WHISTLE BLOWER POLICY / VIGIL MECHANISM
1. PREFACE
1.1. Section 177 of the Companies Act, 2013
requires every listed company and such class or classes of companies, as may be
prescribed to establish a vigil mechanism for the directors and employees to
report genuine concerns in such manner as may be prescribed. The Company has
adopted a Code of Conduct for Directors and Senior Management Executives (“the
Code”), which lays down the principles and standards that should govern the
actions of the Company and its employees. Any actual or potential violation of
the Code, howsoever insignificant or perceived as such, would be a matter of
serious concern for the Company. Such a vigil mechanism shall provide for
adequate safeguards against victimization of persons who use such mechanism and
also make provision for direct access to the chairperson of the Audit Committee
in appropriate or exceptional cases.
1.2. In the draft Rules under Companies
Act’2013, among others, a company which has borrowed money from banks and
public financial institutions in excess of Rs.50 crore needs to have a vigil
mechanism.
1.3. Under these circumstances, Private
Limited (“_________”), being a Private Limited Company proposes to
establish a Whistle Blower Policy/ Vigil Mechanism and to formulate a policy
for the same.
2. POLICY
OBJECTIVES
2.1. The Company is committed to adhere to
the highest standards of ethical, moral and legal conduct of business
operations. To maintain these standards, the Company encourages its employees
who have concerns about suspected misconduct to come forward and express these
concerns without fear of punishment or unfair treatment. A Vigil (Whistle Blower)
mechanism provides a channel to the employees and Directors to report to the management
concerns about unethical behaviour, actual or suspected fraud or violation of the
Codes of conduct or policy. The mechanism provides for adequate safeguards against
victimization of employees and Directors to avail of the mechanism and also
provide for direct access to the Chairman of the Audit Committee in exceptional
cases.
2.2. This neither releases employees from
their duty of confidentiality in the course of their work nor can it be used as
a route for raising malicious or unfounded allegations against people in
authority and / or colleagues in general.
3. SCOPE OF
THE POLICY
3.1. This Policy covers malpractices and
events which have taken place / suspected to have taken place, misuse or abuse
of authority, fraud or suspected fraud, violation of company rules,
manipulations, negligence causing danger to public health and safety, misappropriation
of monies, and other matters or activity on account of which the interest of
the Company is affected and formally reported by whistle blowers concerning its
employees.
4.
DEFINITIONS
4.1. “Alleged
wrongful conduct” shall mean violation of law, Infringement of Company’s
rules, misappropriation of monies, actual or suspected fraud, substantial and
specific danger to public health and safety or abuse of authority”.
4.2. “Audit
Committee” means a Committee constituted by the Board of Directors of the Company
in accordance guidelines of Companies Act, 2013.
4.3. “Board”
means the Board of Directors of the Company.
4.4. “Company”
means the.................................. Private Limited and all its
offices.
4.5. “Code” means Code of Conduct for
Directors and Senior Management Executives adopted by _____________ Private
Limited.
4.6. “Employee” means all the present employees and whole time Directors
of the Company (Whether working in India or abroad).
4.7. “Protected
Disclosure” means a concern raised by an employee or group of employees of the
Company, through a written communication and made in good faith which discloses
or demonstrates information about an unethical or improper activity under the title
“SCOPE OF THE POLICY” with respect to the Company. It should be factual and not
speculative or in the nature of an interpretation / conclusion and should
contain as much specific information as possible to allow for proper assessment
of the nature and extent of the concern.
4.8. “Subject”
means a person or group of persons against or in relation to whom a Protected Disclosure
is made or evidence gathered during the course of an investigation.
4.9. “Vigilance
and Ethics Officer” means an officer appointed to receive protected
disclosures from whistle blowers, maintaining records thereof, placing the same
before the Audit Committee for its disposal and informing the Whistle Blower
the result thereof.
4.10. “Whistle
Blower” is an employee or group of employees who make a Protected Disclosure
under this Policy and also referred in this policy as complainant.
5.
ELIGIBILITY
All Employees of the Company are eligible to
make Protected Disclosures under the Policy in relation to matters concerning
the Company.
6. RECEIPT
AND DISPOSAL OF PROTECTED DISCLOSURES.
6.1. All Protected Disclosures should be
reported in writing by the complainant as soon as possible after the Whistle
Blower becomes aware of the same so as to ensure a clear understanding of the
issues raised and should either be typed or written in a legible handwriting in
English or in Gujarati.
6.2. The Protected Disclosure should be
submitted in a closed and secured envelope and should be super scribed as
“Protected disclosure under the Whistle Blower policy”. Alternatively, the same
can also be sent through email with the subject “Protected disclosure under the
Whistle Blower policy”. If the complaint is not super scribed and closed as
mentioned above, it will not be possible for the Audit Committee to protect the
complainant and the protected disclosure will be dealt with as if a normal
disclosure. In order to protect identity of the complainant, the Vigilance and
Ethics Officer will not issue any acknowledgement to the complainants and they
are advised neither to write their name / address on the envelope nor enter
into any further correspondence with the Vigilance and Ethics Officer. The
Vigilance and Ethics Officer shall assure that in case any further
clarification is required he will get in touch with the complainant.
6.3. Anonymous / Pseudonymous disclosure
shall not be entertained by the Vigilance and Ethics Officer.
6.4. The Protected Disclosure should be
forwarded under a covering letter signed by the complainant. The Vigilance and
Ethics Officer / Chairman of the Audit Committee/ CEO/ Chairman as the case may
be, shall detach the covering letter bearing the identity of the Whistle Blower
and process only the Protected Disclosure.
6.5. All Protected Disclosures should be
addressed to the Vigilance and Ethics Officer of the Company or to the Chairman
of the Audit Committee/ CEO/ Chairman in exceptional cases. The contact details
of the Vigilance and Ethics Officer is as under:-
Name and Address - .....................................................
(CFO)
Email- .............................
6.6. Protected Disclosure against the
Vigilance and Ethics Officer should be addressed to the Chairman of the Company
and the Protected Disclosure against the Chairman/ CEO of the Company should be
addressed to the Chairman of the Audit Committee.
The contact details of the Chairman, CEO and
the Chairman of the Audit Committee are as under:
Name and Address of Chairman - .....................
Email- ........................
Name and Address of CEO - ......................
Email- ............................
Name and Address of the Chairman of the Audit
- ..............................
Email- .....................
6.7. On receipt of the protected disclosure
the Vigilance and Ethics Officer / Chairman/ CEO / Chairman of the Audit
Committee, as the case may be, shall make a record of the Protected Disclosure
and also ascertain from the complainant whether he was the person who made the
protected disclosure or not. He shall also carry out initial investigation
either himself or by involving any other Officer of the Company or an outside
agency before referring the matter to the Audit Committee of the Company for
further appropriate investigation and needful action. The record will include:
a)
Brief facts;
b) Whether
the same Protected Disclosure was raised previously by anyone, and if so, the
outcome thereof;
c) Whether
the same Protected Disclosure was raised previously on the same subject;
d) Details
of actions taken by Vigilance and Ethics Officer / Chairman/ CEO for processing
the complaint
e) Findings
of the Audit Committee
f) The
recommendations of the Audit Committee/ other action(s).
6.8 The Audit Committee, if deems fit, may
call for further information or particulars from the complainant.
7.
INVESTIGATION
7.1. All protected disclosures under this
policy will be recorded and thoroughly investigated. The Audit Committee may
investigate and may at its discretion consider involving any other Officer of
the Company and/ or an outside agency for the purpose of investigation.
7.2. The decision to conduct an investigation
is by itself not an accusation and is to be treated as a neutral fact finding
process.
7.3. Subject(s) will normally be informed in
writing of the allegations at the outset of a formal investigation and have
opportunities for providing their inputs during the investigation.
7.4. Subject(s) shall have a duty to
co-operate with the Audit Committee or any of the Officers appointed by it in
this regard.
7.5. Subject(s) have a right to consult with
a person or persons of their choice, other than the Vigilance and Ethics
Officer / Investigators and/or members of the Audit Committee and/or the
Whistle Blower.
7.6. Subject(s) have a responsibility not to
interfere with the investigation. Evidence shall not be withheld, destroyed or
tampered with and witness shall not be influenced, coached, threatened or
intimidated by the subject(s).
7.7. Unless there are compelling reasons not
to do so, subject(s) will be given the opportunity to respond to material
findings contained in the investigation report. No allegation of wrong doing
against a subject(s) shall be considered as maintainable unless there is good evidence
in support of the allegation.
7.8. Subject(s) have a right to be informed
of the outcome of the investigations. If allegations are not sustained, the
Subject should be consulted as to whether public disclosure of the investigation
results would be in the best interest of the Subject and the Company.
7.9. The investigation shall be completed
normally within 90 days of the receipt of the protected disclosure and is
extendable by such period as the Audit Committee deems fit.
8. DECISION
AND REPORTING
8.1. If an investigation leads the Vigilance
and Ethics Officer / Chairman of the Audit Committee to conclude that an
improper or unethical act has been committed, the Vigilance and Ethics Officer
/ Chairman of the Audit Committee shall recommend to the management of the Company
to take such disciplinary or corrective action as he may deem fit. It is
clarified that any disciplinary or corrective action initiated against the
Subject as a result of the findings of an investigation pursuant to this Policy
shall adhere to the applicable personnel or staff conduct and disciplinary
procedures.
8.2. The Vigilance and Ethics Officer shall
submit a report to the Chairman of the Audit Committee on a regular basis about
all Protected Disclosures referred to him/her since the last report together
with the results of investigations, if any.
8.3. In case the Subject is the Chairman/CEO
of the Company, the Chairman of the Audit Committee after examining the
Protected Disclosure shall forward the protected disclosure to other members of
the Audit Committee if deemed fit. The Audit Committee shall appropriately and
expeditiously investigate the Protected Disclosure.
8.4. If the report of investigation is not to
the satisfaction of the complainant, the complainant has the right to report
the event to the appropriate legal or investigating agency.
8.5. A complainant who makes false
allegations of unethical & improper practices or about alleged wrongful
conduct of the subject to the Vigilance and Ethics Officer or the Audit Committee
shall be subject to appropriate disciplinary action in accordance with the
rules, procedures and policies of the Company.
9.
SECRECY / CONFIDENTIALITY
9.1. The complainant, Vigilance and Ethics
Officer, Members of Audit Committee, the Subject and everybody involved in the
process shall:
9.1.1.
Maintain confidentiality of all matters under this Policy
9.1.2.
Discuss only to the extent or with those persons as required under this policy
for completing the process of investigations.
9.1.3. Not
keep the papers unattended anywhere at any time
9.1.4. Keep
the electronic mails / files under password.
10.
PROTECTION
10.1. No unfair treatment will be meted out
to a Whistle Blower by virtue of his/ her having reported a Protected
Disclosure under this policy. The company, as a policy, condemns any kind of
discrimination, harassment, victimization or any other unfair employment
practice being adopted against Whistle Blowers. Complete protection will,
therefore, be given to Whistle Blowers against any unfair practice like
retaliation, threat or intimidation of termination / suspension of service,
disciplinary action, transfer, demotion, refusal of promotion or the like
including any direct or indirect use of authority to obstruct the Whistle
Blower’s right to continue to perform his duties / functions including making further
Protected Disclosure. The company will take steps to minimize difficulties,
which the Whistle Blower may experience as a result of making the Protected
Disclosure. Thus if the Whistle Blower is required to give evidence in criminal
or disciplinary proceedings, the Company will arrange for the Whistle Blower to
receive advice about the procedure, etc.
10.2. A Whistle Blower may report any
violation of the above clause to the Chairman of the Audit Committee, who shall
investigate into the same and recommend suitable action to the management.
10.3. The identity of the Whistle Blower
shall be kept confidential to the extent possible and permitted under law. The
identity of the complainant will not be revealed unless he himself has made
either his details public or disclosed his identity to any other office or
authority. In the event of the identity of the complainant being disclosed, the
Audit Committee is authorized to initiate appropriate action as per extant
regulations against the person or agency making such disclosure. The identity
of the Whistle Blower, if known, shall remain confidential to those persons
directly involved in applying this policy, unless the issue requires
investigation by law enforcement agencies, in which case members of the organization
are subject to subpoena.
10.4. Any other Employee assisting in the
said investigation shall also be protected to the same extent as the Whistle
Blower.
10.5. Provided however that the complainant
before making a complaint has reasonable belief that an issue exists and he has
acted in good faith. Any complaint not made in good faith as assessed as such
by the Audit Committee shall be viewed seriously and the complainant shall be
subject to disciplinary action as per the Rules / certified standing orders of
the Company. This policy does not protect an employee from an adverse action
taken independent of his disclosure of unethical and improper practice etc.
unrelated to a disclosure made pursuant to this policy.
11. ACCESS
TO CHAIRMAN OF THE AUDIT COMMITTEE
11.1. The Whistle Blower shall have right to
access Chairman of the Audit Committee directly in exceptional cases and the
Chairman of the Audit Committee is authorized to prescribe suitable directions
in this regard.
12.
COMMUNICATION
12.1. A whistle Blower policy cannot be
effective unless it is properly communicated to employees. Employees shall be
informed through by publishing in notice board and the website of the company.
13.
RETENTION OF DOCUMENTS
13.1. All Protected disclosures in writing or
documented along with the results of Investigation relating thereto, shall be
retained by the Company for a period of 7 (seven) years or such other period as
specified by any other law in force, whichever is more.
14.
ADMINISTRATION AND REVIEW OF THE POLICY
14.1. The Chief Financial Officer shall be
responsible for the administration, interpretation, application and review of
this policy. The Chief Financial Officer also shall be empowered to bring about
necessary changes to this Policy, if required at any stage with the concurrence
of the Audit Committee.
15.
AMENDMENT
15.1. The Company reserves its right to amend
or modify this Policy in whole or in part, at any time without assigning any
reason whatsoever. However, no such amendment or modification will be binding
on the Employees and Directors unless the same is notified to them in writing
