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Biocon  /  Corporate Governance

ANALYST COVERAGE

Biocon is committed to high standards of Corporate Governance and has in place appropriate structures and reporting systems.

Biocon’s Board of Directors is headed by an Executive Chairman and comprises of three Executive Directors and seven Non-Executive Directors. It meets regularly throughout the year, at the registered office in Bangalore. Its agenda includes approval of Company’s Strategy and the Annual Business Plan. The Board is assisted by an Audit and Remuneration Committee. Both operate under clear terms of reference which outline the authorities and duties of each Committee, allowing them to examine any information they consider relevant and take independent advice wherever necessary. Capital expenditure is authorised and subsequently monitored by the Board.

Board agendas are agreed upon by the Chairman and Directors. Board Members are free to raise other issues at the Board meetings. Directors bring their independent judgment to all matters affecting the Company. Chairman can be approached by the Non- Executive Directors at any point of time.

The Board acknowledges responsibility for Biocon’s systems of internal control and review of their effectiveness. The systems utilised are intended to manage rather than eliminate the risk of failure to achieve business objectives. Biocon recognises that such systems can provide reasonable, but not absolute, assurance against material mis-statement or loss.

The Remuneration Committee is chaired by Ms. Mary Harney and consists entirely of Non- Executive Directors. It has clear written terms of reference and recommendations are reported directly to the Board. The Committee has authority to undertake research on any compensation matter. The Company bears the expenses of such research.

In setting the remuneration package for Executive Directors, the Committee aims to ensure that the total package including benefits is competitive with companies of similar size, activity and complexity and that accordingly, it will attract, retain and motivate senior staff with the required skills to maximise returns for shareholders. The Committee receives advice from independent remuneration consultants including a comparability assessment against other companies of similar size and activity. It believes that a significant part of the remuneration package should be clearly linked to measurable company performance from which Shareholders benefit. Accordingly, the package balances base salary with performance incentives. The Committee keeps the total remuneration package with various elements under regular review.

The Directors have identified that Biocon has the resources to continue operating for the future. For this reason, the going concern basis was adopted in preparing the accounts.

Over the last 38 years, Biocon has developed a strong set of values where integrity is vital. The Board believes that values are a key ingredient in good governance.

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