CORPORATE GOVERNANCE REPORT FOR THE YEAR 2007-08

1. Company’s philosophy on Corporate Governance

WALCHAND PEOPLEFIRST LIMITED believes that the essence of Corporate Governance lies in promoting and maintaining integrity, transparency and accountability in the higher echelons of management. It is not only a pre-requisite

for facing intense competition for sustainable growth in the emerging global market scenario but is also an embodiment of the parameters of fairness, accountability, disclosures and transparency to maximize value for the stakeholders. Corporate Governance at Walchand is not limited to statutory and legal compliances but is the natural and voluntary code of managing its operations which has enabled it to continuously create value for all its stake holders.

Good Corporate Governance contributes to sustainable development by enhancing the performance of Companies. Corporate Governance is one of the pillars of WALCHAND’s focus on sustainability. Better Corporate Governance allows companies to recognize and act to fulfill their environmental and social responsibilities. Accordingly, it contributes to long- term, sustainable growth.

In India, corporate governance standards for listed companies are regulated by the Securities and Exchange Board of India (SEBI) through Clause 49 of the listing agreement of the Stock Exchanges. As a Company, which believes in implementing and adopting best-in-class corporate governance policies, WALCHAND PEOPLEFIRST LIMITED has adopted practices mandated in the revised Clause 49 and has established procedures and systems to be compliant with it.

Corporate governance is about commitment to values and ethical business conduct. The report on the Corporate Governance is to fulfill this commitment. An organization is able to attract investors, and enhance the trust and confidence of all stakeholders by following the best governance practices.

Our governance philosophy is based on the following:-

1. Management is the trustee of the shareholders capital and not the owner.

2. Provide an enabling environment to harmonise the goals of maximizing stakeholder value and maintaining a customer centric focus.

3. Have a simple and transparent corporate structure driven solely by business needs.

4. Communicate externally, in a truthful manner, about how the Company is running internally.

5. Make clear distinction between personal conveniences and corporate resources.

6. Be transparent and maintain a high degree of disclosure levels in all facets of its operations.

7. Satisfy the spirit of the law and not just the letter of the law.

The Company’s philosophy on Corporate Governance is thus concerned with the ethics, values and morals of the Company and its Directors, who are expected to act in the best interests of the Company and remain accountable to shareholders and other beneficiaries for their action.

Your Board of Directors presents the Corporate Governance Report for the year 2007- 08.

2. Board of Directors

a. Size and Composition of Board

The composition and category of Directors as on March 31, 2008 are as under:-

Name of Directors	Category	No. of Directorships in other Companies		No. of Membership/Chairmanship of other Board Committees
		Public	Private	Member	Chairman
Ms. Pallavi Jha	Chairperson and Managing Director	1	2	-	-
*Ms. Kamalini Bahubali	Non-executive	-	1	-	-
**Mr. Sanjay Jha	Whole time	1	2	-	-
Mr. M.N. Bhagwat	Independent Non-executive	5	-	5	3
Dr. S.C. Jha	Independent Non-executive	1	-	-	-
Mr. V.K.Verma	Independent Non-executive	-	-	-	-
***Ms. Poonam Barua	Independent Non-executive	-	-	-	-

* Ms. Kamalini Bahubali - Resigned as a Director at the Board meeting held on April 26, 2007.

**Mr. Sanjay Jha - Appointed as a Whole time Director of the Company at the Annual General Meeting of the Company held on July 27, 2007.

*** Ms. Poonam Barua - Appointed as a Director under Section 260 of the Companies Act, 1956 at the Annual General Meeting of the Company held on July 27, 2007.

b. Attendance at Board Meeting and Annual General Meeting :-

During the accounting year 2007-08, six Board Meetings were held on April 26, 2007, July 31, 2007, October 12, 2007, October 15, 2007, October 30, 2007, and January 31, 2008.

The Annual General Meeting of the Company for the financial year 2006-2007 was held on July 27, 2007.

Attendance at Board Meeting and last Annual General Meeting:-

Name of Directors	No. of Board Meetings attended	Attendance at last AGM
Ms. Pallavi Jha	6	Present
*Ms. Kamalini Bahubali	1	Absent
**Mr. Sanjay Jha	6	Present
Mr. M.N. Bhagwat	5	Absent
Dr. S.C. Jha	3	Absent
Mr. V.K.Verma	6	Present
***Ms. Poonam Barua	5	Present

* Ms. Kamalini Bahubali - Resigned as a Director at the Board meeting held on April 26, 2007.

**Mr. Sanjay Jha - Appointed as a Whole time Director of the Company at the Annual General Meeting of the Company held on July 27, 2007.

*** Ms. Poonam Barua - Appointed as a Director under Section 260 of the Companies Act, 1956 at the Annual General Meeting of the Company held on July 27, 2007.

c. Board’s Functioning & Procedures:-

The Board has complete access to any information within the Company. At meetings of the Board, it welcomes the presence of Managers who can provide additional insights into the items being discussed.

The items placed at the Meeting of the Board include the following:-

· Unaudited Quarterly/Half Yearly financial results and Audited Annual Accounts of the Company, results and capital employed, for consideration and approval,

· Minutes of meetings of Audit, Share Holders Grievance Committee and Remuneration Committee,

· Abstracts of circular resolutions passed,

· General notices of interest,

· Sale and/or purchase of investments, fixed assets,

· Review compliance of all laws applicable to the Company including the requirements of the Listing Agreement with the Stock Exchanges and steps taken by the Company to rectify instances of non compliances, if any,

· Related party transactions,

· Reviewing the Company’s financial and risk management policies,

· Reviewing the business plan and strategy of the Company,

· Reviewing the operations of the Subsidiary Company-Walchand TalentFirst Limited,

· Financial Results of Subsidiary Company-Walchand TalentFirst Limited,

· Minutes of the Board of Directors of Subsidiary Company-Walchand TalentFirst Limited,

All the items in the Agenda are accompanied by notes giving comprehensive information on the related subject and in certain matters such as financial /business plans, financial results, detailed presentations are made. The Agenda and the relevant notes are sent in advance separately to each Director to enable the Board to take informed decisions.

The Minutes of the Meetings of the Board are circulated through email to all Directors and confirmed at the subsequent Meeting. The Minutes of the Audit Committee, Remuneration Committee, Shareholders’ Grievance Committee and the Minutes of the Board of Directors Meetings of the Subsidiary Company are also are circulated through email to all Directors and thereafter tabled for discussion at the subsequent Board Meeting.

3. Audit Committee

Audit committee acts as a link between the Statutory and Internal Auditors and the Board of Directors. The primary objective of the Audit Committee is to provide effective supervision of the management’s financial reporting process with a view to ensure accurate, timely and proper disclosures.

a. Size and Composition:-

The Board constituted an Audit Committee of Directors on April 26, 2001 having Mr. Sanjay Jha, Whole-Time Director and Dr. S. C. Jha, Non-Executive Independent Director as Members and Mr. M.N. Bhagwat, Non-Executive Independent Director as Chairman of the Committee. Mr. V.K. Verma, Non-Executive Independent Director was appointed as a Member of the Audit Committee with effective from April 12, 2006 by passing a circular resolution, which was noted by the Board at their meeting, held on April 28, 2006.

The Members of the Committee are well versed in finance / accounts, legal matters and general business practices.

b. Attendance at the Audit Committee Meetings:-

During the accounting year 2007-08, four Audit Committee Meetings were held on April 26, 2007, July 31, 2007, October 30, 2007 and January 31, 2008.

Name of Members	No. of Audit Committee Meetings attended
*Mr. Sanjay Jha	4
Mr. M.N. Bhagwat	4
Dr. S.C. Jha	3
Mr. V.K.Verma	4

*Mr. Sanjay Jha - Appointed as a Whole time Director of the Company at the Annual General Meeting of the Company held on July 27, 2007.

c. The functions of the Audit Committee include the following:-

· Reviewing the Company’s financial reporting process and the disclosure of its financial information to ensure that the financial statement is correct, sufficient and credible.

· Recommending the appointment and removal of external Auditor, fixation of Audit fee and also approval for payment for any other expenses.

· Reviewing with management the Annual/Half-yearly/ Quarterly financial statements before submission to the Board.

· Reviewing with management, external and internal Auditors, the adequacy of the internal control systems.

· Reviewing the adequacy of Internal Audit function, including reporting structure coverage and frequency of Internal Audit.

· Discussion with External Auditors before the Audit, nature and scope of Audit, any significant findings and follow up thereon as well as post-Audit discussion to ascertain any area of concern.

· Reviewing the findings of any internal investigations by Internal Auditors into matters where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the Board.

· To look into the reasons for substantial defaults in the payment to the depositors, shareholders (in case of non payment of declared dividends) and creditors.

· Related party transactions,

· To review the matters required to be included in the Director’s Responsibility Statement to be included in the Board’s report in terms of clause (2AA) of Section 217 of the Companies Act, 1956.

· To review the Management discussion and analysis of financial condition and results of operations.

· To recommend re-appointment of Statutory Auditors and to fix their remuneration.

All the items in the Agenda are accompanied by notes giving comprehensive information on the related subject and in certain matters such as financial results, detailed presentations are made. The Agenda and the relevant notes are sent in advance separately to each Member to enable the Committee to take informed decisions.

The Minutes of the Meetings of the Committee are circulated through email to all Directors and confirmed at the subsequent Meeting.

4. Remuneration Committee

The purpose of the Committee shall be to discharge the Board’s responsibilities relating to formulation of compensation plans and policies of the Company’s Executive Directors.

a. Size and Composition:-

The Board constituted Remuneration Committee of Directors on April 29, 2004 having Mr. M.N. Bhagwat, Non-executive Independent Director and Mr. Shailesh Haribhakti, Non-executive Independent Director as Members and Dr. S. C. Jha, Non-executive Independent Director as Chairman of the Committee.

Mr. Shailesh Haribhakti resigned from the Directorship at the Board meeting held on October 27, 2005 as a result he ceased to be a member of remuneration committee.

Mr. V K Verma, Non- Executive Independent Director of the Company was appointed as a member of the Remuneration Committee with effective from April 4, 2007 by passing a circular resolution, which was noted by the Board at their meeting, held on April 26, 2007.

The broad terms of the Committee are to determine and review remuneration/compensation package of Managing Director and Whole Time Director of the Company.

b. Attendance at the Remuneration Committee Meetings:-

During the accounting year 2007-08, Remuneration Committee Meeting was held on April 26, 2007.

Name of Members	Meeting attended (Yes/ No)
Mr. M.N. Bhagwat	Yes
Dr. S.C. Jha	Yes
Mr. V.K.Verma	Yes

c. Disclosure of Remuneration paid: -

At present Non–executive and Independent Directors are not paid any remuneration except sitting fees for attending Board Meetings.

Details of remuneration paid to Directors during the accounting year ended March 31, 2008 are as under:

Name Of Directors	Salary Rs.	Contribution To P.F. Gratuity and Superannuation Fund (Rs.)	Perquisites Rs.	Sitting Fees Rs.	Total Rs.
Ms. Pallavi Jha	23, 23, 871	6,14,568	7,37,839	0.00	36,76,278
*Ms. Kamalini Bahubali	-	-	-	8000	8000
**Mr. Sanjay Jha	14,69,032	3,67,258	3,35,662	8000	21,79,952
Mr. M.N. Bhagwat	-	-	-	48000	48000
Dr. S. C. Jha	-	-	-	28000	28000
Mr. V.K.Verma	-	-	-	48000	48000
Ms. Poonam Barua	-	-	-	48000	48000

* Ms. Kamalini Bahubali - Resigned as a Director at the Board meeting held on April 26, 2007.

**Mr. Sanjay Jha - Appointed as a Whole time Director of the Company at the Annual General Meeting of the Company held on July 27, 2007.

Note: - Except Ms. Pallavi Jha who is Chairperson and Managing Director and Mr. Sanjay Jha who is Whole Time Director all other Directors are Non- Executive Directors.

d. Change in terms of remuneration to be paid to Ms. Pallavi Jha, Chairperson & Managing Director and Mr. Sanjay Jha, Whole Time Director :-

In view of the transfer of Training Business of the Company to Walchand TalentFirst Limited, a wholly owned subsidiary of the Company, vide Business Transfer Agreement dated November 23, 2007, the Board of Directors of the Company at its meeting held on April 21, 2008 unanimously approved the modification to the existing terms of remuneration of Ms. Pallavi Jha, Chairperson & Managing Director and Mr. Sanjay Jha, Whole time Director of the Company.

An abstract of the variation in the terms of remuneration, of Ms. Pallavi Jha, Chairperson & Managing Director and Mr. Sanjay Jha, Whole time Director, in accordance with the provisions of Section 302 of the Companies Act, 1956 have been sent to the shareholders whose names appeared on the Register of Members as on April 21, 2008.

5. Shareholders Grievance Committee

The Committee has the mandate to review, redress shareholders’ grievances, to approve all share transfers.

a. Size and Composition:-

The Company reconstituted Shareholders Grievance Committee in July 2001 to specifically look into the redressal of the shareholders grievances and also the share transfers and other investor related matters. The Committee consists of Mr. Sanjay Jha - Chairman and Ms. Pallavi Jha - Member. Mr. Vivek Wadhavkar, Associate Vice President has been designated as the Compliance Officer.

b. Meeting of the Shareholders’ grievance committee Meetings:-

During the accounting year 2007-08, twenty-two Shareholders’ Grievance Committee Meetings were held on 03/04/2007, 15/05/2007, 19/05/2007, 07/06/2007, 18/06/2007, 03/07/2007, 16/07/2007, 01/08/2007, 03/09/2007, 17/09/2007, 03/10/2007, 18/10/2007, 02/11/2007, 19/11/2007, 03/12/2007, 17/12/2007, 02/01/2008, 17/1/2008, 04/02/2008, 18/02/2008, 03/03/2008 and 17/03/2008.

c. The functions of the Shareholders’ Grievance Committee include the following:-

· Transfer /Transmission of shares,

· Issue of duplicate share certificates,

· Review of shares dematerialized and all other related matters,

· Monitors expeditious redressal of investors’ grievances,

· Non receipt of Annual report and declared dividend,

· All other matters related to shares.

d. Investor Grievance Redressal

Number of complaints received and resolved to the satisfaction of investors during the year under review and their break-up are as under:

Type of Complaints	No. of complaints
Non Reciept of Annual Reports	1
Non Reciept of Dividend Warrants	2
Non Reciept of Interest or Redemption Warrants	0
Non Reciept of Certificates	1
TOTAL	4

During the accounting year ended March 31, 2008, four complaints were received from shareholders, all of which have been attended/ resolved as of date. All valid share transfers received during the accounting year ended March 31, 2008 have been acted upon. There were no share transfers pending as on March 31, 2008, for more than 30 days.

The Shareholders Grievance Committee continued to function effectively and held twenty-two meetings during the year under review. It continued to attend the matters related to Share Transfers and redressal of Shareholders’ complaints. This Committee has two Directors, namely, Ms. Pallavi Jha, Chairperson & Managing Director and Mr. Sanjay Jha, Whole Time Director. Mr. Vivek Wadhavkar is designated as Compliance Officer. The complaints and grievances of shareholders received were duly attended by the Committee and as of now no complaints are pending. Ms. Pallavi Jha, Chairperson & Managing Director and Mr. Sanjay Jha, Whole time Director were present in all the twenty two meetings.

6. Subsidiary Company’s Monitoring Framework:

The Minutes of the Meetings of the Board of Subsidiary Company are circulated through email to all Directors and confirmed at the subsequent Meeting.

7. General Body Meetings

a. The particulars of last four Annual General Meetings are as under:-

Financial Year	Day and Date	Location	Time
2003-2004	Tuesday September 28. 2004	Walchand Hirachand Hall, Indian Merchant Chambers., IMC Marg, Churchgate, Mumbai – 400 020	11.30 A.M.
2004-2005	Tuesday, December 27, 2005	Walchand Hirachand Hall, Indian Merchant Chambers., IMC Marg, Churchgate, Mumbai – 400 020	10.30 A.M.
2005-2006	Friday, July 28, 2006	Walchand Hirachand Hall, Indian Merchant Chambers., IMC Marg, Churchgate, Mumbai – 400 020	2.30 P.M.
2006-2007	Friday, July 27, 2007	Walchand Hirachand Hall, Indian Merchant Chambers., IMC Marg, Churchgate, Mumbai – 400 020	3.00 P.M.

b. Whether any Special Resolutions were passed in the previous three AGMs? Yes.

At the Annual General Meeting of the Shareholders held on July 27, 2007, Ms. Pallavi Jha was re-appointed as the Managing Director of the Company for a further period of 3 years with effect from July 26, 2007 and Mr. Sanjay Jha was appointed as Whole Time Director of the Company for a period of 3 years with effect from July 27, 2007.

c. Postal Ballot:

The Postal ballot was conducted pursuant to Section 192A (2) of the Companies Act, 1956 (the "Act"), read with the Companies (Passing of the Resolutions by Postal Ballot) Rules, 2001, a Notice dated October 17, 2007 was sent to the Share holders seeking their consent to transfer the Training Business of the Company to a Walchand TalentFirst Limited, a new Wholly Owned Subsidiary of the Company.

The Board of Directors of the Company appointed Mr. Pramod S. Shah, Proprietor of “Pramod S. Shah & Associates”, Practicing Company Secretaries, Mumbai, as scrutinizer for conducting the postal ballot process in a fair and transparent manner.

The Resolution was declared as passed through the postal ballot. The voting results were as under:

Number of valid Postal Ballot forms received	7
Votes in favour of the Resolution	165754
Votes against Resolution	0
Number of Invalid Postal Ballot forms received	0
Percentage of Votes cast in favour of the Resolution	100%

8. Disclosures

· The Company has de-registered as an NBFC.

· Ms. Divya Momaya, has resigned from the post of Company Secretary with effect from May 1, 2008

· The Company has incorporated Walchand TalentFirst Limited as its Wholly Owned Subsidiary on October 10, 2007.

· The Company has transferred its Training Business to Walchand TalentFirst Limited, its Wholly Owned Subsidiary vide Business Transfer Agreement dated November 23, 2007.

· Mr. Sadanand Marathe resigned from the post of Compliance Officer with effect from January 11, 2008.

· Mr. Vivek Wadhavkar was appointed as Compliance Officer with effect from January 11, 2008.

· The related party transactions as per Accounting Standard 18 is set out at note no. 4 of Schedule “O” in notes forming part of accounts in the Annual Report. These transactions are not likely to have any conflict with the Company’s interest except as stated in para 10 of Annexure to Auditors Report.

· The Company has complied with the requirements of the Stock Exchanges, SEBI and Statutory Authorities on all matters related to capital markets and no penalties / strictures were imposed on the Company during the last three years.

· No penalty has been imposed on the Company by the Stock Exchange (BSE) or the Securities and Exchange Board of India (SEBI) or any statutory authority on any matters related to capital markets during last three years.

· During the year the following amounts were transferred to the Investor Education and protection fund :-

Particulars	Date of transfer	Amount (Rs.)
Matured Deposits	-	-
Interest on Matured Deposits	-	-
Matured Deposits	-	-
Interest on Matured Deposits	-	-
Matured Deposits	-	-
Unpaid Dividend	28/03/2008	2,66,850

· Adoption of non mandatory requirements under Clause 49 of the Listing Agreement are being reviewed by the Board from time to time.

9. Code of Conduct:-

The Board of Directors has adopted the Code of Business Conduct and Ethics for Directors and Senior Management. The Code is reviewed from time to time by the Board. The said Code has been communicated to the Directors and the Members of the Senior Management. The Code has also been posted on the Company’s website www.walchandpeoplefirst.com.

10. Trading in the Company’s shares by Directors and Designated Employees:-

In compliance with the SEBI (Prevention of Insider Trading) Regulations, 1992, our Company has appointed Mr.Vivek Wadhavkar as the Compliance Officer who is responsible for setting policies, procedures for the preservation of price sensitive information, pre-clearance of trade, monitoring of trades and implementation of the Code of Conduct for trading in Company’s securities under the overall supervision of the Board. The Company has adopted a Code of Conduct for Prevention of Insider Trading.

11. Means of Communication:

· The Quarterly and Half-Yearly results of the Company are published in English and Marathi National dailies. The Financial results are also displayed on the website of the Company www.walchandpeoplefirst.com.

· The Company is complying with EDIFAR requirement as directed by SEBI. The shareholders can view entries by logging into the Website ‘sebiedifar.nic.in’

· The Management Discussion and Analysis Report forms a part of this Annual Report, which is sent to each member by post.

· The Company informs the Stock Exchange all price sensitive matters or such other matters which are material and of relevance to the shareholders.

9. General Shareholder Information:

a. Annual General Meeting

· Date : September 30, 2008.

· Time : 11:00A.M.

· Venue : Walchand Hirachand Hall,

Indian Merchants’Chamber,

IMC Marg, Churchgate, Mumbai – 400 020

b. Financial Calendar :

· Financial Reporting for

Quarter ending June 30,2008	By end July 2008
Quarter/Half year ending Sept. 30, 2008	By end October 2008
Quarter ending December 31, 2008	By end January 2009
Quarter/Year ending March 31, 2009	By end April 2009

· Date of Book Closure : September 23, 2008 to September 30, 2008 (both days inclusive).

· Dividend payment Date : On or after September 30, 2008 but within the statutory time limit of 30 days, subject to shareholders approval.

c. Market information

· Listing on Stock Exchange : The Bombay Stock Exchange

Limited

· Listing fee for the year 2007-08 has been paid to the Stock Exchange.

· Stock Code- Physical : 501370 on The Bombay Stock

Exchange Limited

· ISIN No. NSDL & CDSL : INE 695DO1013

· Market Price Data : High / Low price during each

month of 2007-08 on The Bombay Stock Exchange Limited and BSE Sensex are as under:

SHARE PRICES OF WALCHAND PEOPLEFIRST LIMITED								BSE SENSEX
	Open	High	Low	Close	No. of	No. of		High	Low	Close
Date	(Rs.)	(Rs.)	(Rs.)	(Rs.)	Shares	Trades	Net T/O (Rs.)	(Rs.)	(Rs.)	(Rs.)
2007 Apr	782.00	1007.70	746.00	905.00	2940	390	2666359.00	14383.72	12425.52	13872.37
May	876.00	1269.90	840.00	1149.00	7195	743	7375794.00	14576.37	13554.34	14544.46
Jun	1092.00	1234.00	966.25	1234.00	4185	649	4490887.00	14683.36	13946.99	14650.51
Jul	1295.70	1422.05	1136.00	1264.60	16437	1689	21127626.00	15868.85	14638.88	15550.99
Aug	1253.00	1878.05	1144.00	1797.65	35820	3340	58109126.00	15542.40	13779.88	15318.60
Sept	1751.00	2621.55	1527.00	2621.55	11809	1291	21956075.00	17361.47	15323.05	17291.10
Oct	2752.60	7667.55	2625.00