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A Study of HR Practices in ITC

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					                   A PROJECT REPORT
                                    On

              A Study of HR Practices in ITC
Submitted in partial fulfillment of the requirement for the award of degree
                                    Of
                 Master of Business Administration
                                   OF




                       ITC Ghaziabad




                              SESSION 2009


                             Submitted by:

              Raibahadur Singh Parihar
                       Under the guidance of:
                       MR. Ravi karan singh
                             Contents
1. Declaration
2. Acknowledgement
3. Preamble
4. Objective
5. Certification of ITC
6. Policies of ITC
7. Company profile
8. Growth history
9. SWOT Analysis
10.   ITC Philosophy
11.   HR Management
12.   HR Practices at ITC
13.   Action Plan
14.   Graphical representation of data
15.   Research Methodology
16.   Questionnaire
17.   Results & Conclusion
18.   Suggestion
                       DECLARATION

This project report on “a study of HR practices in ITC” in ITC
Ghaziabad is submitted by me for the partial fulfillment of the course
of M.B.A from Sikkim Manipal University.

This is an original work done by me expected the guidance received
which has been properly acknowledgement in the report.

This is not the copy of any other report or any part of it hasn‟t been
submitted for the award of any degree or diploma.




                                           Raibahadur Singh Parihar
                                           Sikkim Manipal University
               ACKNOWLEDGEMENT
I would like to express my gratitude towards Mr. Ravi Karan Singh for the
valuable guidance, supervision and keen interest in study, progress and
completion of this project.
             I would like to acknowledge the precious contribution General
Manager H.R. who had been in continuous support through out the training
period.
             I am also graceful to our faculty member Mr. Vishal whose
precious guidance throughout the session has been of undaunted help to us
in grooming our self and without which this work wasn't possible.


             I am also thankful to my friend Mr. Nitin Shukla
(Senior HR Executive) whose help has given this shape to the report.

                                                   Submitted by
                                                Raibahadur Singh Parihar
                                               Sikkim Manipal University
                       Preamble

 I have made this report as an essential part of IV semester course
curriculum of MBA. The title of project is “a study of HR practices in
ITC” at ITC Ghaziabad.
 In the course of my training I have had the golden opportunity of
seeing the practical application of what ever theoretical knowledge
was imparted to me in a class room studies at    Learning Point Sec- 16

Noida   I have had the good fortune in interacting with the executive
and employee of ITC Ghaziabad who were very warm and cordial in
their conduct toward me.
  My report mainly focuses on “study of HR practices in ITC”.
  I hope that the finding of the project work must conform with the
companies expectation & suggestion made on that basis must be useful
for the total performance of the employees of the “ITC Ghaziabad.”

                                           Raibahadur Singh Parihar
                                            Sikkim Manipal University
OBJECTIVE



The main objective of the study is as follows:

    To know the recruitment & selection procedures adopted in this company.


    To improve training and development programs used in the company.


    To know how the performance of the employees is being appraised.


    To provide better employee welfare.



    To increase the labor productivity.
Certification of ITC




ITC constantly endeavors to benchmark its products, services and processes to global
standards. The Company's pursuit of excellence has earned it national and international
honors. ITC is one of the eight Indian companies to figure in Forbes A-List for 2004,
featuring 400 of "the world's best big companies". Forbes has also named ITC among
Asia's'Fab 50' and the World's Most Reputable Companies

ITC is the first Indian company and the second in the world to win the prestigious
Development Gateway Award. It won the $100,000 Award for the year 2005 for its
trailblazing ITC e-Choupal initiative which has achieved the scale of a movement in rural
India. The Development Gateway Award recognizes ITC's e-Choupal as the most
exemplary contribution in the field of Information and Communication Technologies
(ICT) for development during the last 10 years. ITC e-Choupal won the Award for the
importance of its contribution to development priorities like poverty reduction, its
scale and replicability, sustainability and transparency.

  ITC has won the inaugural 'World Business Award', the worldwide business award
recognizing companies who have made significant efforts to create sustainable livelihood
opportunities and enduring wealth in developing countries. The award has been instituted
jointly by the United Nations Development Programme (UNDP), International
Chamber of Commerce (ICC) and the HRH Prince of Wales International Business
Leaders Forum (IBLF).

  ITC is the first Corporate to receive the Annual FICCI Outstanding Vision
Corporate Triple Impact Award in 2007 for its invaluable contribution to the triple
bottom line benchmarks of building economic, social and natural capital for the nation.
  ITC has won the Golden Peacock Awards for 'Corporate Social Responsibility (Asia)'
in 2007, the Award for „CSR in Emerging Economies 2005‟ and „Excellence in
Corporate Governance' in the same year. These Awards have been instituted by the
Institute of Directors, New Delhi, in association with the World Council for Corporate
Governance and Centre for Corporate Governance

ITC's cigarette factory in Kolkata is the first such unit in India to get ISO 9000 quality
certification and the first among cigarette factories in the world to be awarded the ISO
14001 certification

  ITC Maurya in New Delhi is the first hotel in India to get the coveted ISO 14001
Environment Management Systems certification.

  ITC Filtrona is the first cigarette filter company in the world to obtain ISO 14001

  ITC Infotech finds pride of place among a select group of SEI CMM Level 5
companies in the world.

  ITC's Green Leaf Threshing plant in Chirala is the first in India and among the first 10
units in the world to bag the Social Accountability (SA 8000) certification

ITC Chairman Y C Deveshwar has received several honors over the years. Notable
among them are:

      Year      Award

      2007      SAM/SPG Sustainability Leadership Award conferred at the
                International Sustainability Leadership Symposium, Zurich.
      2006      Business Person of the Year from UK Trade & Investment, the
                UK Government organisation that supports overseas businesses in
                that country.
      2006      Inducted into the `Hall of Pride' by the 93rd Indian Science
                Congress
      2005      Honoured with the Teacher's Lifetime Achievement Award
      2001      Manager Entrepreneur of the Year from Ernst & Young Retail
                Visionary of the Year from Images, India's only fashion and retail
                trade magazine
      1998      Honorary Fellowship from the All India Management Association
      1996      Distinguished Alumni Award from IIT, Delhi
      1994      Marketing Man of the Year from A&M, the leading marketing
                magazine
      1986      Meridien Hotelier of the Year
ITC has won the 'Enterprise Business Transformation Award' for Asia Pacific
(Apac), instituted by Infosys Technologies and Wharton School of the University of
Pennsylvania for its celebrated e-Choupal initiative.

  ITC is the only Indian FMCG Company to have featured in the Forbes 2000 list.
The Forbes 2000 is a comprehensive ranking of the world's biggest companies,
measured by a composite of sales, profits, assets and market value. The list spans 51
countries and 27 industries.

  ITC continues its dominance of The Economic Times' Brand Equity listing of
India's 100 Biggest FMCG Brands, with three brands from its stable making it to the
top five. Gold Flake remains India's biggest FMCG brand in terms of sales. Navy Cut
ranks at No. 4. ITC's Scissors brand ranks at No 5 and is the only new entrant into the
top 10.

   Restaurant magazine has chosen Bukhara at the ITC Maurya, New Delhi as the best
Indian restaurant in the world and the best restaurant in Asia. Bukhara has also been
adjudged one of the top 50 restaurants in the world by the London based magazine
'The Good Food Guide'. Bukhara is the only South Asian restaurant to figure in the
list.

  ITC's Lifestyle Retailing Business Division (LRBD) has won the "Best Supply
Chain Practices Award" for time-effective and cost-efficient Logistics Management
in Organized Retail. The awards were organized by Retailers Association of India (rai)
in association with ITW Signode - the International leaders in packaging solutions.

                           ITC’s market strategies are:

   Create multiple drivers of growth by developing a portfolio of world class businesses
that best matches organizational 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.




Sustain ITC's position as one of India's most valuable corporations through world class
performance, creating growing value for the Indian economy and the Company‟s stakeholders




To enhance the wealth generating capability of the enterprise in a globalising environment,
delivering superior and sustainable stakeholder value



ITC's EHS Policy

ITC‟s mission is to sustain and enhance the wealth-generating capacity of its portfolio of
businesses in a progressively globalising environment. As one of India‟s premier
corporations employing a vast quantum of societal resources, ITC seeks to fulfil a larger
role by enlarging its contribution to the society of which it is a part. The trusteeship role
related to social and environmental resources, aligned to the pursuit of economic
objectives, is the cornerstone of ITC‟s Environment, Health and Safety philosophy. ITC‟s
EHS philosophy cognises for the twin needs of conservation and creation of productive
resources.

In the multi-business context of ITC, Corporate Strategies are designed to create enduring
value for the nation and the shareholder, through leadership in each business and the
attainment of world-class competitive capabilities across the value chain. The objective
of leadership extends to all facets of business operations including Environment, Health
and Safety.

ITC is, therefore, committed to conducting its operations with due regard for the
environment, and providing a safe and healthy workplace for each employee. Various
international and national awards and accreditations stand testimony to ITC‟s
commitment to EHS. Such external recognition further reinforces the need to direct the
collective endeavour of the Company‟s employees at all levels towards sustaining and
continuously improving standards of Environment, Health and Safety in a bid to attain
and exceed benchmarked standards, whether regulatory or otherwise.




In particular, it is ITC’s EHS policy -

       To contribute to sustainable development through the establishment and
        implementation of environment standards that are scientifically tested and meet
        the requirement of relevant laws, regulations and codes of practice.
       To take account of environment, occupational health and safety in planning and
        decision-making.
       To provide appropriate training and disseminate information to enable all
        employees to accept individual responsibility for Environment, Health and Safety,
        implement best practices, and work in partnership to create a culture of
        continuous improvement.
       To instil a sense of duty in every employee towards personal safety, as well as
        that of others who may be affected by the employee‟s actions.
       To provide and maintain facilities, equipment, operations and working conditions
        which are safe for employees, visitors and contractors at the Company‟s premises.
       To ensure safe handling, storage, use and disposal of all substances and materials
        that are classified as hazardous to health and environment.
       To reduce waste, conserve energy, and promote recycling of materials wherever
        possible.
       To institute and implement a system of regular EHS audit in order to assure
        compliance with laid down policy, benchmarked standards, and requirements of
        laws, regulations and applicable codes of practice.
       To proactively share information with business partners towards inculcating
        world-class EHS standards across the value chain of which ITC is a part.

All employees of ITC are expected to adhere to and comply with the EHS Policy and
Corporate Standards on EHS.

ITC‟s EHS Policy extends to all sites of the Company. It will be the overall responsibility
of the Divisional/SBU Chief Executives, through the members of their Divisional
Management Committees, General Managers and Unit Heads, to ensure implementation
of this Policy and Corporate Standards on EHS, including formation of various
committees and designating individuals for specific responsibilities in respect of their
Division/SBU.

The Corporate EHS Department is responsible for reviewing and updating Corporate
Standards on EHS, and for providing guidance and support to all concern.




Corporate Governance

Preamble

Over the years, ITC has evolved from a single product company to a multi-business
corporation. Its businesses are spread over a wide spectrum, ranging from cigarettes and
tobacco to hotels, packaging, paper and paperboards and international commodities trading.
Each of these businesses is vastly different from the others in its type, the state of its
evolution and the basic nature of its activity, all of which influence the choice of the form of
governance. The challenge of governance for ITC therefore lies in fashioning a model that
addresses the uniqueness of each of its businesses and yet strengthens the unity of purpose of
the Company as a whole.

Since the commencement of the liberalisation process, India's economic scenario has begun
to alter radically. Globalisation will not only significantly heighten business risks, but will
also compel Indian companies to adopt international norms of transparency and good
governance. Equally, in the resultant competitive context, freedom of executive management
and its ability to respond to the dynamics of a fast changing business environment will be the
new success factors. ITC's governance policy recognises the challenge of this new business
reality in India.

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, we believe 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 :

  i.   Management must have the executive freedom to drive the enterprise forward
       without undue restraints; and
 ii.   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 fulfíls 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 jeopardising 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. We believe 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. We believe 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. We believe that unethical behaviour corrupts organisational culture and
undermines stakeholder value.
                        ITC Ltd. Policy on Human Rights


ITC believes that all its employees must live with social and economic dignity and
freedom, regardless of nationality, gender, race, economic status or religion. In the
management of its businesses and operations therefore, ITC ensures that it upholds the
spirit of human rights as enshrined in existing international standards such as the
Universal Declaration and the Fundamental Human Rights Conventions of the ILO.

Policy
ITC upholds international human rights standards, does not condone human rights
abuses, and creates and nurtures a working environment where human rights are
respected without prejudice.

Implementation
The Corporate Human Resources function of ITC is responsible for the Human Rights
Policy design, implementation and updation.The policy is implemented at all locations of
ITC through a set of separate policies and procedures covering each of the main
constituents of human rights applicable at the workplaces.
Monitoring&Audit
The assessment procedures for different constituents of this policy are defined against
each specific policy.

Consideration of Human Rights Impacts Across the Supply
Chain

As a large and multi-product enterprise whose products are benchmarked nationally and
internationally, ITC's main supply chains can be grouped as follows:

   1. For all its operations, technology, machinery and equipment are sourced from
      reputed and globally benchmarked suppliers/vendors who are expected to follow
      internationally accepted norms and standards on human rights.
   2. ITC's major businesses are vertically integrated across several Divisions. A
      substantial part of the supply chain is therefore internal through strategic
      backward linkages. Common values relating to human rights performance are
      shared across this supply chain.
   3. Being a major agri-based company, the agriculture sector is a major supplier of
      inputs for its operations. The bulk of agricultural commodities are procured from
      state controlled trading platforms and the open market.

A very small proportion of ITC's business consists of supply chains comprising local
vendors and suppliers. The policy framework for such entities is enunciated separately in
'Policy to Ensure Respect for Human Rights across the Supply Chain'.




Policy to Prevent Discrimination at Workplace

ITC acknowledges that every individual brings a different and unique set of perspectives
and capabilities to the team. A discrimination-free workplace for employees provides the
environment in which diverse talents can bloom and be nurtured. This is achieved by
ensuring that a non-discrimination policy and practice is embedded across the Company
in line with corporate principles and benchmarked business practices.

Policy
ITC's approach to its human resources is premised on the fundamental belief in fostering
meritocracy in the organisation which, pari passu, promotes diversity and offers equality
of opportunity to all employees. ITC does not engage in or support direct or indirect
discrimination in recruitment, compensation, access to training, promotion, termination
or retirement based on caste, religion, disability, gender, age, race, colour, ancestry,
marital status or affiliation with a political, religious, or union organization or minority
group.
Implementation
The policy is communicated to all employees through induction programmes, policy
manuals and intranet portals.

The custodian of this policy is the head of each operational unit and Divisional Chief
Executives of the respective business.

ITC's complaints resolution procedure is premised on the freedom of employees to
approach higher officials beyond his/her immediate superior. For the unionised
employees, compliance of the policy is ensured through a robust grievance handling
procedure and the presence of a union that brings violations to the notice of the unit HR
head.

Monitoring&Auditing
The accountability for the application of the non-discrimination employment policy rests
with the Unit Head who reviews anti-discriminatory complaints annually or on a case-by-
case basis.

The Corporate Human Resources function conducts non-discrimination reviews annually
on a sample basis with unit heads and through on-site assessments




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


ITC believes that all its employees must live with social and economic dignity and
freedom, regardless of nationality, gender, race, economic status or religion. In the
management of its businesses and operations therefore, ITC ensures that it upholds the
spirit of human rights as enshrined in existing international standards such as the
Universal Declaration and the Fundamental Human Rights Conventions of the ILO.

Policy

ITC upholds international human rights standards, does not condone human rights
abuses, and creates and nurtures a working environment where human rights are
respected without prejudice.

Implementation
The Corporate Human Resources function of ITC is responsible for the Human Rights
Policy design, implementation and updation.

The policy is implemented at all locations of ITC through a set of separate policies and
procedures covering each of the main constituents of human rights applicable at the
workplaces.

Monitoring & Audit

The assessment procedures for different constituents of this policy are defined against
each specific policy.




Consideration of Human Rights Impacts Across the Supply Chain

As a large and multi-product enterprise whose products are benchmarked nationally and
internationally, ITC's main supply chains can be grouped as follows:

   1. For all its operations, technology, machinery and equipment are sourced from
      reputed and globally benchmarked suppliers/vendors who are expected to follow
      internationally accepted norms and standards on human rights.
   2. ITC's major businesses are vertically integrated across several Divisions. A
      substantial part of the supply chain is therefore internal through strategic
      backward linkages. Common values relating to human rights performance are
      shared across this supply chain.
   3. Being a major agri-based company, the agriculture sector is a major supplier of
      inputs for its operations. The bulk of agricultural commodities are procured from
      state controlled trading platforms and the open market.

A very small proportion of ITC's business consists of supply chains comprising local
vendors and suppliers. The policy framework for such entities is enunciated separately in
'Policy to Ensure Respect for Human Rights across the Supply Chain'



Policy to Ensure Respect for Human Rights Policy across the Supply
Chain
ITC provides products and services of superior quality and value by sourcing its
technologies, equipment and inputs from reputed international and Indian manufacturers
and suppliers. Common values, relating to human rights performance, are shared across
the entire supply chain because ITC is committed to the importance of a socially
responsible and accountable supply chain.

Policy

ITC nurtures an internal working environment which respects human rights without
prejudice. Likewise, it expects its business partners to establish a human rights compliant
business environment at the workplace.

Implementation

The responsibility for implementation of this policy rests with the Divisional Chief
Executive of the concerned business and the Unit Manager. The policy is communicated
internally through policy manuals and intranet portals, and externally by the HR
personnel of concerned units to vendors/suppliers.

Monitoring & Audit

ITC has established a policy intent for mapping/monitoring progress and performance of
existing and potential vendors/suppliers on human rights performance.




Policy to Prevent Discrimination at Workplace
ITC acknowledges that every individual brings a different and unique set of perspectives
and capabilities to the team. A discrimination-free workplace for employees provides the
environment in which diverse talents can bloom and be nurtured. This is achieved by
ensuring that a non-discrimination policy and practice is embedded across the Company
in line with corporate principles and benchmarked business practices.


Policy

ITC's approach to its human resources is premised on the fundamental belief in fostering
meritocracy in the organisation which, pari passu, promotes diversity and offers equality
of opportunity to all employees. ITC does not engage in or support direct or indirect
discrimination in recruitment, compensation, access to training, promotion, termination
or retirement based on caste, religion, disability, gender, age, race, colour, ancestry,
marital status or affiliation with a political, religious, or union organization or minority
group.

Implementation

The policy is communicated to all employees through induction programmes, policy
manuals and intranet portals.

The custodian of this policy is the head of each operational unit and Divisional Chief
Executives of the respective business.

ITC's complaints resolution procedure is premised on the freedom of employees to
approach higher officials beyond his/her immediate superior. For the unionised
employees, compliance of the policy is ensured through a robust grievance handling
procedure and the presence of a union that brings violations to the notice of the unit HR
head.

Monitoring & Auditing

The accountability for the application of the non-discrimination employment policy rests
with the Unit Head who reviews anti-discriminatory complaints annually or on a case-by-
case basis.

The Corporate Human Resources function conducts non-discrimination reviews annually
on a sample basis with unit heads and through on-site assessments.




Policy on Freedom of Association
ITC's culture is characterized by cooperative relationships and high employee
involvement that relies on building partnerships and interdependence. Adhering to these
principles has helped build, sustain and strengthen harmonious employee relations in the
organisation.


Policy

ITC respects the employees' right to organize themselves into interest groups as
initiatives of the workers, independent from supervision by the management. In keeping
with the spirit of this Policy, employees are not discriminated against for exercising this
right.

Implementation

The policy is communicated to all employees through induction programmes, policy
manuals and intranet portals.

The custodian of this policy is the HR head of each operational unit who reports directly
to Unit Head on such issues.

The actualisation of this policy is evident from the joint agreements and minutes that are
signed between the union and the management.

Monitoring & Audit

Each ITC Unit has appropriate systems and checks to ensure compliance with the Policy
and statutory provisions, including means for filing of grievances, collective bargaining
agreements and minutes from worker meetings.
Compliance with the Policy is regularly monitored by Divisional and Corporate HR.
Policy Prohibiting Child Labour and Preventing Forced Labour from
Workplace

The foundation of ITC's "No Child or Forced Labour policy" is based on the Company's
commitment to find practical, meaningful and culturally appropriate responses to support
the elimination of such labour practices. It thus endorses the need for appropriate
initiatives to progressively eliminate these abuses.

Policy
ITC does not employ any person below the age of eighteen years in the workplace.

ITC prohibits the use of forced or compulsory labour at all its units. No employee is
made to work against his/her will or work as bonded/forced labour, or subject to corporal
punishment or coercion of any type related to work.

Implementation
This policy is publicly available throughout the Company and clearly communicated to
all employees in a manner in which it can be understood through induction programmes,
policy manuals and intranet portals.

The responsibility for the implementation of the policy rests with the Units HR
Department and the security staff who do not permit underage persons to enter the factory
as workers.

Employment contracts and other records documenting all relevant details of the
employees, including age, are maintained at all units and are open to verification by any
authorized personnel or relevant statutory body.

Compliance with the policy is evident in the transparent system of recruitment and the
policy of exit interviews which are undertaken by a manager not directly connected with
the employee. For the unionised employees, compliance is also ensured through a robust
grievance handling procedure and the presence of a union that brings violations to the
notice of the unit HR head.

Monitoring & Audit
Sample checks of the records are undertaken annually by Corporate Human Resources
function.

Audit and assessment is undertaken annually by Corporate Internal Audit and the
Environment, Occupation Health and Safety function.
Policy on Information and Consultation on Changes

ITC's core values support an employee engagement process that aligns its employees
with a shared vision and purpose of the Company in the belief that every individual
brings a different perspective and capability to the team. ITC thus harnesses the creative
potential of all its employees by promoting a culture of partnerships to unleash relevant
synergies between different groups of employees.

Policy

All major changes in operations involving work processes, manning norms and other
productivity linked issues are carried out after discussions with the employees and the
recognized unions at each location.

Implementation

Business plans are shared with employees at all units through a series of formal
communication meetings, and through the intranet portals. Unionised employees at the
concerned units are informed of all major changes well in advance through their
representatives.

The responsibility for the implementation of the policy rests with the Unit's HR
Department in the case of unionized employees and with the concerned Divisional
Management Committees for other employees.

The employees are given enough time to consider the implications of change and an
opportunity to discuss their apprehensions, if any, with the management.

The Policy is actualised through consultative meetings with representatives of employees,
culminating in joint minutes/agreements.
Monitoring & Auditing
Compliance with the Policy is regularly monitored by the Unit Head.




HIV/AIDS: Policy Guidelines

Background

ITC is committed to providing a safe and healthy work environment to all its employees.
These policy guidelines on HIV/AIDS are an endorsement of this commitment and, in
particular, of the Company's commitment to specific programmes and actions in response
to the HIV epidemic.

The Company's position is based on scientific and epidemiological evidence that people
with HIV/AIDS do not pose a risk of transmission of the virus to co-workers by casual,
non-sexual contact in the normal work setting.

Policy Guidelines

Compliance
The Company's policies on HIV/AIDS with regard to its employees will, at a minimum,
comply with all relevant Central and State legislation and the Company will implement
all policies and directions of the Government regarding HIV/AIDS whenever issued.

   1. Prevention through Awareness
      The Company will provide to all its employees sensitive, accurate and the latest
      information about risk reduction strategies in their personal lives, with the
      objectives of reducing the stigma of HIV/AIDS, encouraging safe behaviour and
      improving understanding of treatment.
   2. Safe and Healthy Workplace
      The Company is committed to providing a safe and healthy workplace to all its
      employees. It is the Company's objective that employees will have access to
      health services to prevent and manage HIV/AIDS.
   3. Non-discrimination
      The Company will not discriminate against any employee infected by HIV/AIDS
      with regard to promotions, training and other privileges and benefits as applicable
      to all employees.
         i.   A HIV positive employee will be allowed to continue to work in his/her
              job unless
       • Medical conditions interfere with the specific job being done, in which case
       reasonable alternative working arrangements will be made; or

       • The employee is incapacitated to perform his/her duties and is declared
       medically unfit by a medical doctor, in which case the employee will be assisted
       to rehabilitate himself/herself outside the Company.

         ii.The Company will not make pre-employment HIV/AIDS screening
            mandatory as part of its fitness to work assessment. Screening of this kind
            refers to direct methods (HIV testing), indirect methods (assessment of
            risk behaviour), and questions about HIV tests already taken.
       iii. HIV/AIDS test will not be part of the annual health check-ups unless
            specifically requested for by an employee.
   4. Confidentiality

Voluntary testing for HIV/AIDS when requested for by the employee, will be carried out
by private or community health services and not at the workplace.

There will no obligation on the part of the employees to inform the Company about their
clinical status in relation to HIV/AIDS.

Information on clinical diagnosis of an employees' status in terms of his/her HIV/AIDS
status if advised to the Company, will be kept strictly confidential.

Management Approach
Policy: The Company's commitment in the area of economic performance is
encapsulated in its Vision statement, which is 'to sustain ITC's position as one of India's
most valuable corporations through world-class performance, creating growing value for
the Indian economy and the Company's stakeholders'. ITC's Mission is 'to enhance the
wealth generating capability of the enterprise in a globalising environment delivering
superior and sustainable stakeholder value'.

The Company's strategy is to ensure that each of its businesses is world-class and
internationally competitive in the Indian global market in the first instance, and
progressively in the offshore global markets.
ITC, as a premier 'Indian' enterprise, consciously exercises the strategic choice of
contributing to and securing the competitiveness of the entire value chain of which it is a
part. This philosophy has shaped the Company's approach to business into 'a commitment
beyond the market'.


Goals and Performance: At the enterprise level the Company's goals include:

      Sustaining ITC's position as one of India's most valuable corporations
      Achieving leadership in each of the business segments within a reasonable time
       frame
      Achieving a Return on Capital Employed (ROCE) in excess of the Company's
       cost of capital, at all times

Amongst listed companies in the private sector, ITC ranked 4th in terms of Gross
Turnover and 3rd in terms of pre-tax profits for the financial year ended 31st March
2006. The Company ranked 6th by market capitalisation amongst listed private sector
companies in the country, as at 31st March 2006.

The Company has consistently achieved a ROCE well in excess of its cost of capital. Of
the Rs.10,325 crores of 'value added' by the Company during the financial year ended
31st March 2006, 74% represented Contribution to the Exchequer.

Please refer to the 'Report of the Directors and Management Discussion and Analysis'
section of the Report and Accounts 2006 (available on itcportal.com) for a detailed
discussion on the Company's market standing in each of the business segments.

Context: Please refer to the 'Report of the Directors and Management Discussion and
Analysis' section of the Report and Accounts 2006 for a detailed discussion on the
business environment, opportunities, key challenges, etc. pertaining to each of the
Company's businesses (available at www.itcportal.com).
   ITC Ltd.
 GHAZIABAD
UTTAR PRADESH
    INDIA
ITC limited is one of the top three private sector companies in India. It is a market leader
in India in Cigarettes & Tobacco, hotels, packaging, specialty papers and paperboards. It
has also entered into the life style retailing business with the lunch of the “wills sports”
range of relaxed wear. It has also spin off its information technology (I.T) business into a
wholly owned subsidiary to more aggressively pursue emerging opportunities.
ITC has a market capitalization of around US $ 4 billion and a turnover of over US $
1.8billion. It employees 12,000 employees at over 60 locations across India, and
nearly1,50,000 shares holders.
Over the years, ITC has evolved from a single product company to a multi-business
corporation. Its businesses are spread over a wide spectrum, ranging from cigarettes and
tobacco to hotels, packaging, paper and paperboards and international commodities
trading.

Each of these businesses is vastly different from the others in its type, the state of its
Evolution and the basic nature of its activity, all of which influence the choice of the
form of Governance. The challenge of governance for ITC therefore lies in fashioning
a model that Addresses the uniqueness of each of its businesses and yet strengthens
the unity of purpose of the Company as a whole.

Since the commencement of the liberalization process, India's economic scenario has
begun to alter radically. Globalization will not only significantly heighten business
risks, but will Also compel Indian companies to adopt international norms of
transparency and good Governance. Equally, in the resultant competitive context,
freedom of executive management and its ability to respond to the dynamics of a fast
changing business environment will be the new success factors. ITC's governance
policy recognizes the challenge of this new business reality in India.

                  Indian leafs Tobacco Development (ILTD) division
The leaf & tobacco arm of ITC Ltd. For over 9 decades, has pioneered the cultivation and
development of cigarette tobacco in India. It is instrumental in making India succeed in
the global cigarette tobacco market. ITC-ILTD is head quartered (HQ) at Guntur, in the
state of Andhra Pradesh, the biggest agro-commercial center for tobacco. Mysore is the
gateway to cigarette tobacco in the state of Karnataka. Sustaining ILTD” leadership in the
leaf business by combining the virtues of tradition with modernity, and delivering goods
and services efficiently with a personal touch.

ITLD give one key to superior business performance, it is his ability to turn the
perceptions capabilities, and relationships of our people into the building blocks of the
organization. His track record, so far, stands testimony to this recognition and the future
will be no different.
                                Tobacco & it’s processing
            ITLD is controlling from tobacco seed to finally tobacco. ITLD give
       adoption of contemporary Agro- techniques and the enterprising sprit of the
       tobacco farmer have led to India being aknow-ledged as one of the most
       important tobacco producing countries in the world. Topical climate Coupled with
       two monsoons facilitates the Indian farmer to grow tobacco throughout the gear.
       Tobacco cultivation in India is spread over a large geographical area covering a
       wide range of Soils, each growing area producing a unique style of tobacco .The
       southern states of India, Andhra Pradesh and Karnataka are the Prime cigarette
       type tobacco growing regions with 4,00,000 hectares land under Tobacco
       cultivation. India is recognized as an ideal source for a variety of tobacco,
       offering sustainable quality produce at competitive prices through out the Year.

ITLD‟s green leaf threshing (GLT) plants with a total capacity to process 520 metric
Tones per day are comparable with the best in the world. They are fully automated with
the latest equipment to process and deliver 100 million Kg‟s of high quality tobacco
every year. It is no surprise that they enjoy ISO9002 and ISO14001 accreditations. He
have two processing lines in the southern state of Andhra parades - chirala with 3
processing lines and antipathy with 1 processing line. Chirala unit is first unit in India
who has received the “Coveted Social Accountability Standard Certification (SA 8000).
This unit” ware housing facilities are benchmarked to international standard for hygiene
and infestation control. ILTD have large wear housing capacity to stock around 100
M.Kg of finishes produce (Tobacco).

                                Production process of cigarettes: -
The production of cigarettes in ILTD two major process. One is primary process which
includes So many sub processes, which we discussed later, and other is secondary
process which includes final packing of cigarettes and lots etc.


                                 Primary process of cigarettes: -
Under this process ILTD start from the leaf cutting, which he received from his GLT unit chirala.
Chirala supply leaf all the production units of ILTD in 200kg size pack.
Production unit start from there point, First of all production unit cuts 200kg.pack in to 5 -
6 piece and put in to machine which give moisture 10-11% to 21%of leaf and up to 38%
of stamc. After that he cut it into 30 cut and per inch length 140 cuts per inch length
respectively through cottoned rolled squire (CRS). After the processing of cutting leaf he
possesses through drying process and these times tobaccos have up to 15% moisturizer.
When tobacco is cooled then he is passed into secondary proem. Before passes secondary
proem both type of cutting result [Leaf and stems] is mixed up. The tobacco carmines and
stems are then cooled and stacked in bins-ready to be rolled into cigarettes.

                              Production division of ILTD
India leaf tobacco development (ILTD) is a major department of ITC which have four
major production division across the country such as Bang lore, (Karnataka) munger
(Bihar), Saharanpur (U.P.)& Kolkatta (W.B). These all four-production division is
producing billion cigarettes per year.
One thing is cam man amery all production division is that all units producing will‟s
brand and other brand of IRC is depended upon the regional requirement of cigarettes.
Wills is most valuable brand of ITC Ltd. And his share of total sales is % appox.
Brand, name and his length are as follows: -.




Brand, name and his length are as follows: -.


 S.No.         Brand Name             Filter/with out Filter Length
 1       Classic                      Filter                   82 mm
 2       Gold Flake (King)            Filter                   82 mm
 3       Gold Flake (Premiums)        Filter                   69 mm
 4       Wills Navy Cut               Filter                   74 mm
 5       Capstan Fl                   Filter                   69 mm
 6       Bristol                      Filter                   69 mm
 7       Wills Flake                  Filter                   69 mm
 8       Scissors                     Filter                   69 mm
 9       Scissors                     Filter                   69 mm
 10      Capstan Standard             With out                 58 mm
 11      Bristol Standard             With out                 58 mm
 12      India King                   Filter                   82 mm
Marketing Division
ILTD have four marketing office for maintaining advertising and promotined activities. It
maintains supply of cigarette all over India. There office is situated are as follows-
1. Jalandar (Punjab)
2. Saharanpur (U.P)
3. Delhi (Capital Marking office)
4. Kanpur (U.P)


                          Secondary process of cigarette production
After making tobacco by primary process. Then begins the one rouse task of giving shape
to the cut tobacco and dressing it up in cigarette paper. The processed tobacco is spread
every on cigarette paper from roll that is anywhere from 4000 to 6000 meters in length.
Then some thing like a long pencil is formed. This pencil of tobacco column rolled into
cigarette paper is then cut into predermined sections depending on the length of the
cigarette.
After that, double length filters are inserted between every two cigarette and cut in half
with a strong blade.
The cigarettes get collected in aluminum trays which are then stored under controlled
conditions of temperature and humidity. After storage for a few hours these are taken to
the packers machine, which pack the cigarettes sticks into pack of 10‟s and 20‟s.


                                 Working Area of ITC Ltd
ITC is now a day‟s doing eight (8) major area of production, distribution and servicing.
these are as follows-


A. Cigarettes and Tobacco.
B. Hotels.
C. Packaging
D. Paper board & Specialty paper
E. Information Technology (IT)
F. Life style retailing
G. Agro-Exports
H. Group Companies etc


A. Cigarettes and Tobacco: - ITC buys nearly 50% of all cigarettes types tobacco
   grown in India. It has been India “single largest integrated sources of quality tobacco
   for customer” in 37 countries over the last 6 decades. ITC‟s Comprehensive and
   sophist6icated R&D facilities cover all aspects of cultivation. Processing and
   packaging. ITC to process and deliver 100 million Kgs of high quality tobacco par
   Annam. ITC also co-operates with government agencies to develop new varieties of
   tobacco and to develop new areas for tobacco cultivation.


B. Hotels: - ITC entered into hotels field in 1975. He is giving best hospitality services
   in some field. ITC have 46 hotels across 42 destination all over India.




C. Packaging: - ITC also producing packaging items like-
       I. Flip top boxes.
       II.     Car board outers.
       III.    Shells and slides.
       IV.     Soft cup and strap labels
       V.      Bundle wraps
       VI.     Flap boxes
       VII.    Inner frames
       VIII.   Coupon inserts & Variety
       IX.     Folding crotons
The major unit (factory) which is producing packaging items- one is munger (Bihar) and
other is Tiruvottiyar hear chennai.
D. Paper Board & Specialty paper: - ITC has now integrates sits paperboard &
   specialty paper business into its newly created (PSPD), to how new strategic &
   operational synergies. ITC is one of the world” most modern and contemn porary
   manufactures of packaging (paper board) boards, with a manufacturing capacity of
   over 2,00,000 tones par year (1) packaging board coasted folding box boards, solid
   bleached sulphates board, white unit chipboard, liquid packaging board (2) cast
   coated papers and boards. The division also produced quality-


(a). Printing & Writing papers
(b). Eco- friendly papers
(c). Photo copier papers.


Specialty paper:- ITC is the premier manufacturer of specialty paper in India, with a
diversified product. Range ITC‟s specialty paper are used in the manufacturer of
cigarettes, decorative laminates. Electrical equipment, fire works and automotive factory
filters. They are also used for fire printing, packaging and carbonizing.
The division pioneered the manufacturer of specialty paper for Indian cigarette industry
in 1949.
It currently offers a comprehensive range of cigarette Tissues; plug Wray, tipping base,
printed tipping papers and metailising base.


E. Information Technology (IT): - ITC has recently spun off its 20 year old
   information system division into a wholly owned subsidiary to aggressively pursue
   growth opportunities in this sector. ITC Infotech India Ltd offer a powerful customer
   value proposition based on its in depth domain‟s know ledge gained from the
   experience of servicing a range of internal & external customers across diverse
   domains. -
1. FMCG
2. Hoteliering
3. Packaging
4. Paper boards
5. Specialty papers
6. International Trading Etc.
F. Life style retelling: - ITC also manufacturing ready made garments range of
      international quality of relaxed wear under the brand name “wills sport”. It have 48
      retail out across 38 cites in the country. Recently he also lunched another brand name
      “john players” offers complete range of contemn porary men‟s wear- like shirts,
      Trousers, t-shirts & denims. It also lunches in Nov. 2002 under brand name “ the
      classes collection”.


G. Agro-Exports: - ITC international business division (IBD) is doing Exports activities
      of
      Agriculture products and processed foods Etc. he exports following items to UK, US
and
      Another European countries-
1. Soya meal.
2. Rice
6. Aqua products.
7. Peanuts.
8. Coffee.
9. Wheat.
10. Sesame Seeds.
11. Black pepper
12. Processed & frozen fruits & vegetables.


H. Group Companies: - Main group companies-
a). ITC Hotels.
b). Surya Nepal private limited.
c). International travel house
d). Land base
Associate companies -ITC filtrona.
ITC A RESPONSIBLE CITIZEN

ITC is a responsible corporate citizen: -
ITC is doing so many activities for the welfare of society and darks as a responsible
corporate leader without any gap. Some of its major societal activation for the welfare of
different section of society is as follows-


a. Environment, health & safety (EHS)
b. Reaching out to society
c. Preserving national heritage.
d. Supporting sustainable development


a. Envoirment, health & Safety (EHS): - As a responsible corporate citizen, ITC
accords the highest priority to environment, occupational health, and safety. It is
committed to protecting the environment in which it operates. It is equally committed to
ensuring very high standard of safety at the work place.
   It is a relegations of ITC” high EHS standards that lit has been the recipient of several
   National and international awards- such as-


   ISO 14000
   Sword of honour
   Royal society of prevention of accidents awards.
   National safety awards.
   The corporate Environment award.
   The golden peacock environment management award.
   Excellence in pollution control management.
   Prashanna patra award.
   National Award for excellence in energy conservation.
b. Reaching out to society: - As a responsible corporate citizen, ITC promotes art,
culture and
      education. Besides working for the protection and enrichment of the environment and
      over all social development.
      Community development.
      Education.
      Protecting the environment.


c. Preserving National Heritage: - As a socially responsible corporate citizen, ITC
      Endeavors to creates value for the Indian society in multiple ways, one of them being
      Preservation of India” rich culture heritage ITC has made significant contribution to
the
      Promotion of Indian classical music, theatre, are and cuisine




GRADES FOR MANAGERS
         Senior Managers. (Managers)
         Middleman Managers.(Asst. Managers)
       Junior Managers. (Executives)


GRADES FOR WORKERS
         Unskilled Workers.
         Semi Skilled Workers.
         Skilled Workers.
         Highly Skilled Workers.
           ORGANISATION STRUCTURE / HIERARCHY


ITC a world leading electric company works as a Team System.
Hierarchy of this organization is as follows:


                       Unit Head (Managing Director)




                   Functional Heads (General Managers)




                       Departmental Heads (Managers)




                      Section In charge (Asst. Managers)




                             Supervisors (Executives)




                                        Workers
History
   ITC was incorporated on August 24, 1910 under the name of 'Imperial Tobacco
Company of India Limited'. Its beginnings were humble. A leased office on Radha Bazar
Lane, Kolkata, was the centre of the Company's existence. The Company celebrated its
16th birthday on August 24, 1926, by purchasing the plot of land situated at 37,
Chowringhee, (now renamed J.L. Nehru Road) Kolkata, for the sum of Rs 310,000. This
decision of the Company was historic in more ways than one. It was to mark the
beginning of a long and eventful journey into India's future. The Company's headquarter
building, 'Virginia House', which came up on that plot of land two years later, would go
on to become one of Kolkata's most venerated landmarks. The Company's ownership
progressively indianised, and the name of the Company was changed to I.T.C. Limited in
1974. In recognition of the Company's multi-business portfolio encompassing a wide
range of businesses - Cigarettes & Tobacco, Hotels, Information Technology, Packaging,
Paperboards & Specialty Papers, Agri-Exports, Foods, Lifestyle Retailing and Greeting
Gifting & Stationery - the full stops in the Company's name were removed effective
September 18, 2001. The Company now stands rechristened „ITC Limited‟.

ITC is one of India's foremost private sector companies with a market capitalization of
nearly 19505 cr. and a turnover of over is 12369 cr. ITC also ranks among India's top 10
`Most Valuable (Company) Brands', in a study conducted by Brand Finance and
published by the Economic Times. ITC was the first company in India to voluntarily seek
a corporate governance rating. 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 Most Respected Companies by Business World and among India's Most Valuable
Companies by Business Today.

ITC has a diversified presence in Cigarettes, Hotels, Paperboards & Specialty Papers,
Packaging, Agri-Business, Packaged Foods & Confectionery, Information Technology,
Branded Apparel, Personal Care, Greeting Cards, Safety Matches and other FMCG
products. While ITC is an outstanding market leader in its traditional businesses of
Cigarettes, Hotels, Paperboards, Packaging and Agri-Exports, it is rapidly gaining market
share even in its nascent businesses of Packaged Foods & Confectionery, Branded
Apparel and Greeting Cards.

ITC's wholly owned Information Technology subsidiary, ITC Infotech India Limited, is
aggressively pursuing emerging opportunities in providing end-to-end IT solutions,
including e-enabled services and business process outsourcing.

ITC's production facilities and hotels have won numerous national and international
awards for quality, productivity, safety and environment management systems. ITC was
the first company in India to voluntarily seek a corporate governance rating.

ITC employs over 21,000 people at more than 60 locations across India. The Company
continuously endeavors to enhance its wealth generating capabilities in a globalizing
environment to consistently reward more than 3,97,000 shareholders, fulfill the
aspirations of its stakeholders and meet societal expectations. This over-arching vision of
the company is expressively captured in its corporate positioning statement:


                              ITC Leadership

Flowing from the concept and principles of Corporate Governance adopted by the
Company, leadership within ITC is exercised at three levels. The Board of Directors at
the apex, as trustee of shareholders, carries the responsibility for strategic supervision of
the Company. The strategic management of the Company rests with the Corporate
Management Committee comprising the whole time Directors and members drawn from
senior management. The executive management of each business division is vested with
the Divisional Management Committee (DMC), headed by the Chief Executive. Each
DMC is responsible for and totally focused on the management of its assigned business.

This three-tiered interlinked leadership process creates a wholesome balance between the
need for focus and executive freedom, and the need for supervision and control.




Vision

           Sustain ITC’s position as one of India’s most valuable
              Corporation through world class performance,
            Creating growing value for the Indian economy and
                       the company’s stakeholders
Mission

                 To enhance the wealth generating capability
                of the enterprise in a globalizing environment,
                      delivering superior and sustainable
                               Stakeholder value
                              SWOT Analysis
The following point shows the internal and external factors affecting the market
opportunities for ITC. This SWOT analysis also shows ITC internal strengths such as
their experienced management team, a competitive product line, a global marketing
realm, and the continuous efforts by their research and development to research trends in
the industry and to be creative in exploiting those trends. Some possible opportunities
noted in the SWOT analysis are the growing markets for specialized ethnic foods and
healthier food products. Another opportunity is that the income of consumers is high
enabling them to be less price sensitive, and convenience is becoming evermore
important not only to the United States but to many countries around the world.

Although ITC has many strengths, a few weaknesses lie in the fact that the company is so
large and could possibly lose focus or have internal conflict problems. A few of the
threats ITC must stay aware of are the ease of replicability of its product line, the almost
pure competition in pricing for its products, and the quickness of technological advances
causing existing products to be no longer the most advanced.

                                  STRENGTHS
        Management
                 Experienced, broad base of interests and knowledge
        Product Line
                 Unique, tastes good, competitive price, and convenient
        Marketing
                 Diverse and global awareness
        Personnel
                 International, diverse positions
        International, diverse positions
                 High sales revenue, high sale growth, large capital base
        Manufacturing
                 Low costs and liabilities due to outsourcing of bottling
        Research & Development
                 Continuous efforts to research trends an reinforce creativity
        Consumer/Social
                 Huge market in the healthy products and growing market for specialized
                                    foods for ethnic groups
        Competitive
                   Distinctive name, product and packaging in with regards to its
       markets
        Technological
                  Internet promotion such as banner ads and keywords can increase their
        sales, and more computerized manufacturing and ordering processes can increase
                                        their efficiency
 Economic
               Consumer income is high, more tend to eat out, convenience is
                             important to U.S.
                              Weaknesses
 Management
              Large size may lead to conflicting interests
 Product Line
             New one calorie products have no existing customer base, generic
brands can make similar product – cheaper
 Marketing
           May lose focus, may not be segmented enough
 Personnel
      Possible conflicts due to so many people, possible trouble staying focused
 Finance
        High expenses may have trouble balancing cash-flows of such a large
                                 operation.
 Research & Development
         May concentrate too much on existing products, intrapreneuralship may
not be welcomed
 Consumer/Social
         More expensive products than Hul. Such a high price may limit lower
income families from buying an ITC product
 Competitive
         Not entirely patentable, constant replicability by competitors
 Technological
         Computer breakdowns, viruses and hackers can reduce efficiency, and
must constantly update products or other competitors will be more advanced
 Economic
         Very elastic demand, almost pure competition
                             Opportunities

       Expected 30% CAGR in organized market to result in better footfall and
        conversion rates.
       Entry into Tier 2 and Tier 3 cities.
       Collaboration with foreign players because of a national brand.
        An opportunity to diversify its operations in e-retailing.
       As big company of India can go globally.




                                        Threats
   Employee shortage and attrition due to rapid growth in the holl market .
   Impact of slowdown in consumer spends to be felt in FMCG market.
   Opening up of economy for free entry of foreign players.
                A SOCIAL CHARTER FOR BUSINESS
Few weeks ago, the Humble Prime Minister Dr Manmohan Singh presented a ten-point
'Social Charter' sharing his vision on the responsibility of corporate for sustainable and
inclusive growth. He said, and I quote, "Indian industry must rise to the challenge of
making our growth processes both efficient and inclusive. This is our endeavor in
Government. It will have to be yours too and I seek your partnership in making a success
of this giant national enterprise. If those who are better off do not act in a more socially
responsible manner, our growth process may be at risk, our polity may become anarchic
and our society may get further divided. I invite corporate India to be a partner in making
ours a more humane and just society." Unquote.

By the Y C Deveshwar mind, the Hon'ble Prime Minister's clarion call is not only a
responsibility that we, in Indian Business and Industry, must commit ourselves to but a
crying need that we cannot afford to neglect any longer. While we can justifiably be
proud of India's stellar performance in GDP growth, the growing inequity in sharing the
fruits of success is indeed a millstone that impedes the nation's true potential. Business
Corporations draw heavily on societal resources. Therefore, it is in the enlightened self-
interest of business to engage constructively in enlarging its contribution to the broader
social and environmental agenda. Competitiveness of firms can be severely threatened by
unsustainable environments and a lopsided social structure that creates islands of
affluence amidst a sea of poverty. A constructive public-private partnership for socially
responsible growth is imperative and must occupy a larger space in the future business
strategies of India's corporate sector.

You are indeed aware of the enormous importance of our rural engagement in the future
growth of your Company. We have constantly strived to meaningfully blend our social
responsibilities with business competitiveness, so that we can continue to create
shareholder value even as we enhance the benefits that accrue to rural communities. We
recognize that this is the path we must pursue to ensure sustainable and inclusive growth
- a philosophy that is central to the vision articulated by Prime Minister's Social Charter
for Business. I take immense pride that the vision enunciated by the Hon'ble Prime
Minister echoes the core values that your Company has enshrined in its management
philosophy and governance structure. We have indeed been 'practitioners' of this vision
for many years now. It gives me immense satisfaction that your Company has executed,
on a substantial scale, innovative business strategies which result in 'mainstreaming' the
disadvantaged sections of rural India.

ITC Ltd. Company's pioneering e-Choupal initiative today comprises 6,400 choupals
transforming the lives of over 3.5 million farmers in 38,500 villages in 9 States of India.
We hope to reach out to 10 million farmers in 100,000 villages in the not too distant
future. The Social and Farm Forestry Programme of ITC covers 65,000 hectares
providing over 28 million person days of employment among the disadvantaged. In the
process, we have also helped sequester over 2,000 kilotons of Carbon Dioxide as a firm
commitment to combating climate change. Your Company's Integrated Watershed
Development programmes in rural areas cover nearly 27,000 hectares providing critical
irrigation to water stressed areas. This year, we have also forged a milestone partnership
with the Government of Rajasthan for an integrated watershed development project
covering 5,000 hectares. ITC's initiatives to provide opportunities for non-farm incomes
through economic empowerment of women, supplementary education and integrated
animal husbandry services continue to make significant strides in rural empowerment.

As a nation, we face today a multi-dimensional challenge to chart a growth path that will
transform the lives of almost a third of our billion populations who live at the margin.
Surely, it is not a task that any single segment of society - be it Government or
Responsible Business - can hope to accomplish in isolation. It is true that sustained high
rates of GDP growth is one of the surest ways of creating livelihoods for the
disadvantaged. However, if such growth impulses do not envision or contain conscious
efforts to enhance social value, it is not necessary that high growth rates alone will ensure
social equity. In fact, there is a danger that competitive pressures may not actually lead to
development and growth in areas that need it the most.

ALIGNING FORCES OF FRANCHISE
Given the power of consumer franchise, how do we align forces amongst all the market
participants to support a new movement for innovative CSR?

To make 'consumer choice' a compelling market driver we would need to create a
supportive institutional framework to facilitate the process of making an informed choice
by market participants. Let me briefly elaborate on some of these enablers:

First, the Policy and Institutional Framework.

      Market participants would need an effective tool to make an informed choice in
       favour of a Responsible Corporation. I would suggest that Government support
       the development of a 'CSR Sustainability Trust mark', or a series of Trust marks
       defined by Industry segments, which could be displayed on products and services
       to convey to the consumer that the enterprise follows a strong commitment to
       building natural and social capital. Voluntary in nature, these Trust marks, crafted
       on sound scientific and market principles, will stand for the positive impact a
       company has made on the environment and the society. The Trust marks could
       also be supplemented with Ratings, based on the extent of the individual
       company's involvement in creating societal capital.
      The Trust marks need to be administered by a reputed and independent body or
       bodies, much like the financial rating agencies. An institutional framework and
       appropriate guidelines can be created by a Government-Industry partnership to
       provide organizational support and credibility.
      A major impetus can emerge out of Government's consideration to extend fiscal
       and financial concessions, priority clearance and other incentives to organizations
       that attain sustained high ratings. Government and its agencies could also give
       purchase preferences to suppliers with highly rated Trust marks.

Second, the role of Industry:

      In championing a sincere commitment to a Vision that embraces contribution to
       Society as a key component of business strategy.
      In moving towards voluntary disclosure of Triple Bottom Line performance in the
       Company's Annual Reports, verified by independent reputed third party
       organizations.
      In making a strong effort to attain the CSR Sustainability Trust marks, and
       displaying the same on their products and services.
      In enlarging the Company's contribution by giving preference to vendors with a
       strong CSR and Sustainability orientation.
      In developing a model code of responsible conduct by Industry bodies and
       associations for its members.
      In encouraging Modern Retail outlets to develop special sections that display and
       sell products with Trust marks.
      In providing support to the creation of Awards that recognize outstanding
       Sustainability Performance. This would provide a tremendous reputation asset and
       incentives CSR significantly.
      In strengthening reporting on Sustainability based on guidelines such as the
       Global Reporting Initiative. I am sure that the Indian operations of multinationals,
       not listed on Indian bourses, would also want to make such public disclosures and
       demonstrate their contribution to the Indian Society. I envisage a future where
       Sustainability Reporting will form an integral part of a firm's public disclosures,
       and will be valued by stakeholders in equal measure to the established practices of
       financial reporting.

Third, the role of Investors.

      Investors play a critical role in encouraging social accountability in corporate
       behavior. Globally, there are today hundreds of funds that invest in socially
       responsible enterprises. These funds rely on Sustainability Indices such as Dow
       Jones Sustainability World Index, FTSE4Good, Domini 400 Social Index and
       others to guide investment decisions. These funds have already channeled large
       amount of investors' savings into companies that have high social brand capital.
      India has witnessed some welcome developments in this direction in recent years.
       The ABN Amro Bank launched a Sustainable Development Fund as India's first
       Socially Responsible Investing Fund. Recently CRISIL, S&P and KLD have
       announced that they would develop an Environmental, Social and Corporate
       Governance (ESG) Index of Indian companies. The Institute of Chartered
       Accountants of India is also reported to be working on developing a similar
       evaluation.
      Individual investors, while seeking to maximise returns from their portfolio
       holdings, could exercise a powerful choice for companies with high Triple
       Bottom Line performance.
      Banks and Financial Institutions could ask for voluntary disclosures and factor the
       rating in their lending evaluations.

Fourth, the role of Civil Society organizations.

      Consumer awareness will benefit immensely if civil society organizations and
       consumer bodies actively advocate the usage of Trust marks. They could also
       promote awareness amongst constituents to support products and services of
       companies with higher Sustainability ratings.
      Schools and educational institutions could also promote awareness on responsible
       corporate behavior and its association with the Trust mark ratings on products and
       services, and design elements in their curriculum to groom citizens of tomorrow
       as enlightened consumers.
      And finally, the Media, as one of the most powerful forces of shaping public
       opinion, can make a multi-dimensional contribution in this direction.

It is my strong belief that by aligning such powerful forces, we will see the emergence of
a new consciousness where CSR will transcend from corporate philanthropy to a
competitive value proposition.

ITC has been instrumental in setting up the CII-ITC Centre of Excellence for Sustainable
Development, which is a unique institution that seeks to address the void in developing
requisite capability on Sustainability issues among Indian industry. The Centre endeavors
to bring about transformational change in Indian businesses by providing thought
leadership, promoting awareness and building capacity. One of the major initiatives of
the CII-ITC Centre is to recognize excellence in Sustainability practices by presenting
Awards to industry, based on a rigorous process of selection. This attempt to recognize
outstanding Sustainability initiatives is designed not only to celebrate individual
corporate action, but also to inspire others to follow.

ITC convinced that in today's enlightened India, more and more companies will respond
to the appeal made by the Hon'ble Prime Minister to forge partnerships for social action,
and achieve growth with efficiency and inclusively. Making markets work for CSR will
indeed provide the compelling foundation for such initiatives.
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
value.

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 tocompromising 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.
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.

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 / any other observed unethical
behaviour on the part of those covered under this Code should be brought to the attention
of the immediate reporting authority, who shall in turn report the same to the Head of
Corporate Human Resources Senior management for the purpose of this Code would
mean the following:
- Managers at Grade „A‟ & its equivalent, and above
- Divisional & SBU Chief Executives
- Corporate HODs
* This Code of Conduct, as adopted by the Board of Directors of the Company on 26th
    March, 2005, was amended on 29th March, 2006


ITC, 10 other Indian firms among world's 50 'Local Dynamos'


Going global is not the only trump card for an international recognition'. As 'many as 11
India companies, including the likes of ICICI Bank and Bharti Airtel, have made it to a
list of 50 'Local Dynamos' for mastering the dynamics of their domestic markets.

These 50 firms from the world's Rapidly Developing Economies (RDEs) are
"domestically focused, at least for now, and have devised formidable business models
with which to master the intense dynamics of their local markets," global consultancy
firm Boston Consultancy Group said in a report.

Other Indian companies in the list are two Tata Group entities Indian Hotels and Titan
Industries besides Amul; Apollo Hospitals, CavinKare Group, ITC Limited, NIIT, SKS
Micro finance and Subhiksha. Apart from the four BRIC countries - Brazil, Russia, India
and China - the list also Includes companies from Indonesia, Malaysia, Mexico, Poland,
Slovakia, Poland and Thailand.
The study titled "The BCG 50 Local Dynamos - How Dynamic RDE based companies
are mastering their home markets - and what MNCs need to learn from them" has 15
companies from China, including the internet search engine Baidu.com.

BCG said these companies were selected on the basis of criteria such as high growth and
original business model specifically adapted to the unique challenges posed by RDEs.
According to BCG, companies from RDEs are "staying home" and conquering their
domestic markets. Further, these firms are using innovative Business models to beat
MNCs and established domestic incumbents, many of which are state-owned entities.

BCG said ICICI Bank has an interest income of 5,196 million dollars as compared to its
MNC competitor, HSBC, which rakes in an interest income of 1,066 million dollars.
"Withs more than 950 branches and 24 million customers, it offers a diverse range of
financial products and services and competes well against local and foreign rivals," it
noted. Observing that the chosen Dynamos target their offerings mainly at the middle
class, the study said India has shown that companies can serve the poor profitably
provided they use "the right approach".

"In consumer goods, CavinKare entered the personal care market by selling shampoo in
affordable sachets to rural customers. Titan Industries produces more than seven million
watches a year... No-frills retailer Subhiksha has brought low prices and convenience to
the lives of many Indians by locating small supermarkets close' to its customers...," the
study added.




                               Privacy Policy

      ITC Limited welcomes you to its website and looks forward to a meaningful
       interaction with you.

      ITC Limited respects your right to privacy. Any personal information that you
       share with us, like your name, date of birth, address, marital status, telephone
       number, credit card particulars and the like, shall be entitled to privacy and kept
       confidential.

      ITC Limited assures you that your personal information shall not be
       used/disclosed by it, save for the purpose of doing the intended business with you,
       or if required to be disclosed under the due process of law.

      ITC Limited assures you that in the event of your personal information being
       shared with its subsidiaries, business associates etc., such sharing of information
       shall be for the purpose of doing the intended business with you.
      ITC Limited reserves its rights to collect, analyse and disseminate aggregate site
       usage patterns of all its visitors with a view to enhancing services to its visitors.
       This includes sharing the information with its subsidiaries, and business
       associates as a general business practice.

      In the course of its business ITC Limited may hold on-line contests and surveys as
       permitted by law and it reserves its right to use and disseminate the information so
       collected to enhance its services to the visitors. This shall also include sharing the
       information with its subsidiaries and business associates as a general business
       practice.

      If you have any questions or concerns regarding your privacy issues, please do not
       hesitate to contact ITC Limited at webmaster@itc.in

      While ITC Limited assures you that it will do its best to ensure the privacy and
       security of your personal information, it shall not be responsible in any manner
       whatsoever for any violation or misuse of your personal information by
       unauthorised persons consequent to misuse of the internet environment.

      Cookies :- To personalise your experience on our website or to support one of our
       promotions, we may assign your computer browser a unique random number
       called a cookie. "Cookies" enhance website performance in important ways like
       personalising your experience, or making your visit more convenient. Your
       privacy and security are not compromised when you accept a "cookie" from our
       website. ITC Limited does not use "cookies" to collect personal information.
       "Cookies" cannot read data from your computer‟s hard disk or read cookie files
       from other websites.

      ITC Limited reserves its rights to revise this privacy policy from time to time at
       its discretion with a view to making the policy more user friendly.

In the design of our website, we have taken care to draw your attention to this privacy
policy so that you are aware of the terms under which you may decide to share your
personal information with us. Accordingly, should you choose to share your personal
information with us, ITC Limited will assume that you have no objections to the terms of
this privacy policy.


A SOCIAL CHARTER FOR BUSINESS

A few weeks ago, the Hon'ble Prime Minister Dr Manmohan Singh presented a ten-point
'Social Charter' sharing his vision on the responsibility of corporates for sustainable and
inclusive growth. He said, and I quote, "Indian industry must rise to the challenge of
making our growth processes both efficient and inclusive. This is our endeavor in
Government. It will have to be yours too and I seek your partnership in making a success
of this giant national enterprise. If those who are better off do not act in a more socially
responsible manner, our growth process may be at risk, our polity may become anarchic
and our society may get further divided. I invite corporate India to be a partner in making
ours a more humane and just society." Unquote.

To my mind, the Hon'ble Prime Minister's clarion call is not only a responsibility that we,
in Indian Business and Industry, must commit ourselves to but a crying need that we
cannot afford to neglect any longer. While we can justifiably be proud of India's stellar
performance in GDP growth, the growing inequity in sharing the fruits of success is
indeed a millstone that impedes the nation's true potential. Business Corporations draw
heavily on societal resources. Therefore, it is in the enlightened self-interest of business
to engage constructively in enlarging its contribution to the broader social and
environmental agenda. Competitiveness of firms can be severely threatened by
unsustainable environments and a lopsided social structure that creates islands of
affluence amidst a sea of poverty. A constructive public-private partnership for socially
responsible growth is imperative and must occupy a larger space in the future business
strategies of India's corporate sector.

You are indeed aware of the enormous importance of our rural engagement in the future
growth of your Company. We have constantly strived to meaningfully blend our social
responsibilities with business competitiveness, so that we can continue to create
shareholder value even as we enhance the benefits that accrue to rural communities. We
recognise that this is the path we must pursue to ensure sustainable and inclusive growth -
a philosophy that is central to the vision articulated by Prime Minister's Social Charter for
Business.

I take immense pride that the vision enunciated by the Hon'ble Prime Minister echoes the
core values that your Company has enshrined in its management philosophy and
governance structure. We have indeed been 'practitioners' of this vision for many years
now. It gives me immense satisfaction that your Company has executed, on a substantial
scale, innovative business strategies which result in 'mainstreaming' the disadvantaged
sections of rural India.

Your Company's pioneering e-Choupal initiative today comprises 6,400 choupals
transforming the lives of over 3.5 million farmers in 38,500 villages in 9 States of India.
We hope to reach out to 10 million farmers in 100,000 villages in the not too distant
future. The Social and Farm Forestry Programme of ITC covers 65,000 hectares
providing over 28 million person days of employment among the disadvantaged. In the
process, we have also helped sequester over 2,000 kilotons of Carbon Dioxide as a firm
commitment to combating climate change. Your Company's Integrated Watershed
Development programmes in rural areas cover nearly 27,000 hectares providing critical
irrigation to water stressed areas. This year, we have also forged a milestone partnership
with the Government of Rajasthan for an integrated watershed development project
covering 5,000 hectares. Your Company's initiatives to provide opportunities for non-
farm incomes through economic empowerment of women, supplementary education and
integrated animal husbandry services continue to make significant strides in rural
empowerment.
As a nation, we face today a multi-dimensional challenge to chart a growth path that will
transform the lives of almost a third of our billion population who live at the margin.
Surely, it is not a task that any single segment of society - be it Government or
Responsible Business - can hope to accomplish in isolation. It is true that sustained high
rates of GDP growth is one of the surest ways of creating livelihoods for the
disadvantaged. However, if such growth impulses do not envision or contain conscious
efforts to enhance social value, it is not necessary that high growth rates alone will ensure
social equity. In fact, there is a danger that competitive pressures may not actually lead to
development and growth in areas that need it the most.

There is also a significantly large cost involved in implementing value-chains that are
socially inclusive. While commensurate returns may flow over the longer term, there are
indeed cost barriers, over the short to medium term, that inhibit investments in such
socially inclusive initiatives. In the absence of strong fiscal or financial incentives,
business enterprises would hesitate to raise such investments and commit physical and
human resources over a longer term. Therefore, it is important to examine how market
drivers can creatively facilitate such long-term investments which have larger societal
benefits. Corporates will be able to support a much larger social involvement in their
business strategies, if market forces facilitate such investments and returns.
                                   INTRODUCTION

My research report is entitled “A study of HR Practices in ITC”. Firstly I would like to
discuss about HR Practices.
What are HR Practices?


HR Practices are those practices which are been done by the organization for having
optimum utilization of human resource of the organization. These practices can be
explained as follows:


      Recruitment & Selection
      Training & Development
      Performance Appraisal System
      Evaluation System
      Feed Back Mechanism
      Rewards to Employees
      Work Remuneration of the employees


      Increment practices
                INTRODUCTION OF HRM


  Human resource management is the planning , organizing, directing, and controlling
of the procurement, development, compensation, integration, maintenance and separation
of human resources to the end that individual, organizational, and social objective are
accomplished.



                               FEATURES OF HRM
      Increased competition
      Emphasis on quality in staff, goods/services
      Flexibility in operations
      Willingness to adopt to changing market needs
      Global Market



                             OBJECTIVES OF HRM
      Integration of HRM policy with business goals/objectives
      Attainment of organizational objectives through human capital
      Creation of flexible work hours/function
      Creation of a flexible environment to be responsive to market ambience, as per
       the need of the dizzily fast packed and changing environment.
      Integration of people related issues with business issues, while bringing people
       related issues to the fore and advocating primacy of business needs.
                       MEANING & DEFINITION


“HRM is a management function that helps manager‟s recruit, select, train and develops
members for an organization obviously HRM is concerned with peoples dimension in
organizations”


HRM: - It is also a management function concerned with hiring motivating and
maintaining people in an organization.


It is a series of integrated decision that from the employment relationship; their quality
contributes to the ability of the organization and the employees to achieve their objective.
Human resource management is concerned with the people dimension in management.
since every organization is make up of people, acquiring their services, developing their
skill, motivating them to higher level of performance and ensuring that they continue to
maintain their commitment to the organization are essential to achieving organizational
objectives.
                    INTRODUCTION OF RECRUITMENT
The human resources are the most important assets of organization. The success or failure
of an organization is largely dependent on the caliber of the people working therein.
Without positive and creative contribution from people, organization can‟t progress a nd
prosper. In order to achieve the goals and perform the activities of an organization,
therefore we need to recruit people with requisite, skills, qualification and experience.
While doing so we have to keep the present as well as future requirements of the
organization in mind.



                                     OBJECTIVE
    To effectively manage the manpower recruitment in coherence with long term and
short term manpower planning of the organization through a standard recruitment and
selection policy.
    To proactively and systematically identify the recruitment needs in time. To ensure
that all the recruitment are within the manpower budget and as per the laid down policy.
    The recruited people with required level of skilled and aptitude for learning and
growth.
                                       SCOPE:
This policy shall apply to all PERMANENT management position in the company
including the workmen.


IDENTIFICATION OF VACANT POSITIONS
          1. Total permanent manpower strength/budget for organization has been
             sanctioned by the board of directors.
          2. All the recruitment has necessarily to be made within the approved
             budget/strength only.
          3. Vacancies against the sanctioned budget may arise due to:
                    Retirement
                    Turnover
                    Natural Separation


          4. whenever a vacancy arise, the concerned department has to fill up the
          prescribed manpower requisition form clearly indication the job description and
          specification, time frame and send it to HR department .
HR PLANNING


               HRP is the process of forecasting an organization‟s future demand for and
supply of, the right type of people in the right number. It is only after this that the HRM
department can initiate the recruitment and selection process. HRP is the sub-system in the
total organizational planning. Organizational planning includes managerial activities that
set the company‟s objective. HRP facilitates the realization of the company‟s objectives by
providing the right type and right number of personnel. HRP then is like materials planning
that estimate the type and quality of the materials and supplies needed to facilitate the
manufacturing activities of the organization. HRP is variously called manpower planning,
personnel planning or employment planning.




                      RECRUITMENT SOURCES


The sources of recruitment may be broadly divided into two categories: internal
sources and external sources. On receipt of the Manpower Requisition (MPR) form
HR department will initiate action of sourcing the candidates as under:
            1. INTERNAL SOURCES:
                       As a matter of policy, the organization will encourage to fill up the
                        vacancies from within the existing people if they are fulfilling the
                        criteria and found suitable.
                       In order to invite application from internal sources, notice/circular
                        for all such vacancies will be put up on the notice board.
                       In case any permanent employee dies in harness due to accident or
                        any other reason, one depend son of deceased employee may be
                        given preference in employment with the company subject to his
                        fulfilling the eligibility criteria based on qualification and
                        experience as well as suitable vacancy in the company at that time.
                       The conditions fulfilling the requirement may apply against
                        internal notification to HR department through their department.
            2. other sources :
            Other sources can be tapped for recruitment only when suitable candidates
            are mot available internally. Other sources may include the following:
                       internal data bank
                       local employment exchange
                       advertisement through newspaper
                       Placement agencies.




       Methods Of Recruitment
The following are the most commonly used method of recruiting people.
   1. Internal Method
   2. Direct Method
   3. Indirect Method
1.     INTERNAL METHOD:


      PROMOTION AND TRANSFERS:


ITC Prefer to fill vacancies through promotion or transfers from within wherever possible.
Promotion involves movement of an employee from a lower level position to higher level
position accompanied by changes in duties, responsibilities, status and value and value.
It may lead to changes in duties and responsibility, working conditions, etc., but not
necessarily salary. Internal promotions and transfers certainly allow people greater scope
to experiment with their career, kindling ambitions and motivating them to take a shot at
something they might otherwise never have considered. The system, of course, works
best for young executives who are willing to take risks.




JOB POSITION
       Job position is another way of hiring people from within. In this method, the
organization publicizes job openings on bulletin boards, electronic media and similar
outlets. Hindustan lever introduced its version open job position in early 2002 and over 40
positions have since been filed through the process. HLL even allows its employee to under
take career shifts, for example from technical position system.


EMPLOYEE REFERRALS
        Employee referral means using personal contacts to locate job opportunities. It is a
recommendation from a current employee regarding a job applicant. The logic behind
employee referral is that “ it takes one to know one” employee working in the organization
in this case, are encouraged to recommend the name of their friends working in other
organization for a possible vacancy in the near future. In fact, this has become a popular
way of recruiting people in the highly competitive information technology industry now a
day. Companies offer rich rewards also to employees whose recommendation are accepted
after the routine screening and examining process is over- and job offers extended to the
suggested candidates.




Direct Method


Campus Recruitment
      It is a method of recruiting by visiting and participating in college campuses and
their placement centers. Here the recruiter‟s visits reputed educational institutions such as
IITs, IIMs colleges and universities with a view to pickup job aspirants having a requisite
technical of professional skills. Job seekers are provided information about the jobs and the
recruiter‟s inturen get a snap shot of job seekers through constant interchange of
information with respective institutions. A preliminary screening is done within the campus
and the short listed students are then subjected to the reminder of the selection process. In
view of the growing demand for young managers, most reputed organizations visit
regularly and even sponsor certain popular activities with a view to earn goodwill in the job
market. Advantage of this method include: the placement centre helps locate applicants and
provides resumes to organization; applicants can be prescreened; applicants will not have
to be lured away from a current job and lower salary expectation.
Indirect Method


Advertisement
This includes advertisement in news papers; trade, professionals and technical journals;
radio and TV etc.      In recent time this medium became just as colorful lively and
imaginative as consumer advertising. The ad generally gives a brief outline of the job
responsibilities, compensation package, prospects in the organization etc. This method is
appropriate when (a) the organization intends to reach a large target group and (b) the
organization wants a fairly good no. of talented people who are geographically spread out.



Head Hunters
There is an influx of executive search agencies also known as head hunters who specialize
in selection of professionals for very senior or top posts, where applicants are in short
supply and employers have no time to go round in search of the best talents. Such
vacancies are fewer and far between and organizations prefer hiring a head hunter who
maintains confidentiality of the employer and are specialize in recruiting the best talent
strictly as per the job specification. But, these specialists bodies charges hefty professional
fees. However, the high cost is outweighed by the benefit of recruiting the best talent
without going through the cumbersome and time consuming process of internal recruitment
syste
                          SELECTION PROCEDURE


1.     Screening of Application :
                        All application received from various sources will be screened by
                         the concerned department and HR based on the job description
                         and specification and the applicant profile.
                        Shorting of prima facile suitable candidates who should be called
                         for test/interview shall be prepared.
                        The ratio between the number of vacancy and the number of
                         candidate to be called for test/interview should normally be 1:5.


     2. TEST:
                       Depending on the requirement of the job if required, management
                        may conduct written/aptitude/psychometric/physical or any other
                        test as deem fit.
                       Short listed application will be send formal letter for appearing test
                        at least 15 days in advance.
                       Qualifying criteria for the test will be determined by the
                        management depending on the nature and requirement of the job.




3. INTERVIEW:
                       All the candidates short listed for interview will be informed
                        through a formal call letter for attending interview at least 15 days
                        in advance.
                       The candidate will be interview by the interview panel.
                
4.     FINAL SELECTIOM AND APPOINTMENT:
                Recommendation of the interview panel will be put up before the MD by
                 the HR Department for his approval.
                Candidates for the officer and above after interviewed by the panel will
                 be finally interview by the MD.
                Selection of candidates will be strictly on the basis of merit. Other things
                 being equal local candidate from state of Bihar will be given preference.
                Appointment letter will be issued to the finally selected candidates after
                 duly approved by MD. However, in case appointment letter can initially
                 be issued to the candidates and the detailed formal appointment letter
                 can be issued at the time of joining.
                Before letter of appointment is issued to candidates HR department will
                 ensure the following:
                    1. Check and verify all the personal details furnished by the
                        candidates.
                    2. Verify the certificates and other credentials.
                    3. Make necessary reference/antecedents verifications whenever
                        required.




     5. Joining Formalities:
                            (a)       Employees joining shall first report in the HR
                                      department will facilitate in completing the joining
                                      formalities such as filling of joining report and other
                                      necessary forms.
                            (b)       HR department will ensure that the candidates will be
                                      allowed to join subject to their being found medically.
                               Data Interpretation



Q1. How long you are working in the organization ?




                                            0-0.5 year
                                               7%




                                                                 0.5-2 years
                                                                    19%
              3 - more years
                   39%




                                                    2--3 years
                                                       35%
Q2. what are the various sources of recruitment in your
    Organization?




                                             others
                                              2%
                                                      news paper advertisement
                                                                4%
                                                                 references
                                                                     8%




                          management
                             86%
Q3. Are you satisfied with the recruitment process of your company ?




                        no
                       32%




                                                            yes
                                                            68%
Q4. Are you satisfied with your organization salary increment
    Policy ?




                     can't say
                       30%




                                                                yes
                                                                47%




                                  no
                                 23%
Q5. Are you satisfied with the training procedure given in the
    Organization ?




                         no
                        32%




                                                                 yes
                                                                 68%
Q6. Are you getting regular training in your company ?




                        no
                       32%




                                                         yes
                                                         68%
Q7. What methods is used for the performance appraisal system in
    your organization?




                                     others
                                      11%




               forced distribution
                      17%




                                                       ranking
                                                         72%
Q8. Are you satisfied with your promotion activities in your
     Organization?




                                         .




                            no
                           23%




                                                     yes
                                                     77%
Q9. Does the present performance appraisal system meet your
    Career advancement?




                     can't say
                       28%




                     no
                     6%
                                                          yes
                                                          66%
10.Are you comfortable with the working environment?




                                  no
                                  9%




                                               yes
                                               91%
Conclusions and results

There are the following conclusions come up after the research of the project by filling
the questionnaire:


      The working environment of the organization is excellent this is reason why
       employees are doing the work their and they are stable there.

      Generally organization appointed the employees through the recommendations
       that is references even though other sources are there.


      The employees are satisfied with the recruitment process of the organization.

      Most of the employees consider that the salary increment policy is good.


      Generally ranking method is used in the organization for the performance
       appraisal system and with the promotion activities.

      As they accept that the working environment is really good this shows thye are
       satisfied and the satisfaction of the employees of the organization is very
       necessary.


      And at last I would like to say that satisfied employees contribute more to the
       organization this is the reason why ITC is growing faster.
Recommendations and suggestions

There are the following suggestions being an HR student I would like to give the
organization:


      Organization should keep the eyes on the recruitment process they should recruit
       the employees from outside as well means from where they get the employees
       they should recruit them.

      As the organization is growing faster they should emphasis on the training
       programs even though their training programs are quite good.


      Organization should regularly give the increment on the salary so that who are not
       satisfied they would become also satisfied.

      Organization should analyze the training methods and should adopt those methods
       which are good for the employees and promotion activities should be good so that
       employees are satisfied as we know this is the basic requirement of the success.

				
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