CORE VALUES

ITC's Core Values are aimed at developing a customer-focused, high-performance organisation which creates value for all its stakeholders:

TRUSTEESHIP

As professional managers, we are conscious that ITC has been given to us in "trust" by all our stakeholders. We will actualise stakeholder value and interest on a long term sustainable basis.

CUSTOMER FOCUS

We are always customer focused and will deliver what the customer needs in terms of value, quality and satisfaction.

RESPECT FOR PEOPLE

We are result oriented, setting high performance standards for ourselves as individuals and teams.

We will simultaneously respect and value people and uphold humanness and human dignity.

We acknowledge that every individual brings different perspectives and capabilities to the team and that a strong team is founded on a variety of perspectives.

We want individuals to dream, value differences, create and experiment in pursuit of opportunities and achieve leadership through teamwork.

EXCELLENCE

We do what is right, do it well and win. We will strive for excellence in whatever we do.

INNOVATION

We will constantly pursue newer and better processes, products, services and management practices.

NATION ORIENTATION

We are aware of our responsibility to generate economic value for the Nation. In pursuit of our goals, we will make no compromise in complying with applicable laws and regulations at all levels.

CORPORATE STRATEGIES

ITC is a board-managed professional company, committed to creating enduring value for the nation and the shareholder. It has a rich organisational culture rooted in its core values of respect for people and belief in empowerment. Its philosophy of all-round value creation is backed by strong corporate governance policies and systems.

ITC's corporate strategies are:

  • Create multiple drivers of growth by developing a portfolio of world class businesses that best matches organisational capability with opportunities in domestic and export markets.
  • Continue to focus on the chosen portfolio of FMCG, Hotels, Paper, Paperboards & Packaging, Agri Business and Information Technology.
  • Benchmark the health of each business comprehensively across the criteria of Market Standing, Profitability and Internal Vitality.
  • Ensure that each of its businesses is world class and internationally competitive.
  • Enhance the competitive power of the portfolio through synergies derived by blending the diverse skills and capabilities residing in ITC's various businesses.
  • Create distributed leadership within the organisation by nurturing talented and focused top management teams for each of the businesses.
  • Continuously strengthen and refine Corporate Governance processes and systems to catalyse the entrepreneurial energies of management by striking the golden balance between executive freedom and the need for effective control and accountability.

CORPORATE GOVERNANCE

DEFINITION AND PURPOSE

PREAMBLE

Over the years, ITC has evolved from a single product company to a multi-business corporation. Its diverse businesses include fast moving consumer goods, hotels, paperboards, paper & packaging and agri business.

The Company's investments in its different businesses are structured in the nature of in-house divisions, subsidiaries, joint ventures, associate companies and trade investments.

The task of governing a corporation of ITC's size and diversity was rendered more complex in post liberalisation India, which began experiencing the intense impact of globalisation. In order to address its own unique organisational context and prepare itself for the global Indian market, ITC, as early as in 1999, fashioned an unique corporate governance model that would enable it to 'focus' on its multiple businesses, while maximising shareholder value.

This governance policy has not only stood the test of time, but also supported ITC's rapid growth in the last two decades since its formulation. In the intervening years, ITC has not only widened its diversity with the launch of several new businesses in its chosen strategic arena, but has also responded to the growth challenge by creating new internal structures like shared services and business verticals, designing broad-band roles like Line CMC Members, Chief Operating Officers of Business / Vertical, and enabling operating decision making powers at empowered levels.

DEFINITION AND PURPOSE

ITC defines Corporate Governance as a systemic process by which companies are directed and controlled to enhance their wealth generating capacity. Since large corporations employ vast quantum of societal resources, ITC believes that the governance process should ensure that these companies are managed in a manner that meets stakeholders aspirations and societal expectations.

CORE PRINCIPLES

ITC's Corporate Governance initiative is based on two core principles. These are :

  • Management must have the executive freedom to drive the enterprise forward without undue restraints; and
  • This freedom of management should be exercised within a framework of effective accountability.

ITC believes that any meaningful policy on Corporate Governance must provide empowerment to the executive management of the Company, and simultaneously create a mechanism of checks and balances which ensures that the decision making powers vested in the executive management is not only not misused, but is used with care and responsibility to meet stakeholder aspirations and societal expectations.

CORNERSTONES

From the above definition and core principles of Corporate Governance emerge the cornerstones of ITC's governance philosophy, namely trusteeship, transparency, empowerment and accountability, control and ethical corporate citizenship. ITC believes that the practice of each of these leads to the creation of the right corporate culture in which the company is managed in a manner that fulfils the purpose of Corporate Governance.

TRUSTEESHIP

ITC believes that large corporations like itself have both a social and economic purpose. They represent a coalition of interests, namely those of the shareholders, other providers of capital, business associates and employees. This belief therefore casts a responsibility of trusteeship on the Company's Board of Directors. They are to act as trustees to protect and enhance shareholder value, as well as to ensure that the Company fulfils its obligations and responsibilities to its other stakeholders. Inherent in the concept of trusteeship is the responsibility to ensure equity, namely, that the rights of all shareholders, large or small, are protected.

TRANSPARENCY

ITC believes that transparency means explaining Company’s policies and actions to those to whom it has responsibilities. Therefore transparency must lead to maximum appropriate disclosures without compromising the Company's strategic interests. Internally, transparency means openness in Company's relationship with its employees, as well as the conduct of its business in a manner that will bear scrutiny. ITC believes transparency enhances accountability.

EMPOWERMENT AND ACCOUNTABILITY

Empowerment is an essential concomitant of ITC's first core principle of governance that management must have the freedom to drive the enterprise forward. ITC believes that empowerment is a process of actualising the potential of its employees. Empowerment unleashes creativity and innovation throughout the organisation by truly vesting decision-making powers at the most appropriate levels in the organisational hierarchy.

ITC believes that the Board of Directors are accountable to the shareholders, and the management is accountable to the Board of Directors. The Company believes that empowerment, combined with accountability, provides an impetus to performance and improves effectiveness, thereby enhancing shareholder value.

CONTROL

ITC believes that control is a necessary concomitant of its second core principle of governance that the freedom of management should be exercised within a framework of appropriate checks and balances. Control should prevent misuse of power, facilitate timely management response to change, and ensure that business risks are pre-emptively and effectively managed.

ETHICAL CORPORATE CITIZENSHIP

ITC believes that corporations like itself have a responsibility to set exemplary standards of ethical behaviour, both internally within the organisation, as well as in their external relationships. The Company believes that unethical behaviour corrupts organisational culture and undermines stakeholder value.

THE GOVERNANCE STRUCTURE

THE GOVERNANCE STRUCTURE

Flowing from the philosophy and core principles of governance, Corporate Governance in ITC shall take place at three interlinked levels, namely -

  • Strategic supervision by the Board of Directors.
  • Strategic management by the Corporate Management Committee.
  • Executive management by the Chief Executives / Chief Operating Officers of Divisions, SBUs, Business Verticals and Shared Services, assisted by their respective Management / Executive Committees.

It is ITC's belief that the right balance between freedom of management and accountability to shareholders can be achieved by segregating strategic supervision from strategic and executive management. The Board of Directors (Board) as trustees of the shareholders will exercise strategic supervision through strategic direction and control, and seek accountability for effective strategic management from the Corporate Management Committee (CMC). The CMC will have the freedom, within Board approved direction and framework, to focus its attention and energies on the strategic management of the Company. The Chief Executives / Chief Operating Officers of Divisions, SBUs, Business Verticals and Shared Services, assisted by their respective Management / Executive Committees will have the freedom to focus on the executive management of their respective business/ shared services.

THE 3-TIER GOVERNANCE STRUCTURE THUS ENSURES THAT

  • Strategic supervision (on behalf of the shareholders), being free from involvement in the task of strategic management of the Company, can be conducted by the Board with objectivity, thereby sharpening accountability of management.
  • Strategic management of the Company, uncluttered by the day-to-day tasks of executive management, remains focused and energised; and
  • Executive management of businesses assisted by respective Management / Executive Committee, free from collective strategic responsibilities for ITC as a whole, remains focused on enhancing the quality, efficiency and effectiveness of the business to achieve best in class performance.

ROLES

The core roles of the various entities at the three levels of Corporate Governance will be as follows:

BOARD OF DIRECTORS (BOARD)

The primary role of the Board of Directors is that of trusteeship to protect and enhance shareholder value through strategic supervision of ITC, its wholly owned subsidiaries and their wholly owned subsidiaries. As trustees they will ensure that the Company has clear goals relating to shareholder value and its growth. They should set strategic goals and seek accountability for their fulfillment. They will provide direction, and exercise appropriate control to ensure that the Company is managed in a manner that fulfills stakeholder aspirations and societal expectations. The Board must periodically review its own functioning to ensure that it is fulfilling its role. The Board will also evaluate the performance of the individual Directors and Board Committees.

The ITC Board will be a balanced Board, consisting of Executive and Non-Executive Directors including Independent Directors. The Board will have a balance of skills, experience and diversity of perspectives appropriate to the Company. The Non-Executive Directors shall be drawn from amongst eminent professionals, with experience in business / finance / law / public administration & enterprises. Directors shall be appointed / re-appointed for a period of three to five years or a shorter duration, in accordance with the retirement guidelines as may be determined by the Board from time to time or by any applicable statutes, rules, regulations or guidelines, and in the case of Executive Directors up to the date of their retirement, whichever is earlier. The Board shall determine from time to time the retirement age for both Executive and Non-Executive Directors. The Board shall specify the maximum number of company Directorships which can be held by members of the ITC Board.

Non-Executive Directors, including Independent Directors, are expected to play a critical role in imparting balance to the Board processes by bringing an independent judgement to bear on issues of strategy, performance, resources, standards of Company conduct etc.

The Board shall meet at least five times a year. The tentative annual calendar of meetings shall be agreed upon at the beginning of each year. As laid down in the Articles of Association of the Company, the quorum for meetings shall be one third of members and decisions shall be taken by simple majority, unless statutorily required otherwise. Meetings shall be governed by a structured agenda. All major issues included in the agenda shall be backed by comprehensive background information to enable the Board to take informed decisions. Agenda papers, as far as practicable, shall be circulated at least seven days prior to the meeting. Normally items for the Board Agenda, except those emanating from Board Committees, shall have been examined by the CMC. Draft Minutes of Board Meeting shall be circulated within 15 days of the meeting and noted / confirmed at the next meeting. Board decisions shall record the related logic as far as practicable.

The Board shall have the following Committees whose terms of reference shall be determined by the Board from time to time:

Audit Committee: To provide reassurance to the Board on the adequacy of internal control systems and financial disclosures. The Company Secretary shall be the Secretary to the Audit Committee. The Head of Internal Audit shall be Co-ordinator of the Committee and shall be Permanent Invitee to the meetings of the Committee.

Nomination & Compensation Committee: To identify persons qualified to become Directors and to formulate criteria for evaluation of performance of the individual Directors and the Board as a whole. The Committee's role inter alia includes recommending to the Board the appointment, remuneration and removal of the Directors and senior management. The Committee also has the responsibility for administering the Employee Stock Option Schemes of the Company.

Securityholders Relationship Committee: To oversee redressal of shareholder and investor grievances and, inter alia, approve transmission of shares, sub-division / consolidation / renewal / issue of duplicate share certificates etc. and allotment of shares upon exercise of Options under the Company's Employee Stock Option Schemes.

CSR and Sustainability Committee: To review, monitor and provide strategic direction to the Company's CSR and sustainability practices towards fulfilling its triple bottom line objectives. The Committee shall guide the Company in integrating its social and environmental objectives with its business strategies and assist in crafting unique models to support creation of sustainable livelihoods. The Committee shall also formulate & monitor the CSR Policy and recommend to the Board the annual CSR Plan of the Company.

Independent Directors Committee: The role of the Committee would be such as may be prescribed under law.

Terms of Reference of the Board Committees shall include :

  • Objectives, Roles & Responsibilities
  • Authority / Powers
  • Membership & Quorum
  • Chairmanship
  • Tenure
  • Frequency of Meetings

The composition of the Board Committees will be as follows or as may be prescribed by law from time to time :-

Committee Members Chairman
Audit Committee Three or more Directors of the Company, as may be decided by the Board with at least two-third of the members being Independent Directors. The Executive Director representing the Finance function, the Chief Financial Officer, the Head of Internal Audit and the representative of the Statutory Auditors shall be Invitees to the meetings of the Committee. The Company Secretary shall act as the Secretary. One of the Independent Directors, to be appointed by the Board.
Nomination & Compensation Committee Three or more Non-Executive Directors of the Company, as may be decided by the Board with at least one-half of the members being Independent Directors. The Chairman of the Company shall be a Member. The Company Secretary shall act as the Secretary. One of the Independent Directors, to be appointed by the Board.
Securityholders Relationship Committee Three or more Directors of the Company, as may be decided by the Board with at least one member being a Non-Executive Director. The Company Secretary shall act as the Secretary. One of the Non-Executive Directors, to be appointed by the Board.
CSR and Sustainability Committee Three or more Directors of the Company, as may be decided by the Board with at least one member being an Independent Director. The Company Secretary shall act as the Secretary. Chairman of the Board.
Independent Directors Committee All the Independent Directors of the Company. One of the Independent Directors.

 Normally meetings of the Board Committees shall be convened by their respective Chairmen. However, any member of the Committee may, with the consent of the concerned Chairman, convene a meeting of the Committee.

Signed minutes of Board Committee meetings shall be tabled for the Board's information. However, issues requiring Board's attention / approval should be tabled in the form of note(s) to the Board from the Committee Chairman.

RISK MANAGEMENT COMMITTEE

The Risk Management Committee constituted by the Board comprises all the Executive Directors and some senior managers. The role of the Committee includes approval of the strategic risk management framework of the Company, review of the risk mitigation strategies and results of risk identification, prioritisation and mitigation plans for all businesses / functions, as also the measures taken for cyber security. The Chief Risk Officer of the Company shall act as the Secretary to the Committee.

CORPORATE MANAGEMENT COMMITTEE (CMC)

The primary role of the CMC is strategic management of the Company's businesses within Board approved direction / framework and realisation of Company goals. The CMC will assess the performance of the businesses and allocate resources, and will operate under the superintendence and control of the Board. The composition of the CMC will be determined by the Board (based on the recommendation of the Nomination & Compensation Committee), and will consist of all the Executive Directors and some key senior members of management. Membership of the CMC shall be reviewed by the Nomination & Compensation Committee as and when necessary. Meetings of the CMC shall be convened and chaired by the Chairman & MD. The Company Secretary or such other person as may be decided by the Nomination & Compensation Committee / Board shall be the Secretary to the CMC.

CHAIRMAN & MANAGING DIRECTOR

The Chairman is also the MD of the Company. He is the Chairman of the Board and the CMC. His primary role will be to provide leadership to the Board and the CMC for realising Company goals in accordance with the charter approved by the Board. He will be responsible, inter alia, for the working of the Board and the CMC, for ensuring that all relevant issues are on the agenda and for ensuring that all Directors and CMC members are enabled and encouraged to play a full part in the activities of the Board and the CMC, respectively. He will keep the Board informed on all matters of importance. He will also be responsible for the balance of membership of the Board, subject to Board and Shareholder approvals. He will preside over General Meetings of Shareholders.

In respect of the Businesses and Corporate Functions which directly report to the MD, he will have the responsibility of Line Director.

EXECUTIVE DIRECTOR

  • As a member of the CMC, contribute to the strategic management of the Company's businesses within Board approved direction / framework.
  • As Director accountable to the Board for a business or shared services (Line Director), assume overall responsibility for its strategic management, including governance processes and top management effectiveness.

    In the context of the multi-business character of the Company, an Executive Director is in the nature of a Managing Director for those businesses and functions reporting to him.
  • As Director accountable to the Board for a wholly owned subsidiary, or its wholly owned subsidiary (Line Director), at all times exercise independent judgement and application of mind in the interest of the company and its shareholder.
  • As Director accountable to the Board for a corporate function (Line Director), assume overall strategic responsibility for its performance including governance processes and senior management effectiveness.

CMC MEMBER

  • As a member of the CMC, contribute to the strategic management of the Company's businesses within Board approved direction / framework.
  • As CMC Member accountable for a business or shared services (Line CMC Member), assume responsibility for its strategic management, including governance processes and top management effectiveness.
  • As CMC Member accountable for a wholly owned subsidiary, or its wholly owned subsidiary (Line CMC Member), at all times exercise independent judgement and application of mind in the interest of the company and its shareholder.
  • As CMC Member accountable for a corporate function (Line CMC Member), assume overall strategic responsibility for its performance including governance processes and senior management effectiveness.

DIVISIONAL MANAGEMENT COMMITTEE (DMC)

Executive management of the Divisional business/ shared services to realise tactical and strategic objectives in accordance with CMC / Board approved plan. Composition of the DMC shall be determined by the Line Director with the approval of the CMC. The Divisional Chief Executive shall convene and chair the DMC meetings.

EXECUTIVE COMMITTEE FOR BUSINESS VERTICAL (EC)

The CMC, in order to drive sharper focus, greater agility and responsiveness, may form Business Verticals within the Division / Business / Shared Services from time to time. Each of these Verticals will have its own EC led by the COO - Business Vertical with responsibility for delivering comprehensive business results under the overall direction and supervision of the Divisional Chief Executive supported by the DMC. Each such Vertical will be represented on the DMC.

Composition of EC for Business Vertical shall be determined by the Line Director with the approval of the CMC.

DIVISIONAL CHIEF EXECUTIVE (DCE)

The DCE will have executive responsibility of the business and shall provide leadership to the Divisional Management Committee in its task of executive management of the Divisional business and of the Verticals within the Division.

CHIEF OPERATING OFFICER - BUSINESS VERTICAL (COO - BV)

COO-BV shall be responsible for providing leadership to the Vertical and realising the tactical and strategic objectives of their business area.

BOARD COMMITTEES

AUDIT COMMITTEE

Mr. S. B. Mathur Chairman
Mr. H. Bhargava Member
Mr. A. Duggal Member
Mr. S.S.H. Rehman Member
Mr. Murali Ganesan Invitee
Mr. R. Tandon Invitee
Representative of Statutory Auditors  Invitee
Mr. R. K. Singhi Secretary to the Committee

CSR AND SUSTAINABILITY COMMITTEE

Mr. S. Puri Chairman
Mr. H. Bhargava Member
Mr. John Pulinthanam Member
Ms. Nirupama Rao Member
Ms. M. Shankar Member
Mr. David Simpson Member
Mr. R. K. Singhi Secretary to the Committee

NOMINATION & COMPENSATION COMMITTEE

Mr. S. Banerjee Chairman
Mr. S. Puri Member
Mr. S. S. H. Rehman Member
Ms. M. Shankar Member
Mr. R. K. Singhi Secretary to the Committee

SECURITYHOLDERS RELATIONSHIP COMMITTEE

Mr. S.S.H. Rehman Chairman
Mr. J. Pulinthanam Member
Mr. S. Puri Member
Mr. R. Tandon Member
Mr. R. K. Singhi Secretary to the Committee

INDEPENDENT DIRECTORS COMMITTEE

Mr. S. Banerjee Member
Mr. A. Duggal Member
Mr. S. B. Mathur Member
Mr. A. Nayak Member
Ms. N. Rao Member
Mr. S. S. H. Rehman Member
Mr. A.K. Seth Member
Ms. M. Shankar Member

CODE OF CONDUCT

APPLICABLE TO ALL DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES OF THE COMPANY

PREAMBLE

ITC's Code of Conduct is derived from three interlinked fundamental principles, viz. good corporate governance, good corporate citizenship and exemplary personal conduct.

PHILOSOPHY

ITC is a professionally managed organisation and the core value underlying our corporate philosophy is "trusteeship". We believe this organisation has been handed to us by the various stakeholders in "trust" and we as professionals are the "trustees" of these stakeholders. It is therefore our responsibility to ensure that the organisation is managed in a manner that protects and furthers the interests of our stakeholders. We recognise society as an important stakeholder in this enterprise and therefore it is part of our responsibility to practise good corporate citizenship.

It is also our belief that in order to serve the interests of our stakeholders in perpetuity, we must build ITC into an institution whose dynamism and vitality are anchored in its core values.

CORPORATE GOVERNANCE POLICY

The Corporate Governance Policy is the apex level instrument guiding conduct of the affairs of the Company and clearly delineates the roles, responsibilities and authorities of the key entities in the governance structure of the Company. This Code forms an integral part of the Company's Governance Policy. The directors, senior management and employees must adhere to the Corporate Governance Policy of the Company.

GOOD CORPORATE CITIZENSHIP

In the conduct of the Company's business, the practice of good corporate citizenship is a prerequisite and embraces the following:

Dealing with People in the Organisation

In dealing with each other, directors, senior management and employees shall uphold the values which are at the core of our HR Philosophy - trust, teamwork, mutuality and collaboration, meritocracy, objectivity, self respect and human dignity. Indeed, these values form the basis of our HR management systems and processes. In selection and recruitment, while meritocracy will be a prime criterion, managers will scrupulously consider all factors that go towards securing the interests of the Company. ITC will focus on meritocracy, equity and upholding of Company values in all people processes including performance management systems, appraisals, remuneration and rewards.

A Gender Friendly Workplace

As a good corporate citizen, ITC is committed to a gender friendly workplace. It seeks to enhance equal opportunities for men and women, prevent/stop/redress sexual harassment at the workplace and institute good employment practices.

Sexual harassment includes unwelcome sexually determined behaviour such as:
unwelcome physical contact; a demand or request for sexual favours; sexually coloured remarks; showing pornography and any other unwelcome physical, verbal or non-verbal conduct of a sexual nature.

ITC maintains an open door for reportees; encourages employees to report any harassment concerns and is responsive to employee complaints about harassment or other unwelcome and offensive conduct. A committee has been constituted to enquire into complaints and to recommend appropriate action, wherever required.

ITC demands, demonstrates and promotes professional behaviour and respectful treatment of all employees.

Relationships with Suppliers and Customers

All directors, senior management and employees shall ensure that in their dealings with suppliers and customers, the Company's interests are never compromised. Accepting gifts and presents of more than a nominal value, gratuity payments and other payments from suppliers or customers will be viewed as serious breach of discipline as this could lead to compromising the Company's interests.

Legal Compliance

It is the Company's policy to comply fully with all applicable laws and regulations. Ensuring legal and regulatory compliance is the responsibility of the Chief Executives of the Businesses and the Divisional Management Committees. The Company cannot accept practices which are unlawful or may be damaging to its reputation. Divisional Management Committees must satisfy themselves that sound and adequate arrangements exist to ensure that they comply with the legal and regulatory requirements impacting each business and identify and respond to developments in the regulatory environment in which they operate. In the event the implication of any law is not clear, the Company's Legal Department shall be consulted for advice.

Health and Safety

The Company attaches great importance to a healthy and safe work environment. ITC is committed to provide good physical working conditions and encourages high standards of hygiene and housekeeping. Particular attention should be paid to training of employees to increase safety awareness and adoption of safe working methods, particularly designed to prevent serious or fatal accidents.

Environment Policies

The Company believes that commitment to sustainable development is a key component of responsible corporate citizenship and therefore deserves to be accorded the highest priority.

Accordingly, the Company is committed to Best Practices in environmental matters arising out of its business activities and expects each business to fully demonstrate this commitment.

In addition to complying with applicable laws and regulations, Businesses must establish procedures for assessing the environmental effects of their present and future activities. They should adopt Best Practices in their environmental policies and procedures.

 

PERSONAL CONDUCT

All directors, senior management and employees have the obligation to conduct themselves in an honest and ethical manner and act in the best interest of the Company at all times. They are expected to demonstrate exemplary personal conduct through adherence to the following:

Avoidance of Conflict of Interest

All directors, senior management and employees must avoid situations in which their personal interest could conflict with the interest of the Company. This is an area in which it is impossible to provide comprehensive guidance but the guiding principle is that conflict, if any, or potential conflict must be disclosed to higher management for guidance and action as appropriate.

Transparency and Auditability

All directors, senior management and employees shall ensure that their actions in the conduct of business are totally transparent except where the needs of business security dictate otherwise. Such transparency shall be brought about through appropriate policies, systems and processes, including as appropriate, segregation of duties, tiered approval mechanism and involvement of more than one manager in key decisions and maintaining supporting records. It shall be necessary to voluntarily ensure that areas of operation are open to audit and the conduct of activities is totally auditable.

Protection of Confidential Information

No director, senior management and employee shall disclose or use any confidential information gained in the course of employment/ association with the Company for personal gain or for the advantage of any other person. No information either formally or informally shall be provided to the press, other publicity media or any other external agency except within approved policies.

Dealing in Securities of the Company by Employees

  • Employees, who are granted Stock Options under the Company's Employee Stock Option Schemes (ESOS) shall not buy and / or sell any shares of the Company.

    This restriction, however, will not apply to exercise of Options granted by the Company under ESOS and sale of resultant shares arising out of such exercise.
  • Employees, who are not granted Stock Options under ESOS, and their 'Immediate Relatives', and also the 'Immediate Relatives' of Employees who are granted Stock Options shall not buy and / or sell shares of the Company in excess of 10,000 shares in aggregate in a calendar quarter.
  • Employees and their 'Immediate Relatives' shall not enter into any derivative transactions with respect to the shares of the Company.
(Immediate Relative for this purpose means spouse, and includes parent, sibling, and child if they are financially dependent on the employee.)

Company Facilities

No director, senior management and employee shall misuse Company facilities. In the use of Company facilities, care shall be exercised to ensure that costs are reasonable and there is no wastage.

Leading by Example

The organisation's directors and senior management set the professional tone for the Company. Through both their words and their actions, the organisation's leadership conveys what is acceptable and unacceptable behaviour. ITC's directors, senior management and employees must constantly reinforce through their actions and behaviour that ITC's stated beliefs of responsible corporate citizenship are rooted in individual conviction and personal integrity.

WAIVERS

Any waiver of any provision of this Code of Conduct for a director, senior management or employee must be placed for approval before the Company's Board of Directors / Corporate Management Committee, as appropriate.

NON ADHERENCE

Any instance of non-adherence to the Code of Conduct should be brought to the attention of the immediate reporting authority, with copies to the relevant Divisional Chief Executive / Head of Corporate Department and the Head of Corporate Human Resources. In respect of senior management, any such instance should be brought to the attention of the Chairman of the Audit Committee with a copy to the Company Chairman.

DUTIES OF INDEPENDENT DIRECTORS

The duties of Independent Directors of the Company, as laid down under Schedule IV to the Companies Act, 2013, are incorporated herein pursuant to Clause 49 of the Listing Agreement with Stock Exchanges. It shall be the duty of Independent Directors to:

  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 they are a member;
  4. participate constructively and actively in the Board Committees in which they are chairpersons or members;
  5. strive to attend the general meetings of the Company;
  6. ensure, where they have concerns about the running of the Company or a proposed action, that these are addressed by the Board of Directors;
  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 Board Committee;
  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 ensure that the interests of a person who uses such mechanism are not prejudicially affected on account of such use;
  11. report concerns about unethical behaviour, actual or suspected fraud or violation of the Code of Conduct;
  12. act within their authority and assist in protecting the legitimate interests of the Company, shareholders and its employees;
  13. not to disclose confidential information, including commercial secrets, technologies, advertising and sales promotion plans and unpublished price sensitive information, unless such disclosure is expressly approved by the Board of Directors or required by law.

WHISTLEBLOWER POLICY

1. Philosophy

ITC believes that every employee is a trustee of its stakeholders and must adhere to the Company's Code of Conduct (hereinafter referred to as 'ITC Code') and conduct himself or herself at all times in a professional and ethical manner.

2. Purpose

The "Whistleblower Policy" encourages Directors and employees (hereinafter referred to as 'employees') to bring to the Company's attention, instances of unethical behaviour, actual or suspected incidents of fraud, actual or suspected instances of leak of unpublished price sensitive information (hereinafter referred to as 'UPSI'), or violation of the ITC Code, that could adversely impact the Company's operations, business performance and / or reputation. The Company will investigate such reported incidents in an impartial manner and take appropriate action to ensure that the requisite standards of professional and ethical conduct are always upheld.

3. Policy

It is ITC's Policy:

(a) To create an environment where every employee feels free and secure to report specific incidents of unethical behaviour, actual or suspected incidents of fraud, actual or suspected instances of leak of UPSI, or violation of the ITC Code;

(b) To investigate such reported incidents in a fair manner;

(c) To take appropriate disciplinary action against the delinquent employee(s);

(d) To ensure that no employee is victimised or harassed for bringing such incidents to the attention of the Company.

The practice of this Policy will be overseen by the Audit Committee.

4. Reporting Mechanism

(a) Employees are encouraged to bring to the attention of the Company incidents pertaining, inter alia, to:

(i) Illegal or unethical conduct including that which adversely affects investors, shareholders, customers, suppliers, other employees, or the business performance or image or reputation of the Company;

(ii) Violation of any law or regulation including actual or suspected fraud;

(iii) Conflict of interest with the Company;

(iv) Leaking of confidential or proprietary information of the Company;

(v) Actual or suspected instances of leak of UPSI pertaining to the Company;

(vi) Any other violation of the ITC Code.

(b) A Whistleblower complaint may be made by any employee (hereinafter referred to as the ‘complainant’). Such complaint should be sent to his or her immediate reporting authority, with copies to the relevant Divisional Chief Executive / Head of Corporate Department and the Head of Corporate Human Resources. Complaint for any actual or suspected instance of leak of UPSI should also be copied to the Company Secretary and the Chief Financial Officer.

Anonymous complaint will not be entertained. If the complainant has reasons to believe that the concerned immediate reporting authority or his / her superior is involved in the suspected violation, the complaint may be addressed directly to the Head of Corporate Human Resources.

Complaint by or against senior management (as defined in the ITC Code) should be made to the Chairman of the Audit Committee with a copy to the Managing Director. Complaint by or against Directors should be made to the Chairman of the Audit Committee with a copy to the Company Chairman.

(c) Complaint shall be made in writing and must include as much information about the suspected violation as the complainant can provide. It should describe:

(i) the nature, period of commission and details of the alleged violation;

(ii) the identities of the persons suspected to have committed the alleged violation; and

(iii) a description of the documents that would prove or relate to the suspected violation.

(d) Employees are encouraged to report such incidents as early as possible, in any case within 30 days of the suspected violation / breach noticed by him / her, so that timely action can be taken.

5. Investigation

(a) Upon receipt of a complaint (other than by or against senior management), the Head of Corporate Human Resources, who should keep the Line Director informed, will make an assessment thereof and on being satisfied as to the seriousness and credibility of the complaint, direct the complaint for investigation, in consultation with the General Counsel, to the Internal Audit Department of the Company.

(b) All employees have a duty to cooperate in an investigation.

(c) All information disclosed during the course of an investigation, including the identity of the complainant, will be kept confidential, except as necessary or appropriate to disclose for the purposes of the investigation or where required to be statutorily disclosed.

(d) The report of the investigation shall be submitted by the Internal Audit Department to the Corporate Management Committee along with reasoning and supporting material. Depending on the materiality, the investigation findings will be reported to the Audit Committee.

(e) Complaint by or against Directors and senior management will be investigated as directed by the Audit Committee.

(f) If the Corporate Management Committee / the Audit Committee determines that a violation has occurred, the Company will take appropriate action which may include disciplinary proceedings against the violator, including termination of employment.

(g) Complaint for any actual or suspected instance of leak of UPSI shall be dealt with in accordance with the Company’s Policy for inquiry in case of leak of UPSI.

6. No Retaliation

(a) This Policy is intended to encourage and enable employees to raise bonafide concerns. No employee who reports a violation shall suffer any harassment, retaliation or adverse employment condition as a consequence of such reporting.

(b) Any employee who retaliates against a person reporting a violation will be subject to disciplinary proceedings, which may extend to termination of employment.

7. Complaint to be made in good faith

(a) A complainant must act in good faith and have reasonable grounds for forming a belief that his or her complaint constitutes a violation as described under Clause 4(a).

(b) This Policy must not be used as a tool for victimisation, making false allegation or acting malafide.

(c) Any person who is found to be making baseless, reckless, malicious or deliberately false allegation, shall be subject to disciplinary proceedings, which may extend to termination of employment.