2. Governance at Schaeffler
  3. Approach to governance

Approach to governance

Cultivating values for tomorrow

Corporate governance philosophy

Our corporate governance exemplifies our values and principles, including our culture, policies, and interactions with our stakeholders. Integrity, accountability, and value creation are core principles of our corporate governance practices and ensure that we always gain and retain the trust of our stakeholders.

Our corporate governance is guided by the twin objectives of achieving economic success while simultaneously acting responsibly towards the environment, people, and society. This is reflected in our Code of Conduct, which applies to the Board, Senior Management, and every single employee of the Company.

The true north of governance

Board focus areas in CY22

Review organisational progress and continuously evaluate our strategic priorities relating to changing dynamics and opportunities

Focus on future-ready technologies to enable sustainable mobility and motion

Formulate ESG frameworkand targets

92%
Attendance by the Board of Directors

5
Board meetings held in CY22

Our corporate governance is a statement of the values we wish to imbibe in our business. We strive to ensure that our governance framework is effective, transparent, and accountable to the relevant stakeholders. We take pride in our commitment to the highest standards of corporate governance, and we strive to ensure that our practices are in line with applicable guidelines and regulations."


Ashish Tiwari
Vice President, Legal and Company Secretary

G20/OECD principles of corporate governance

Corporate governance practices at Schaeffler India are benchmarked by the Organization for Economic Cooperation and Development (OECD) as follows:

Ensuring the basis for an effective corporate governance framework Rights and equitable treatment of shareholders Role of stakeholders in corporate governance Disclosures and transparency Responsibilities of the Board
  • Governance structure
  • Quality of shareholder meetings
  • Related party transactions
  • Shareholders’ Handbook
  • Conflict of interest
  • Business responsibility initiatives
  • Supplier management
  • Employee welfare
  • Investor engagement
  • Whistle-blower Policy
  • Ownership structure
  • Financials
  • Company filings and quarterly disclosures
  • Risk management
  • Audit integrity
  • Dividend payouts and policies
  • Board as a trustee
  • Board and committee composition
  • Training for directors
  • Board evaluation
  • Director remuneration
  • Succession planning

Ensuring the basis for an effective corporate governance framework

Our governance structure is designed to responsibly manage and oversee the Company's activities, ensuring that potential risks are identified and managed effectively. It provides a framework for making decisions, setting objectives, and maintaining accountability across the organisation.

Our governance structure

Board of Directors and Senior Management are responsible for establishing measures of corporate governance and ensuring compliance

Compliance management, risk management and internal control system serve to identify and manage risks

Internal audit to ensure independent check on the effectiveness

Compliance management:
We are moving from a culture of compliance to a culture of integrity

Risk management:
We assess and review risk diligently to minimise their impact on our business

Internal control system:
We have built controls to ensure integrity of our financial reporting

Cultivating values for tomorrow

    • All shareholders are provided with an opportunity to participate and raise questions in shareholder meetings.
    • Detailed minutes are made available.
    • All related party transactions are identified and approved by the Audit Committee and the Board when required.
    • Certified by an external auditor/independent consultant on a periodic basis.
    • Relevant disclosures were made to the stock exchanges on a timely basis.
    • There is a Shareholders’ Handbook for the redressal of investor grievances and to educate the shareholders about their rights as shareholders, standard procedures, and documentation requirements for certain matters. The Handbook should be considered as an informal guideline.
    • We assign importance to resolving investor grievances fairly and expeditiously.
    • The provisions on conflict of interest are reflected in principle six of the code of conduct.
    • Comprehensive ESG targets formulated in CY22.

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    • Suppliers form an important part of our ambitions to become carbon neutral. We believe that working together with suppliers is crucial to meet our ESG commitments.

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    • Our business performance is a result of the dedication and passion of Schaeffler India’s employees. We focus on improving their wellbeing through our ‘we care, we act’ initiatives.

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    • We believe in transparent communication with our shareholders, and we communicate with them continuously.

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    • A whistle-blower policy is in place for stakeholders to raise concerns regarding violations and potential violations of our code of conduct and applicable laws without any fear of retaliation.
    • We are part of Schaeffler Group, which has a ~74% controlling interest in the form of equity stock. For more information on the ownership structure, please refer to Shareholder Information in this integrated Annual Report.
    • We publish unaudited financial statements quarterly to communicate with our stakeholders.
    • We believe in information flow across all stakeholders on a timely basis. Hence, we fulfil all our statutory obligations/filings in good time.
    • A robust risk management process identifies, assesses, monitors, and reports risks that impact our business.

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    • External independent auditors were appointed for a statutory audit and secretarial audit. There were no qualifications or adverse remarks received.
    • We use structured evaluation criteria for selecting our auditors, which cover various aspects such as performance, quality, skillset, and experience among others. The Audit Committee reviews the statutory auditors' performance and related aspects on a yearly basis.
    • A dividend distribution policy is in place to guide our dividend distribution every financial year.
    • During the year, the Board of Directors recommended a dividend for CY22 at the rate of
      ` 24/- per equity share at a face value of ` 2/- each.
    • The Board comprises eminent professionals with varied skill sets and experience. As trustees, the Board has fiduciary responsibility to ensure growth in shareholder value.
    • Five Board-level committees have adopted charters defining the roles and duties of each committee.
    • Board composition is determined based on the specific skill requirements of each committee, which are reviewed periodically.
    • We periodically conduct familiarisation and training programs for our directors.
    • The Nomination and Remuneration Committee (NRC) reviews and assesses the adequacy of the Company’s policies, plans, and procedures concerning succession planning, including policies and principles for selection of the Directors, key managerial personnel, Senior Managerial Personnel and performance review.