Responding to the extremely challenging context of old burden and new opportunities, the newly constituted Board of Directors led by Shri Y C Deveshwar launched into a purposeful phase of rationalising, restructuring and repositioning the Company for international competitiveness. The new team stood steadfast in its resolve to preserve ITC’s Indian identity and its strategy of creating multiple drivers of growth. A new structure of corporate governance based on the principles of trusteeship, transparency and distributed leadership was put in place. Recognising that ITC was not well positioned to create long-term value in businesses such as edible oils and financial services, a responsible exit from these businesses was executed in 1998. In what was one of the most turbulent periods in the Company's history, huge financial outlays were incurred to wind up Classic Finance and make a pre-deposit in the excise duty case for the period 1983-87. Subsequently, with the winning of several legal cases, ITC’s stand was vindicated, marking a very important step in the rebuilding of its reputation.

The critical task of building the international competitiveness of the Company’s businesses continued apace. Reaffirming its faith in the strategy of multiple drivers of growth, the Company restructured its portfolio of businesses based on the strategic fit between market opportunities and its core capabilities. The Paperboards business was merged with ITC, infusing it with new life. A deep commitment to the creation of growing and sustainable value within India inspired ITC to swim against the tide and fashion a comprehensive turnaround strategy, drawing upon the diverse skills within the ITC Group. The R&D programme which had developed high yielding, hardy and disease resistant clonal saplings was significantly stepped up. Small farmers and poor tribals with private wastelands were mobilised to grow these trees with an assured buy back to augment their meagre incomes. Today, these plantations span over 1,00,000 hectares. Over 46 million person days of employment have been created. Most importantly, the Paperboards business stands transformed into a clear industry leader - profitable and environmentally responsible. Similarly, the Hotels business was folded back into ITC in 2004. Renewed and dedicated efforts to create one of India’s finest hospitality chains have today resulted in an internationally acknowledged business with best-in-class operating margins, with discerning guests that include Heads of State of several countries as well as global corporate leaders. Moreover, reflecting ITC’s commitment to ‘Responsible Luxury’, its Hotels combine the finest luxury with the greenest service delivery.

As globalisation unfolded with the economic reforms of the 90s, ITC saw this turning point in the country’s economic history as an opportunity to invest in the businesses for tomorrow. A strategic choice was made to enter new businesses with adjacency by leveraging internal competencies that best matched emerging market opportunities. Driven by the aspiration to become the country’s leading FMCG company, ITC created a bouquet of businesses which spawned several brands that are popular household names today. The expansion strategy in FMCG saw ITC making an entry into lifestyle apparel, branded packaged foods, education & stationery products, safety matches and incense sticks and more recently personal care products. Core competencies and group synergies lent strength to these businesses taking them to leadership positions in a short span of time.