolidated sum of '' 11 Million to the Statutory Auditors and all their entities.
Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board has appointed M/s. BNP & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company for the financial year ending March 31, 2021. The Secretarial Audit Report for the financial year ended March 31, 2021 is enclosed as Annexure "F" to this Directors'' Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark. The Company is in compliance with the Secretarial Standards specified by the Institute of Company Secretaries of India.
The Board of Directors wishes to thank the employees of the Company for their exemplary dedication and valued contribution, as well as their unwavering support. The Directors would like to express their grateful appreciation for the co-operation and assistance extended by all the valued stakeholders of the Company, viz. customers, government authorities, financial institutions, banks, shareholders, suppliers and other business associates. The Company also acknowledges the consistent support and guidance of its promoters.
For and on behalf of the Board of Directors
Chairman
Ahmedabad, May 25, 2021 (DIN: 00131852)
Mar 31, 2019
Dear Members,
The 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: (Rs. in Millions)
Particulars |
2018-19 |
2017-18 |
Revenue from Operations |
26,857 |
27,490 |
Other Income |
372 |
388 |
Total Income |
27,229 |
27,878 |
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 |
403 |
|
Income |
||
Amount available for Appropriation |
15,719 |
19,582 |
Appropriations: |
||
Dividend declared |
618 |
601 |
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 |
Dividend:
In line with the Dividend Distribution Policy, the Board of Directors have recommended a final dividend of Rs. 18.00 per Equity Share of Rs. 10 each amounting to Rs. 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). Exports:
The export sale for the financial year ended March 31, 2019 was Rs. 2,567 Millions as compared to Rs. 2,496 Millions during the previous year.
Open-offer:
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 Rs. 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 Rs. 2,926.87 per share, aggregating to Rs. 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 Rs. 10 each credited as fully paid-up of BCSL for every three (3) equity shares of Rs. 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.
Insurance:
Your Company''s 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 Company''s 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 Company''s 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.
Directorsâ Responsibility Statement:
Pursuant to the provisions of Section 134(3)(c) of the Companies Act, 2013, (âthe Actâ) 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: âAct Safe & Sustainableâ.
The Bombay Chamber of Commerce and Industry awarded ''Bayer House'', Bayer''s 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 as per ISO 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 âEducation, Science, Health and Social needsâ. 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 Society''s acceptance of technology. The âFostering Educationâ 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 - âFostering Rural Developmentâ, 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 - ââEmpowering Womenâ 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 - âPreventive Health & Sanitationâ 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.
Corporate Sustainability:
Responsible business practices are the foundation of the Bayer''s 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 Bayer''s 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 society''s 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 -âBayer: Science for a better life.â
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.
Human Resources:
Bayer''s 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 âLIFEâ (Leadership, Integrity, Flexibility and 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 Bayer''s mission statement âScience for a better lifeâ into action. Employees continue to remain the Company''s 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 Company''s 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. This assessment also determines a significant portion of their variable compensation.
Wide-ranging career opportunities:
Bayer''s 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 Bayer''s 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, initiatives like âNIEVâ - Certificate in Management Studies in collaboration with WE School and âMy Growth My Lifeâ - an 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 - âFairness and Respect at Work.â 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 Company''s 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 employee''s personal and professional abilities vis-a-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.
- Work-life balance
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 âEmployee Assistance Programâ 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.
Directors:
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 15, 2018.
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 office upto 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. Narain''s appointment as Managing Director and Chief Executive Officer, Ms. Bhagwati'' s appointment as Non-Executive Independent Director, Mr. Hartmann''s appointment as NonExecutive Non-Independent Director and Mr. Hoffmann''s 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 (âSEBI Listing Regulationsâ) as amended.
Corporate Governance:
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 disclosures that have to be made in this regard. A Certificate from a Company Secretary in whole-time practice, confirming compliance of the Corporate Governance requirements by the Company is annexed with the Corporate Governance Report. A Certificate of 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.
Audit Committee:
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.
Board Evaluation:
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 Board''s as well as Committee''s 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 Chairman''s 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 - [email protected] 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 (âCodeâ) 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 âAâ 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 financial and 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 âEâ 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 âBâ 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 Rs. 2,926.87 per share, aggregating to Rs. 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 arm''s 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 âCâ to the Directors'' Report.
Prevention of Sexual Harassment at Workplace:
Your Company has a policy on prevention of sexual harassment to ensure harassment free workspace for the employees. Sexual harassment cases are dealt as per the prevention of sexual harassment policy. An Internal Complaints Committee (ICC) has been set up by the Company to redress complaints received regarding sexual harassment. This policy is applicable to all its employees (permanent, contractual, temporary and trainees).
The following is a summary of sexual harassment complaints received and disposed off during financial year 2018-19.
- No. of complaints received : Nil
- No. of complaints disposed off : Nil
Extract of Annual Return:
The details forming part of the extract of the Annual Return of your Company in Form MGT 9 for the financial year ended March 31, 2019 as per the provisions of Section 92 of the Act, is enclosed as Annexure âDâ to the Directors'' Report.
Management Discussion & Analysis Report:
A detailed review of operations, performance and future outlook of your Company is given separately under the head Management Discussion & Analysis Report.
Cost Audit:
Pursuant to the provisions of Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company in respect of ''Insecticides'' is required to be audited. Your Directors have, on the recommendation of the Audit Committee appointed M/s. D.C. Dave & Co. to audit the cost accounts of the Company pertaining to ''Insecticides'' for the financial year ending March 31, 2020. As required under the provisions of the Act, the remuneration payable to the Cost Auditor is to be placed before the Members in the Annual General Meeting for ratification. Accordingly, a resolution for seeking members'' ratification for the remuneration payable to M/s. D.C. Dave & Co. is included at Item No. 10 of the Notice convening the Annual General Meeting.
Statutory Auditors:
M/s. Deloitte Haskins & Sells LLP, Chartered Accountants, (ICAI Firm Registration No. 117366W/W-100018) are the Statutory Auditors of the Company pursuant to the provisions of Section 139 of the Companies Act, 2013 and as per their appointment made at the 59th Annual General Meeting of the Company held on August 23, 2017, for a period of five years.
Secretarial Audit:
Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, your Company has appointed M/s. BNP & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company for the financial year ending March 31, 2020. The Secretarial Audit Report for the financial year ended March 31, 2019 is enclosed as Annexure âFâ to this Directors'' Report.
Acknowledgements:
The Board of Directors wishes to thank the employees of the Company for their exemplary dedication and valued contribution. Your Directors would like to express their grateful appreciation for the co-operation, assistance and support extended by all the valuable stakeholders of the Company viz. customers, government authorities, financial institutions, banks, shareholders, suppliers and other business associates. We also acknowledge the consistent support and guidance from Bayer AG, Bayer CropScience AG, Bayer SAS and Bayer Vapi Private Limited.
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
Mar 31, 2018
Dear Members,
The Directors are pleased to present the 60th 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, 2018.
Financial Performance: (Rs. in Millions)
Particulars |
2017-18 |
2016-17 |
Revenue from Operations |
27,490 |
29,484 |
Other Income |
388 |
701 |
Total Income |
27,878 |
30,185 |
Profit before Finance Costs, Depreciation and Taxation |
4,482 |
4,837 |
(Less): Finance Costs |
(113) |
(69) |
(Less): Depreciation and Amortisation Expense |
(331) |
(289) |
Profit Before Tax |
4,038 |
4,479 |
(Less): Tax Expense |
(1,037) |
(1,569) |
Profit for the year |
3,001 |
2,910 |
(Less): Other Comprehensive income |
(13) |
(14) |
Total Comprehensive Income for the year |
2,988 |
2,896 |
Add : Retained Earnings at the beginning of the year |
16,594 |
14,722 |
Amount available for Appropriation |
19,582 |
17,618 |
Appropriations: |
||
Dividend Declared |
601 |
601 |
Dividend Distribution Tax on Dividend |
122 |
122 |
Transfer to General Reserve |
290 |
301 |
Premium paid on Buyback of Equity shares |
4,989 |
- |
Transfer to Capital Redemption Reserve |
11 |
- |
Transaction Cost for Buyback of Equity shares |
49 |
- |
Operations:
Your Companyâs Revenue from Operation for the financial year 2017-18 is Rs. 27,490 Millions vis-a-vis Rs. 29,484 Millions in 2016-17. Profit before Taxation is Rs. 4,038 Millions for the financial year 2017-18.
Dividend:
In line with the Dividend Distribution Policy, the Board of Directors have recommended a final dividend of? 18.00 per Equity Share of Rs. 10 each amounting to Rs. 618 Millions for the financial year ended March 31, 2018, subject to the approval of the members.
The Register of Members will remain closed from Wednesday, August 08,2018 to Tuesday, August 21, 2018 (both days inclusive).
Transfer to Reserves:
The Company proposes to transfer an amount of Rs. 290 Millions to the General Reserve.
Exports:
The export sale for the financial year ended March 31, 2018 was Rs. 2,496 Millions as compared to Rs. 4,257 Millions during the previous year.
Insurance:
The Companyâs assets continue to be adequately insured against various risks like fire, riot, earthquake, terrorism and the risk of loss of profits arising due to this insurable risks also stands insured, amongst other things. In addition, adequate coverage has been taken to cover public liability, environmental liability and product liability claims. Stocks are insured whilst in transit and/ or stored in the warehouses. Also, all the employees are covered against the risk of loss of life, hospitalisation and personal accident.
Foreign Exchange Management:
The Companyâs 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 now invoiced in rupee terms effective from January, 2018, thereby insulating the Company 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.
Directorsâ Responsibility Statement:
Pursuant to the provisions of Section 134(3)(c) of the Companies Act, 2013, (âthe Actâ), 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, 2018 and of the profit of the Company for the financial year ended March 31, 2018;
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:
Your Company observed National Safety Week and Fire Prevention Week during the year and conducted various activities throughout the week to spread awareness on safety amongst employees. September 20, 2017, was observed as the Bayer Safety Day. Various activities were conducted at sites and offices to promote safety. Your Company observed World Environment Day at the Himatnagar Site during the year. A âRoad Safety Campaignâ was conducted in 2017 to increase awareness on road safety amongst Bayer employees in India.
Your Company, covering the manufacturing site at Himatnagar was audited for ISO 9001:2015 Quality Management System and ISO 14001:2015 Environmental Management Systems by TUV India Pvt. Ltd. (TUV) and the Company continued certification for 2017-18.
Your Company accords high priority to health, safety and environment.
Corporate Sustainability and Social Responsibility:
As a Life Science company, Bayer with itâs more than 150 years history and core competencies in the areas of health care and agriculture is contributing to finding solutions to some of the major challenges of our time.
For Bayer, sustainability means shaping the future successfully and, as part of our corporate strategy, is an integral part of our day-to-day work routines. Bayerâs social commitment is based on innovation and pioneering spirit. We at Bayer are committed to improving the healthcare and better social living conditions. For this purpose, we cooperate with partners in international programs and support local initiatives.
Our mission as a Company is to act sustainably through our commitment to the U.N. Global Compact, and through our active global involvement in leading initiatives such as the World Business Council for Sustainable Development (WBCSD).
Environment is another key focus area. We are continuously working to reduce the environmental impact of our business activities and develop product solutions that benefit the environment. We use many means to make our production processes more resource-friendly and lower the emissions they generate. We are also committed to minimizing wastewater pollution. Systematic waste management and recycling activities reduce the amount of materials to be disposed of.
In India, Bayer is active in a variety of ways in the core fields of education and science, health and social needs. With its initiatives, Bayer is supporting local communities with innovative educational and social projects. We are focusing on long term projects according to the principle âhelping people to help themselvesâ.
Corporate Societal Engagement:
In India, the Company has rolled out a holistic, well-planned implementation approach for executing its Corporate Societal Engagement (CSE) projects. Since the introduction of the Section 135 of the Companies Act, 2013, the Company has conceptualised a portfolio of projects that focuses on four essential pillars: Fostering education, Fostering rural development, Empowering women and Preventive health & sanitation.
Under the Fostering Education pillar, educational and science projects are being undertaken. As education is a vital factor in achieving sustainable prosperity, Bayer places tremendous emphasis on supporting education and research within its social environment. The second pillar - Fostering Rural Development, focuses on many Community Development programs being implemented in various parts of India that aim to enhance awareness about health, hygiene and skill development. Empowering Women is the third pillar under which, using proven expertise and knowhow from years of experience, Bayer and its partnering institutions are developing strategies through the Program for Primary Prevention of Sexual Violence (PPPSV) to implement primary prevention measures, which protect women and children from sexual violence and its after effects. Another project, Discovering Hands aims to make a positive difference to the area of breast cancer as well as lend a helping hand for the visually challenged blind women. The fourth pillar - Preventive Health & Sanitation aims to provide targeted assistance in the areas of health and hygiene.
On all the four fronts, the Company has achieved significant milestones.
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.
Human Resources:
Bayerâs business success is based to a large extent on the knowledge, skills, commitment and satisfaction of our employees. As an employer we offer our employees attractive conditions and wide-ranging individual development opportunities. Alongside professional training, we focus on conveying our corporate values (LIFE - Leadership, Integrity, Flexibility, Efficiency) and establishing a dialogue-oriented corporate culture based on trust, respect for diversity and equality of opportunity. Our responsible approach to structuring working conditions includes fair treatment at work, a transparent and equitable compensation system, the ability to combine working with family commitments, flexible worktime arrangements and a working environment that fosters health.
These are the cornerstones of our global human resources strategy, which is designed to safeguard and expand our business activities. They strengthen our competitiveness, and also reflect our social responsibility to provide secure employment and stable incomes, and to foster social cohesion.
In this way, we want to recruit and retain the best employees for Bayer.
We measure employeesâ satisfaction with Bayer as an employer with the help of institutionalized feedback discussions and the Group-wide Employee Survey, which is usually conducted about every two years. This enables us to monitor the effectiveness of our activities and make any necessary improvements. In the 2017 Employee Survey - Results, we had an Employee Engagement Index of 81%.
Attracting, Developing and Retaining the best managers and employees:
Employer branding targets both current and prospective employees.
Your Company continues to leverage its Employer Value proposition - its Employer Brand - âPassion to Innovate | Power to Changeâ, which shows what the Bayer Group expects of its employees and what it can offer them. It translates Bayerâs mission statement âScience for a better lifeâ into the world of work. It is a reflection of what makes Bayer and what is expected of every employee who joins Bayer. The Employer Brand demonstrates a strong value proposition for future talents and strengthens Bayer as an employer of choice.
Your Companyâs career Facebook page, its Linkedln page continues to present Bayer in an engaging manner through proof points which make Bayer an Employer of Choice. You would be happy to note that your Company has been ranked by Working Mother & AVTAR in the â100 Best Companies forWomen in Indiaâ.
Internships and the Bayer Scholarships keep our connect with the student community high.
Feedback on employee performance:
Specific and differentiated feedback forms the basis for positive personal development. Bayer encourages a culture of candid feedback to help employees achieve their individual goals. 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. This assessment also determines a significant portion of their variable compensation.
Wide-ranging career opportunities:
Thanks to our wide-ranging business activities, we offer employees throughout the Group good opportunities for development. Regular Development Dialogues between employees and supervisors provide an opportunity to discuss the employeesâ further career development perspectives.
Around 1,302 Development Dialogues were held and documented in 2017. Vacancies throughout the Bayer Group, from non-managerial right up to management level, are advertised via a globally accessible platform. International assignments are also an important element in employee development. 29 employees from India had participated in the international assignments (short term and long term) in 2017.
In line with Bayerâs talent management philosophy, a number of employees went through various Development Centres this year as well. These exercises not only built capabilities, but also provided opportunities for employees to move into different roles and positions. Our strong work on XCEDO, the CropScience Divisionsâ Training Academy continued to be recognized at all levels. We continued with SKILL CAMP which is a global marketing and sales initiative. In continuation of last yearâs efforts towards providing opportunities for Learning and Development to the employees, initiatives like NIEV - Certificate in Management Studies in collaboration with WE School and My Growth My Life - An accelerated Development Program were progressed.
Since the roll out of the Bayer Competency Model, the Bayer Competencies - Core and Leader, remain linked to all People Processes, Performance Management, Talent Development initiatives across the employee life cycle.
In line with the strategy, the Company has decided on emphasizing and amplifying four focus behaviours - Customer Focus, Experimentation, Collaboration and Trust in our organization, so that we can ensure that our culture supports our strategy and purpose.
Corporate culture: dialogue, diversity, innovation:
Fairness and respect are central elements of our corporate culture. That includes observing Group-wide standards of conduct and protecting employees from discrimination, harassment and retaliation. These standards are set forth in our Corporate Policy âFairness and Respect at Work.â With the help of training, videos and our internal websites, Bayer employees around the world are provided with guidance on how to comply with this corporate policy. Child and forced labour are strictly prohibited at Bayer in accordance with the core labor 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:
Employees can use the internal crowdsourcing platform WeSolve to pose questions relating to internal matters at Bayer. These are then answered together with other employees with whom the person asking the question does not normally have any contact. We involve our employees in business processes through active dialogue, informing staff promptly and extensively about upcoming changes.
Creating attractive working conditions:
- Competitive compensation and variable pay
Our compensation system combines a salary reflecting performance and responsibility with elements based on the Companyâs success, plus additional benefits. Adjustments based on continuous benchmarking make 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.
Binding and transparent compensation structures - At Bayer, individual salaries are based on each employeeâs personal and professional abilities and the level of responsibility assigned to them. At the managerial level, this is based on uniform evaluation of all positions throughout the Group using the internationally recognized Hay method.
Our compensation concept also includes variable one-time payments.
- Work-life balance
We offer our employees flexible working hours and support in child care 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, targets further improvements in the daily work environment and is intended particularly to help balance employeesâ professional and private lives. We aim to provide employees with access to affordable and targeted health offerings such as regular medical check-ups, sports programs, and on-site medical care.
The Company offers employees the support of free 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 recognized as one of the â100 Best Companies for Women in India 2017â. The study conducted by AVTAR Group & Working Mother aims to recognize and bring into foray the sustained initiatives undertaken by companies to increase womenâs workforce participation.
During the year, the Company was awarded the âMercer NDTV Employer Excellence Awards 2017â in Excellence in Career Development category and was also declared as âAon Best Employer in India 2018â award for the second consecutive year.
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.
Directors:
Mr. A.K.R. Nedungadi, Non-Executive independent Director ceased to be a Director of the Company with effect from April 30, 2018. The Board of Directors placed on record its warm appreciation for the valuable contribution made by Mr. Nedungadi during his tenure as Director of the Company.
At the forthcoming 60th Annual General Meeting (AGM) of the Company and in accordance with the provision of the Act, Dr. (Ms.) Miriam Colling- Hendelkens retires by rotation and being eligible offers her candidature for re-appointment. The resolution for the said re-appointment along with the brief profile forms a part of the Notice of the AGM and the resolution for her re-appointment is recommended for your approval.
The independent Directors hold office for a fixed term of five years and are not liable to retire by rotation.
In accordance with the provisions of Section 149(7) of the Act, Mr. Pankaj Patel, Mr. Sharad M. Kulkarni, Mr. A.K.R. Nedungadi and Mr. Vimal Bhandari, the independent Directors of the Company as on March 31, 2018 have given declaration 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 (âSEBI Listing Regulationsâ).
Meetings of the Board:
During the financial year ended March 31, 2018, five Board Meetings were convened and held. The details of which are given in the Corporate Governance Report.
Audit Committee:
During the financial year ended March 31, 2018, four Audit Committee Meetings were convened and held. The composition of the Audit Committee is given in the Corporate Governance Report. All the recommendations made by the Audit Committee were accepted by the Board.
Board Evaluation:
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 collectively evaluated the Boardâs as well as Committeeâs performance based on various parameters. The individual directors were also evaluated by their peers based on the parameters provided by the SEBI Listing Regulations. The results of the evaluation were discussed at the Nomination & Remuneration Committee and were also placed at the Board Meeting for the Chairmanâs review. The Evaluation process primarily focused on the criteria with respect to the overall functioning of the Board as well as the Committees, the composition of the Board and Committees, 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 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 policy is available on the website of the Company at www.bayer.in.
Whistle Blower Policy (Vigil Mechanism):
The Company has adopted a Whistle Blower Policy, as a part of vigil mechanism to provide appropriate avenues to the employees as well as any third parties 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 all the employees have been given the access to the Audit Committee. The Company has also provided dedicated email address [email protected] for reporting such concerns. The Corporate Compliance Team looks into the whistle blower complaints and places the status of such complaints at the Audit Committee Meeting on a quarterly basis.
The details of this Policy is explained in the Corporate Governance Report and also posted on the website of the Company at www. bayer.in.
Code of Conduct:
The Company has in place a Code of Business Conduct (âCodeâ) 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 personnel have confirmed compliance with the Code.
Risk Management Policy:
The 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 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 are given in the Corporate Governance Report.
Corporate Social Responsibility Policy:
The brief outline of the CSR Policy of the Company and the initiatives undertaken by the Company on CSR activities during the year is set out in Annexure âAâ of this report. The CSR policy is uploaded on the website of the Company and is available at www.bayer.in.
Internal Control Systems:
The 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 discussed 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 financial and operational information. The Company has reviewed effectiveness of internal financial controls by adopting a systematic approach to assess design and its operating effectiveness.
Information pursuant to Section 197(12) of the Companies Act, 2013:
The information as prescribed under 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 âEâ to the Directorsâ Report. However, as per the proviso to Rule 5 the Directorsâ Report and Financial Statements 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 required under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 with respect to these matters forms part of this Report and is enclosed as Annexure âBâ hereto.
Particular of Loans, guarantees or investments under Section 186 of the Companies Act, 2013:
During the financial year ended March 31, 2018, the Company did not give any loan, guarantee or provide security in connection with any loan to any group company or acquired any securities on or behalf of any group company.
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 as per the Related Party Transaction Policy and are in the Ordinary Course of Business and at armâs length.
Information on transactions 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 are given under Annexure âCâ.
Prevention of Sexual Harassment at Workplace:
Your Company has a policy on prevention of sexual harassment to ensure harassment free workspace for the employees. Sexual harassment cases are dealt as per the Company policy on prevention of sexual harassment. The Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy.
The following is a summary of sexual harassment complaints received and disposed off during last calendar year.
- No. of complaints received : Nil
- No. of complaints disposed off : Nil
Extract of Annual Return:
The details forming part of the extract of the Annual Return in Form MGT 9 is enclosed as Annexure âDâ hereto.
Corporate Governance:
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 given as an Annexure to this Report. The Company is in full compliance with the requirements and disclosures that have to be made in this regard. The Certificate from a Company Secretary in whole-time practice confirming compliance of the Corporate Governance requirements by the Company is attached to the Corporate Governance Report. Also a Certificate of the CEO and CFO of the Company in terms of the SEBI Listing Regulations, interalia, confirming the correctness of the financial statements and cash flow statements, adequacy of internal control measures forms a part of the Corporate Governance Report.
Management Discussion & Analysis Report:
A detailed review of operations, performance and future outlook of the Company is given separately under the head Management Discussion & Analysis Report.
Buyback of shares:
During the year under review, the Company completed Buyback of 1,020,408 equity shares (representing 2.89% of total equity capital) of Rs. 10/- each at a price ofRs. 4,900/- per equity share aggregating to Rs. 499,99,99,200. The Buyback of shares from the shareholders of the Company was on a proportionate basis through the tender offer route as prescribed under the Securities and Exchange Board of India (Buyback of Securities) Regulations, 1998, as amended.
Cost Audit:
Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company in respect of âInsecticidesâ is required to be audited. Your Directors have on the recommendation of the Audit Committee appointed M/s. D.C. Dave & Co. to audit the cost accounts of the Company pertaining to âInsecticidesâ for the financial year ending March 31, 2019. As required under the Act, the remuneration payable to the Cost Auditor is required to be placed before the Members in the General Meeting for their ratification. Accordingly, a resolution for seeking members ratification for the remuneration payable to M/s. D.C. Dave & Co. is included at Item No. 4 of the Notice convening the Annual General Meeting.
Statutory Auditors:
M/s. Deloitte Haskins & Sells LLP, Chartered Accountants, (ICAI Firm Registration No. 117366W/W-100018) are the Statutory Auditors of the Company pursuant to Section 139 of the Companies Act, 2013 as per their appointment made at the 59th Annual General Meeting of the Company held on August 23, 2017 for a period offive years.
Secretarial Audit:
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. BNP & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company for the financial year ending March 31, 2019. The Secretarial Audit Report for the financial year ended March 31, 2018 is enclosed as Annexure âFâ hereto.
Acknowledgements:
The Board of Directors wishes to thank the employees of the Company for their exemplary dedication and valued contribution made by them. Your Directors would like to express their grateful appreciation for the co-operation, assistance and support extended by all the valuable stakeholders of the Company viz: customers, government authorities, financial institutions, banks, shareholders, suppliers and other business associates. We also acknowledge the consistent support and guidance from BayerAG, Bayer CropScience AG, Bayer SAS and Bayer Vapi Private Limited.
For and on behalf of the Board of Directors
Pankaj Patel
Chairman
(DIN:00131852)
Mumbai, May 23, 2018
Mar 31, 2017
DIRECTORSâ REPORT
Dear Members,
The Directors are pleased to present the 59th 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, 2017. These financial statements for the Financial Year ended March 31, 2017 are the first financial statements with comparatives prepared under Indian Accounting Standard (Ind AS).
Financial Performance: (Rs, in Millions)
Particulars |
2016-17 |
2015-16 |
Revenue from Operations |
29,484 |
28,894 |
Other Income |
701 |
817 |
Total Income |
30,185 |
29,711 |
Profit before Finance Costs, Depreciation and Taxation |
4,837 |
5,163 |
(Less) : Finance Costs |
(69) |
(100) |
(Less) : Depreciation and Amortisation Expense |
(289) |
(247) |
Profit Before Tax |
4,479 |
4,816 |
(Less) : Tax Expense |
(1,569) |
(1,665) |
Profit for the year |
2,910 |
3,151 |
(Less) : Other Comprehensive Income |
(14) |
(12) |
Total Comprehensive Income for the year |
2,896 |
3,139 |
Add : Retained Earnings at the beginning of the year |
14,722 |
17,817 |
Amount available for Appropriation |
17,618 |
20,956 |
Appropriations: |
||
Dividend |
601 |
623 |
Dividend Distribution Tax on Dividend |
122 |
127 |
Transfer to General Reserve |
301 |
383 |
Premium paid on Buy back of Equity shares |
- |
5,048 |
Transfer to Capital Redemption Reserve |
- |
12 |
Transaction Cost for Buyback of Equity shares |
- |
41 |
Operations:
Your Companyâs Revenue from Operation for the financial year 2016-17 is Rs, 29,484 Millions vis-a-vis Rs, 28,894 Millions in 2015-16.
Profit before Taxation is Rs, 4,479 Millions for the financial year 2016-17.
Dividend:
The Board of Directors of the Company had approved the Dividend Distribution Policy in line with the parameters laid down by the Securities Exchange Board of India (Listing Obligations & Disclosure Requirements) Regulations, 2015. The Dividend Distribution Policy is uploaded on the Companyâs website at www.bayer.in.
In line with the said Policy, the Board of Directors have recommended a final dividend of? 17.00 per Equity Share of '' 10 each amounting to '' 601 Millions for the financial year ended March 31,2017, subject to the approval of the members.
The Register of Members will remain closed from Wednesday, August 09, 2017 to Wednesday, August 23, 2017 (both days inclusive). Transfer to Reserves:
The Company proposes to transfer an amount of Rs, 301 Millions to the General Reserve.
Indian Accounting Standards (Ind AS):
The Ministry of Corporate Affairs (MCA) notified its phase-wise roadmap for the adoption of Indian Accounting Standards (âInd ASâ), converged with the International Financial Reporting Standards (IFRS) vide its notification dated February 16, 2015, announcing the Companies (Indian Accounting Standards) Rules, 2015, for the application of Ind AS.
Accordingly, your Company has adopted Ind AS with effect from the financial year 2016-17 (along with comparative for the financial year
2015-16), since it is covered under phase-I based on net worth criteria. Your Company believes in highest standards of corporate governance and recognizes that financial statements are an important source of information to the shareholders and other stakeholders.
The financial statements for the year ended March 31, 2017 are the first financial statements with comparatives prepared under Ind AS.
Reconciliations and explanations of the effect of the transition from previous GAAP to Ind AS on your Companyâs Total Equity, Total Comprehensive Income and Statement of Cash Flows are provided in Note 42 to the Financial Statements.
Exports:
Your Company is a recognized Export House. The export sale for the year ended March 31, 2017 was '' 4,257 Millions as compared to '' 5,462 Millions during the previous year.
Insurance:
The Companyâs assets continue to be adequately insured against the risk of fire, riot, earthquake, terrorism and the risk of loss of profits also stands insured, amongst other things. In addition, adequate coverage has been taken to cover public liability, environmental liability and product liability claims. Also, all the employees are covered against the risk of loss of life, hospitalisation and personal accident.
Foreign Exchange Management:
The Companyâs exposure to foreign exchange risk comprises the risk of a foreign currency versus the local currency. The goal is to reduce the negative impact of the risks arising from fluctuations in exchange rates in the earnings. The majority of the forex transactions are denominated in US dollar. To mitigate the currency fluctuations, the net exposure of the Company is hedged after taking advantage of the natural hedge on fortnightly basis.
Directorsâ Responsibility Statement:
Pursuant to the provisions of Section 134(3)(c) of the Companies Act, 2013, 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, 2017 and of the profit of the Company for the financial year ended March 31, 2017;
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:
Your Company observed National Safety Week and Fire Prevention Week during the year and conducted various activities throughout the week to spread awareness on safety amongst employees. September 06, 2016 was observed as the Bayer Safety Day. Various activities were conducted at sites and offices to promote safety. Your Company observed World Environment Day at the Himatnagar Site during the year. A âRoad Safety Campaignâ was conducted in 2016 to increase awareness on road safety amongst Bayer employees in India.
Your Company, covering all the manufacturing sites, all India business operations and supporting services, was audited for ISO 9001:2008 Quality Management System by TUV India Pvt. Ltd. (TUV) and the Company continued certification for 2016-17. The ISO 14001:2004 Environmental Management Systems for Himatnagar Site was audited by TUV and the certification continued for 2016-17.
Your Company accords high priority to health, safety and environment.
Corporate Sustainability and Social Responsibility:
Bayer is a Life Science company with more than 150 years history and core competencies in the areas of health care and agriculture. With its innovations, Bayer is contributing to finding solutions to some of the major challenges of our time.
To us, sustainability means safeguarding our future viability and, as part of corporate strategy, is integrated into everyday procedures. We underline our mission as a company that acts sustainably through our commitment to the U.N. Global Compact, and through our active global involvement in leading initiatives such as the World Business Council for Sustainable Development (WBCSD). Our innovations, products and services make a contribution to overcoming some of the biggest global challenges, including the Sustainable Development Goals (SDG) of zero hunger and good global health care in particular.
In India, within the scope of our social commitment, Bayer makes targeted strategic investments in the areas of science, education, health, social needs and community projects.
We meet our responsibility to protect the environment in many different ways. We are continuously working to reduce the environmental impact of our business activities and develop product solutions that benefit the environment. For us, an efficient approach to raw materials and energy makes both ecological and economic sense. Our measures help reduce environmental impact and at the same time cuts the costs associated with materials, energy, emissions and disposal.
Our objective is to safeguard and boost the Companyâs success, creating entrepreneurial value while also respecting social values. We are developing products that will be of great social benefit in the future and are safe in both manufacturing and applications.
Corporate Social Responsibility:
In India, Bayer Crop Science Limited (âthe Companyâ) has rolled out a comprehensive well-planned approach for executing Corporate Social Responsibility (CSR) projects. Since the introduction of the Section 135 of the Companies Act 2013, Bayer Crop Science Limited has envisaged a portfolio of projects that focusses on three essential pillars: Society Progress Pilots for pioneering ideas and topics of nationwide importance, Science Excellence - that focuses on life science talents and frontier research and Community development -- for neighborhood projects on topics such as health and education. On all the three fronts, Bayer Crop Science Limited has achieved significant milestones. In addition, the Company also took up disaster relief operations for rehabilitating areas in and around the city of Chennai and the State of Tamil Nadu which was ravaged by floods and incessant rains in the last quarter of 2015. Society Progress Pilots is now in the second phase of implementation. Science Excellence initiatives have been implemented successfully. Community development projects have been extended to cover newer approaches that focus on increasing participation through stakeholder engagement on key aspects such as science, health, sanitation, hygiene, vocational training and education.
Business Responsibility Reporting:
Regulation 34(2)(f) of the Securities and Exchange Board of India (Listing Obligations & Disclosure Requirements) Regulations, 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.
Human Resources:
At Bayer, we believe that competent and engaged employees are key to the Companyâs success. Our LIFE (Leadership, Integrity, Flexibility, Efficiency) Values and organizational culture provide employees with a guideline for their daily work and for sustainable performance. In the past year, your Company launched several initiatives with a special focus on Competency Based Training programs.
Since the roll out of the Bayer Competency Model, the Bayer Competencies - Core and Leader, remain linked to all People Processes, Performance Management, Talent Development initiatives across the employee life cycle.
In line with the strategy, the Company has decided on emphasizing and amplifying four focus behaviors - Customer Focus, Experimentation, Collaboration and Trust in our organization, so that we can ensure that our culture supports our strategy and purpose.
Your Company continues to leverage its Employer Value proposition - its Employer Brand - âPassion to Innovate | Power to Changeâ, which shows what the Bayer Group expects of its employees and what it can offer them. It translates Bayerâs mission statement âScience For A Better Lifeâ into the world of work. It is a reflection of what makes Bayer and what is expected of every employee who joins Bayer. The Employer Brand demonstrates a strong value proposition for future talents and strengthens Bayer as an employer of choice.
To stay connected with external talent, your Company established its presence on Face book by launching the Bayer India Career Page. The aim of the page is to present in an engaging manner, the proof points which make Bayer an Employer of Choice. Internships and the Bayer Scholarships keep our connect with the student community high.
In line with Bayerâs talent management philosophy, a number of employees went through various Development Centres this year as well. These exercises not only built capabilities, but also provided opportunities for employees to move into different roles and positions. Our strong work on XCEDO, the Crop Science Divisionsâ Training Academy continued to be recognized at all levels. An addition to the academy was the SKILL CAMP which is a global marketing and sales initiative. In continuation of last yearâs efforts towards providing opportunities for Learning and Development to the employees initiatives like NIEV and DISHA - Bayer Management Program and My Growth My Life -Employee Development Program were progressed.
The Company has been awarded AON Best Employers in India 2017 and was one of the 19 companies to be recognized out of total 113 companies across 12 key industries.
Employee relations during the year were harmonious and cordial.
Directors:
Pursuant to the relevant provisions of the Companies Act, 2013 (âthe Actâ) and based on the recommendation of the Nomination and Remuneration Committee, the Board of Directors has appointed Dr. Miriam Colling-Hendelkens as an Additional Director with effect from June 06, 2017.
In accordance with Section 161 of the Act, Dr. Colling-Hendelkens holds office up to the date of the forthcoming Annual General Meeting of the Company and being eligible offer her candidature for appointment as Director. Your approval for the appointment of Dr. Colling-Hendelkens as a Non-Executive Non-Independent Director has been sought in the Notice convening the Annual General Meeting of the Company.
Dr. Regine Juergens, Non-Executive Non-Independent Director ceased to be a Director of the Company with effect from June 06, 2017. The Board of Directors placed on record its warm appreciation for the valuable contribution made by Dr. Juergens during her tenure as Director of the Company.
At the forthcoming 59th Annual General Meeting (AGM) of the Company and in accordance with the provision of the Act, Mr. Peter Mueller retires by rotation and being eligible offers his candidature for re-appointment. The resolution for the said re-appointment along with the brief profile forms a part of the Notice of the AGM and the resolution for his re-appointment is recommended for your approval.
The Independent Directors hold office for a fixed term of five years and are not liable to retire by rotation.
In accordance with the provisions of Section 149(7) of the Act, Mr. Pankaj Patel, Mr. Sharad M. Kulkarni, Mr. A.K.R. Nedungadi and Mr. Vimal Bhandari, the Independent Directors of the Company as on March 31, 2017 have given declaration 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 (âSEBI Listing Regulationsâ).
Meetings of the Board:
During the financial year ended March 31, 2017, five Board Meetings were convened and held. The details of which are given in the Corporate Governance Report.
Audit Committee:
During the financial year ended March 31, 2017, four Audit Committee Meetings were convened and held. The composition of the Audit Committee is given in the Corporate Governance Report. All the recommendations made by the Audit Committee were accepted by the Board.
Board Evaluation:
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 collectively evaluated the Boardâs as well as Committeeâs performance based on various parameters. The individual Directors were also evaluated by their peers based on the parameters provided by the SEBI Listing Regulations. The results of the evaluation were discussed at the Nomination & Remuneration Committee and were also placed at the Board Meeting for the Chairmanâs review. The Evaluation process primarily focused on the criteria with respect to the overall functioning of the Board as well as the Committees, the composition of the Board and Committees, 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 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 Policy is available on the website of the Company at www.bayer.in.
Whistle Blower Policy (Vigil Mechanism):
The Company has adopted a Whistle Blower Policy, as a part of vigil mechanism to provide appropriate avenues to the employees as well as any third parties 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 all the employees have been given the access to the Audit Committee. The Company has also provided dedicated email address [email protected] for reporting such concerns. The Corporate Compliance Team looks into the whistle blower complaints and places the status of such complaints at the Audit Committee Meeting on a quarterly basis.
The details of this Policy is explained in the Corporate Governance Report and also posted on the website of the Company at www.bayer.in.
Code of Conduct:
The Company has in place a Code of Business Conduct (âCodeâ) 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 personnel have confirmed compliance with the Code.
Risk Management Policy:
The 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 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 are given in the Corporate Governance Report.
Corporate Social Responsibility Policy:
During the year under review, the terms of reference of the Corporate Social Responsibility (âCSRâ) Committee were widened to include the Business Responsibility Reporting parameters.
The brief outline of the CSR Policy of the Company and the initiatives undertaken by the Company on CSR activities during the year is set out in Annexure âAâ of this Report. The CSR Policy is uploaded on the website of the Company and is available at www.bayer.in.
Internal Control Systems:
The 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 and processes in line with the approved internal audit plan. Audit observations and follow-up actions are discussed 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 organization. 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 financial and operational information. The Company has reviewed sustained effectiveness of internal financial controls by adopting a systematic approach to assess design and its operating effectiveness.
Information pursuant to Section 197(12) of the Companies Act, 2013:
The information as prescribed under 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 âEâ to the Directorsâ Report. However, as per the proviso to Rule 5, the Directorsâ Report and Financial Statements 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 required under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 with respect to these matters forms part of this Report and is enclosed as Annexure âBâ hereto.
Particular of Loans, guarantees or investments under Section 186 of the Companies Act, 2013:
During the financial year ended March 31, 2017, the Company gave loan to one of its group company. As on March 31, 2017 no loan is outstanding. Particulars of the loans are given under Note No. 40(ii)(A)(a) in Financial Statement. The Company did not give any guarantee or provide security in connection with any loan or acquired any securities during the financial year ended March 31, 2017.
Related Party Transactions:
In accordance with the relevant provisions of the Companies Act, 2013 and rules framed there under 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 as per the Related Party Transaction Policy and are in the Ordinary Course of Business and at armâs length.
Information on transactions 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 are given under Annexure âCâ.
Prevention of Sexual Harassment at Workplace:
Your Company has a policy on prevention of sexual harassment to ensure harassment free workspace for the employees. Sexual harassment cases are dealt as per the Company policy on prevention of sexual harassment. The Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy.
The following is a summary of sexual harassment complaints received and disposed off during last calendar year.
No. of complaints received : Nil
No. of complaints disposed off : Nil
Extract of Annual Return:
The details forming part of the extract of the Annual Return in Form MGT-9 is enclosed as Annexure âDâ hereto.
Corporate Governance:
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 Regulation, a detailed Corporate Governance Report is given as an Annexure to this Report. The Company is in full compliance with the requirements and disclosures that have to be made in this regard. The Certificate from a Company Secretary in whole-time practice confirming compliance of the Corporate Governance requirements by the Company is attached to the Corporate Governance Report. Also a Certificate of the CEO and CFO 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 forms a part of the Corporate Governance Report.
Management Discussion & Analysis Report:
A detailed review of operations, performance and future outlook of the Company is given separately under the head Management Discussion & Analysis Report.
Cost Audit:
Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company in respect of âInsecticidesâ is required to be audited. Your Directors have on the recommendation of the Audit Committee appointed M/s. D.C. Dave & Co. to audit the cost accounts of the Company pertaining to âInsecticidesâ for the financial year ending March 31, 2018. As required under the Act, the remuneration payable to the Cost Auditor is required to be placed before the Members in the General Meeting for their ratification. Accordingly, a resolution for seeking members ratification for the remuneration payable to M/s. D.C. Dave & Co. is included at Item No. 6 of the Notice convening the Annual General Meeting.
Statutory Auditors:
As per the provisions of Section 139 of the Companies Act, 2013, the term of office of M/s. Price Waterhouse, as Statutory Auditors of the Company will expire from the close of the forthcoming Annual General Meeting of the Company.
The Board of Directors places on record its appreciation for the services rendered by M/s. Price Waterhouse as the Statutory Auditors of the Company.
Subject to the approval of the members, the Board of Directors of the Company has recommended the appointment of M/s. Deloitte Haskins & Sells LLP, Chartered Accountants, (ICAI Firm Registration No. 117366W/W-100018) as the Statutory Auditors of the Company pursuant to Section 139 of the Companies Act, 2013. The resolution for appointment of M/s. Deloitte Haskins & Sells LLP as Statutory Auditors is included at Item No.4 of the Notice convening the Annual General Meeting.
Secretarial Audit:
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. BNP & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company for the financial year ended March 31, 2018. The Secretarial Audit Report is enclosed as Annexure âFâ hereto.
Acknowledgements:
The Board of Directors wishes to thank the employees of the Company for their exemplary dedication and valued contribution made by them. Your Directors would like to express their grateful appreciation for the co-operation, assistance and support extended by all the valuable stakeholders of the Company viz: customers, government authorities, financial institutions, banks, shareholders, suppliers and other business associates. We also acknowledge the consistent support and guidance from Bayer AG, Bayer Crop Science AG, Bayer SAS and Bayer Vapi Private Limited.
For and on behalf of the Board of Directors
Richard van der Merwe Ulrich Stefer
Vice Chairman & Managing Director and Executive Director &
Chief Executive Officer Chief Financial Officer
(DIN: 06768305) (DIN: 07447177)
Thane, June 06, 2017
Mar 31, 2015
Dear Members,
The Directors take pleasure in presenting the 57th Annual Report on
the business and operations of the Company together with the audited
Financial Statements along with the Report ofthe Auditors for the
financial year ended March 31,2015.
Financial Performance:
(Rs. in Millions)
Particulars 2014*15 2013*14
Revenue from Operation (Net) 37,233 32,452
Other Income 879 909
Total Revenue 38,112 33,361
Profit before Finance Costs, Depreciation,
Exceptional Items and Taxation 6,034 5,102
Less : Finance Costs (46) (48)
Less: Depreciation and Amortisation
Expense (including Impairment) (253) (646)
Profit before Exceptional Items and Taxation 5,735 4,408
Add/(Less): Exceptional Items * *
Profit Before Tax 5,735 4,408
Less: TaxExpense (1,905) (1,513)
Profit After Tax 3,830 2,895
Add : Surplus in Statement of Profit and
Loss at the beginning of the year 14,134 16,314
Amountavailablefor Appropriation 17,964 19,209
Appropriations:
Interim Dividend 146 *
Dividend Distribution Tax on Interim Dividend 25 *
Proposed Dividend 623 201
Dividend Distribution Tax on Proposed Divided 130 34
Transferred to General Reserve 383 290
Premium paid on Buy*back of shares * 4,521
Transfer to Capital Redemption Reserve * 29
Operations:
Your Company's Revenue from Operation (Net) has increased by 15%, from
Rs. 32,452 Millions in 2013*14 to Rs. 37,233 Millions in 2014*15.
Profit before Exceptional Items and Taxation has increased by 30%, from
Rs. 4,408 Millions in 2013*14 to Rs. 5,735 Millions in 2014*15.
Dividend:
The Board of Directors is pleased to recommend the payment of final
dividend of Rs. 17.00 per Equity Share of Rs. 10 each for the financial
year ended March 31, 2015, subject to the approval ofthe members
(previous year Rs. 5.50 per Equity Share of Rs. 10 each). With the
final dividend of Rs. 17.00 per Equity Share proposed by the Board of
Directors and an interim dividend of Rs. 4.00 per Equity Share already
paid, the total dividend for the financial year ended March 31,2015
amounts to Rs. 21.00 per Equity Share. The Register of Members will
remain closed from Saturday, September 05, 2015 to Tuesday, September
15, 2015 (both days inclusive).
Exports:
Your Company is a recognised Export House. The export sale (FOB) for
the year ended March 31, 2015 was Rs. 6,287 Millions compared to Rs.
4,960 Millions during the previous year.
Insurance:
The Company's assets continue to be adequately insured against the risk
of fire, riot, earthquake, terrorism and the risk of loss of profits,
amongst other things. In addition, adequate coverage has been taken to
cover public liability, environmental liability and product liability
claims. Also, all the employees are covered against the risk of
hospitalisation and personal accident.
Foreign Exchange Management:
The Company's exposure to foreign exchange risk comprises the risk of a
foreign currency versus the local currency. The goal is to reduce the
negative impact of the risks arising from fluctuations in exchange
rates in the earnings. The majority of the forex transactions are
denominated in US dollar. To mitigate the currency fluctuations, the
net exposure of the Bayer Group is hedged after taking advantage of the
natural hedge on fortnightly basis. Foreign currency loans, including
interest, ifany, are completely hedged.
The exports receivables are offset against the imports payables
pertaining to the major party on fortnightly basis and the balance
receivables / payables are hedged to mitigate the currency risk.
Directors' Responsibility Statement:
Pursuant to the provisions of Section 134(3)(c) of the Companies Act,
2013, 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 had been followed;
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, 2015 and of the profit ofthe
Company for the financial year ended March 31,2015;
3. proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 2013for safeguarding the assets ofthe 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:
Your Company observed National Safety Week and Fire Prevention Week
during the year and conducted various activities throughout the week to
spread awareness on safety amongst employees. September 16, 2014 was
observed as the Bayer Safety Day. Your Company observed Environment Day
at Himatnagar site during the year. A"Road Safety Campaign" was
launched in 2012 and was continued in 2014 to increase awareness
amongst Bayer employees in India. This year, the theme was "Responsible
Driving". Himatnagar Site completed 15 years without lost time injury
in 2014.
Your Company, covering all the manufacturing sites, all India business
operations and supporting services, was audited on Quality Management
System by TUV India Pvt. Ltd. (TUV) and the Company was recertified for
ISO 9001:2008. The Environmental Management System for Himatnagar site
was audited by TUV and was recertified for ISO 14001:2004.
Your Company accords high priority to health, safety and environment.
Corporate Sustainability and Social Responsibility:
To Bayer CropScience Limited, sustainability basically means future
viability and it forms an integral part of our business strategy. We
believe that innovation is essential for achieving sustainable economic
success. We at Bayer carefully develop products and services
specifically designed to benefit people. In this endeavour, we are
committed to achieving the economic, ecological and social
responsibility objectives of Sustainable Development.
Sustainable agriculture, higher crop yields and improved crop quality
are becoming increasingly important. In this context, ensuring ample
food supplies is one of the biggest challenges of our time. Bayer
CropScience Limited is developing solutions to this problem and has
firmly established the topic of "high*quality food for all" as a
central objective of its sustainability programme. For us, the only way
to achieve this goal is through sustainable agriculture.
Two key prongs of our commitment to sustainability are improving
resource and energy efficiency. At Bayer CropScience Limited, we are
constantly working to reduce environmental impact and find innovative
product solutions that benefit the environment.
Our mission states ** "Bayer: Science For A Better Life" For us, it is
therefore important to contribute to society's future viability and
create value in diverse ways. Within the scope of our social
commitment, we thus make targeted strategic investments in the areas of
science and education, health, social needs and community projects.
This commitment is an integral element of our corporate policy.
For Bayer CropScience Limited, India's traditional CSR spend was
focussed on rural development. For the future, we intend to make India,
a Role Model, with a focus on innovative CSR projects and
system*changing social seed*funding under Bayer's strategic CSR policy
areas.
The CSR for India portfolio target structure has three distinct
pillars:
1. Society Progress Pilots for pioneering ideas and topics of
nationwide importance
2. Science Excellence with focus on life science talents and frontier
research
3. Community developmentfor neighbourhood projects on farming/rural
topics, health and education Corporate Social Responsibility:
In accordance of the requirements of Section 135 of the Companies Act,
2013, your Company has constituted a Corporate Social Responsibility
Committee. The Composition and terms of reference of the Corporate
Social Responsibility Committee is provided in the Corporate Governance
Report. The Brief outline ofthe CSR Policy ofthe Company and the
initiatives undertaken by the Company on CSR Activities during the
financial year 2014*15 are set out in Annexure "A" of this report in
the format prescribed in the Companies (Corporate Social Responsibility
Policy) Rules, 2014.
Human Resources:
Employee engagement is an important factor in your Company's success.
Central to this engagement are culture and LIFE values. They provide
the employees with guidance for daily work and encourage them for
sustainable performance.
Your Company reaffirmed its commitment to personal growth and learning
with the launch of 24 different training & development initiatives to
support the employees in an increasingly dynamic and complex business
landscape. The year was marked with special focus on enhancing the
feedback culture and on leadership development. Additionally, our
employees were nominated to 39 identified external training programs.
Your Company launched its Employer Value proposition * its Employer
Brand * 'Passion to Innovate Power to Change'. Bayer's Employer Brand
promise is based upon the Bayer strong Corporate Brand * Bayer: Science
for a Better Life. It is a reflection of what makes Bayer and what is
expected of every employee who joins Bayer. The Employer Brand brings a
strong value proposition for future talents and further strengthens
Bayeras an Employer ofchoice.
It further continued its strong Employer Branding initiatives by
continuing the "Bayer Scholarship Program" with front ranking
universities in India, with the aim to further strengthen the interface
between the educational institutes and the industry.
Roll out of the global Bayer Competency Model which forms the base for
all HR subsystems. The Model conveys our focus on 8 core and 8
leadership competencies that link our People Processes, Performance
Management, Talent Development initiatives across the employee
lifecycle.
To establish on*boarding practices to integrate employees smoothly into
the organization and to make them productive as quickly as possible,
the Bayer Group in India launched an on*boarding process which includes
the 'Hello Bayer' portal. New employees are curious to know more about
the organization they are going to join. Hello Bayer is an internet
based customized India on*boarding portal which offers new employees
information so as to help them quickly acclimatize to the organization.
In line with Bayer's talent management philosophy of "Building the
Leadership Pipeline" & "Valuing the Expertise of employees", a number
of employees went through various Development Centres. These exercises
not only built capabilities, but also presented opportunities for
employees to move into different roles and positions. Our strong work
on XCEDO, the Bayer CropScience Training Academy was recognised at the
Asia Pacific level. An addition to the academy was the SKILL CAMP which
is a global marketing and sales initiative.
In continuation to last year's efforts towards providing opportunities
for Learning and Development to the employees, additional batches of
our employee development initiatives like NIEV * Bayer Management
Program and My Growth My Life * Employee Development Program were
launched.
Employee relations during the year were harmonious and cordial.
Directors:
Mr. Kaikobad B. Mistry retires by rotation and being eligible, offers
himself for re*appointment. Dr. Regine Juergens was appointed as an
Additional Director of the Company with effect from February 02, 2015.
Brief profile of both Directors is given in the explanatory statement
annexed to the Notice.
Mr. Tobias Marchand, Non*Executive Non*Independent Director resigned
from the Board of the Directors of the Company with effect from closing
hours of January 31,2015.
Dr. Vijay Mallya, Mr. Sharad M. Kulkarni, Mr. A.K.R Nedungadi and Mr.
Vimal Bhandari, the Independent Directors have given declaration to the
Board that they meet the criteria of independence as laid down under
Section 149(6) of the Companies Act, 2013 and Clause 49 of the Listing
Agreement.
Meetings ofthe Board:
During the financial year ended March 31, 2015, five Board Meetings
were convened and held. The details of which are given in the Corporate
Governance Report.
Audit Committee:
All the recommendations made by the Audit Committee were accepted by
the Board. The composition of the Audit Committee is given in the
Corporate Governance Report.
Board Evaluation:
Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of
the Listing Agreement, the Board has carried out an annual performance
evaluation of its own performance and that of its committees and
individual directors. The manner in which the evaluation has been
carried out has been explained in the Corporate Governance Report.
Nomination and Remuneration Policy:
The Board has, on the recommendation of the Nomination and Remuneration
Committee framed a Nomination and Remuneration Policy in accordance
with Section 178 of the Companies Act, 2013 and Clause 49 of the
Listing Agreement. The Policy provides for appointment and removal of
Directors, Key Managerial Personnel and Senior Management employees and
their remuneration. The Policy is stated in the Corporate Governance
Report.
Whistle Blower Policy (Vigil Mechanism):
In terms of Section 177 of the Companies Act, 2013 and requirements of
Clause 49 of Listing Agreement, the Company has a Whistle Blower Policy
as its vigil mechanism. The details of this Policy is explained in the
Corporate Governance Report and also posted on the website of the
Company.
Risk Management Policy:
The 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 personnel of the company with regards to risk management.
* structure for identification, escalation, and minimization of risks
* procedure for risk identification, escalation, and minimization of
risks.
The risks identified can be of various types/categories (Risk
categorisation). The categories that are being used are
Operational/Business, Regulatory/Compliance, People, Information
Technology, Environmental and Reputation. The details on risk
management are given in the Corporate Governance Report.
Information pursuant to Section 197(12) ofthe Companies Act, 2013:
The information as prescribed under 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 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 required under Section 134(3)(m) of the Companies Act,
2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 with
respect to these matters forms part of this Report and is enclosed as
Annexure "B" hereto.
Particular of Loans, guarantees or investments under Section 186 ofthe
Companies Act, 2013:
During the financial year ended March 31,2015 the Company gave loan to
its group companies. As on March 31,2015 no loan is outstanding. The
particulars of the loans is given under Note No. 37 in Financial
Statement. The Company did not give any guarantee or provide security
in connection with any loan or acquire any securities during the
financial year ended March 31, 2015.
Related Party Transactions:
In terms of the requirements as per the Companies Act, 2013 and the
Listing Agreement, your Company has formulated a Related Party
Transaction Policy. All the transactions entered with related parties
are as per the Related Party Transaction Policy and are in the ordinary
course of business and at arm's length. Information on transactions
with the related parties pursuant to Section 134(3)(h) of the Companies
Act, 2013 read with rule 8(2) ofthe Companies (Accounts) Rules, 2014
are given under Annexure "C".
Prevention of Sexual Harassment at Workplace:
The Company has in place an Anti*Sexual Harassment Policy in line with
the requirements of The Sexual Harassment of Women at the Workplace
(Prevention, Prohibition & Redressal) Act, 2013. Internal Complaints
Committee (ICC) has been set up to redress complaints received
regarding sexual harassment. All employees (permanent, contractual,
temporary, trainees) are covered under this policy.
The following is a summary of sexual harassment complaints received and
disposed off during each calendar year.
* Noofcomplaintsreceived : Nil
* No of complaints disposed off : Nil
Extract of Annual Return:
The details forming part of the extract of the Annual Return in Form
MGT 9 is enclosed as Annexure "D" hereto.
Corporate Governance:
Your Company believes in transparency and has always maintained a very
high level of Corporate Governance. As required by Clause 49 of the
Listing Agreement, a detailed Corporate Governance Report is given as
an Annexure to this Report. The Company is in full compliance with the
requirements and disclosures that have to be made in this regard. The
Certificate from a Company Secretary in whole*time practice confirming
compliance ofthe Corporate Governance requirements by the Company is
attached to the Corporate Governance Report.
Management Discussion and Analysis Report:
A detailed review of operations, performance and future outlook of the
Company is given separately under the head Management Discussion and
Analysis Report.
Cost Audit:
Pursuant to Section 148 of the Companies Act, 2013 read with the
Companies (Cost Records and Audit) Amendment Rules, 2014, the cost
audit records maintained by the Company in respect of 'Insecticides' is
required to be audited. Your Directors had, on the recommendation of
the Audit Committee, appointed M/s. N. I. Mehta & Co. to audit the cost
accounts of the Company pertaining to 'Insecticides' for the financial
year ending March 31, 2016.
Statutory Auditors:
M/s. Price Waterhouse, Chartered Accountants, (Firm Registration Number
301112E) retire as Statutory Auditors at the conclusion of the ensuing
Annual General Meeting and are eligible for re*appointment. The Company
has received a letter from the retiring Auditors that their appointment
as Statutory Auditors, if made, would be within the limits prescribed
under the Companies Act, 2013. The Audit Committee and the Board
recommends the re*appointment of M/s. Price Waterhouse, Chartered
Accountants, (Firm Registration Number 301112E) as Statutory Auditors
for the financial year ending March 31,2016.
Members are requested to consider and re*appoint M/s. Price Waterhouse,
Chartered Accountants, (Firm Registration Number 301112E) as the
Statutory Auditors of the Company for conducting the audit for the
financial year ending March 31,2016.
Secretarial Audit:
Pursuant to the provisions of Section 204 of the Companies Act, 2013
and the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, the Company has appointed M/s. BNP &
Associates, a firm of Company Secretaries in Practice to undertake the
Secretarial Audit of the Company. The Secretarial Audit Report is
enclosed as Annexure "F" hereto.
Acknowledgements:
The Board of Directors wishes to express its sincere appreciation for
the dedicated services rendered by employees at all levels and the
constructive co*operation extended by them. Your Directors would like
to express their grateful appreciation for the assistance and support
extended by all customers, government authorities, financial
institutions, banks, shareholders, suppliers and other business
associates. We also acknowledge the consistent support and guidance
from Bayer AG, Bayer CropScience AG, Bayer SAS and Bayer Vapi Private
Limited.
For and on behalf of the Board of Directors
Dr. Vijay Mallya
Chairman
Thane, May 27, 2015
Mar 31, 2013
Dear Members,
The Directors take pleasure in presenting the 55th 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, 2013.
Financial Performance:
Rs. in Millions
Particulars 2012-13 2011-12
Revenue from Operation (Net) 27,253 22,723
Other Income 689 453
Total Revenue 27,942 23,176
Profit before Finance Costs, Depreciation,
Exceptional Items and Taxation 4,288 2,980
Less : Finance Costs (37) (17)
Less : Depreciation and Amortisation (366) (340)
Profit before Exceptional Items and Taxation 3,885 2,623
Add/(Less): Exceptional Items 11,747 (579)
Profit Before Tax 15,632 2,044
Less : Taxes (4,015) (654)
Profit After Tax 11,617 1,390
Add : Surplus in Statement of Profit and
Loss at the beginning of the year 6,090 5,032
Amount available for Appropriation 17,707 6,422
Appropriations:
Proposed Dividend 197 166
Taxation on Proposed Dividend 34 27
Transferred to General Reserve 1,162 139
Profit & Loss Balance Carried Forward 16,314 6,090
Operations:
Your Company''s Revenue from Operation (Net) has increased by 19.94%,
from Rs. 22,723 Millions in 2011-12 to Rs. 27,253 Millions in 2012-13.
Profit before Exceptional Items and Taxation has increased by 48.11%,
from Rs. 2,623 Millions in 2011-12 to Rs. 3,885 Millions in 2012-13.
Material Developments during the year:
Pursuant to the approval of Board vide its resolution dated July 19,
2010 and December 22, 2010, for the sale / transfer/disposal of Land
and Buildings situated at Kolshet Road, Thane (the said Property), the
Company and Agile Real Estate Private Limited ("Agile") have
accepted Rs. 12,500 Millions as full and final aggregate consideration
for the sale and transfer of the said Property to Agile. The Company
and Agile have, on November 29, 2012, executed two Agreements and other
incidental documents and undertaken all the requisite acts for
concluding the transaction. On execution as aforesaid, the Company has
received balance consideration of Rs. 7,300 Millions (net of advance of
Rs. 5,200 Millions) as full and final consideration. The Company has no
further obligations relating to the transfer of the said Property. The
execution of deed of conveyance in favour of Agile shall be undertaken
subsequently.
The Company has sold the Building situated at Powai, Mumbai pursuant to
an agreement dated March 15,2013 for Rs. 823 Millions. Consequent to
the sale of Powai Building, the Board of Directors have approved the
change of Registered Office from Bayer House, Central Avenue,
Hiranandani Gardens, Powai, Mumbai - 400 076 to Olympia, First Floor,
Central Avenue, Hiranandani Gardens, Powai, Mumbai - 400 076.
Dividend:
The Board of Directors is pleased to recommend the payment of dividend
of Rs. 5.00 per Equity Share of Rs. 10 each for the financial year
ended March 31, 2013, subject to the approval of the members (previous
year Rs. 4.20 per Equity Share of Rs. 10 each). The proposed dividend
will absorb a sum of Rs. 197 Millions. The Register of Members will
remain closed from Wednesday, August 14, 2013 to Thursday, August 29,
2013 (both days inclusive).
Exports:
Your Company is a recognised Export House. The export sale (FOB) for
the year ended March 31, 2013 was Rs. 4,582 Millions compared to Rs.
3,096 Millions during the previous year.
Public Deposits:
A sum of Rs. 15,000 relating to 1 deposit has been transferred to
Investor Education and Protection Fund. No interest was payable on such
unclaimed deposit. During the year under review, your Company has not
accepted any public deposits. As on March 31, 2013, the Company has Nil
deposits.
Insurance:
The Company''s assets continue to be adequately insured against the
risk of fire, riot, earthquake, terrorism and the risk of loss of
profits, amongst other things.
In addition to the above, adequate coverage has been taken to cover
public liability, environmental liability and product liability claims.
Also, all the employees are covered against the risk of hospitalisation
and personal accident.
Foreign Exchange Management:
The Company''s exposure to foreign exchange risk comprises the risk of
a foreign currency versus the local currency. The goal is to reduce the
negative impact of the risks arising from fluctuations in exchange
rates in the earnings. The majority of the forex transactions are
denominated in US dollar. To mitigate the currency fluctuations, the
net exposure of the Bayer Group is hedged after taking advantage of the
natural hedge on every month end. Foreign currency loans, including
interest, are completely hedged.
The exports receivables are offset against the imports payables
pertaining to the major party on monthly basis and the balance
receivables payables are hedged to mitigate the currency risk.
Directors'' Responsibility Statement:
Pursuant to the provisions of Section 217(2AA) of the Companies Act,
1956, the Directors confirm that, to the best of their knowledge and
belief:
1. in the preparation of the annual accounts, the applicable
accounting standards have been followed;
2. appropriate accounting policies have been selected and applied
consistently, and such judgements 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 on March 31, 2013 and of the profit of the
Company for the financial year ended March 31, 2013;
3. proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and
4. the annual accounts have been prepared on a going concern basis.
Responsible Care and Quality:
Your Company observed National Safety Week and Fire Prevention Week in
the year and conducted various activities throughout the week to spread
awareness on safety amongst employees. September 18, 2012 was observed
as the Bayer Safety Day. Your Company observed Environment Day at
Ankleshwar and Himatnagar sites during the year. A Special Road Safety
campaign was launched in 2012 to increase awareness amongst employees.
Your Company, covering all the manufacturing sites, all India business
operations and supporting services, was audited on Quality Management
System by TUV India Pvt. Ltd. and the Company was recommended
continuation of ISO 9001:2008 certificate. The Environmental Management
System for Himatnagar and Ankleshwar sites was audited by TUV and was
recommended continuation of ISO 14001:2004 certificate.
Continual improvement and sustainability resulted in conservation of
energy, reduction in waste generation and recycling of resources and
cost savings.
Your Company accords high priority to health, safety and environment.
Corporate Sustainability and Social Responsibility:
Growing population and demographic changes present enormous challenges
for society and companies. These include, in particular, sufficient
food, and environmental and climate protection and access to
appropriate health care for everyone. We consider ourselves a part of
society and see our commitment as living up to the role of a good
corporate citizen. Sustainable Development, therefore, forms an
integral part of our business strategy.
Together with our value concept LIFE - which stands for Leadership,
Integrity, Flexibility and Efficiency - our mission forms the basis of
our sustainable actions. As an innovation company with the mission
"Science For A Better Life," the Bayer Group continues to focus on
its core competencies in the development of new solutions in the
fast-growing, innovation-driven areas of health care, nutrition and
high-tech materials.
Social commitment is an established part of Bayer''s sustainability
strategy and corporate policy. We view the promotion of worthy causes
in the areas of education, health care, environment, sports and culture
as a long-term investment in society''s future viability and as a
contribution to a positive business environment.
Progress on Model Village Project
Acknowledging that agriculture is the first source to create a
significant value addition in rural areas, agricultural development is
being planned to further foster many measures that include, in
particular, a strong focus on knowledge transfer on how sustainable
crop production can increase productivity. This is the principle
objective of the Model Village Project.
The Model Village Project being implemented in two villages -
Mangalgudda and Kadivala in North Karnataka, aims to foster rural
development through ''empowerment''. Based on the insights gained
during the implementation of Child Care Programme, the project is being
tried out on a pilot basis. The overall approach for execution of the
project is being implemented through Bayer Prayas Rural Development
Association.
Acomprehensive approach is being adopted to further the objectives of
the Model Village Project. A number of initiatives are being
implemented in the Model Village such as introduction of drip
irrigation, facilitating soil testing, organising Animal Health Camp,
implementing Vidya Prayas scholarships for school-going children,
productivity enhancement training for farmers, establishing an
Information and Communication Technology (ICT) lab for Model Village
children which has led to positive outcome with adoption of such
progressive technologies.
Similarly, Bayer has organised three diagnostic health camps for
determining the health burdens in the Model Village and to facilitate
possible interventions for the local population. .
IT-enabled schooling in Model Villages
Bayer''s achievements as an innovation company with a long tradition
are based on progress in science and research. We focus not only on our
own research activities, but also on promoting and strengthening
education and research in general. Through various initiatives, Bayer
systematically supports the training of young people, the development
of scientific talent and innovative approaches to research.
As a part of our ongoing activities to nurture education in the Model
Villages, we are establishing an ICT lab for rural children in
Mangalgudda Village. Towards this end, we have tied up with Pearson
Education Services to provide us with Kannada content in major subjects
- Science, Mathematics and Social Sciences. This ICT lab will benefit
approximately 150 children studying in the school from Class V to VIII.
Project evaluation by external stakeholder
The Model Village Project is continuously academically evaluated by a
team of professors and students of the Pforzheim University, Germany.
About five students have got the opportunity to do an internship at
Bayer in India, to do their own experiences and to gain a lot of
interesting and incredible impressions of the current situation of the
affected people in the villages.
Employee-volunteering in Model Village
Mannschaft - A Leadership Development Programme has been envisaged as
an employee-volunteering programme across the sub-groups of Bayer in
India. Mannschaft represents the German word for''team''. In each
Mannschaft, about 10-15 employees from across sub-groups and functions
travel together on a week-end and get the opportunity to work in the
village on various development activities related to the Model Village
Project. So far, four Mannschaft have been organised by the Sustainable
Development team in Kadivala and Chandippa villages.
Exemplary contribution
Two key prongs of Bayer''s commitment to sustainability are improving
resource and energy efficiency and finding solutions for the challenges
posed by the consequences of climate change. Bayer''s climate
commitment also has economic benefits. Not only does improved energy
efficiency lead to significant savings in energy costs, the Company is
also developing and marketing products that help our customers to
protect the climate and adapt to climate change.
Bayer''s Ankleshwar site has demonstrated this aptly. The site won the
prestigious National Energy Conservation Award 2012 in the chemical
sector for demonstrating excellence in energy conservation during 2011.
The award was received by the Company from the President of India, Shri
Pranab Mukherjee.
The National Energy Conservation awards, instituted by the Bureau of
Energy efficiency under the Indian Government''s Ministry of Power to
promote and support energy conservation initiatives in the country, are
presented to organisations that have made systematic and serious
attempts to conserve energy and use it efficiently. .
In the year 2011, the Ankleshwar site undertook various initiatives to
enhance energy conservation that included the implementation of a
''Daily Energy Balance Sheet'' to optimise energy saving, an in-house
training for employees to create awareness about the topic, analysis of
energy-intensive processes and a brainstorming activity to find
solutions for further reduction of energy consumption.
Our long-term commitment to sustainability
We want to tap new market opportunities to safeguard the future
long-term viability of the Company. All our activities are geared to
achieving ecological, economic and social benefits for our customers
and for society. This is made possible by innovative products,
efficient and responsible use of resources and the environment and a
global commitment to good working conditions and human rights.
Human Resources:
Employee engagement is an important factor in your Company''s success.
Central to this engagement are culture and LIFE values. They provide
the employees with guidance for daily work and encourage them for
sustainable performance.
Your Company reaffirmed its commitment to personal growth and learning
with the launch of 23 different training & development initiatives to
support the employees in an increasingly dynamic and complex business
landscape. The year was marked with special focus on general
management, self-leadership and leading people initiatives.
Additionally, our employees were nominated to 20 identified external
training programs.
Your Company further continued its strong Employer Branding initiatives
by continuing the "Bayer Scholarship Program" with front ranking
universities in India, with the aim to further strengthen the interface
between the educational institutes and the industry.
In line with Bayer''s talent management philosophy of "Building the
Leadership Pipe line'''' & "Valuing the Expertise of employees", a
number of employees went through various Development Centres. These
exercises not only build capabilities, but also presented opportunities
for employees to move into different roles and positions. Our strong
work on XCEDO, the Bayer CropScience Training Academy was recognised
and conferred with two external awards - Best Corporate University
Award at the TISS LEAPVAULT CLO Awards and The Best Learning
Organisations Award from L&OD Roundtable.
In continuation to last year''s efforts towards providing
opportunities for Learning and Development to the employees, an
initiative which strengthens the performance and feedback culture was
launched.
Employee relations during the year were harmonious and cordial.
Information pursuant to Section 217(2A) of the Companies Act, 1956:
The information as prescribed by Section 217(2A) of the Companies Act,
1956, read along with the Companies (Particulars of Employees) Rules,
1975, as amended is set out as an Annexure to the Directors'' Report.
However, as per the provisions of Section 219(1 )(b)(iv) of the
Companies Act, 1956, the Directors'' Report and Financial Statements
are being sent to the Members excluding the statement giving
particulars of employees under Section 217(2A). Any Member interested
in obtaining a copy of such statement may write to the Company
Secretary at the Registered / Corporate Office of the Company.
Conservation of Energy, Technology Absorption and Foreign Exchange
Earnings and Outgo:
The information required under Section 217(1 )(e) of the Companies Act,
1956 read with the Companies (Disclosure of Particulars in the Report
of the Board of Directors) Rules, 1988 with respect to these matters
forms part of this Report and is annexed hereto.
Corporate Governance:
Your Company believes in transparency and has always maintained a very
high level of Corporate Governance. As required by Clause 49 of the
Listing Agreement, a detailed Corporate Governance Report is given as
an Annexure to this Report. The Company is in full compliance with the
requirements and disclosures that have to be made in this regard. The
Certificate from a Company Secretary in whole-time practice confirming
compliance of the Corporate Governance requirements by the Company is
attached to the report on Corporate Governance.
Management Discussion and Analysis Report:
A detailed review of operations, performance and future outlook of the
Company is given separately under the head Management Discussion and
Analysis Report.
Directors:
Dr. Vijay Mallya and Mr. A.K.R. Nedungadi retire by rotation and, being
eligible, offer themselves for re-appointment.
Dr. Thomas Hoffmann was appointed as an Additional Director and
Whole-time Director of the Company with effect from April 2, 2013.
Brief profile of the above Directors are given under the Corporate
Governance Report.
Cost Audit:
In accordance with the directive received from the Central Government,
an audit of the cost accounts relating to Insecticides manufactured by
the Company is required to be conducted every year, by an auditor with
the requisite qualifications as prescribed under Section 233B of the
Companies Act, 1956.
The Board of Directors has appointed M/s. N. I. Mehta and Co.,
qualified CostAccountantsforthe conduct of the audit
of''Insecticides''for the year ending March 31, 2014. In terms of the
Cost Audit Report Rules, 2011, the cost audit report is required to be
filed within 180 days from the end of the financial year or as per the
date notified by Ministry of Corporate Affairs (MCA) in XBRL. Your
Company filed the Cost Audit Report in XBRL for the financial year
ended March 31, 2012 within the date notified by MCA.
Auditors:
M/s Price Waterhouse, Chartered Accountants, (Firm Registration Number
301112E) retire as Statutory Auditors at the conclusion of the ensuing
Annual General Meeting and are eligible for re-appointment. The Company
has received a letter from the retiring Auditors that their appointment
as Statutory Auditors, if made, would be within the limits prescribed
under Section 224(1 B) of the Companies Act, 1956. The Audit Committee
and the Board recommends the re-appointment of M/s. Price Waterhouse,
Chartered Accountants, (Firm Registration Number 301112E) as Statutory
Auditors for the financial year ending March 31, 2014.
Members are requested to consider and re-appoint M/s. Price Waterhouse,
Chartered Accountants, (Firm Registration Number 301112E) as the
Statutory Auditors of the Company for the financial year ending March
31, 2014.
Acknowledgements:
The Board of Directors wishes to express its sincere appreciation for
the dedicated services rendered by employees at all levels and the
constructive co-operation extended by them. Your Directors would like
to express their grateful appreciation for the assistance and support
extended by all customers, government authorities, financial
institutions, banks, shareholders, suppliers and other business
associates. We also acknowledge the consistent support and guidance
from Bayer AG, Bayer CropScience AG and Bayer SAS.
For and on behalf of the Board of Directors
Dr. Vijay Mallya
Chairman
Mumbai, May 20, 2013
Mar 31, 2012
The Directors take pleasure in presenting the 54th 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, 2012.
Financial Performance:
Rs. in Millions
Particulars 2011 -121 2010 -11
Revenue from Operation (Net) 22,723 21,373
Other Income 453 205
Total Revenue 23,176 21,578
Profit before Finance costs, Depreciation,
Exceptional Items and Taxation 2,980 2,436
Less: Finance Costs (17) (83)
Less: Depreciation and Amortisation (340) (327)
Profit before Exceptional Items and Taxation 2,623 2,026
Less: Exceptional Items (579) (38)
Profit Before Tax 2,044 1,988
Less: Taxes (654) (672)
Prof it After Tax 1,390 1,316
Add : Surplus in Statement of Profit and
Loss at the beginning of the year 5,032 4,032
Amount available for Appropriation 6,422 5,348
Appropriations:
Proposed Dividend 166 158
Taxation on Proposed Dividend 27 26
Transferred to General Reserve 139 132
Profit & Loss Balance Carried Forward 6,090 5,032
Operations:
Your Company's profit after tax increased to Rs. 1,390 Millions during
the financial year ended March 31, 2012 as compared to Rs. 1,316 Millions
in previous year, an increase of 5.62 %.
Dividend:
The Board of Directors is pleased to recommend the payment of dividend
of Rs. 4.20 per Equity Share of Rs. 10 each for the financial year ended
March 31, 2012, subject to the approval of the Members (previous year Rs.
4 per Equity Share of Rs. 10 each). The proposed dividend will absorb a
sum of Rs. 166 Millions. The Register of Members will remain closed from
Friday, August 10, 2012, to Friday, August 24, 2012 (both days
inclusive).
Exports:
Your Company is a recognised Export House. The export sale (FOB) for
the year ended March 31, 2012 was Rs. 3,096 Millions compared to Rs. 2,363
Millions during the previous year.
Public Deposits:
A sum of Rs. 15,000 relating to 1 deposit, which was claimed, but not
encashed, remained balance as on March 31, 2012. No interest is payable
on such unclaimed deposit after the maturity date. During the year
under review, your Company has not accepted any public deposits.
Insurance:
The Company's assets continue to be adequately insured against the risk
of fire, riot, earthquake, terrorism and the risk of loss of profits,
among other things.
In addition to the above, adequate coverage has been taken to cover
public liability, environmental liability and product liability risks.
All the employees are also covered against the risk of hospitalisation
and personal accident.
Foreign Exchange Management:
The Company's exposure to foreign exchange risk comprises the risk of a
foreign currency versus the local currency. The goal is to reduce the
negative impact of the risks arising from fluctuations in exchange
rates in the earnings. The majority of the forex transactions are
denominated in US dollar. To mitigate the currency fluctuations, the
net exposure of the Bayer Group is hedged after taking advantage of the
natural hedge on every month end. Foreign currency loans, including
interest, are completely hedged.
Directors' Responsibility Statement:
Pursuant to the provisions of Section 217(2AA) of the Companies Act,
1956, the Directors confirm that, to the best of their knowledge and
belief:
1. in the preparation of the annual accounts, the applicable
accounting standards have been followed;
2. appropriate accounting policies have been selected and applied
consistently, and such judgements 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 on March 31, 2012 and of the profit of the
Company for the financial year ended March 31, 2012;
3. proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and
4. the annual accounts have been prepared on a going concern basis.
Responsible Care and Quality:
Your Company observed National Safety Week and Fire Prevention Week in
the year and conducted various activities throughout the week to spread
awareness on safety amongst employees. September 13, 2011 was observed
as the Bayer Safety Day.
Your Company, covering all the manufacturing units, all India business
operations and supporting services, was audited on Quality Management
System by TUV India Private Limited (TUV) and the Company was
recommended continuation of ISO 9001:2008 certificate. The
Environmental Management System for Himatnagar and Ankleshwar plants
was audited by TUV and was recommended continuation of ISO 14001:2004
certificate.
Continual improvement and sustainability resulted in conservation of
energy, reduction in waste generation and recycling of resources and
cost savings.
Your Company accords high priority to health, safety and environment.
Corporate Sustainability and Social Responsibility:
In our mission statement "Bayer: Science For A Better Life" we
summarise what we stand for as a Company: "Innovative solutions to
socially relevant problems". Our new values concept 'LIFE - which
stands for Leadership, Integrity, Flexibility and Efficiency' combine
innovative performance with the personal actions of each employee, thus
providing orientation for our everyday business.
Sustainability - which essentially means future viability - forms an
integral part of our business strategy. We are convinced that we can
only be commercially successful in the long run, if we balance economic
growth with ecological and social responsibility.
Bayer Model Village Project
As a key player in the agricultural industry, Bayer CropScience in
India is playing an important role in driving innovation to improve
agricultural productivity in the country.
Agriculture is the key to economic growth and prosperity. In order to
provide livelihood for a majority of Indian farmers living in rural
areas, Bayer CropScience has been taking a lead in developing a broad
variety of measures that include, in particular, a strong focus on
knowledge transfer on how sustainable crop production can increase
productivity.
Child Care Programme (CCP) has been envisaged as a social intervention
model to eliminate child labour in the seed supply chain and for
protecting their right to education. CCP has been acknowledged as an
exemplary model by NGOs and companies alike, for getting children off
the farms of contract seed growers and into schools.
As a next step towards empowerment, Bayer is now using the insights
gained during the implementation of CCP to launch the Model Village
Project.
The "Model Village Project" is an inspired extension of CCP's objective
- to usher in comprehensive rural development, by means of a variety of
purposeful projects that focus on improving quality of life in Indian
villages.
In the framework of the project, interim storage space for harvested
crops, weather insurance schemes and micro loans for farm investments
will also be included as core components. These programmes will help
farmers to directly access markets by eliminating the ineffective and
traditional ways of trade, e.g. through middlemen. Education and
training opportunities for children are an essential part of this
initiative.
The Model Village Project in India is to be implemented in two villages
- Mangalgudda and Kadivala, both in Karnataka as pilots. Based on the
success of the two pilot projects, Bayer intends to scale up this
project in all seed production villages across the country.
Bayer's approach
Bayer and its partners will help farmers to improve their agricultural
productivity and profitability by providing advice and making available
quality inputs. Bayer and its partners intend to carry out various
projects to contribute to the improvement of educational standards and
the livelihood situation of the villagers.
The overall approach for execution of the project will be through
developing partnerships with like-minded organisations and bringing
their expertise to the table. To act as a focal point and incubator,
Bayer has incorporated a separate legal entity, "Bayer Prayas Rural
Development Association".
Bayer Prayas will facilitate community involvement, strong partnerships
and possibility of turning the Model Villages into a hub of development
activities, with the organisation working as a point of convergence and
project sustainability.
Implementation update
Drip Irrigation
As an integral part of the Model Village Project, a drip irrigation
project has been implemented in four cotton seed production plots
located in the Gajendragada and the Sira districts of Karnataka on an
experimental basis (pilot trial) for the Kharif (wet) season 2011. The
results of the trial are very encouraging and, therefore, Bayer will
replicate this irrigation scheme in the selected Model Villages.
Water Purification plant
Bayer has invited the company Smaat Aqua Water Technologies to partner
in establishing water purification and distribution plants in two Model
Villages. The objective is to help in improving the overall health and
hygiene standards in the villages and facilitate the availability of
safe drinking water.
The first Bayer-Smaat Water Purification Plant has been commissioned in
Kadivala village on January 24, 2012. Mr. Stephan Gerlich formally
inaugurated the plant which has a capacity of 500 litres per hour to
serve safe drinking water to about 180 households.
Bayer Vidya Prayas Scholarships
Under Bayer Vidya Prayas initiatives, employees of Bayer and its
associated companies in India can sponsor a child's education by
voluntarily donating Rs. 5,000 every year. This donation will be utilised
for the child's school fee and study material. Bayer Vidya Prayas is
being implemented in the Model Villages and will cover 200 children
initially. Bayer Vidya Prayas was formally launched by Mr. Stephan
Gerlich on January 24, 2012 at Kadivala village. On the same day, about
50 children belonging to Kadivala, the beneficiaries of Bayer Vidya
Prayas in the first phase, received school kits.
Bayer Rural Service Centres
Envisaged as a service delivery hub, Bayer Rural Service Centres
located in the project villages provide comprehensive solutions to the
local farming needs from 'Seed to Harvest' and help the farmers to
improve their productivity and profitability. Training on farm
mechanisation, commodity trading and quality consciousness are some of
the key elements of this initiative.
Currently, 11 Bayer Rural Service Centres are operational serving
around 262 villages in the State of Karnataka in and around the Model
Villages. As on date, 2,408 farmers have registered with the Bayer
Rural Service Centres.
Long-term Commitment
Bayer regards itself as a member of society and believes it needs
society's long-term acceptance to be able to act entrepreneurially.
Model Village Project is a shining example to illustrate this point.
Through this project, our objectives clearly show the direction in
which, we want to go, namely towards an even stronger integration of
sustainability into our activities. In this way, we aim to further
improve our position as a responsible enterprise and drive forward more
strategically our contribution to the sustainable development of
society.
Human Resources:
Employee engagement is an important factor in your Company's success.
Central to this engagement are culture and our LIFE values. They
provide the employees with guidance for daily work and encourage them
for sustainable performance.
Your Company reaffirmed its commitment to personal growth and learning
with the launch of 30 different training and development initiatives to
support the employees in an increasingly dynamic and complex business
landscape. The year was marked with special focus on self-leadership,
leading people and customer service initiatives. Additionally, our
employees were nominated to 22 identified external training programs.
Your Company further continued its strong Employer Branding initiatives
and built upon its Corporate Image in the market by launching "Bayer
Scholarship Program" with six top ranking universities in India, with
the aim to further strengthen the interface between the educational
institutes and the industry.
In line with Bayer's talent management philosophy of "Building the
Leadership Pipeline" and "Valuing the Expertise of employees", a number
of employees went through Development Centre exercises during the year
and qualified for promotion at National Level. The assessments were
conducted based on the specific skills, beliefs and competencies
identified in XCEDO, the Bayer CropScience Training Academy.
In continuation to last year's efforts towards providing opportunities
for learning and development to the employees, an initiative was
launched to further strengthen the leadership abilities and feedback
culture. Also, employees participated in the third batch of Bayer
Management Program "NIEV".
Employee relations during the year were harmonious and cordial.
Information pursuant to Section 217(2A) of the Companies Act, 1956:
The information as prescribed by Section 217(2A) of the Companies Act,
1956, read along with the Companies (Particulars of Employees) Rules,
1975, as amended is set out as an Annexure to the Directors' Report.
However, as per the provisions of Section 219(1)(b)(iv) of the
Companies Act, 1956, the Directors' Report and Financial Statements are
being sent to the Members excluding the statement giving particulars of
employees under Section 217(2A). Any Member interested in obtaining a
copy of the aforesaid 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 required under Section 217(1)(e) of the Companies Act,
1956 read along with the Companies (Disclosure of Particulars in the
Report of the Board of Directors) Rules, 1988 with respect to these
matters, form part of this Report and is annexed hereto.
Corporate Governance:
Your Company believes in transparency and has always maintained a very
high level of Corporate Governance. As required by Clause 49 of the
Listing Agreement, a detailed Corporate Governance Report is given as
an Annexure to this Report. The Company is in full compliance with the
requirements and disclosures that have to be made in this regard. The
Certificate from a Company Secretary in whole-time practice confirming
compliance of the Corporate Governance requirements by the Company is
attached to the Corporate Governance Report.
Management Discussion and Analysis Report:
A detailed review of operations, performance and future outlook of the
Company is given separately under the head Management Discussion and
Analysis Report.
Directors:
Mr. Sharad M. Kulkarni and Mr. Vimal Bhandari retire by rotation and,
being eligible, offer themselves for re-appointment.
Mr. Peter Mueller and Mr. Tobias Marchand were appointed as Directors
with effect from August 1, 2011 in the casual vacancies caused due to
the resignations of Mr. Johannes Dietsch and Mr. Bernd Naaf
respectively. Mr. Mueller and Mr. Marchand hold office till the ensuing
Annual General Meeting as Directors appointed in casual vacancies and,
being eligible, offer themselves for re-appointment.
Brief profiles of the above Directors are given under the Corporate
Governance Report.
Cost Audit:
In accordance with the directive received from the Central Government,
every year, an audit of the cost accounts relating to Insecticides
manufactured by the Company is required to be conducted by an auditor
with the requisite qualifications as prescribed under Section 233B of
the Companies Act, 1956.
The Board of Directors has appointed M/s. N. I. Mehta and Co.,
qualified Cost Accountants for the conduct of the audit of Insecticides
- Technical Grade for the year ending March 31, 2013. In terms of the
Companies (Cost Audit Report) Rules, 2011 the cost audit report is
required to be filed within 180 days from the end of the financial
year. Your Company filed the Cost Audit Report for the financial year
ended March 31, 2011 on September 23, 2011. The Cost Audit Report for
the financial year ended March 31, 2012 will be filed within 180 days
from the end of the financial year.
Auditors:
M/s. Price Waterhouse, Chartered Accountants, (Firm Registration Number
301112E) retire as Statutory Auditors at the conclusion of the ensuing
Annual General Meeting and are eligible for re-appointment. The Company
has received a letter from the retiring Auditors that their appointment
as Statutory Auditors, if made, would be within the limits prescribed
under Section 224(1 B) of the Companies Act, 1956. The Audit Committee
and the Board recommends the re-appointment of M/s. Price Waterhouse,
Chartered Accountants, (Firm Registration Number 301112E) as Statutory
Auditors for the financial year ending March 31, 2013.
Members are requested to consider and re-appoint M/s. Price Waterhouse,
Chartered Accountants, (Firm Registration Number 301112E) as the
Statutory Auditors of the Company for the financial year ending March
31, 2013.
Acknowledgements:
The Board places on record its sincere appreciation for the dedicated
services rendered by employees at all levels and the constructive
co-operation extended by the staff unions and the officers'
association. Your Directors would like to express their grateful
appreciation for the assistance and support extended by all customers,
government authorities, financial institutions, banks, shareholders,
suppliers and other business associates. We also acknowledge the
continual support and guidance from Bayer AG, Bayer CropScience AG and
Bayer SAS.
For and on behalf of the Board of Directors
Bayer CropScience Limited
Dr. Vijay Mallya
Chairman
Mumbai, May 29, 2012
Mar 31, 2011
Dear Members,
The Directors take pleasure in presenting the 53rd Annual Report on
the business and operations of the Company together with the audited
Statements of Accounts along with the Report of the Auditors for the
financial year ended 31st March, 2011.
Financial Performance:
Rs. in million
Particulars 2010-11 2009-10
Net Sales and Other Operating Income 21,392.71 17,241.06
Other Income 184.96 252.53
Total Income 21,577.67 17,493.59
Profit before Interest, Depreciation,
Exceptional Items and Taxation 2,433.44 2,430.15
Less : Interest (79.11) (114.50)
Less : Depreciation/ Amortisation (326.89) (264.42)
Profit before Exceptional Items and
Taxation 2,027.44 2,051.23
Less : Exceptional Items (37.78) (86.78)
Profit for the year Before Tax 1,989.66 1,964.45
Less : Taxes (674.22) (691.91)
Profit for the year After Tax 1,315.44 1,272.54
Add : Profit & Loss balance brought forward
from previous year 4,032.03 3,070.98
Amount available for Appropriation 5,347.47 4,343.52
Appropriations:
Proposed Dividend 158.00 158.00
Taxation on Proposed Dividend 25.63 26.24
Transferred to General Reserve 131.54 127.25
Profit & Loss Balance Carried Forward 5,032.30 4,032.03
Operations:
Your Company's profit after tax increased to Rs. 1,315.44 million during
the year ended 31 st March, 2011 as compared to Rs. 1,272.54 million in
the previous year, an increase of 3.37%.
Dividend:
The Board of Directors is pleased to recommend the payment of dividend
of Rs.4 per Equity Share ofRs. 10 each for the financial year ended 31st
March, 2011, subject to the approval of members (previous year Rs. 4 per
Equity Share of Rs. 10 each). The proposed dividend will absorb a sum of
Rs. 158 million. The Register of Members will remain closed from
Thursday, 11th August, 2011 to Thursday, 25th August, 2011 (both days
inclusive).
Exports:
Your Company is a recognised Export House. The export sales (FOB) for
the year ended 31st March, 2011 was Rs. 2,362.89 million compared to Rs.
1,518.46 million during the previous year.
Public Deposits:
A sum ofRs. 15,000 relating to 1 deposit, which was claimed, but not
encashed, remained balance as on 31st March, 2011. No interest is
payable on such unclaimed deposit after the maturity date. During the
year under review, your Company has not accepted any public deposits.
Insurance:
The Company's assets continue to be adequately insured against the risk
of fire, riot, earthquake, terrorism and the risk of loss of profits,
among other things.
In addition to the above, adequate coverage has been taken to cover
public liability and product liability claims. Also, all the employees
are covered against the risk of hospitalisation and personal accident.
Foreign Exchange Management:
The Company's exposure to foreign exchange risk comprises the risk of a
foreign currency versus the local currency. The goal is to reduce the
negative impact of the risks arising from fluctuations in exchange
rates in the earnings. The majority of the Forex transactions are
denominated in US dollar. To mitigate the currency fluctuations, the
net exposure of the Bayer Group is hedged after taking advantage of the
natural hedge at the end of each month. Foreign currency loans
including interest are completely hedged.
Directors' Responsibility Statement:
Pursuant to the provisions of Section 217(2AA) of the Companies Act,
1956, the Directors confirm that, to the best of their knowledge and
belief;
1. in the preparation of the annual accounts, the applicable
accounting standards have been followed;
2. appropriate accounting policies have been selected and applied
consistently and such judgements 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 on 31st March, 2011 and of the profit of
the Company for the financial year ended 31st March, 2011;
3. proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and
4. the annual accounts have been prepared on a going concern basis.
Responsible Care and Quality:
Your Company was awarded "The Best Green Belt Award" from the Chief
Minister of Gujarat for its Ankleshwar plant.
Your Company observed National Safety week and Fire Prevention week and
conducted various activities throughout the week to spread awareness
amongst its employees.
Your Company, covering all the manufacturing units, all India business
operations and supporting services, was audited on Quality Management
System by TUV India Private Limited (TUV) and the Company was
recertified to ISO 9001:2008 certificate. The Environmental Management
System for Himatnagar and Ankleshwar plants was audited by TUV and was
recommended continuation of ISO 14001:2004 certificate.
Continual improvement and sustainability resulted in conservation of
energy, reduction in waste generation, recycling of resources and cost
savings.
Your Company accords high priority to health, safety and environment.
Material Developments during the financial year:
In follow up to the incident that occurred at the Ankleshwar site,
Gujarat, on 11th March 2010, the Company on 11th April, 2011 was
granted permanent re-instatement of all permissions for production of
all products, except Ethoprophos from the relevant authorities' in
Gujarat. Subsequently permanent re-instatement of permission for
production of Ethoprophos was granted on 20th April, 2011.
Your Company's Board had approved the sale of around 100 acres of land
at Thane. The Company has entered into a non-binding and exclusive
agreement, for the proposed sale of the land, with Agile Real Estate
Private Limited. The Company has received an earnest amount ofRs. 2,600
million for this exclusive arrangement. The Conveyance, Transfer, Sale
and Possession of the said Thane land will be completed at a future
date, subject to relevant approvals and permissions from the Government
& other Statutory Authorities, as may be deemed necessary.
Corporate Sustainability and Social Responsibility:
The Bayer Group believes that its technical and commercial expertise
entails a duty to contribute to sustainable development. The main areas
that Bayer in India is involved in include Learning & Child Education,
Youth Environmental Partnerships, Emergency Response, Partnerships with
Associations to combat social and environmental problems and activities
in the vicinity of the sites where Bayer has operations.
Making Science Make Sense Program (MSMS)
MSMS is an initiative that advances science literacy among students
through hands-on, inquiry-based science learning. The program is
designed in a specific way that includes live demonstrations,
experiments, audio-visual tools and interactive sessions to enhance the
learning experience and make sure that science is taught in a way
that's enjoyable and fun. Currently, 20 schools in Mumbai and 4 schools
in Ankleshwar participated in this program.
Bayer Young Environmental Envoy Program
As a research-based enterprise, Bayer also places great emphasis on
promoting science education for the youth and has, therefore, been
committed to promoting youth environmental programs for many years. In
cooperation with the United Nations Environment Program, Bayer
organises and promotes a number of specific projects which aim to
improve knowledge about the environment among the youth and support
them in their environmental commitment. Under the Bayer Young
Environment Envoy Program, the participating students win a chance to
represent India, alongwith youth delegates from other countries on an
'all - expense' paid study trip to Germany every year. The week long
study trip gives students the unique opportunity to gain a first hand
experience of best environmental protection practices by the Company,
people and Government in industrialised countries.
Child Care Program (CCP): A social intervention model for tackling
child labour and protecting their right to education
The CCP is one of the most successful initiatives of Bayer in India. No
children in the hybrid cotton seed fields - that's the principle of
Bayer. For the past 5 years, Bayer has worked effectively to implement
a comprehensive multilevel CCP. The program has been rolled out in
Andhra Pradesh, Karnataka and Tamil Nadu where Bayer has contract
cotton seed production. It aims at getting children off the fields of
contract farmers and into schools.
Learning for Life project - Impacting lives
A key component of the CCP is the educational module under the broader
'Learning for Life' initiative. It provides out-of-school children from
cotton seed production farms with an access to education.
The Bayer-Ramanaidu Vignana Jyothi School of Agriculture was
established as a part of the 'Learning for Life' strategy to foster
education. This is a first-of-its-kind model developed and
successfully implemented in an industry with a farm-based supply chain.
Your Company remains committed to Social Responsibility by continuing
to be involved in community projects. The Bayer Group also undertakes
several initiatives around the sites where it has operations. For
example your Company organised transport and books for the differently
abled children of Holy Cross Convent School, Thane and also distributed
school uniforms, medicines and other school supplies to schools in the
vicinity of Ankleshwar and Thane. Over the years, tree plantation
drives have also been successfully implemented.
As an extension of the Company's activities in Sustainable Development
and Climate Program, Bayer in India has enrolled itself as an
invitational member with The Energy and Resources Institute - Business
Council for Sustainable Development (TERI - BCSD). TERI- BCSD India is
an independent and credible platform for corporate leaders to address
issues related to sustainable development and promote leadership in
environmental management, social responsibility and economic
performance.
Bayer considers sustainable development to be the central model for
companies in the 21st century. As a result, Bayer is committed to
structuring its business processes in such a way that they meet the
economic, ecological and social needs of society without compromising
on development opportunities for future generations.
Human Resources:
This year, the employees of your Company participated in the Bayer
Employee Survey and achieved excellent results. The survey was held
across the Bayer Group Companies worldwide and Bayer CropScience in
India showed significantly higher engagement scores. The engagement
score of Bayer CropScience in India was 97%.
The importance of personal growth was reaffirmed with the launch of 26
different training and development initiatives to help the employees
find their bearings in an increasingly challenging and complex work
environment. More than 900 employees participated in 26 training
initiatives and 72 participants were nominated for 37 external training
programs.
In line with Bayer's philosophy of "Grow from Within", a large number
of employees went through Assessment Center exercise during the year
and qualified for promotion at National Level. The Assessment Center
was conducted based on the specific skills and competencies identified
in the XCEDO (BCS Training Academy).
In continuation to last year's efforts towards providing opportunities
for Learning and Development to the employees, the second batch of
Bayer Management Program "NEIV" was rolled out in October 2010 with 32
participants from across the Bayer Group in India.
An extension of BCS Training Academy - Kalpavruksh Prabodhini continued
with providing training programs focusing on our Industrial Operations
Group.
Your Company further continued its strong Employer Branding initiatives
and built upon its Corporate Image in the market.
Employee relations during the year were harmonious and cordial.
Information pursuant to Section 217(2A) of the Companies Act, 1956:
The information as prescribed by Section 217(2A) of the Companies Act,
1956, read along with the Companies (Particulars of Employees) Rules,
1975, as amended is set out as an annexure to the Directors' Report.
However, as per the provisions of Section 219(1)(b)(iv) of the
Companies Act, 1956, the Directors' Report and Accounts are being sent
to the members excluding the statement giving particulars of employees
under Section 217(2A). Any member interested in obtaining a copy of the
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 required under Section 217(1)(e) of the Companies Act,
1956 read along with the Companies (Disclosure of Particulars in the
Report of the Board of Directors) Rules, 1988 with respect to these
matters forms part of this Report and is annexed hereto.
Corporate Governance:
Your Company believes in transparency and has always maintained a very
high level of Corporate Governance. As required by Clause 49 of the
Listing Agreement, a detailed Report on Corporate Governance is given
as an Annexure to this Report. Your Company is in full compliance with
the requirements and disclosures that have to be made in this regard. A
certificate from a Company Secretary in whole-time practice confirming
compliance of the Corporate Governance requirements by the Company is
attached to the Corporate Governance Report.
Management Discussion and Analysis:
A detailed review of operations, performance and future outlook of the
Company is given separately under the head Management Discussion &
Analysis Report.
Directors:
Dr. Vijay Mallya and Mr. A.K.R. Nedungadi retire by rotation and being
eligible, offer themselves for re-appointment. A brief profile of Dr.
Mallya and Mr. Nedungadi is given under the Corporate Governance
Report.
Cost Audit:
In accordance with the directive received from the Central Government,
every year, an audit of the cost accounts relating to Insecticides
manufactured by the Company is required to be conducted by an auditor
with the requisite qualifications as prescribed under Section 233B of
the Companies Act, 1956.
The Board of Directors has appointed M/s. N. I. Mehta and Co.,
qualified Cost Accountants for the conduct of the audit of Insecticides
- Technical Grade for the year ending 31 st March, 2012. The requisite
approval from the Central Government for their appointment has been
received. In terms of the Cost Audit Report Rules, 2001 the Cost Audit
Report is required to be filed within 180 days from the end of the
financial year. Your Company filed the Cost Audit Report for the year
ended 31st March, 2010 on 19th September, 2010. The Cost Audit Report
for the year ended 31st March, 2011 will be filed on or before 30th
September, 2011.
Auditors:
M/s. Price Waterhouse, Chartered Accountants, (Firm Registration No.
007568S) retire as Statutory Auditors at the conclusion of the ensuing
Annual General Meeting and are eligible for re-appointment. M/s. Price
Waterhouse, (Firm Registration No. 007568S) have communicated their
unwillingness to be re-appointed as Auditors. The Board of Directors
has on recommendation of the Audit Committee proposed the appointment
of M/s. Price Waterhouse (Firm Registration No. 301112E) for the
approval of the members at the ensuing Annual General Meeting. The
Company has received a special notice from a member, in terms of
provisions of Section 225 of the Companies Act, 1956, read with Section
190, proposing the appointment of M/s. Price Waterhouse (Firm
Registration No. 301112E) as the Auditors of the Company from the
conclusion of the ensuing Annual General Meeting till the conclusion of
the next Annual General Meeting. Members are requested to consider and
appoint M/s. Price Waterhouse (Firm Registration No. 301112E) as the
Auditors of the Company for the year ending 31 st March, 2012.
A certificate from them has been received, to the effect that their
appointment as Auditors of the Company, if made, would be within the
limits prescribed under Section 224 (1B) of the Companies Act, 1956.
Acknowledgements:
The Board places on record its sincere appreciation for the dedicated
services rendered by employees at all levels and the constructive
cooperation extended by the staff unions and the officers' association.
Your Directors would like to express their grateful appreciation for
the assistance and support extended by all customers, government
authorities, financial institutions, banks, shareholders, suppliers and
other business associates. We also acknowledge the continual support
and guidance from Bayer AG, Bayer CropScience AG and Bayer SAS.
For and on behalf of the Board of Directors
Bayer CropScience Limited
Dr. Vijay Mallya
Chairman
Leverkusen, Germany, 19th May, 2011
Mar 31, 2010
The Directors take pleasure in presenting the 52nd Annual Report on
the business and operations of the Company together with the audited
Statements of Accounts alongwith the Report of the Auditors for the
financial year ended 31st March, 2010.
FINANCIAL PERFORMANCE:
Rs. Million
Particulars 2009-10 2008-09
Net Sales and Operating Income 17,241.06 14,825.91
Other Income 252.53 215.63
Total Income 17,493.59 15,041.54
Profi t before Interest, Depreciation,
Exceptional Items and Taxation 2,430.15 1,916.51
Less : Interest (114.50) (107.99)
Less : Depreciation/ Amortisation/
Impairment (264.42) (239.92)
Profi t before Exceptional Items
and Taxation 2,051.23 1,568.60
Less : Exceptional Items (86.78) (60.33)
Profi t for the year Before Tax 1,964.45 1,508.27
Less : Current Tax (615.00) (510.84)
Less : Deferred Taxes (77.94) (21.03)
Less : Fringe Benefi t Tax 1.03 (31.81)
Profi t for the year After Tax 1,272.54 944.59
Add : Profi t & Loss balance brought
forward from previous year 3,070.98 2,350.25
Amount available for Appropriation 4,343.52 3,294.84
Appropriations:
Proposed Dividend 158.00 110.60
Taxation on Proposed Dividend 26.24 18.80
Transferred to General Reserve 127.25 94.46
Profi t & Loss Balance Carried Forward 4,032.03 3,070.98
Operations:
Your CompanyÃs profi t after tax increased to Rs.1,272.54 million
during the year ended 31st March, 2010 as compared to Rs. 944.59
million in previous year, an increase of 34.72%.
Dividend:
The Board of Directors is pleased to recommend a dividend of Rs. 4 per
Equity Share of Rs. 10 each for the fi nancial year ended 31st March,
2010 subject to the approval of members (previous year Rs. 2.80 per
Equity Share of Rs. 10 each). The proposed dividend will absorb a sum
of Rs. 158 million. The Register of Members will remain closed from
Tuesday, 14th September, 2010 to Tuesday, 28th September, 2010 (both
days inclusive).
Exports:
Your Company is a recognised Export House. The export turnover (FOB)
during the year ended 31st March 2010 was Rs. 1,518.46 million compared
to Rs. 1,695.43 million during the previous year.
Public Deposits:
The Company discontinued its Public Deposit Scheme in the year 2003. A
sum of Rs. 125,000 relating to 6 deposits remained unclaimed as on 31st
March, 2010. No interest is payable on such unclaimed deposits after
the maturity dates.
Insurance:
Your CompanyÃs assets continue to be adequately insured against the
risk of fi re, riot, earthquake, terrorism and the risk of loss of
profi ts, among other things.
In addition to the above, adequate coverage has been taken to cover
public liability and product liability claims. Also, all the employees
are covered against the risk of hospitalisation and personal accident.
Foreign Exchange Management:
The CompanyÃs exposure to foreign exchange risk comprises the risk of
foreign currency versus the local currency. The goal is to reduce the
negative impact of the risks arising from fluctuations in exchange
rates on the earnings. The majority of the Forex transactions are
denominated in US dollar. To mitigate the currency fluctuations, the
net exposure of the Bayer Group is hedged after taking advantage of
the natural hedge on every month end. Foreign currency loans including
interest are completely hedged.
Directorsà Responsibility Statement:
Pursuant to the provisions of Section 217(2AA) of the Companies Act,
1956, the Directors confi rm that, to the best of their knowledge and
belief:
1. in the preparation of the annual accounts, the applicable
accounting standards have been followed;
2. appropriate accounting policies have been selected and applied
consistently and such judgements 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 on 31st March, 2010 and of the profi t of
the Company for the fi nancial year ended 31st March, 2010;
3. proper and suffi cient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and
4. the annual accounts have been prepared on a going concern basis.
Responsible Care and Quality:
Your Company observed National Safety week and Fire Prevention week and
conducted various activities throughout the week to spread awareness
amongst its employees.
Your Company, covering all the manufacturing units, all India business
operations and supporting services, was audited on Quality Management
System by TUV India Pvt. Ltd. (TUV) and the Company was recommended
continuation of ISO 9001: 2000 certifi cate. The Environmental
Management System for Himatnagar and Ankleshwar plants was audited by
TUV and was recommended continuation of ISO 14001: 2004 certifi cate.
Continual improvement and sustainability resulted in conservation of
energy, reduction in waste generation, recycling of resources and cost
savings.
Your Company accords high priority to health, safety and environment.
Despite all the measures undertaken by the Company an unfortunate
incident occurred at the Ankleshwar site, Gujarat. On 11th March, 2010
at 03:00 hrs, a fi re occurred in the storage tank of AC4 plant at the
aforesaid site. AC4 is a plant where active ingredients are produced
for the crop protection products. The fi re was brought under control
within 25 minutes. There was minimal impact on the rest of the site and
this incident has posed no hazard to the neighbourhood at any time.
Unfortunately, one employee died during the course of this incident.
The Company had been asked to halt manufacturing activities at the
Ankleshwar site on 22nd March, 2010, subsequent to the fi re that broke
out at the storage tank. The Company was allowed to resume production
with effect from 6th April, 2010 except for the active ingredient
Ethoprophos à at the Ankleshwar site after having been granted 3 months
production allowance by the relevant authorities in Gujarat, which has
now been extended by a further period of 3 months.
Since your Company has suffi cient stocks of key products manufactured
at Ankleshwar, no major interruption of product supply to its customers
is foreseen.
Social Responsibility:
Your Company remains committed to Social Responsibility by continuing
to be involved in community projects.
Thane
Your Company organised transport and books for the differently abled
children of Holy Cross Convent School, Thane and also distributed
school uniforms to the school at Balkum village.
Your Company organised a medical camp for the Kapurbawdi Police
Station, Thane.
Ankleshwar
Being a Responsible Care Signatory, your Company continued to provide
support for the e-Communication Centre at the CollectorÃs offi ce,
Bharuch.
Your Company also undertook tree plantation at the CollectorÃs offi ce,
Bharuch.
Sadhana Village initiative: Endeavour to help the underprivileged
Sadhana Village is a voluntary organisation located in Kolwan valley,
30 kms from Pune, Maharashtra. This reputed NGO started its activities
in 1994 and has been focusing on various endeavours in rural areas such
as education of children, women, the differently abled, school drop
outs etc. Your Company empowered the efforts of Sadhana Village by
making a signifi cant donation in 2009.
CORPORATE SUSTAINABILITY Sustainability and commitment:
As a global innovation and market leader in its industry, Bayer
CropScience believes that its technological and commercial expertise
entails a duty to contribute to Sustainable Development. In awareness
of our responsibility as a corporate citizen, we defi ne economy,
ecology and social commitment as objectives of equal rank.
Emergency response: Providing immediate relief
Your Company has undertaken a range of rehabilitation and relief
operations in the wake of natural disasters and calamities. The Bayer
Group has always been a fi rm supporter of humanitarian causes. In the
year 2009, your Company made donations to the Calamity Relief Fund,
Karnataka and also towards fl ood relief in Andhra Pradesh. This
support was given in the form of basic essentials such as bed sheets,
towels and utensils.
Science For A Better Life:
For Bayer CropScience, sustainability of our actions includes a
personal commitment to act in a way that balances the economic,
ecological and social needs of current and future generations, by
reconciling short-term results with long-term requirements.
Conservation of Energy, Technology Absorption and Foreign Exchange
Earnings and Outgo:
The information required under Section 217(1)(e) of the Companies Act,
1956 read alongwith the Companies (Disclosure of Particulars in the
Report of the Board of Directors) Rules, 1988 with respect to these
matters forms part of this Report and is annexed hereto.
Human Resources:
In its endeavour to provide learning & development opportunities to
employees and to support BayerÃs philosophy to ÃGrow Talent from
withinÃ, your Company introduced à BAYER Management Program - ÃNIEVÃ.
This program aims at providing an opportunity for undergoing formal
management education to a selected group of high performing and high
potential employees.
An Internal Customer Service initiative was launched to build a culture
of service excellence amongst members of the service departments. A
series of workshops followed by a celebration of Customer Service Week
has resulted in an enhanced level of service delivery.
In continuation to last yearÃs efforts towards identifi cation of
career and development path of its key talents, Bayer Group
International Orientation Centre was conducted which resulted in the
individual development plans being formulated for each participant. To
further develop and nurture potentials, an exclusive program called
ÃTiger Cubsà for young talents and ÃPouncing Panthersà for middle
management group was launched during the year in Supply Chain and
Industrial Operations.
Several employee engagement activities were conducted under the
initiative ÃPrayaasÃ. Prayaas was centered around 4 themes, ÃShareÃ,
ÃGrowÃ, ÃTeachà and ÃCareÃ, where employees came together to contribute
to society through various activities such as blood donations,
volunteering at NGOs, donation of clothes and toys and a newspaper
drive to raise funds for the lesser privileged.
Your Company further enhanced its employee branding in several
educational and professional campuses across the country with various
events such as job & career fairs.
Information pursuant to Section 217(2A) of the Companies Act, 1956:
The information as prescribed by Section 217(2A) of the Companies Act,
1956, read alongwith the Companies (Particulars of Employees) Rules,
1975, as amended is set out as an annexure to the DirectorÃs Report.
However, as per the provisions of Section 219(1)(b)(iv) of the
Companies Act, 1956 the Directorsà Report and Accounts are being sent
to the members excluding the statement giving particulars of employees
under Section 217(2A). Any member interested in obtaining a copy of the
statement may write to the Company Secretary at the Registered Offi ce
of the Company.
Corporate Governance:
Your Company believes in transparency and has always maintained a very
high level of Corporate Governance. As required by Clause 49 of the
Listing Agreement, a detailed report on Corporate Governance is given
as an annexure to this Report. Your Company is in full compliance with
the requirements and disclosures that have to be made in this regard. A
certifi cate from a Company Secretary in whole-time practice confi
rming compliance of the Corporate Governance requirements by the
Company is attached to the report on Corporate Governance.
Management Discussion & Analysis:
A detailed review of operations, performance and future outlook of the
Company is given separately under the head Management Discussion &
Analysis Report.
Directors:
Mr. Bernd Naaf and Mr. Vimal Bhandari retire by rotation and being
eligible offer themselves for re-appointment. A brief profi le of Mr.
Naaf and Mr. Bhandari is given under the report on Corporate
Governance.
Cost Audit:
In accordance with the directive received from the Central Government,
every year an audit of the cost accounts relating to Insecticides
manufactured by the Company is required to be conducted by an auditor
with the requisite qualifi cations as prescribed under Section 233B of
the Companies Act, 1956.
The Board of Directors has appointed M/s. N. I. Mehta and Co., qualifi
ed Cost Accountants for the conduct of the audit of Insecticides Ã
Technical Grade for the year ending 31st March, 2011. The requisite
approval from the Central Government for their appointment has been
received.
Auditors:
M/s. Price Waterhouse, Chartered Accountants, retire as Statutory
Auditors at the conclusion of the ensuing Annual General Meeting and
are eligible for re-appointment. The Company has received a letter from
the retiring auditors that their appointment as Statutory Auditors, if
made, would be within the limits prescribed under Section 224(1B) of
the Companies Act, 1956. The Audit Committee and the Board recommends
the re-appointment of M/s. Price Waterhouse, as Statutory Auditors for
the year ending 31st March, 2011.
The members are requested to consider and re-appoint M/s. Price
Waterhouse, Chartered Accountants, as the Statutory Auditors of the
Company for the year ending 31st March, 2011.
Acknowledgements:
The Board of Directors places on record its sincere appreciation for
the dedicated services rendered by employees at all levels and the
constructive co-operation extended by the staff unions and the offi
cersà association. Your Directors would like to express their grateful
appreciation for the assistance and support extended by all customers,
government authorities, fi nancial institutions, banks, shareholders,
suppliers and other business associates. The management also
acknowledges the continual support and guidance from Bayer AG, Bayer
CropScience AG and Bayer SAS.
For and on behalf of the Board of Directors
Bayer CropScience Limited
Dr. Vijay Mallya
Chairman
Mumbai, 28th May, 2010