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A Corporate Governance policy deals with prevention or mitigation of the conflict of interests of stakeholders. It guarantees that an enterprise is directed and controlled in a responsible, professional, and transparent manner with the purpose of safeguarding its long-term success. It is intended to increase the confidence of shareholders and capital-market investors. An important theme of the policy is the nature and extent of accountability of people in the business, and mechanisms that try to decrease the principalagent problem. The directors, senior management and employees must adhere to the Corporate Governance Policy of the Company.
Board of Directors:
The Board at Tata Motors comprises of 13 Directors out of which 11 Directors (84.62%) are NonExecutive Directors. The Company has a Non-Executive chairman and seven are Independent directors comprise more than half the total strength of the Board. None of the Directors on the Company's Board is a Member of more than ten Committees and Chairman of more than five Committees. All the Directors have made necessary disclosures regarding Committee positions held by them in other companies and do not hold the office of Director in more than 15 public companies. None of the Directors of the Company is related to each other.
Stakeholder value
At Tata Motors, stakeholders are considered to be partners in success and hence the company strives towards inclusive growth. It believes that stakeholders play a key role towards ensuring the longevity and sustainability of its business.
Tata Motors follows the Stakeholder Engagement Model which involves: Engaging with Stakeholders Identifying issues and concerns Prioritizing the issues and concerns Addressing the issues and concerns Setting goals and targets Implementing strategic initiatives and review Reporting back to stakeholders Learnings and feedback
Environmental Performance
Tata Motors has taken measures to reduce its packaging footprint by either using sustainable packaging (replacing wood with metal) or reusing existing packaging (recycling wood). It recycles close to 69% of the wood packaging thus eliminating use of fresh wood. Tata Motors is heavily investing in the research and development in order to develop low Carbon, fuels saving technologies which will help reduce greenhouse gas emissions. The company has been actively partnering with NGOs on regional resource agency basis in order to organize programs for creating environmental awareness followed by field action at the local, regional and national level. The company continues to increase water use efficiency through implementation of advanced technology such as rain water harvesting and generation of awareness amongst employees. The efforts have resulted into total water withdrawal of close to 19% in the past 2 years. Tata Motors has made significant investments to effectively monitor air emissions from its production facilities including an on-line monitoring and alarm system for incinerator emissions.
Social Performance
Tata Motors being a socially conscious company develops programs for the benefit of the communities. Their contributions have been in the fields of health, education and employability across the societies. Health: Healthcare provided to nearly 300,000 people annually. Over 300 low cost toilets built per annum. Sanitation drives conducted with participation of over 40,000 villagers in over 50 villages. Amritdhura Project implemented to provide safe drinking water to 100 villages in next three years. Smoke efficient chullahs installed in over 200 village households to curb respiratory problems. 5,000 women treated in anemia treatment camps.
Education Infrastructure and facility up-gradation benefitting 50,000 students annually. Teachers training for more than 2,000 primary school teachers. Extra-curricular activities for nearly 7,000 students. Nearly 500 students supported through scholarships annually.
Employability Technical and vocational training provided to nearly 7,000 people. Adopted 21 ITIs under public-private partnership schemes. Over 1,500 women benefited through SHGs and over 150 SHGs formed and sustained.
Measurement of Governance
Based on the Qualitative Aspects
Per my observations about Tata Motors High importance is given to code of conduct, core values, stakeholder aspirations and societal expectations. The Board comprises of 13 Directors out of which 11 Directors (84.62%) are Non-Executive Directors. The Company has a Non-Executive Chairman and seven are Independent directors comprise more than 50% of the total strength of the Board. They Board works in a transparent manner and has different committees with specific terms of reference and scope to deal effectively on issues and resolve them. Stakeholders of the company are considered to be partners in success and hence the company strives towards inclusive growth. They also have a Whistle Blower Policy in place. Shareholders have been suitably rewarded for the money they have put in the Company.