12.2 Summary of NIIF Limited’s governance bodies

TABLE 12.2 Summary of NIIF Limited’s governance bodies

BODY COMPOSITION

Governing Council • Chaired by the Minister of Finance • At the time of writing also includes the Secretary of

Department of Economic Affairs, Secretary of

Department of Financial Services, and representatives from business and investment communities

Board • At the time of writing, has 6 members: 2 from government, 1 from ADIA, 1 from a block of domestic investors in the Master Fund, NIIF Limited’s Managing Director and CEO, and 1 independent • Allows a seat to every investor with more than 10% of the capital in the Master Fund • As of spring 2019, was looking to add 1 independent and 2–3 investor representatives, assuming the same number of large-ticket investors commit to the Master Fund

Investment Committees (one for each fund)

Corporate Social Responsibility (CSR) Committee • Appointed by board • Include members from NIIF Limited management as key persons detailed in the private placement memorandum of each NIIF fund (with any changes triggering the filing of a memorandum amendment with SEBI) • Have no government representatives and other fund investors in any of the three committees • Do not have chairs • Master Fund: As of spring 2019, had 4 members—NIIF

Limited’s CEO, COO, Executive Director of Investments, and 1 independent member (none from government) • Includes CEO • Consists of 3 additional members of the board including the independent director

Nomination and Remuneration Committee • Has one investor representative • Has one independent member • Has one government representative

Audit and Risk Committee • Has two investor representatives • Has one independent member • Has one government representative

FUNCTIONS

• Meets annually and provides guidance on NIIF’s strategy

• Meets at least every quarter to establish and review

NIIF’s overall strategy • Appoints the Investment Committee • Approves annual budget

• Have sole power over investment decisions of the respective funds, based on the three-stage approval process previously described • Also decide on key portfolio action items and exits, and review investment performance on a periodic basis

• Devises the CSR policy • Approves the expenditure to be made on CSR projects (with at least 2% of the average net profits of previous 3 years to be spent on CSR projects) • Devises compensation plans, policies, and succession plans for NIIF Limited’s employees • Assists the board in matters regarding compensation of the directors and key managerial personnel • Ensures compliance with accounting, legal, and regulatory requirements • Ensures accuracy, integrity, and transparency of

NIIF Limited’s financial statements with adequate and timely disclosures • Evaluates matters pertaining to auditors’ appointments and their report on the financial statements • Evaluates internal financial controls and risk management systems • Monitors adherence to the risk policy prescribed by board but does not involve itself in deal-specific risks

Advisory Boards (one for each fund) • Provide only one government seat per fund (even if the government is the largest individual investor) • Master Fund: As of fall 2018, had 4 members representing ADIA, the domestic financial investor block, the government, and Temasek • Provides oversight on the operations of the respective funds, with focus on conflicts of interest and related-party transactions, in case any such situations arise from time to time

Trustee (NIIF Trustee Limited, or NIIFTL) • Is the trustee for the three funds managed by NIIF

Limited • Is 100% owned by government of India • Has a board comprising 5 directors nominated by the government • Oversees the operations of NIIF Limited at a high level under the Investment Management

Agreement