ஆசிர்வாத் மைக்ரோபைனான்ஸ் லிமிடெட்          Asirvad Microfinance Limited          आशीर्वाद माइक्रोफिनॅन्स लिमिटेड         ആശിർവാദ് മൈക്രോഫിനാൻസ് ലിമിറ്റഡ്          ಅಸೀರ್ವಾಡ್ ಮಿಕ್ರೊಫಿನನ್ಸೆ ಲಿಮಿಟೆಡ್          ਅਸਿਰਵਾਦ ਮਿਕਰੋਫਈਨਂਸੇ ਲਿਮਿਟੇਡ          ଆଶୀର୍ବାଦ ମଇକ୍ରୋଫାଇନାନ୍ସ ଲିଃ          আশির্বাদ মাইক্রো ফাইনান্স লিমিটেড

CODE OF CONDUCT OF DIRECTORS AND SM

1.OVERVIEW:

The Code of Conduct of the Board of Directors and the Senior
Management Personnel (hereinafter referred to as “the Code”) has been
framed and shall be adopted by the Board of Asirvad Micro Finance
Limited (hereinafter referred to as “the Company”) on 4th November. This Code of Conduct is prepared in compliance with the requirement of the Companies Act, 2013 and SEBI (LODR) Regulations, 2015.

The Code of Conduct is in alignment with Company’s Vision and Values
to achieve the Mission & Objectives and aims at enhancing ethical and
transparent process in managing the affairs of the Company.

The Code is intended to provide guidance to the Board of Directors and
Senior Management Personnel to manage the affairs of the Company in
an ethical manner. The purpose of this code is to enhance integrity,
ethics & transparency in governance of the Company, and thereby
reinforce the trust and confidence reposed in the management of the
Company by the shareholders and other stakeholders.

2. DEFINITIONS:

In this Code, unless repugnant to the meaning or context thereof, the
following expressions, wherever used in this Code, shall have the meaning as defined below:

i. “Board / Board of Directors” shall mean the collective body of the
Directors of the Company.
ii. “Board Members” shall mean the Members on the Board of Director
of the Company.
iii. “Company” shall mean “Asirvad Micro Finance Limited”.

iv. “Conflict of Interest” shall mean where the interests or benefits of
one person or entity conflicts with the interests or benefits of the
Company.
v. “Executive Directors/Whole time Directors” shall mean and include
Company’s Managing Director and Directors who are in whole time
employment of the Company.
vi. “Independent Directors” shall mean an Independent Director as
defined in Section 2(47) and Section 149(6) of the Companies Ac!
2013, and, Securities and Exchange Board of India (Listing
Obligations and Disclosure Requirements) Regulations, 2015 (as
amended from time to time). vii. “Non Executive Directors” shall mean Directors other than
Executive Directors who are not in whole time employment of the
Company.
viii. “Senior Management Personnel” shall mean personnel of the
Company who are members of its core management team excluding
Board of Directors. Normally, this shall comprise of all members of
management one level below the Executive Directors, including all
functional heads.

3. APPLICABILITY:
This Code shall be applicable to the following persons:
a) All the Directors of Company including Independent Directors
unless specifically exempted from provisions of this Code.
b) All Senior Management Personnel.

4. PRINCIPLES OF THE CODE:
The Board of Directors and the Senior Management Personnel of the
Company shall act within the authority conferred upon them, in the best
interests of the Company and observe the following:

* The Board of Directors and the Senior Management Personnel shall
act honestly, ethically, in good faith and in the best interest of the
Company and to fulfill their fiduciary obligations.

* While carrying out the duties, the Board of Directors and the Senior
Management Personnel shall ensure that all executions shall be in
terms of the authorizations granted and shall be within the limits
prescribed under the relevant policies, codes, guidelines and other
directives issued by the Board of Directors or Committee of Directors
of the Company, from time to time.

*The Board of Directors and the Senior Management Personnel shall
neither receive nor offer or make, directly or indirectly, any illegal
payments, remuneration, gifts, donations or comparable benefits
which are intended to or perceived to obtain business or
uncompetitive favors for the conduct of its business except accepting
a gift or entertainment if warranted by the accepted ethical customs and practices.

*The Board of Directors and the Senior Management Personnel shall
refrain from indulging in any discriminatory practice or behaviour
based on race, color, sex, age, religion, ethnic or national origin,
disability or any other unlawful basis. The ethical conduct,
performance and skills shall be the qualifying indicatives for an
employee’s performance.
* The Board of Directors and the Senior Management Personnel shall
conduct themselves in a professional, courteous and respectful
manner and shall not take any improper advantage of their position.

* The Board of Directors and the Senior Management Personnel shall
use the Company’s assets, property, proprietary information and
intellectual rights for business purposes of the Company and not for
any personal benefits or gains.
*The Board of Directors and the Senior Management Personnel shall
maintain confidentiality of the information that is entrusted upon
them for carrying on their respective responsibilities and duties and
shall not use the same for personal benefits or gains.

* The Board of Directors and the Senior Management Personnel shall
not allow any extraneous considerations that could vitiate their
exercise of objective independent judgment in the paramount interest
of the Company as a whole, while concurring in or dissenting from
the collective judgment of the Board in its decision making.

*The Board of Directors and the Senior Management Personnel shall report their concerns about unethical behaviour, actual or suspected instances of fraud, misconduct or irregularity or failure of internal control system, likely to impact the business interest of the Company or any other in-formation that may be perceived to be violating any legal/ regulatory requirements as per the Whistle-blower Policy of the Company.

* The Board of Directors and the Senior Management Personnel shall
comply with all laws, rules, and regulations governing trading in the
shares of the Company and the Company’s Code of Conduct for
Prohibition of Insider Trading in dealing with the securities of the
Company which inter-alia, prohibits buying or selling of the
Company’s securities on the basis of any unpublished price sensitive
information and prohibits disclosure of such information to any other
person (including relatives) where such information may be used by
such person for his or her personal benefit or gain.

5.DUTIES OF DIRECTORS:
The Companies Act, 2013 significantly specifies certain duties and
responsibilities of the Directors of the Company. The list of duties as per
the provisions of the Companies Act, 2013, has been enumerated below:
o The Directors shall act in accordance with the articles of the Company,
subject to the provisions of the Companies Act, 2013, as amended
from time to time; o The Directors shall act in good faith in order to promote the objects of
the Company for the benefit of its members as a whole, and in the best
interests of the Company, its employees, the shareholders, the
community and for the protection of environment;
o The Directors shall have a clear understanding of the aims and
objectives, capabilities and capacity and various policies of the company
o The Directors shall exercise his duties with due and reasonable care,
skill and diligence and shall exercise independent judgment;
o The Directors shall not involve in a situation in which he may have a
direct or indirect interest that conflicts, or possibly may conflict, with
the interest of the Company; o The Directors shall not achieve or attempts to achieve any undue gain
or advantage either to himself or to his relatives, Partners, or
associates and if such director is found guilty of making any undue
gain, he shall be liable to pay an amount equal to that gain to the
Company o The Directors shall not assign his office and any assignment so made
shall be void;

6. CODE FOR INDEPENDENT DIRECTORS SPECIFYING THEIR DUTIES

A guide to professional conduct for Independent Directors is separately
specified under the Companies Act, 2013, in Schedule IV – “Code for
Independent Directors”, which lays down the guidelines of professional
conduct for Independent Directors, their role & duties, along with
appointment/re-appointment process, evaluation mechanism and
requirement for separate meetings of Independent Directors, which is
appended as “Annexure I” to this Code.

7. AMENDMENT TO THE CODE:
The provisions of this code can be amended or modified by the Board of
Directors from time to time in alignment with the applicable lawsf rules /
regulation and all such amendments/ modifications shall take effect from
such date.

CODE FOR INDEPENDENT DIRECTORS

I. Guidelines of professional conduct:
An Independent Director shall:
(1) Uphold ethical standards of integrity and probity;
(2) Act objectively and constructively while exercising his duties;
(3) Exercise his responsibilities in a bona fide manner in the interest
of the Company;
(4) Devote sufficient time and attention to his professional
obligations for informed and balanced decision making;

(5) Not allow any extraneous considerations that will vitiate his
exercise of objective independent judgment in the paramount
interest of the company as a whole, while concurring in or
dissenting from the collective judgment of the Board in its
decision making;
(6) Not abuse his position to the detriment of the company or its
shareholders or for the purpose of gaining direct or indirect
personal advantage or advantage for any associated person;
(7) Refrain from any action that would lead to loss of his
independence;
(8) Where circumstances arise which make an independent director
lose his independence, the independent director must
immediately in-form the Board accordingly; (9) Assist the company in implementing the best corporate
governance practices

II. Role and functions:

The Independent Directors shall

(1) Help in bringing an independent judgment to bear on the
Board’s deliberations especially on issues of strategy,
performance, risk management, resources, key appointments
and standards of conduct;
(2) Bring an objective view in the evaluation of the performance of
board and management
(3) Scrutinize the performance of management in meeting agreed
goals and objectives and monitor the reporting of performance;
(4) Satisfy themselves on the integrity of financial information and
that financial controls and the systems of risk management are
robust and defensible;
(5) Safeguard the interests of all stakeholders, particularly the
minority shareholders;
(6) Balance the conflicting interest of the stakeholders;
(7) Determine appropriate levels of remuneration of executive
directors, key managerial personnel and senior management
and have a prime role in appointing and where necessary
recommend removal of executive directors, key managerial
personnel and senior management;
(8) Moderate and arbitrate in the interest of the Company as a
whole, in situations of conflict between management and
shareholder’s interest.

III Duties:

The Independent Directors shall –
(1) Undertake appropriate induction and regularly update and
refresh their skills, knowledge and familiarity with the
Company;
(2) Seek appropriate clarification or amplification of information and, where necessary, take and follow appropriate professional advice and opinion of outside experts at the expense of the company;
(3) Strive to attend all meetings of the Board of Directors and of the
Board committees of which he is a member;
(4) Participate constructively and actively in the committees of the
Board in which they are chairpersons or members;
(5) Strive to attend the general meetings of the company;
(6) Where they have concerns about the running of the company or
a proposed action, ensure that these are addressed by the Board
and, to the extent that they are not resolved, insist that their
concerns are recorded in the minutes of the Board meeting;
(7) Keep themselves well informed about the Company and the
external environment in which it operates
(8) Not to unfairly obstruct the functioning of an otherwise proper
Board or committee of the Board;
(9) Pay sufficient attention and ensure that adequate deliberations
are held before approving related party transactions and assure
themselves that the same are in the interest of the company;
(10) Ascertain and ensure that the company has an adequate and
functional vigil mechanism and to ensure that the interests of a
person who uses such mechanism are not prejudicial affected
on account of such use;
(11) Report concerns about unethical behavior, actual or suspected
fraud or violation of the company’s code of conduct or ethics
policy;
(12) Acting within his authority, assist in protecting the legitimate
interests of the company, shareholders and its employees;
(13) Not disclose confidential information, including commercial
secrets, technologies, advertising and sales promotion plans,
unpublished price sensitive information, unless such disclosure
is expressly approved by the Board or required by law.

IV. Manner of Appointment:
(1) Appointment process of independent directors shall be
independent of the company management! while selecting
independent directors the Board shall ensure that there is
appropriate balance of skills, experience and knowledge in the
Board so as to enable the Board to discharge its functions and
duties effectively.

(2) The appointment of independent director(s) of the company
shall be approved at the meeting of the shareholders.
(3) The explanatory statement attached to the notice of the meeting
for approving the appointment of independent director shall
include a statement that in the opinion of the Board, the
independent director proposed to be appointed fulfills the
conditions specified in the Act and the rules made there under
and that the proposed director is independent of the
management.

(4) The appointment of independent directors shall be formalized
tfuough a letter of appointment, which shall set out:
(a) The term of appointment
(b) The expectation of the Board from the appointed director;
the Board level committee(s) in which the director is
expected to serve and its tasks;
(c) The fiduciary duties that come with such an appointment
along with accompanying liabilities;
(d) Provision for Directors and Officers (D and O) insurance, if
any;

(e) The Code of Business Ethics that the company expects its
directors and employees to follow;
(f) The list of actions that a director should not do while
functioning as such in the company; and
(g) The remuneration, mentioning periodic fees, reimbursement of expenses for participation in the Boards and other meetings and profit related commission if any.

(5) The terms and conditions of appointment of independent
directors shali be open for inspection at the registered office of
the company by any member during normal business hours.
(6) The terms and conditions of appointment of independent
directors shall also be posted on the company’s website.

V. Re-appointment:
The re-appointment of independent director shall be on the basis of
report of performance evaluation.
VI. Resignation or Removal:
(1) The resignation or removal of an independent director shall be in
the same manner as is provided in sections 168 and 169 of the
Act.
(2) An independent director who resigns or is removed from the
Board of the company shall be replaced by a new independent
director within a period of 3 Months from the date of such
resignation or removal, as the case may be.

(3) Where the company fulfills the requirement of independent
directors in its Board even without filling the vacancy created by
such resignation or removal, as the case may be, the requirement
of replacement by a new independent director shall not apply.

VII. Separate Meetings:
(1) The independent directors of the company shall hold at least one
meeting in a year, without the attendance of non-independent
directors and members of management;

(2) All the independent directors of the company shall strive to be present at such meeting;

(3) The meeting shall:
(a) Review the performance of non-independent directors and
the Board as a whole;
(b) Review the performance of the Chairperson of the
company, taking into account the views of executive
directors and non-executive directors;
(c) Assess the quality, quantity and timeliness of flow of
information between the company management and the
Board that is necessary for the Board to effectively and
reasonably perform their duties.

VIII. Evaluation mechanism:

(1) The performance evaluation of independent directors shall be
done by the entire Board of Directors, excluding the director
being evaluated.
(2) On the basis of the report of performance evaluation, it shall
be determined whether to extend or continue the term of
appointment of the independent director.