Remuneration criteria for Non- Executive / Independent Directors’
With changes in the corporate governance norms brought by the Companies Act, 2013 as well as New Listing Regulations notified by the Securities and Exchange Board of India, the Non-Executive Directors (NED) of the Company have a crucial role to play in the independent functioning of the Board. They devote their valuable time in deliberating in the course of the Board and Committee meetings and give their advice to the management of the Company from time to time. Pursuant to Regulation 46(2)(f) of SEBI (Listing Obligation and Disclosure Requirements) Regulations 2015, every company to publish its criteria of making payments to NEDs in its annual report. Alternatively, this may be put up on the company’s website and reference may be drawn thereto in its annual report. The remuneration payable to the NEDs of the Company shall abide with the following:
a) The compensation structure for the Non-Executive/Independent Director(s)
The Non- Executive / Independent Director are paid sitting fees for attending each meeting of the Board of Directors or any committees of the Board and their expenses for attending such meetings shall be reimbursed in compliance with the provisions of the Companies Act, 2013, Listing Regulations and other regulatory guidelines, as amended from time to time. The Board has the flexibility to enhance the sitting fees up to the maximum limit allowed by the Companies Act, 2013 and Rules there under. The Board while recommending the change in the sitting fees considers various factors like size and complexity of organization, Comparison with the peer Banks and Regulatory guidelines as applicable etc. while recommending the change in the sitting fees to the Board.
b) The compensation structure for the Non-Executive Part-Time Chairman
The Bank pay a fixed honorarium to the Part-time Non-Executive Chairman in addition to the sitting fee. The remuneration payable to the Chairman is subject to prior approval of the Reserve Bank of India (RBI). Therefore, the remuneration or any revision in remuneration of the Chairman is payable only after receipt of the approval from RBI.
c) Stock Options:
An Independent Director shall not be entitled to any stock option of the Bank.
The Nomination and Remuneration Committee is entrusted with the role of reviewing the compensation of NEDs after taking into account all relevant factors such as, performance, ability and experience of the individuals recommend to the Board to fix the compensation structure in compliance with the provisions of Companies Act, 2013, Banking Regulation Act, 1949, Listing Regulations and other regulatory guidelines, as amended from time to time.