THE COMPANY PROFILE

ITC’s VISION & STRATEGY

“Envisioning a larger societal purpose (a commitment beyond the

market) has always been a hallmark of ITC. The Company sees no
conflict between the twin goals of shareholder value enhancement and
societal value creation. The challenge lies in fashioning a corporate
strategy that enables realization of these goals in a mutually
reinforcing and synergistic manner.”

ITC is one of India's foremost private sector companies with a market

capitalisation of nearly US $ 15 billion and a turnover of over US $
4.75 billion. 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 ranks third in pre-tax profit among India's
private sector corporations. ITC has a diversified presence in
Cigarettes, Hotels, Paperboards & Specialty Papers, Packaging, Agri
Business, Packaged Foods & Confectionery, Branded Apparel, 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 & Stationery. The
Company's successful strategy of creating multiple drivers of growth
leveraging the diverse competencies residing in its portfolio of

ITC has been ranked among Asia's 'Fabulous 50' by Forbes’

Magazine.
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businesses is evident in its impressive track record of growth in the
last decade and its strong debt-free balance sheet.

ITC is committed to sustain its position as one of India’s most valuable

corporations through world-class performance, creating growing value
for the Company’s stakeholders and the Indian economy. Over the last
decade, Total Shareholder Returns, measured in terms of increase in
market capitalisation and dividends, grew at a compound rate of over
30% per annum, placing ITC among the foremost in the country in
terms of efficiency in servicing financial capital. ITC aims to sustain its
premier market standing and leadership position in each of the
business segments.

Apart from crafting business models that establish direct linkages

between businesses and societal goals, ITC is also engaged in
implementing various other sustainable development initiatives
towards making a meaningful contribution in the economic vicinity of
its operating locations. The thrust of these initiatives, christened
Mission Sunehra Kal, is in three areas: (i) natural resource
management, which includes wasteland, watershed and agriculture
development; (ii) sustainable livelihoods, comprising genetic
improvement in livestock and economic empowerment of women; and
(iii) community development, with focus on primary education and
health and sanitation. ITC is committed to conducting its business
operations with passionate respect for the environment. Several
prestigious national and international awards (listed elsewhere in this
report) testify to ITC’s abiding commitment. Such recognition has
further reinforced the Company’s commitment to consciously
synergize and direct the collective endeavor of its employees at all
levels across all businesses, functions and locations to continuously
improve sustainability practices, to ultimately attain and exceed global

2 from the British Safety Council for

Achieved 5 star Health and Safety Rating
its cigarette factories at Bengaluru, Munger, Kolkata & Saharanpur.
standards. Internationally benchmarked specific consumption of water,
dedicated pursuit of the goal of zero discharge and scaling up of
rainwater harvesting in several moisture-stressed districts of India
have enabled ITC retain its enviable position of a water positive
Company for the fourth successive year. The water harvesting
potential created so far is over four times the Company’s net water
consumption.
FMCG

It is a measure of the continued trust reposed in the Company by its

consumers that the top two FMCG brands in the country today belong
to ITC. The Company’s FMCG businesses leverage one of the largest
retail networks in the country, consisting of about 2 million directly
serviced dealers. Its reach covers a wide range of the retail spectrum,
from premium outlets in the metros to small shops in the interiors of
rural India. The Cigarette business continues to occupy its position of
leadership on the strength of continued value addition. The Company
rapidly scaled up the Branded Packaged Foods business during the
year in the four current categories. Snack Foods, Staples,
Confectionery and Ready-to-Eat now offering over 100 distinctive
products. In the Staples category, Aashirvaad Atta further
consolidated its position as the clear leader amongst national branded
players with market share touching 45%. The year marked the
expansion of the Sunfeast range of biscuits with the launch of Cookies
(Sunfeast Golden Bakes) in 3 variants and Sweet & Salt Crackers
('Sunfeast Snacky') in 2 variants. During the year, outsourced and
distributed manufacturing capacities were geared up to support the
increase in scale of operations. The business is in the process of
establishing its own production facilities across the country with a view
to servicing proximal markets in an efficient and cost-effective manner.

“Sword of Honour” for Bengaluru & Sharanpur for 2006-07.

The year also saw the roll out to target markets of Sunfeast Pasta
Treat, a whole-wheat based non-fried product. Product range in the
Confectionery segment was expanded with the launch of Mint-O
Masti Blue in a new pack design and Cofitino in the hitherto
unrepresented Toffees segment. The Ready to Eat product portfolio
was augmented with the introduction of Instant Mixes in the popular
range under the Aashirvaad Ready Meals banner, launch of new
variants of cooking pastes under the Aashirvaad umbrella brand and a
range of packaged desserts, conserves and chutneys under the
flagship brand Kitchens of India.
The Wills Lifestyle range was further augmented during the year with
the extension of Essenza Di Wills, an exclusive line of prestige
fragrance products, to select .Wills Lifestyle stores the products have
met with encouraging response from discerning consumers. The year
also marked the launch of the Wills Lifestyle India Fashion Week.
(WIFW), billed as the country's premier fashion event. In the popular
segment, the John Players brand delivered a strong performance
during the year and created a buzz among its youthful target audience.

The year witnessed the rapid scale-up of the stationery business

with volumes of Classmate notebooks trebling over last year making
Classmate the most widely distributed notebook brand across the
country. The Expressions brand of greeting cards sustained its
leadership status in multi-brand outlets across the country.

In the Safety Matches business, the Company's brands, including AIM

which is the largest selling brand of matches in the
Country, continued to enjoy strong consumer preference, resulting in
enhanced market standing. The year also witnessed the successful
acquisition of WIMCO by a wholly owned subsidiary of the Company.
The Company's incense sticks (Agarbatti) business made rapid gains

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during the year with the Mangaldeep brand emerging as the only
national brand in its first full year of operations.

HOTELS
During 2005-06, the Hotels business posted a strong financial
performance with Segment Revenues growing by 35.7%. ITC Grand
Central, the Company's second property in Mumbai, which was
commissioned in January 2005, posted an impressive performance to
record a positive bottom line in its first full year of operations. The
business also progressed a product upgradation programme during the
year with a view to maintaining the contemporariness of the
Company's properties.
PAPERBOARDS AND PACKAGING

The Paperboards, Specialty Paper and Packaging segment recorded

strong growth during the year both in terms of sales and operating
profits. The year marked significant growth in the Paperboards
segment on the back of enhanced capacity utilization at the Kovai unit
and the addition of Paper Machine V (capacity 75,000 TPA) at the
Bhadrachalam mill. In fulfillment of its commitment to a cleaner
environment, the Company's Elemental Chlorine Free (ECF) pulp mill,
the only one of its kind in the country, continues to meet world-class
environmental standards. The superior quality of the ECF pulp has
enabled expansion of the market for value-added paperboards. The
Packaging and Printing business leveraged its recent investments in
technology upgradation to expand its range of offerings to include a
wider variety of contemporary packaging formats. During the year, the
business entered the high growth flexible packaging business with the
induction of world-class equipment.

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AGRI BUSINESS

In the Agri Business segment, ITC is engaged in innovatively leveraging

digital technology to transform the rural sector, and strengthening its
position in domestic and global markets as a leading supplier of high
quality, identity-preserved agri commodities. This digital infrastructure,
known as e-Choupal, constitutes the basis for the Company’s deeper
engagement with the rural economy through the progressive
development of low cost, broadband fulfillment capability for two-way
flow of goods and services. This pioneering initiative comprising nearly
6,000 Choupals, currently reaches out to over 3.5 million farmers in
the States of Madhya Pradesh, Haryana, Uttaranchal, Uttar Pradesh,
Rajasthan, Karnataka, Maharashtra, Andhra Pradesh and Kerala.

The Company’s investments in creating rural infrastructure to support

this two-way flow of goods and services is being strengthened through
the creation of rural hubs, christened Choupal Saagar. 10 Choupal
Saagars are operational in the 3 states of Madhya Pradesh,
Maharashtra and Uttar Pradesh while 9 more are in an advanced stage
of construction. These Choupal Saagars, in synergistic combination
with the e-Choupal network, would serve as the core infrastructure to
support ITC's rural distribution strategy.

INFORMATION TECHNOLOGY

ITC’s wholly owned information technology subsidiary, ITC Infotech, is

one of India’s fastest growing IT and IT-enabled outsourced solutions
providers. The Company leverages domain knowledge from its parent’s
market-leading position in Manufacturing, CPG & Retail and Travel &
Hospitality, as well as in other domains like Banking, Financial Services
& Insurance, to devise business solutions for global customers. ITC
Infotech is a US $ 64 million company with over 1,700 employees. In

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addition to IT Solutions, Services and Co-sourcing, the Company has a
joint venture with Client Logic in the BPO space that offers a technical
helpdesk with over 2,500 employees. ITC Infotech has offices in the
United States, Europe and the Asia Pacific, serving Fortune-listed
customers across 42 countries. Overseas Subsidiary Surya Nepal
Private Limited (SNPL) is an Indo-Nepal-UK joint venture, which
started operations in Nepal in 1986. SNPL is the largest private sector
enterprise in Nepal and a subsidiary of ITC Limited. Its businesses
include manufacture and marketing of cigarettes and readymade
garments, as well as export of readymade garments with a total
turnover of US $ 60 million and a pre-tax profit of US $ 8 million.

CITIZEN FIRST

ITC is driven by the compelling vision of enlarging its contribution to

society. It seeks to achieve this value objective by not only driving
each of its businesses towards international competitiveness, but by
also consciously contributing to the competitiveness of the entire value
chain. As a Company that continuously strives to be Citizen First, ITC
attaches critical importance to its responsibility to contribute to the.
Triple Bottom Line., namely the augmentation of economic, ecological
and social capital.
PAN-INDIAN ORGANISATION

ITC employs over 20,000 people at more than 60 locations across

India. ITC continuously endeavors to enhance its wealth generating
capabilities in a globalizing environment to consistently reward more
than 4,45,000 shareholders, fulfill the aspirations of its stakeholders
and meet societal expectations.

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This over-arching vision of the Company is expressively captured in its
corporate positioning statement:

‘Enduring Value. For the Nation. For the Shareholder.’

Bengaluru, Kolkata and Saharanpur Cigarette Factories won the prestigious

Greentech Safety Gold Award for the year 2007 in the manufacturing sector.
THE COMPANY HISTORY
Bengaluru, Kolkata and Saharanpur cigarette factories won the prestigious Greentech
Safety Gold Award for the year 2007 in the manufacturing secto

• 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

8
 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'.

• Though the first six decades of the Company's existence were

primarily devoted to the growth and consolidation of the
Cigarettes and Leaf Tobacco businesses, the Seventies
witnessed the beginnings of a corporate transformation that
would usher in momentous changes in the life of the Company.

• ITC's Packaging & Printing Business Division, was set up in

1925 as a strategic backward integration for ITC's Cigarettes
business. It is today India's most sophisticated packaging house.

• In 1975 the Company launched its Hotels business with the

acquisition of a hotel in Chennai which was rechristened 'ITC-
Welcomgroup Hotel Chola'. The objective of ITC's entry into
the hotels business was rooted in the concept of creating value
for the nation. ITC chose the hotels business for its potential to
earn high levels of foreign exchange, create tourism
infrastructure and generate large scale direct and indirect
employment. Since then ITC's Hotels business has grown to

9
 occupy a position of leadership, with over 70 owned and
managed properties spread across India.

• In 1979, ITC entered the Paperboards business by promoting

ITC Bhadrachalam Paperboards Limited, which today has become
the market leader in India. Bhadrachalam Paperboards
amalgamated with the Company effective March 13, 2002 and
became a Division of the Company, Bhadrachalam Paperboards
Division. In November 2002, this division merged with the
Company's Tribeni Tissues Division to form the Paperboards &
Specialty Papers Division. ITC's paperboards' technology,
productivity, quality and manufacturing processes are
comparable to the best in the world. It has also made an
immense contribution to the development of Sarapaka, an
economically backward area in the state of Andhra Pradesh. It is
directly involved in education, environmental protection and
community development. In 2004, ITC acquired the paperboard
manufacturing facility of BILT Industrial Packaging Co. Ltd
(BIPCO), near Coimbatore, Tamil Nadu. The Kovai Unit allows ITC
to improve customer service with reduced lead time and a wider
product range.

• In 1985, ITC set up Surya Tobacco Co. in Nepal as an Indo-Nepal

and British joint venture. Since inception, its shares have been
held by ITC, British American Tobacco and various independent
shareholders in Nepal. In August 2002, Surya Tobacco became a
subsidiary of ITC Limited and its name was changed to Surya
Nepal Private Limited (Surya Nepal).

• In 1990, ITC acquired Tribeni Tissues Limited, a Specialty paper

manufacturing company and a major supplier of tissue paper to
the cigarette industry. The merged entity was named the Tribeni

10
 Tissues Division (TTD). To harness strategic and operational
synergies, TTD was merged with the Bhadrachalam Paperboards
Division to form the Paperboards & Specialty Papers
Division in November 2002.

• Also in 1990, leveraging its agri-sourcing competency, ITC set up

the International Business Division (IBD) for export of agri-
commodities. The Division is today one of India's largest
exporters. ITC's unique and now widely acknowledged e-Choupal
initiative began in 2000 with soya farmers in Madhya Pradesh.
Now it extends to 9 states covering over 3.5 million farmers.
ITC's first rural mall, christened 'Choupal Saagar' was
inaugurated in August 2004 at Sehore. The year 2006 witnessed
the ramping up of the Company's rural retailing network with 17
'Choupal Saagars' being operational in three states of Madhya
Pradesh, Maharashtra and Uttar Pradesh.

• In 2000, ITC's Packaging & Printing business launched a line of

high quality greeting cards under the brand name
'Expressions'. In 2002, the product range was enlarged with the
introduction of Gift wrappers, Autograph books and Slam
books. In the same year, ITC also launched 'Expressions
Matrubhasha', a vernacular range of greeting cards in eight
languages and 'Expressions Paperkraft', a range of premium
stationery products. In 2003, the company rolled out
'Classmate', a range of notebooks in the school stationery
segment.

• ITC also entered the Lifestyle Retailing business with the

Wills Sport range of international quality relaxed wear for men
and women in 2000. The Wills Lifestyle chain of exclusive stores
later expanded its range to include Wills Classic formal wear

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 (2002) and Wills Clublife evening wear (2003). ITC also initiated a
foray into the popular segment with its men's wear brand, John
Players, in 2002. In December 2005, ITC introduced Essenza Di
Wills, an exclusive line of prestige fragrance products, to select
'Wills Lifestyle' stores. In 2006, Wills Lifestyle became title
partner of the country's most premier fashion event - Wills
Lifestyle India Fashion Week - that has gained recognition from
buyers and retailers as the single largest B-2-B platform for the
Fashion Design industry. To mark the occasion, ITC launched a
special 'Celebration Series', taking the event forward to
consumers.

• In 2000, ITC spun off its information technology business into a

wholly owned subsidiary, ITC Infotech India Limited, to more
aggressively pursue emerging opportunities in this area. In a
short span of 5 years, ITC Infotech has already crossed over
US$ 60 million in revenues. It also has a joint venture with
ClientLogic, a top five global Business Process Outsourcing (BPO)
provider.

• ITC's foray into the Foods business is an outstanding example of

successfully blending multiple internal competencies to create a
new driver of business growth. It began in August 2001 with the
introduction of 'Kitchens of India' ready-to-eat Indian gourmet
dishes. In 2002, ITC entered the confectionery and staples
segments with the launch of the brands Mint-O and Candyman
confectionery and Aashirvaad atta (wheat flour). 2003 witnessed
the introduction of Sunfeast as the Company entered the biscuits
segment. ITC's entered the fast growing branded snacks
category with Bingo! in 2007. In just six years, the Foods
business has grown to a significant size with over 150

12
 differentiated products under six distinctive brands, with an
enviable distribution reach, a rapidly growing market share and a
solid market standing.

• In 2002, ITC's philosophy of contributing to enhancing the

competitiveness of the entire value chain found yet another
expression in the Safety Matches initiative. ITC now markets
popular safety matches brands like iKno, Mangaldeep, VaxLit,
Delite and Aim.

• ITC's foray into the marketing of Agarbattis (incense sticks) in

2003 marked the manifestation of its partnership with the
cottage sector. ITC's popular agarbattis brands include Spriha
and Mangaldeep across a range of fragrances like Rose,
Jasmine, Bouquet, Sandalwood, Madhur, Sambrani and
Nagchampa.

13
 THE ITC WAY

ITC is a board-managed professional company, committed to creating

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

ITC’s corporate strategies are:

• Create multiple drivers of growth by developing a

portfolio of world class businesses that best matches
organisational capability with opportunities in domestic
and export markets.

• Continue to focus on the chosen portfolio of FMCG,

Hotels, Paper, Paperboards & Packaging, Agri Business and
Information Technology.

• Benchmark the health of each business

comprehensively across the criteria of Market Standing,
Profitability and Internal Vitality.

• Ensure that each of its businesses is world class and

internationally competitive.

• Enhance the competitive power of the portfolio

through synergies derived by blending the diverse skills
and capabilities residing in ITC’s various businesses.

• Create distributed leadership within the organisation

by nurturing talented and focused top management teams
for each of the businesses

14
 • 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.

BOARD OF DIRECTORS

Non Executive Directors

Chairman

Mr. Y.C. Deveshwar Mr. J. P. Daly

Executive Directors Mr. C.R. Green

Mr. S.H. Khan

Mr. S S H Rehman
Mr. S.B. Mathur
Mr. A Singh
Mr. D.K. Mehrotra
Mr. K Vaidyanath
Mr. P.B. Ramanujam

Mr. B. Sen

Mr. Ram S. Tarneja

15

Mr. B Vijayaraghavan
 ABOUT THE CHAIRMAN

Mr. Y C Deveshwar, an engineering graduate from

the Indian Institute of Technology, Delhi joined ITC
Limited in 1968. He was appointed as a Director on
the Board of the Company in 1984 and became the
Chief Executive and Chairman of the Board on
January 1, 1996. Between 1991 and 1994, he led
Air India as Chairman and Managing Director.

Under his leadership, ITC’s Sustainability efforts were given shape

through unique business models. ITC became the first Indian company
to publish its Sustainability Report, 2004 in accordance with the
guidelines of the Global Reporting Initiative. For the efforts at creating
sustainable livelihood opportunities, ITC also won the inaugural World
Business Award instituted jointly by the United Nations Development
Program (UNDP), International Chamber of Commerce (ICC) and the
HRH Prince of Wales International Business Leader's Forum (IBLF).
ITC’s ‘e-choupal’, a digital infrastructure initiative to empower marginal
farmers in India, is taught as a case study at the Harvard Business
School. This initiative won the Development Gateway award at Beijing
in September 2005 and the Stockholm Challenge Award in May 2006.

Mr. Deveshwar is the Past President of the Confederation of Indian

Industry. He is also a member of the Board of Governors of the Indian
School of Business and the former Chairman of the Society and Board
of Governors of the Indian Institute of Management, Calcutta. He also

16
serves on the National Executive Committees of some of India’s
premier trade and industry bodies.

Amongst several awards and recognitions during his distinguished

career, Mr. Deveshwar has been honoured with the Business
Person of the Year award by the UK Trade & Investment by His Royal
Highness Prince Andrew, the Duke of York in 2006, and in January
2006, he was inducted to the prestigious Hall of Pride at the Indian
Science Congress He was also named then Manager Entrepreneur of
the Year 2001 by Ernst & Young.

17
CORPORATE MANAGEMENT COMMITTEE

Mr. Y.C. Deveshwar

Mr. S S H Rehman

Mr. A Singh

Mr. K Vaidyanath

18
DIVISIONAL MANAGEMENT COMMITTEES
India Tobacco Division
Kurush N Grant Chief Executive
S M Ahmad Ex-VP, Marketing
R Tandon Ex-VP, Finance & MIS
T V Ramaswamy Ex-VP, Technical & HR
R S Naware

LifestyleGifting
Greeting, Retailing Business Division
& Stationery Strategic Business Unit
CS Dar
Das Divisional
SBU ChiefChief Executive
Executive
AK
B Chand
Pramanick VP, Marketing & Retail
P Sengupta VP , Finance
Finance& Logistics
IT
N K Jasper Head, & IT
K Thakur
N Bose GM, Sourcing & Merchandising
M Rastogi VP, HR
R Kaicker Head Designer

19
 Safety Division
Foods Matches Strategic Business Unit
R SRNaware
Gopal SBU ChiefChief
Divisional Executive
Executive
C Aras
H Malik Marketing Manager
Head
R Ramamurthy
A Pathak
M SBGadhok
K Pramanick Permanent Invitee
S Ganeshkumar Permanent Invitee
V L Rajesh Permanent Invitee
K Singh Permanent Invitee
B Sumant Permanent Invitee

Agarbattis Strategic Business Unit

V M Rajasekharan SBU Chief Executive
Vivek Abrol Marketing Head
Soumen Ray
B K Pramanick

Paperboards & Specialty Papers Division

P Dhobale Divisional Chief Executive
P K Talwar
S K Singh
K I Vishwanathan Permanent Invitee
S R Tulasi Permanent Invitee
P Sanyal Permanent Invitee
C A Nair Permanent Invitee
A V Rao Permanent Invitee

Packaging & Printing Strategic Business Unit

GMK Raju SBU Chief Executive
B K Pramanick
R Senguttuvan
S Banerjee

International Business Division

S Sivakumar Divisional Chief Executive

20
K T Prasad VP, Human Resource Development
C V Sarma VP, Finance & IT
R Rai VP, Operations
Head, Rural Marketing & Retailing
S Tyagi
Businesses

Indian Leaf Tobacco Development Division

S Janardhan Reddy Divisional Chief Executive
A Dutt Head, HR
K C Biddappa VP, Marketing & R&D
S Ramakrishna Head, Processing & Tech.
M Ganesan VP, Finance & IT

Hotels Division
N Anand Divisional Chief Executive
Sr Ex-VP, Projects, Growth &
S C Sekhar
Development
P Verma Ex-VP
M Bhatnagar
B Hariharan VP, Sales & Marketing
R Ahmed

ITC VISION ‘n’ MISSION

VISION

21
 MISSION

ITC CORE VALUES

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

TRUSTEESHIP

22
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

23
We are aware of our responsibility to generate economic value for the Nation. In
pursuit of our goals, we will make no compromise in complying with applicable
laws and regulations at all levels.

CORPORATE GOVERNANCE

24
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.

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:

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

25
ITC believes that any meaningful policy on Corporate Governance must provide
empowerment to the executive management of the Company, and
simultaneously create a mechanism of checks and balances which ensures that
the decision making powers vested in the executive management is not only not
misused, but is used with care and responsibility to meet stakeholder aspirations
and societal expectations.

CORNERSTONES

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

TRUSTEESHIP

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

TRANSPARENCY

ITC believes that transparency means explaining Company's policies and actions
to those to whom it has responsibilities. Therefore transparency must lead to
maximum appropriate disclosures without jeopardising the Company's strategic
interests. Internally, transparency means openness in Company's relationship

26
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-emotively 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.

27
 ITC CODE OF CONDUCT

PREAMBLE

ITC’s Code of Conduct was circulated to the employees more than five years
back and is posted on the Company’s corporate website. This Code has now

28
been re-drafted for better presentation. This Code is derived from three
interlinked fundamental principles, viz. good corporate governance, good
corporate citizenship and exemplary personal conduct.

PHILOSOPHY

ITC is a professionally managed organisation and the core value underlying our
corporate philosophy is "trusteeship". We believe this organisation has been
handed to us by the various stakeholders in "trust" and we as professionals are
the "trustees" of these stakeholders. It is therefore our responsibility to ensure
that the organisation is managed in a manner that protects and furthers the
interests of our stakeholders. We recognise society as an important stakeholder
in this enterprise and therefore it is part of our responsibility to practise good
corporate citizenship.
It is also our belief that in order to the interests of our stakeholders in perpetuity,
we must build ITC into an institution whose dynamism and vitality are anchored
in its core values.

CORPORATE GOVERNANCE POLICY

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

GOOD CORPORATE CITIZENSHIP

In the conduct of the Company’s business, the practice of good corporate

citizenship is a prerequisite and embraces the following:

Dealing with People in the Organisation

29
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 favors; sexually
colored 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

30
All directors, senior management and employees shall ensure that in their
dealings with suppliers and customers, the Company’s interests are never
compromised. Accepting gifts and presents of more than a nominal value,
gratuity payments and other payments from suppliers or customers will be
viewed as serious breach of discipline as this could lead to compromising the
Company’s interests.

Legal Compliance

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

Health and Safety

The Company attaches great importance to a healthy and safe work

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

Environment Policies

The Company believes that commitment to sustainable development is a key

component of responsible corporate citizenship and therefore deserves to be
accorded the highest priority. Accordingly, the Company is committed to Best

31
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

32
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.

Leading by Example

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

WAIVERS

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

NON ADHERENCE

Any instance of non-adherence to the Code of Conduct / any other observed

unethical behaviour on the part of those covered under this Code should be

33
brought to the attention of the immediate reporting authority, who shall in turn
report the same to the Head of Corporate Human Resources.

34
 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.

35
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:

• 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.

• 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.

• 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'.

36
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.

37
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.

38
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.

39
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.

40
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

41
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.

42
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.

43
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.

• 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.

• 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.

• NON-DISCRIMINATION
The Company will not discriminate against any employee infected by

44
 HIV/AIDS with regard to promotions, training and other privileges and
benefits as applicable to all employees.

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.

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.

HIV/AIDS test will not be part of the annual health check-ups unless specifically
requested for by an employee.

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.

45
 CIGARETTES

ITC is the market leader in cigarettes in India. With its wide range of invaluable
brands, it has a leadership position in every segment of the market. It's highly
popular portfolio of brands includes Insignia, India Kings, Classic, Gold
Flake, Silk Cut, Navy Cut, Scissors, Capstan, Berkeley, Bristol and Flake.

The Company has been able to build on its leadership position because of its
single minded focus on value creation for the consumer through significant
investments in product design, innovation, manufacturing technology, quality,
marketing and distribution.

All initiatives are therefore worked upon with the intent to fortify market standing
in the long term. This in turns aids in designing products which are contemporary
and relevant to the changing attitudes and evolving socio economic profile of the
country. This strategic focus on the consumer has paid ITC handsome dividends.

ITC's pursuit of international competitiveness is reflected in its initiatives in the

overseas markets. In the extremely competitive US market, ITC offers high-
quality, value-priced cigarettes and Roll-your-own solutions. In West Asia, ITC
has become a key player in the GCC markets through growing volumes of its
brands.

ITC's cigarettes are produced in its state-of-the-art factories at Bengaluru,

Munger, Saharanpur and Kolkata. These factories are known for their high
levels of quality, contemporary technology and work environment.

46
AN OVERVIEW: ITC IN CIGARETTES

• Market leadership

• Powerful brands across segments

• Leadership in all segments - geographic & price

• Extensive FMCG distribution network

• Direct servicing of 85000 markets & nearly 2 million retail outlets

• World-class state-of-the-art technology and products

• Investment - Rs.10 billion in six years

• Exciting long term growth potential

CIGARETTES: GROWTH POTENTIAL

• Cigarettes account for only 14% of tobacco consumed in India unlike

world pattern of 85% due to prolonged punitive taxation

o Cigarettes (14% of tobacco consumption) contribute nearly 85% of

Revenue to the Exchequer from tobacco sector.

• Of the 58% of adult Indian males who consume tobacco, barely 15%
can afford cigarettes.

• Biri : Cigarettes ratio = 10 : 1

• Annual per capita adult cigarette consumption in India is approx.

one tenth world average : 141

• Future growth depends on relative rates of growth of per capita

income and moderation in taxes.

47
 Per Capita Adult Cigarette Consumption
(Sticks)

1753
1662

1190

561
488

141

USA China Pakistan Nepal India World Avg.

48
 CORPORATE SOCIAL RESPONSIBILITY

ITC Ltd. has undertaken various projects and activities as a part of their
Corporate Social Responsibility. It includes:

• Let’s Put INDIA FIRST

• Greening Wasteland

• Empowering Farmers

• Creating Women Entrepreneurs

• Educating Rural Children

• Irrigating Dry Lands

• SUNEHRA KAL

• Preserving National Heritage

49
 THE ITC LOGO

ITC Ltd. before September 18, 2001 was I.T.C. Ltd. but w.e.f.
the company’s name was changed and along with it the Logo too.

The arguments given in the favour of the change were:

No Stops for ITC

No stops to our commitment beyond the market

No stops to our vision of contributing to the nation
No stops to our endeavour to become world-class
No stops to our creation of sustained shareholder value
We have pulled out all the stops

I.T.C. Limited is now ITC Limited

50
 For the Shareholder. For the Nation.

•
THE SAHARANPUR FACTORY
Established in 1926

• Manpower Strength: 1005 Unionised Workers

• Volumes: Average 6 Crores in a day.

• Brands Manufactured:

o Gold Flake Premium

o Gold Flake King Size

o WILLS Navy Cut

o WILLS Silk Cut

o WILLS Navy Cut Light

o WILLS Classic

o WILS Classic Ultramild

o India Kings

o Capstan

o Bristol

o Flake

o Scissors (Export to Gulf Countries)

o INSIGNIA

51
52
PROJECT:- To Study the Employee Satisfaction Level in Commercial
Department of ITC Ltd., India Tobacco Division, Saharanpur.

ABOUT
AIM:- To analyse the Satisfaction Level amongst the Unionised workers in the
Commercial Department of the organisation.

The basic aim is actually to analyse the satisfaction level amongst the unionised
workers working in the commercial department with the help of Questionnaires
and analyzing on the basis of various parameters and studying and
understanding them psychologically.

Sample Size: The sample size taken for the study is 17. The total population is
19. The sample excludes 2 Drivers.

Parameters on which the study is to be carried out:

• For how the worker has been with the organisation.

• Timings

• Salary

• Appraisal

• Development Opportunity in terms of training provided.

• Role Profile

53
• Authority Vs. Responsibility

• Compensation

• Conveyance

• Inter personal Relationships

• Support from the Management

• Code of Conduct

• Infrastructure Provided

• Feedback mechanism

• Work Life Balance

• Incentives

• Work Pressure

54
STUDY PARAMETERS
1. For how long the worker has been in the Organisation:
This factor will help in actually understanding the
workers loyalty and more importantly the appraisal procedure.

2. Timings:
Just to check whether the worker is satisfied with the present things or need a
change.

3. Salary:
Salary, the main motivating factor for any worker, studying this factor will help in
analyzing whether the worker is happy with the salary paid to him in light if the
work he does. This will also help in analyzing whether the salary factor is
affecting the efficiency of the worker.

4. Appraisal:
Appraisal in Salary done at regular intervals. This will also help in finding out
whether the present appraisal Pattern or Procedure is effective and are they
satisfied with the appraisal or not.

5. Development Opportunity:
Development will include:
• Development on Personal Grounds
• Development on Social Grounds
• Development on Financial Grounds
• Development on Professional Grounds

55
 Personal Grounds: It will include development in:
• Communication Skills
• Effect of Code of Conduct
• Transformation in Nature (if any)

Social Grounds: It includes development in:

• Social Status

Financial Grounds: It includes:

• Increase in Salary
• Incentives
• Assets

Personal Grounds:
• Work related Skills Development

6. Role Profile:
It will help in analyzing whether the work they are doing:
• Are they satisfied in doing it?
• Is there any need of adding any other work in their profile?
• Is there any role which the wish not to perform or has no concerned
with their job (if any)?

7. Responsibility vs. Authority

This will help in analyzing whether they need to be given any more authority to
make decision which variably falls in the responsibility they have.

8. Compensation:

56
To check and analyse whether they need any area to be brought under
compensation or the present areas are suitable and sufficient.

9. Inter Personal Relationships:

The relationship they share with each other will help to judge Social Grounds.

10. Support Level from Management:

Are they getting the desired support from the management? It will help in
increasing the satisfaction level.

11. Work – Life Balance:

To analyse whether they are having a balance between the professional life and
Personal Life. To even check if they are overloaded with work or not.

12. Training:
Do they require training any kind of work or if they have had some training
sessions before so are they satisfied with it or not.

13. Work Pressure:

Do they feel overburdened? This can be judged by looking at their time sheets
and efficiency i.e. looking out for the stretch they have done, etc.

14. Infrastructure Provided:

To check whether they are satisfied with the Infrastructure provided to them or
the lack of the same effects the efficiency.

57
BENEFITS OF THE PROJECT

To the Commercial Department & Organisation

1. They will come to know about the loopholes.

2. It will help in establishing effective work force.

3. Employee satisfaction level analysis will lead to eradication of the

problems faced by employees.

4. Fruitful work experience.

5. It will act as an effective element and will remove the distance between
the management & workers (Distance Required).

6. Will act as a source of motivation for the workers.

To the Workers

1. Their problems will come into notice.

2. They will get a platform to give suggestions.

58
 RESEARCH DESIGN

Research Design specifies the method and procedure of conducting a study.

RESEARCH
DESIGN

EXPLORATORY DESCRIPTIVE CASUAL

For analyzing the Employee Satisfaction Level Casual ‘Research Design’ is

used as a tool.

Casual Research is basically used to find out the characteristics of a particular

individual and a group of Individuals.

59
SOURCES OF DATA:-
The Places or Sources from where the Data is collected is generally termed as
Sources of Data.

Two Types of Sources of Data:

1. Primary Sources
2. Secondary Sources

TOOLS USED FOR DATA COLLECTION:-

1. Questionnaires
2. ITC News (A monthly Journal)
3. Various Websites

60
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63
64
65
66
67
68
 SURVEY FINDINGS

• There have been no new joining in the Commercial Department since last
13 Years.

• All the workers working in the Commercial Department are married.

• All the workers working in the Commercial Department are Male.

(Male : Female :: 17:0)

• The Workers are of the Age Group of 37 – 58.

• 59% workers working in the commercial department find their timings

structure suitable while the rest 41% feel that the timings structure is
improper and need a change.

• 76% of the workers in the Commercial Department are very much satisfied
with the office structure provided to them.

• 76% of the workers feel free to contact their peers in case of queries.

• 76% of the workers believe in team working.

• 94% of the workers feel accountable within themselves for their job.

• 88% of the workers are satisfied with the feedback mechanism followed in
the organization.

69
 SUGGESTIONS

After analyzing the basic finding was that except the TIMING FACTOR the
employees are very much satisfied with the organisation policies, code of
conduct, etc.

The only suggestion to the organisation is that they will have to look and change
their timings structure so that the 41% of employees who find it improper can get
satisfied and ultimately can lead to the more efficiency.

70
 CONCLUSION

The conclusion withdrawn from the survey conducted and the analysis performed is that
the workers working in the Commercial Department in ITC Ltd., India Tobacco Division,
Saharanpur are very much satisfied and feel proud to be associated with the organisation.

Approximately 80% of the workers working in the department are satisfied which is quite
an impressive and a remarkable Employee Satisfaction Level.

Therefore, on the whole ITC Ltd. Need not to take any of the remedial actions in order to
increase the Satisfaction Level except the Timings one which when taken would lead to
increase the above mentioned Satisfaction Level.

It can be concluded that the Organisation has a very fruitful work culture.

71
 BIBLIOGRAPHY

• WEBSITES:

o www.itcportal.com
o www.google.com
o images.google.com

• MAGAZINES:

o ITC NEWS
o WILLS LIFESTYLE

• Human Resource Department Records

72
 ANNEXURE (Questionnaire)

Your Name: ………………………………………………………..

1. Your Age: ………………………………………………..

2. Your Gender: Male Female

3. Marital Status: Married Unmarried

4. How long have you worked for the company?

<5 Years 5 – 10 Years 10 – 15 Years >15 Years

5. Does the working hours of the department maintained on daily basis (8 hrs/day) ?

Yes No

6. Is the office structure (seating arrangement, lighting, etc.) appropriate to carry on

the responsibilities?

Yes No

7. Do you feel free to contact your peers in your queries?

Yes No

8. Do you feel like working as a team in the department?

Yes No

9. Do you feel accountable within yourself while doing your job?

Yes No

10. Do you receive feedback from your peers/managers on the job you perform?

Yes No

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