ITC is one of India's primary private sector companies with a market capitalisation of over US $ 30 billion and a turnover folks $ 6 billion. ITC is rated among the World's Best Big Companies, Asia's 'Fab 50' and the World's Most Reputable Companies by Forbes magazine, among India's ESTEEMED Companies by BUSINESS COMMUNITY and among India's MOST EFFECTIVE Companies by Business Today. ITC rates among India's `10 MOST EFFECTIVE (Company) Brands', in a report conducted by Brand Fund and publicized by the Economic Times. ITC also ranks among Asia's 50 best undertaking companies compiled by Business Week.
ITC has a diversified occurrence in Cigarettes, Hotels, Paperboards & Niche Documents, Packaging, Agri-Business, Packaged Foods & Confectionery, IT, Branded Apparel, Personal Attention, Stationery, Safety Matches and other FMCG products. As one of India's most effective and respected corporations, ITC is extensively perceived to be dedicatedly nation-oriented. Chairman Y C Deveshwar phone calls this source of inspiration "a committed action beyond the market". ITC methods this school of thought by not only driving a car each of its businesses towards international competitiveness but by also consciously adding to enhancing the competitiveness of the larger value chain which it is a component. "
ITC uses over 26, 000 people at more than 60 locations across India. The Company continuously endeavours to improve its wealth creating capacities in a globalising environment to constantly pay back more than 4, 05, 000 shareholders, fulfil the aspirations of its stakeholders and meet societal goals. (assis, 2003)
Sustain ITC's position as you of India's most effective corporations through world class performance, creating growing value for the Indian economy and the business's stakeholders.
To improve the wealth generating capability of the venture in a globalising environment, providing superior and ecological stakeholder value.
The ITC Way
ITC is a board-managed professional company, committed to creating long lasting value for the shareholder and then for the nation. It has a wealthy organisational culture rooted in its main values of admiration for people and perception in empowerment. Its school of thought of all-round value creation is supported by strong corporate governance plans and systems.
ITC's Commercial STRATEGIES are :
Create multiple individuals of development by creating a portfolio of world class businesses that best complements organisational capacity with opportunities in domestic and export marketplaces.
Continue to focus on the chosen collection of FMCG, Hotels, Newspaper, Paperboards & Product packaging, Agri Business and IT.
Benchmark the health of each business comprehensively across the requirements of Market Standing, Profitability and Internal Vitality.
Create sent out leadership within the company by nurturing talented and targeted top management teams for each and every of the businesses.
Continuously bolster and refine Commercial Governance processes and systems to catalyse the entrepreneurial energies of management by dazzling the gold balance between executive freedom and the need for effective control and accountability.
ITC's Core Values are targeted at developing a customer-focused, high-performance company which creates value for all those its stakeholders:
As professional professionals, we are conscious that ITC has been given to us in "trust" by all our stakeholders. We will actualise stakeholder value and interest on the long term sustainable basis.
We are always customer concentrated and will deliver what the client needs in terms of value, quality and satisfaction.
Respect for People
We acknowledge that every person brings different perspectives and capabilities to the team and that a strong team is founded on a number of perspectives.
We want individuals to dream, value variations, create and test in search of opportunities and achieve leadership through teamwork.
We do what's right, take action well and get. We will shoot for excellence in whatever we do.
We will constantly pursue newer and better processes, products, services and management practices.
We know about our responsibility to create economic value for the Nation. In pursuit of our goals, we will make no compromise in complying with appropriate regulations at all levels.
ITC's objective is to sustain and improve the wealth-generating capacity of its portfolio of businesses in a progressively globalising environment. As you of India's premier firms employing a vast quantum of societal resources, ITC looks for to fulfil a larger role by enlarging its contribution to the culture of which it is a component. The trusteeship role related to communal and environmental resources, aligned to the pursuit of economic aims, is the cornerstone of ITC's Environment, Health insurance and Safety beliefs.
In the multi-business context of ITC, Corporate and business Strategies are designed to create enduring value for the country and the shareholder, through leadership in each business and the attainment of world-class competitive capacities over the value chain.
To donate to lasting development through the establishment and execution of environment specifications are scientifically tested and meet the requirement of relevant laws, polices and rules of practice.
To take accounts of environment, occupational health and security in planning and decision-making.
To provide and maintain facilities, equipment, functions and working conditions which are safe for employees, guests and contractors at the Company's premises.
To institute and put into practice something of regular EHS audit to be able to assure compliance with laid down insurance policy, benchmarked requirements, and requirements of laws and regulations, regulations and appropriate codes of practice.
MANAGEMENT - experienced wide-ranging base of hobbies and knowledge
PRODUCT Collection - unique, flavor good, competitive price, and convincement.
MARKETING - diverse and global understanding.
PERSONNEL - international, diverse positions, high sakes income, high sale growth, large capital basic.
MANUFACTURING - low costs an liabilities due to outsourcing of bottling.
RESEARCH AND DEVELOPMENT - constant efforts to analyze styles an reinforce creativeness.
CONSUMER/Sociable - huge market in the healthy products and growing market for professional foods for ethic categories.
COMPETITIVE - distinctive name, product and presentation in with regards to its marketplaces.
TECHNOLOGICAL - internet promotion such as banner advertising and keywords can increase their sales and even more computerized processing their efficiency.
ECONOMIC - consumer income is high, more tend to eat out, convenience is important to us.
MANAGEMENT - large size may lead to conflicting hobbies.
PRODUCT Range - new one calorie product have no existing customer bottom general have brands can make similar product.
MARKETING - may lose focus, may not be segmented enough.
PERSONAL - possible conflicts due to more and more people, possible trouble remaining focused.
FINANCE - high expenses may have trouble balancing cash-flow of such a large operation.
RESEARSH & DEVELOPMENT - may focus too much on existing product, inter apreneuralship might not exactly be welcomed.
CONSUMER/Communal - more costly products, such a higher price may limit lower income family from buying on ITC product.
COMPETITIVE - not entrails patentable, constant reliability by rivals.
TECHNOLOGICAL - computer break downs, viruses and hackers can reduce efficiency and must constantly upgrade products or other opponents could be more advanced.
ECONOMIC - very elastic demand, almost 100 % pure competition.
Expected 30% CAGR in planned market to result in better footfall and conversion rates.
Entry into Tier 2 & Tier 3 towns.
Collaboration with foreign player because of a nationwide brand.
An possibility to diversify its operations in e-relating.
As big company of India can go internationally.
Employee lack and attrition scheduled to rapid expansion in the complete market.
Impact of slowdown in consumer spends to be thought in FMCG market.
Opening up of market for free entrance of overseas players. (Anon. , n. d. )
Politically active unions
Govt. got over suffering companies.
MNCs urged to liquidate equity with a cover of 40%
Multiparty coalitions triggering political uncertainty
Rural job program launched in 2006
Reduced economic control & opened overall economy to imports
Govt. Approved 51% FDI provided company involved in single branding.
Favoured capital goods, increased black market
Low competition in domestic market
Not proficient enough for international level
Lower purchasing electric power of consumer
Foreign investment discouraged
India's swift GDP growth resulted in upsurge in spending power
Increase income 56% demand for FMCG product from rural sector.
Abundance of low wage sector
88 % of rural populace below poverty line
Rural gain access to hampered by poor - road, rail & telecommunication links
NGOs to assist smaller level cooperatives
Combination of low wage & relatively high skilled labour
IT sector grew rapidly
Internet usage usage of rural sector
Increased mediums to information available ITC provided web portal
Limited mediums avaible to promote brand building.
Over the years, ITC has advanced from an individual product company to a multi-business corporation. Its companies are spread over a wide spectrum, which range from cigarettes and tobacco to hotels, presentation, newspaper and paperboards and international commodities trading. Each one of these businesses is vastly different from others in its type, the state of its progression and the basic characteristics of its activity, which influence the choice of the form of governance.
Globalisation will not only significantly heighten business risks, but will also compel Indian companies to adopt international norms of transparency and good governance. ITC's governance insurance policy recognises the challenge of this home based business fact in India.
Corporate Governance emerge the cornerstones of ITC's governance viewpoint, namely trusteeship, transparency, empowerment and accountability, control and honest corporate and business citizenship.
ITC's Commercial Governance initiative is based on two core guidelines. These are -
Management must have the professional freedom to operate a vehicle the enterprise forwards without undue restraints; and
This freedom of management should be exercised inside a construction of effective accountability.
ITC believes that any meaningful policy on Commercial Governance must definitely provide empowerment to the executive management of the Company, and simultaneously produce a mechanism of checks and balances which means that your choice making capabilities vested in the professional management is not only not misused, but is utilized with care and responsibility to meet stakeholder aspirations and societal objectives.
ITC believes that large firms like itself have both a cultural and economic purpose. They represent a coalition of hobbies, 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 Plank of Directors. They may be to act as trustees to safeguard and enhance shareholder value, as well concerning ensure that the Company fulfils its obligations and obligations to its other stakeholders.
ITC believes that transparency means detailing Company's policies and actions to those to whom it has tasks. Therefore transparency must lead to maximum appropriate disclosures without jeopardising the Company's strategic pursuits. Internally, transparency means openness in Company's romantic relationship with its employees, as well as the do of its business in a manner that will bear scrutiny.
Empowerment and Accountability:
Empowerment is an essential concomitant of ITC's first key basic principle of governance that management will need to have the freedom to operate a vehicle the enterprise onward. ITC believes that the Panel of Directors are responsible to the shareholders, and the management is accountable to the Panel of Directors.
Control is a necessary concomitant of its second key principle of governance that the freedom of management should be exercised within the construction of appropriate bank checks and balances. Control should prevent misuse of electric power, accomplish timely management response to improve, and ensure that business dangers are pre-emptively and effectively monitored.
Ethical Corporate Citizenship:
ITC believes that corporations like itself have a responsibility to set exemplary specifications of ethical behavior, both internally within the company, as well as in their external relationships. We think that unethical behavior corrupts organisational culture and undermines stakeholder value.
Flowing from the philosophy and core key points, Commercial Governance in ITC shall take place at three interlinked levels, namely -
Strategic guidance by the Board of Directors
Strategic management by the Corporate Management Committee
Executive management by the Divisional LEADER helped by the Divisional Management Committee
The 3-tier governance structure thus ensures that:
Strategic supervision being free from involvement in the task of strategic management of the business, can be conducted by the Mother board with objectivity, therefore sharpening accountability of management.
Strategic management of the business, uncluttered by the day-to-day responsibilities of professional management, remains focused and energised; and
Executive management of the divisional business, free from collective strategic duties for ITC all together, gets focused on enhancing the product quality, efficiency and performance of its business.
ITC's Code of Do was circulated to the employees more than five years again and is published on the business's commercial website. This Code has now been re-drafted for better demonstration. This Code comes from three interlinked fundamental concepts, viz. good corporate and business governance, good corporate and business citizenship and exemplary personal do.
ITC is a skillfully managed organisation and the primary value root our corporate beliefs is "trusteeship". We believe this organisation has been handed to us by the many stakeholders in "trust" and we as experts will be the "trustees" of these stakeholders. Hence, it is our responsibility to ensure that the organisation is managed in a manner that protects and furthers the interests of our stakeholders.
The Corporate Governance Insurance plan is the apex level device guiding conduct of the affairs of the business and plainly delineates the assignments, responsibilities and authorities of the main element entities in the governance structure of the Company. This Code forms a fundamental element of the Company's Governance Insurance policy.
In the carry out of the Company's business, the practice of good corporate citizenship is a prerequisite and embraces the next -
All directors, older management and employees shall ensure that in their dealings with suppliers and customers, the Company's interests should never be compromised. Accepting items and presents greater than a nominal value, gratuity repayments and other obligations from suppliers or customers will be viewed as serious breach of self-control as this may lead to reducing the Company's pursuits.
It is the Company's coverage to comply totally with all relevant regulations. Ensuring legal and regulatory compliance is the duty of the Chief Executives of the Businesses and the Divisional Management Committees. Divisional Management Committees must gratify themselves that sound and adequate preparations can be found to ensure that they adhere to the legal and regulatory requirements impacting each business and identify and respond to innovations in the regulatory environment in which they operate.
The Company connects great importance to a healthy and safe work place. ITC is focused on provide good physical working conditions and motivates high requirements of hygiene and housekeeping. Particular attention should be paid to training of employees to increase security recognition and adoption of safe working methods, specifically designed to prevent serious or fatal accidents.
The Company believes that commitment to sustainable development is a key component of responsible corporate citizenship and therefore deserves to be accorded the best priority. Furthermore to complying with applicable laws and regulations, Businesses must set up procedures for examining the environmental effects of their present and future activities.
All directors, mature management and employees have the obligation to conduct themselves in an honest and ethical manner and work in the best interest of the Company all the time. They are anticipated to demonstrate exemplary personal conduct through adherence to the following:
All directors, senior management and employees must avoid situations in which their personal interest could issue with the interest of the business. This is a location in which it is impossible to provide detailed guidance however the guiding principle is the fact that issue, if any, or potential discord must be disclosed to higher management for instruction and action as appropriate.
All directors, older management and employees shall ensure that their actions in the do of business are totally translucent except where in fact the needs of business security dictate otherwise. It shall be necessary to voluntarily ensure that regions of operation are available to audit and the conduct of activities is completely auditable.
No director, mature management and worker shall disclose or use any private information gained in the course of employment/ relationship with the Company for personal gain or for the advantage of any other person. No information either officially or informally will be provided to the press, other promotion advertising or any other external organization except within approved guidelines.
No director, senior management and worker shall misuse Company facilities. In the utilization of Company facilities, good care shall be exercised to ensure that costs are sensible and there is absolutely no wastage. (Deveshwar. Y. C, 2002)
· ITC has been 'Carbon Positive' 3 years in a row (sequestering/storing twice the amount of CO2 than the business emits).
· 'Normal water Positive' six years in a row (creating three times more rain drinking water harvesting potential than ITC's net intake).
· Close to 100 % solid waste materials recycling
· All Environment, Health insurance and Security Management Systems in ITC conform to the best international specifications.
· ITC's businesses generate livelihoods for over 5 million people
· ITC's globally recognised e-Choupal effort is the world's major rural digital infrastructure benefiting over 4 million farming individuals.
· ITC's Friendly and Farm Forestry initiative has greened over 80, 000 hectares creating an estimated 35 million person days of employment one of the disadvantaged.
· ITC's Watershed Development Effort brings precious water to nearly 35, 000 hectares of dry lands and moisture-stressed areas.
· ITC's Sustainable Community Development initiatives include women empowerment, supplementary education, integrated animal husbandry programmes.
As a socially accountable corporate and business citizen, ITC endeavours to set-up value for the Indian society in multiple ways, one of them being preservation of India's rich cultural history. ITC has made significant contribution to the advertising of Indian classical music, theatre, skill and food.
In the past, I have shared with you the abiding eye-sight that inspires us to build sustainable stakeholder prosperity and enlarge our contribution to the Indian contemporary society. This commitment moves far beyond the market to create concurrently financial, environmental and interpersonal capital for the country.
This season, ITC signed up with the United Nations Global Small, the world's most significant global commercial citizenship initiative. (Anon. , n. d. )
Renounced company always employs all the issues and regulation to attain at the top most point that is appraise by the organization, follower and people's one of the business that follow all issues and have a brandname image in all areas and everyone internally and externally apologize this company and ITC is one of that company which may have many follower as a person I also comes after ITC as a way to obtain inspirations. It have done many CSR activities to communicate with the people of different region to capture a broad market area that subsequently increase their market talk about.
Corporate governance of ITC is very strong and cover and calls for all from stakeholder to shareholder regulating body to make its company successful in every aspect to achieve it concentrate on point.
So, this is the primary reason i am quite definitely affected from ITC company enjoy to follow it indicate implement in my own corporation to make it successful.
Anon. , n. d. www. echoupal. com. [Online].
Anon. , n. d. www. itcportal. com. [Online].
assis, c. g. , 2003. ITC'S RURAL SYMPHONY. BUSINESS COMMUNITY.
Deveshwar. Y. C, 2002. THE INDIAN TABACOO COMPANY.
ITC ltd. is a leading FMCG Company in India and from previous three consecutive years shows accelerated expansion in FMCG profile. Customer in India also spending more in FMCG as their quality lifestyle is growing. ITC has positioned itself efficiently in the positioning of market innovator in FMCG product, though there was some downfall in sales and income of company in beginning of this ten years but after that ITC has shown considerable climb in both sales and revenue.
ITC promoting their brands through advertisements marketing campaign as well as door to door advertising.
The demand of the product in very low, because people don't know about their brands very well.
ITC has learned their durability and weakness in the non-public care and attention market, so they are simply applying new principle to beat their weaknesses.
ITC now offering more margin, exiting offers and long credit period to vendors and wholesalers.
The future of the company is looking smart as FMCG market in India is still expanding and so we can securely conclude that ITC can secure it No. 1 position in FMCG product.
KEY Concern COVERED
RELATION OF KEY PROBLEMS WITH THE CASE
Introduction of Globalization
Social and Economic Implications.
INTERNAL ANALYSIS-STRENGTHS, WEAKNESS
EXTERNAL ANALYSIS-OPPORTUNITIES, THREATS
PEST ANALYSIS POLITICAL
CSR(corporate cultural responsibility)
THE GOVERNANCE STRUCTURE
BOARD OF DIRECTORS
CORPORATE MANAGEMENT COMMITTEE
CODE OF Carry out CITIZENSHIP
CORPORATE GOVERNANCE POLICY
GOOD CORPORATE CITIZENSHIP
Resettlement of Battle Victims
Welfare of the neighbouring communities.