Nomination & Remuneration

INTRODUCTION

Reliant Credits (India) Limited (‘RCIL’ or ‘Company’) is a Non-Banking Financial Company as defined under Section 45-IA of the Reserve bank of India Act, 1934. It was initiated by a group of visionary young entrepreneurs primarily based on Kothamangalam. The Company has over 100 branches spread across Kerala, Karnataka and Telangana region with major portfolio of Gold loan followed by Microfinance and Business Loans.

The Board of Directors of the Company (Board) in accordance with the provisions of Section 178 of the Companies Act, 2013 constituted a committee to be known as the Nomination and Remuneration Committee consisting of three Non-Executive Directors out of which one-half shall be Independent Directors. The Chairman of the Committee shall be an Independent Director.

The Board has inter-alia delegated the responsibility to the Committee to:

Formulate the criteria for determining qualifications, positive attributes and independence of a director and recommend to the Board a Policy, relating to the remuneration of the Directors, Key Managerial Personnel and other employees.
Specify the manner for effective evaluation of performance of Board, its committees and individual directors to be carried out.

OBJECTIVES

The Nomination and Remuneration Committee shall be guided by the broad principles as laid down in this Policy in respect of nominating persons to hold office of Director, Senior Management including Key Managerial Personnel, recommending the remuneration payable and evaluation of their performance.

CRITERIA FOR SELECTION OF CANDIDATES

The Nomination and Remuneration Committee has adopted the following criteria for selection of Members on the Board of Directors of the Company and also candidates eligible to be appointed in the Senior Management of the Company.

1. Criteria for Selection of Directors

Before making any recommendation to the Board for appointment of any Director, the Committee shall ensure that the candidate:

possess managerial / business / administrative qualifications and experience spread over two or more decades in diverse areas particularly finance, banking and general management; and
is free from any disqualifications as provided under Sections 164 and 167 of the Companies Act, 2013.

In case of appointment of an Independent Director, the candidate shall:

meet the conditions of being independent as stipulated under the Companies Act, 2013;
possess appropriate skills, experience and knowledge in one or more fields of finance, law, management, sales, marketing, administration, research, corporate governance, technical operations, infrastructure, or such other areas or disciplines which are relevant for the Company’s business; and
comply with the “Fit & Proper” criteria as laid down by the Reserve Bank of India in this regard.

2. Criteria for Selection of Senior Management Personnel

The term “Senior Management” shall mean officers / personnel of the Company who are members of its core management team excluding Board of Directors, comprising all members of management one level below the Executive Directors (including Chief Executive Officer / Manager, in case they are not part of the Board) and shall specifically include the Company Secretary and Chief Financial Officer.

The Committee shall, before making any recommendation to the Board for appointment, should ensure that the candidate has the attributes set forth below

The candidate should have a minimum experience of 5 years in any of the areas viz. banking, infrastructure, financial management, legal, sales, marketing, administration, research, corporate governance, technical operations, or such other areas or disciplines which in the opinion of the Committee are relevant for the Company’s business; and
The candidate should possess qualities that demonstrate leadership skills, decision making skills, effective communication, hard work, commitment and such other attributes which in the opinion of the Committee are in the interest of the Company.
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If the Committee, in its opinion finds that the candidate meets the above criteria for appointment (as Director on the Board or in Senior Management position), it shall make its recommendation to the Board. Any amendment to the above criteria for Directors and Senior Management shall be subject to the prior approval of the Committee and any such amendment shall be informed to the Board of Directors.

PERFORMANCE EVALUATION OF DIRECTORS

1. Performance Evaluation of Managing Director / Whole Time Director

The performance of the Managing Director / Whole Time Director is to be undertaken taking into consideration several aspects such as his ability to lead his team, his vision and commitment, his drive and managerial ability, in addition to the performance of the Company and his specific contribution to the growth and efficient functioning of the Company

2. Performance Evaluation of Non-Executive Directors and Independent Directors (NEDs and IDs)

The Committee shall take into consideration various factors as mentioned below while evaluating the performance of the NEDs and IDs:

Understanding and knowledge of the market in which the Company is operating;
Ability to appreciate the working of the Company and the challenges it faces;
Attendance of meeting;
Extend of participation and involvement in the meetings; and
Ability to convey his views and flexibility to work with others.

Marks may be assigned for each of the above criteria and based on the score achieved, the Board may evaluate the performance of each NED and ID.

For the evaluation of Non-Independent Directors by the Independent Directors as per the requirements of Corporate Governance norms, the Independent Directors may adopt any method of evaluation as they deem fit.

3. Criteria for Evaluation of the Board and its Committees

The performance of the Committees shall be evaluated based on the following:

Composition of the Committees;
Effectiveness of the Committee meetings with respect to the terms of reference; and
Conduct of meetings and procedures followed.

REMUNERATION POLICY

1. Remuneration of Managing Director, Whole Time Director and Manager

The Committee while considering the remuneration of the Managing Director, the Whole Time Director and Manager (wherein there is no Managing Director), shall take into consideration the performance of the Company, the experience of the person, his background, job-profile and suitability, his past remuneration, the comparative remuneration profile in the industry, size of the Company, responsibilities shouldered by the Managing Director / Whole Time Director / Manager etc., provided that any remuneration considered by the Committee shall be in accordance and within the limits stipulated under the Companies Act, 2013.

2. Remuneration of Non-Executive Director (NED)

The remuneration to the NEDs may be restricted to the sitting fees for attending meetings of the Board of Directors. The Independent Directors of the Company shall be entitled to remuneration restricted to the sitting fees for attending meetings of the Board of Directors provided that any sitting fees paid to the Independent Director shall not be less than the sitting fees paid to NED. Independent Directors shall not be eligible for stock options of the Company, if any. Any incidental expense incurred by the Directors with relation to the participation in the meetings of the Board and other Sub-Committees shall be reimbursed.

3. Remuneration to KMPs and SMPs

The remuneration of the Senior Management Personnel (SMP) and Key Management Personnel (KMP) shall be in accordance with the internal policies of the Company. The Committee may consider the remuneration of a Senior Management Personnel keeping in view of the performance of the business / function under his control and also the contribution of the business / function under his control towards the overall performance of the Company.

Regular Pay : The KMPs and SMPs including functional heads, shall be eligible for a monthly remuneration as per Company’s Policy, which will consist of Fixed Components including perquisites and statutory benefits to attract, retain and motivate KMPs and SMPs to attain the short and long term performance objectives of the Company.
Profit / Performance based Remuneration: : Subject to approval of the Board, in addition to the fixed remuneration, to motivate executives to pursue the long-term growth and success of the Company, KMPs and SMPs are entitled to receive performance-based incentive / stock options under ESOP Plan. The Performance Based Annual Incentive (annual variable pay) of executives will be linked directly to the performance of the relevant employee, business unit and the Company in accordance with the Employees Incentive Scheme of the Company as formulated from time to time.
Deferred Variable Pay: : The Board of the Company upon recommendation of NRC may decide the quantum/portion of variable pay (cash and non-cash components) that will be subject to deferral to senior employees and KMPs based on the time horizon of the risks.

4. Appointment and Remuneration of other Employees of the Company

The terms of appointment and remuneration of employees of the Company (other than Managing Director, KMPs and SMPs including functional heads) shall be governed by the relevant policies of the Company.

AMENDMENTS & REVIEW OF THE POLICY

In case of any amendment(s), clarification(s), circular(s) etc. issued by the relevant authorities, not being consistent with the provisions laid down under this Policy, then such amendment(s), clarification(s), circular(s), etc. shall prevail upon the provisions in this Policy and this Policy shall stand amended accordingly.

The Board has the power to replace this Policy entirely with a new policy on recommendation by the Committee.