A Project on Hul Csr

7/30/2019 A Project on Hul Csr

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Corporate Social Responsibility & Corporate Governance Activities

Undertaken By HUL.

Project Report for Autumn 2010 submitted to the

Department of Management Studies,

Rizvi college of Arts, Science & Comm.

Bandra (W), Mumbai-400050

In Partial Fulfillment of the requirements for the

Degree of Bachelor in Management Studies.

Submitted

by

Arjuman Ansari.

Eram Khan.

Sayeeda Khan.

Shazia Khan.

Shabnam Saboowala.

Sana Sheikh.

Project Head: Prof. Mr.Sameer Virani

Rizvi College Of Arts, Science & Commerce.

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Acknowledgement.

Apart from the efforts of us, the success of this project depends largely on theencouragement and guidelines of many others. I take this opportunity to express

my gratitude to the people who have been instrumental in the successful

completion of this project.

I would like to show my greatest appreciation to Prof. Sameer Virani. I cant say

thank you enough for his tremendous support and help. I feel motivated and

encouraged every time I attend his lecture. Without his encouragement and

guidance this project would not have materialized.

The guidance and support received from the company Hindustan Unilever

Limited who contributed and are contributing to this project, was vital for thesuccess of the project. I am grateful for their constant support and help.

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Certificate.

This is to certify that Eram Khan, Arjuman Ansari, Sayeeda Khan, Shazia Khan, Shabnam

Saboowala & Sana Shaikh ,BMS final year students of Rizvi College Of Arts, Science & Commerce

have completed their project under the guidance of Prof. Sameer Virani towards the partial

fulfillment of the award of TYBMS during the academic year 2010 - 2011

The project work entitled CSR & Corporate Governance Activities of HUL

________________ _________________

Project Guide/HOD Principal / Headmaster

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Declaration.

We hereby declare that the project work entitled Corporate Social Resposibility& Corporate Governance Activities of HUL submitted to the Rizvi College,is

record of the original work done by us under the guidance of Prof. Mr.Sameer

Virani, Faculty Member, Rizvi College Of Arts, Science & Comerce.

Name Of The Students Roll Nos. Signatures

Eram Khan 23 ________

Sayeeda Khan 28 ________

Shabnam Saboowala 46 ________

Sana Sheikh 53 ________

Arjuman Ansari 62 ________

Shazia khan. 79 ________

Place : Mumbai.

Date : 18/08/2010

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Introduction.

Hindustan Unilever Limited (HUL) (BSE: HUL) is India's largest fast movingconsumer goods company, touching the lives of two out of three Indians with over

20 distinct categories in home & personal care products and food & beverages.They endow the company with a scale of combined volumes of about 4 milliontonnes and sales of over Rs. 13,000 crores. HUL is also one of the country'slargest exporters; it has been recognised as a Golden Super Star Trading House bythe Government of India.

HUL was formed in 1933 as Lever Brothers India Limited and came into being in1956 as Hindustan Lever Limited through a merger of Lever Brothers, HindustanVanaspati Mfg. Co. Ltd. and United Traders Ltd.. It is headquartered in Mumbai,India and has an employee strength of over 15,000 employees and contributes for

indirect employment of over 52,000 people. The company was renamed in June2007 to Hindustan Unilever Limited.

In 2007, Hindustan Unilever was rated as the most respected company in India forthe past 25 years by Businessworld, one of Indias leading business magazines.The rating was based on a compilation of the magazines annual survey of IndiasMost Reputed Companies over the past 25 years. HUL is the market leader inIndian consumer products with presence in over 20 consumer categories such assoaps, tea, detergents and shampoos amongst others with over 700 million Indian

consumers using its products. It has over 35 brands. Sixteen of HULs brandsfeatured in the ACNielsen Brand Equity list of 100 Most Trusted Brands AnnualSurvey (2008). According to Brand Equity, HUL has the largest number of brandsin the Most Trusted Brands List. Its a company that has consistently had thelargest number of brands in the Top 50 and in the Top 10 (with 4 brands).

Hindustan Unilever's distribution covers over 1 million retails outlets across Indiadirectly and its products are available in over 6.3 million outlets in India, i.e.,nearly 80% of the retail outlets in India. It has 39 factories in the country. Two outof three Indians use the companys products and HUL products have the largest

consumer reach being available in over 80 per cent of consumer homes acrossIndia.

The Anglo-Dutch company Unileverowns a majority stake (52%) in HindustanUnilever Limited. HUL was one of the eight Indian companies to be featured onthe Forbes list of Worlds Most Reputed companies in 2007

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Our History.

In the summer of 1888, visitors to the Kolkata harbour noticed crates full ofSunlight soap bars, embossed with the words "Made in England by Lever

Brothers". With it, began an era of marketing branded Fast Moving ConsumerGoods (FMCG).

Soon after followed Lifebuoy in 1895 and other famous brands like Pears, Luxand Vim. Vanaspati was launched in 1918 and the famous Dalda brand came tothe market in 1937.

In 1931, Unilever set up its first Indian subsidiary, Hindustan Vanaspati

Manufacturing Company, followed by Lever Brothers India Limited (1933) and

United Traders Limited (1935). These three companies merged to form HUL in

November 1956; HUL offered 10% of its equity to the Indian public, being the

first among the foreign subsidiaries to do so. Unilever now holds 52.10% equity

in the company. The rest of the shareholding is distributed among about 360,675

individual shareholders and financial institutions.

The erstwhile Brooke Bond's presence in India dates back to 1900. By 1903, the

company had launched Red Label tea in the country. In 1912, Brooke Bond & Co.

India Limited was formed. Brooke Bond joined the Unilever fold in 1984 through

an international acquisition. The erstwhile Lipton's links with India were forged in

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1898. Unilever acquired Lipton in 1972, and in 1977 Lipton Tea (India) Limited

was incorporated.

Pond's (India) Limited had been present in India since 1947. It joined the Unilever

fold through an international acquisition of Chesebrough Pond's USA in 1986.

Since the very early years, HUL has vigorously responded to the stimulus of

economic growth. The growth process has been accompanied by judicious

diversification, always in line with Indian opinions and aspirations.

The liberalisation of the Indian economy, started in 1991, clearly marked an

inflexion in HUL's and the Group's growth curve. Removal of the regulatory

framework allowed the company to explore every single product and opportunity

segment, without any constraints on production capacity.

Simultaneously, deregulation permitted alliances, acquisitions and mergers. In

one of the most visible and talked about events of India's corporate history, the

erstwhile Tata Oil Mills Company (TOMCO) merged with HUL, effective from

April 1, 1993. In 1996, HUL and yet another Tata company, Lakme Limited,

formed a 50:50 joint venture, Lakme Unilever Limited, to market Lakme's

market-leading cosmetics and other appropriate products of both the companies.

Subsequently in 1998, Lakme Limited sold its brands to HUL and divested its

50% stake in the joint venture to the company.

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HUL formed a 50:50 joint venture with the US-based Kimberly Clark

Corporation in 1994, Kimberly-Clark Lever Ltd, which markets Huggies Diapers

and Kotex Sanitary Pads. HUL has also set up a subsidiary in Nepal, Unilever

Nepal Limited (UNL), and its factory represents the largest manufacturing

investment in the Himalayan kingdom. The UNL factory manufactures HUL's

products like Soaps, Detergents and Personal Products both for the domestic

market and exports to India.

The 1990s also witnessed a string of crucial mergers, acquisitions and alliances on

the Foods and Beverages front. In 1992, the erstwhile Brooke Bond acquired

Kothari General Foods, with significant interests in Instant Coffee. In 1993, it

acquired the Kissan business from the UB Group and the Dollops Icecream

business from Cadbury India.

As a measure of backward integration, Tea Estates and Doom Dooma, two

plantation companies of Unilever, were merged with Brooke Bond. Then in 1994,

Brooke Bond India and Lipton India merged to form Brooke Bond Lipton India

Limited (BBLIL), enabling greater focus and ensuring synergy in the traditional

Beverages business. 1994 witnessed BBLIL launching the Wall's range of Frozen

Desserts. By the end of the year, the company entered into a strategic alliance

with the Kwality Icecream Group families and in 1995 the Milkfood 100%

Icecream marketing and distribution rights too were acquired.

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Finally, BBLIL merged with HUL, with effect from January 1, 1996. The internal

restructuring culminated in the merger of Pond's (India) Limited (PIL) with HUL

in 1998. The two companies had significant overlaps in Personal Products,

Speciality Chemicals and Exports businesses, besides a common distribution

system since 1993 for Personal Products. The two also had a common

management pool and a technology base. The amalgamation was done to ensure

for the Group, benefits from scale economies both in domestic and export markets

and enable it to fund investments required for aggressively building new

categories.

In January 2000, in a historic step, the government decided to award 74 per cent

equity in Modern Foods to HUL, thereby beginning the divestment of government

equity in public sector undertakings (PSU) to private sector partners. HUL's entryinto Bread is a strategic extension of the company's wheat business. In 2002, HUL

acquired the government's remaining stake in Modern Foods.

In 2003, HUL acquired the Cooked Shrimp and Pasteurised Crabmeat business of

the Amalgam Group of Companies, a leader in value added Marine Products

exports.

HUL launched a slew of new business initiatives in the early part of 2000s.

Project Shakti was started in 2001. It is a rural initiative that targets small villages

populated by less than 5000 individuals. It is a unique win-win initiative that

catalyses rural affluence even as it benefits business.

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Currently, there are over 45,000 Shakti entrepreneurs covering over 100,000

villages across 15 states and reaching to over 3 million homes.

In 2002, HUL made its foray into Ayurvedic health & beauty centre category with

the Ayush product range and Ayush Therapy Centres. Hindustan UnileverNetwork, Direct to home business was launched in 2003 and this was followed by

the launch of Pureit water purifier in 2004.

In 2007, the Company name was formally changed to Hindustan Unilever

Limited after receiving the approval of share holders during the 74th AGM on

18 May 2007. Brooke Bond and Surf Excel breached the the Rs 1,000 crore

sales mark the same year followed by Wheel which crossed the Rs.2,000 crore

sales milestone in 2008.

On 17th October 2008 , HUL completed 75 years of corporate existence in

India.

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Company Profile.

Hindustan Unilever Limited

Type Public companyBSE:HUL

Industry Fast Moving Consumer Goods FMCG)

Founded 1933

Headquarters Mumbai, India

Key people Harish Manwani (Chairman), Nitin Paranjpe (CEO and Managing Director)

Products Home & Personal Care, Foods, Water Purifier

Revenue Rs 20,869.57 crore (US$ 4.45 billion) (2008-2009) [1]

Employees Over 65,000 direct & indirect employees

Parent UnileverPlc

Website www.hul.co.in

Present Stature.

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Hindustan Unilever Limited (HUL) is India's largest fast moving consumer goodscompany, and estimates that two out of three Indians use its products. It has over42 factories across India.

HUL is also one of the country's largest exporters; it has been recognised as aGolden Super Star Trading House by the Government of India.

The Hindustan Unilever Research Centre (HURC) was set up in 1958, and nowhas facilities in Mumbai and Bangalore. HURC and the Global TechnologyCentres in India have over 200 highly qualified scientists and technologists, many

with post-doctoral experience acquired in the US and Europe.

HUL also renders services to the community, focusing on health & hygieneeducation, empowerment of women, and water management. It is also involved ineducation and rehabilitation of underprivileged children, care for the destitute andHIV-positive, and rural development. HUL has also responded to nationalcalamities, for instance with relief and rehabilitation after the 2004 tsunamicaused devastation in South India.

In 2001, the company embarked on a programme called Shakti, through which itcreates micro-enterprises for rural women. Shakti also includes health andhygiene education through the Shakti Vani Programme, which now covers 15states in India with over 45,000 women entrepreneurs in 135,000 villages. By theend of 2010, Shakti aims to have 100,000 Shakti entrepreneurs covering 500,000villages, touching the lives of over 600 million people. HUL is also running arural health programme, Lifebuoy Swasthya Chetana. The programme endeavoursto induce adoption of hygienic practices among rural Indians and aims to bring

down the incidence ofdiarrhoea. So far it has reached 120 million people in over50,000 villages.

Corporate Social Responsibility.

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A business that makes nothing but money is a poor kind of

business.

The World Business Council for Sustainable Development in its publication

"Making Good Business Sense" by Lord Holme and Richard Watts, used the

following definition. "Corporate Social Responsibility is the continuing

commitment by business to behave ethically and contribute to economic

development while improving the quality of life of the workforce and theirfamilies as well as of the local community and society at large"

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The same report gave some evidence of the different perceptions of what thisshould mean from a number of different societies across the world. Definitions asdifferent as "CSR is about capacity building for sustainable livelihoods. It

respects cultural differences and finds the business opportunities in building theskills of employees, the community and the government" from Ghana, through to"CSR is about business giving back to society" from the Phillipines.

Traditionally in the United States, CSR has been defined much more in terms of aphilanphropic model. Companies make profits, unhindered except by fulfillingtheir duty to pay taxes. Then they donate a certain share of the profits to charitablecauses. It is seen as tainting the act for the company to receive any benefit fromthe giving.

The European model is much more focused on operating the core business in asocially responsible way, complemented by investment in communities for solid

business case reasons. Personally, I believe this model is more sustainablebecause:

1. Social responsibility becomes an integral part of the wealth creationprocess - which if managed properly should enhance the competitivenessof business and maximise the value of wealth creation to society.

2. When times get hard, there is the incentive to practice CSR more andbetter - if it is a philanphropic exercise which is peripheral to the main

business, it will always be the first thing to go when push comes toshove.

But as with any process based on the collective activities of communities ofhuman beings (as companies are) there is no "one size fits all". In differentcountries, there will be different priorities, and values that will shape how

business act. And even the observations above are changing over time. The UShas growing numbers of people looking towards core business issues.

For instance, the CSR definition used by Business for Social Responsibility is:"Operating a business in a manner that meets or exceeds the ethical, legal,commercial and public expectations that society has of business.

On the other hand, the European Commission hedges its bets with two definitionswrapped into one: "A concept whereby companies decide voluntarily tocontribute to a better society and a cleaner environment. A concept whereby

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companies integrate social and environmental concerns in their businessoperations and in their interaction with their stakeholders on a voluntary basis".

CSR is about how companies manage the business processes to

produce an overall positive impact on society.

Take the following illustration:

Companies need to answer to two aspects of their operations. 1. The quality oftheir management - both in terms of people and processes (the inner circle). 2.The nature of, and quantity of their impact on society in the various areas.

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When you review each of these, they broadly agree that the definition now focuseson the impact of how you manage your core business. Some go further than othersin prescribing how far companies go beyond managing their own impact into the

terrain of acting specifically outside of that focus to make a contribution to theachievement of broader societal goals. It is a key difference, when many businessleaders feel that their companies are ill equipped to pursue broaders societalgoals, and activists argue that companies have no democratic legitimacy to takesuch roles. That particular debate will continue.

WHY CSR IS IMPORANT .

Several factors contribute to the importance of CSR. Most importantly, CSRshould not just be another department in a large corporation or a policy it choosesto pursue some of the time. Companies cannot only employ CSR strategies when

they have the economic means to do so or when business is good and disbandCSR policies when business is slow, but rather; CSR must be engrained as acentral value of a company no matter what the economic times are like.

The most important reason CSR is taking prominence in the corporate world isbecause evidence suggests that companies that pursue CSR strategies are moreprofitable than those who do not. Moreover, CSR has gained prominence becausethe Internet and mass media, empowered by globalization, make it difficult forcompanies to bury or hide detrimental social practices. Preserving and

maintaining a healthy company image is one reason for the prevalence of CSR.

Lastly, the awareness of a duty to the communities in which companies operate isemerging. Corporations understand their roles as global citizens and CSR allowsthem to positively facilitate relationships with the communities in which theyoperate. Current World Wild Life CEO Carter Roberts epitomizes this point,Companies still thinking about the environment and the community as socialresponsibilities rather than business imperatives are living in the dark ages.S

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CSR ACTIVITIES.

Sales (2007-2008) = Rs.14000 crores (rounded off)

Net profit after tax = Rs.2000 crores (rounded off)

Community initiatives.

HUL believes that an organisations worth beyond its business, is captured by theservice it renders to the community. We focus on nutrition, health and hygieneeducation, empowering livelihoods and eco-efficiency. We are committed toresponsible leadership by positively impacting India on her most challengingissues.

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Our Goal.We seek to positively impact India on issues relevant to stakeholders andcommunities.

Our Approach.As a part of our voluntary initiatives, we will respond to natural disaster andsupport relief and welfare measures for vulnerable sections etc.

We will also actively work towards water conservation to benefit communitiesaround our manufacturing sites.

Social

Providing healthcare

Sanjivani Mobile MedicalFacilityHUL started Sanjivani a Mobile Medical Service in the year 2003 to bringeffective medical care to villages surrounding our Doom Dooma factory inAssam. The objective has been to meet basic medical needs of people living in theremote villages in Assam through a charge-free mobile medical facility. Apartfrom basicmedical services, it also spreads awareness on issues such as hygiene, child

immunization, family planning etc.

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The project covers a radius of 40 kilometers around the factory with two mobilevans equipped with basic medical equipment and specialised team of one maleand one female doctor, two nurses, a medical attendant and drivers.

On an average, 400 Sanjivini medical camps are conducted every year in remotevillages surrounding our factory. The project is run in close co-ordination with thelocal administration and the progress is reviewed every quarter.

The Sanjivani project has provided medical assistance to more than 1,43,364patients since its inception and in 2007 alone in 344 camps more than 22,395patients were treated. In 2008 through 437 camps, 31,790 patients have beentreated.

Disaster relief andrehabilitationFloods, Bihar, 2008

HUL contributed 10,000 kits worth Rs.60 lakhs as the first installment of materialfor immediate relief of the flood affected families of Araria District in Bihar. The

kit contained essential items such as utensils, clothes, blankets and other usefulmaterial. In all, 12 truckloads of material were distributed to the affected familiesunder the guidance of the Araria District Magistrate.

A sum of 84 lakhs was contributed by HUL employees and the company torehabilitate the underprivileged amongst the flood-affected families in the villageof Jorgama, Madhepura District, Bihar.

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The Project aims at providing, through a strategic alliance between HUL, ACC &Habitat International, the following facilities to the People in a phased manner:

- Construction of 100 disaster proof houses for the purpose of rehabilitation;- Construction and development of a Community Resource Centre for people- Design, development and implementation of livelihood programmes aiming atsustained and increased income for 300 families- Capacity and capability building of villagers for village development- Promoting the concept of Self-Help Groups to develop economically, ecologicallyand viable plans and to mobilize finances for farming and non-farming activities- Creating alternate livelihood opportunities in the areas of manufacturing of concrete

products, sale of hollow brick blocks, fly ash bricks, pavement blocks etc.- Ensuring the involvement of people in non-farming activities and help create a

feasible rapport with fair, remunerative and competitive markets- Assist in improving the living condition for at least 300 families- Development of a model village with provisions for safe drinking water & put in

place a mechanism for water resource management, provisions of electricity supply,clinical & sanitation facilities, etc.

Tsunami, South India, 2006HUL contributed over Rs. 100 million towards relief and rehabilitation oftsunami affected families by the way of providing relief material, land andconstruction of facilities. The Company distributed nutritional and personal hygiene productsworth Rs. 50 million for immediate relief to the needy at the time that tsunamihad hit the region. Later, pursuant to a request from the Government of Tamil

Nadu on a more pressing need to provide housing to the affected families, HUL

donated 5.27 acres of land (market value on a conservative basis is Rs. 45million) at Tondiarpet, Chennai, to the Government of Tamil Nadu forrehabilitation.

The complex has 960 permanent houses spread over 5.27 acres of land donated byHUL. Employees of HUL made a contribution of Rs. 5 million towards the

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construction of the facilities in the complex.

On the day of the disaster, employees from our factories and offices in

Pondicherry, Tamil Nadu and Kerala had provided necessary relief to theTsunami-hitpeople. The relief operations included distribution of bread and biscuits to over500 families in Pondicherry, 12,000 cooked meals for families in Chennai,

Nagapattinam, Cuddalore and Andamans. Over 12,000 dry relief packs,comprising of Company's dry rations and personal hygiene products weredistributed

Gujarat Earthquake, 2001After the devastating earthquake in Gujarat in 2001, HUL reconstructed a village inthe Bhachau Taluka of Gujarat's Kutch district in December 2002. Named asYashodadham, this village was dedicated to 1,100 residents of Nani Chirai village,which was completely wrecked by the earthquake. Yashodadham wasconstructed with the active involvement of villagers and is spread over 25 acres,comprising 289 homes.

HUL has also supported the construction of a school building, playground, multi-purpose community centre, crche, health centre, underground reservoir, overheadtank, community room and a village administration office. All the structures areearthquake and cycloneresistant.

Greening Barriers:Water Conservation and Harvesting

(linked to product Pureit)

HUL's Water Conservation and Harvesting project has two major objectives:a. to reduce water consumption in its own operations and regenerate sub-soilwater tables at its own sites through the principles of 5R - Reduce, Reuse,Recycle, Recover and Renew;

b. help adjacent villages to implement appropriate models of watersheddevelopment.

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SHAKTI - Changing Lives in

Rural India

Shakti is HUL's rural initiative, which targets small villages with population ofless than 2000 people or less. It seeks to empower underprivileged rural women

by providing income-generating opportunities, health and hygiene educationthrough the Shakti Vani programme, and creating access to relevant informationthrough the iShakti community portal.

In general, rural women in India are underprivileged and need a sustainablesource of income. NGOs, governmental bodies and other institutions have beenworking to improve the status of rural women. Shakti is a pioneering effort increating livelihoods for rural women, organised in Self-Help Groups (SHGs), andimproving living standards in rural India. Shakti provides critically needed

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additional income to these women and their families, by equipping and trainingthem to become an extended arm of the company's operation.

Health & Hygiene EducationLifebuoy Swastya Chetna (LBSC) is a rural health and hygiene initiative whichwas started in 2002. LBSC was initiated in media dark villages (in UP, MP,Bihar, West Bengal, Maharashtra, Orissa) with the objective of spreadingawareness about the importance of washing hands with soap.

The need for a program of this nature arose from the fact that diarrhoeal diseasesare a major cause of death in the world today. It is estimated that diarrhoea claimsthe life of a child every 10 seconds and one third of these deaths are in India.

According to a study done by the London School of Hygiene and TropicalMedicine, the simple practice of washing hands with soap and water can reducediarrhoea by as much as 47%. However, ignorance of such basic hygiene

practices leads to high mortality rates in rural India.

Economic Empowerment of Women

EMPOWERMENT OF WOMEN THROUGH EDUCATION

Fair & Lovely Foundation

Scholarships of up to Rs. 1 lakh awarded to women with aptitude, drive & theambition to carve a place of pride for themselves in society, but do not have thefinancial strength to realise their dreams. Awarded, earlier, for postgraduatestudies these scholarships have now been extended to graduate studies as well.

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Since 2003, over 600 scholarships have been awarded to women from acrossIndia.

The Fair & Lovely Foundation is HUL's initiative which aims at economic

empowerment of women across India. It aims to achieve this through providinginformation, resources, inputs and support in the areas of education, career andenterprise. It specifically targets women from low-income groups in rural as wellas urban India. Fair & Lovely, as a brand, stands on the economic empowerment

platform and the Foundation is an extension of this promise. The Foundation hasrenowned Indian women, from various walks of life, as its advisors. Among themare educationists, NGO activists, physicians. The Foundation is implementing itsactivities in association with state governments.

Special Education &RehabilitationUnder the Happy Homes initiative, HUL supports special education andrehabilitation of children with challenges.

Asha Daan:The initiative began in 1976, when HUL supported Mother Teresa and theMissionaries of Charity to set up Asha Daan, a home in Mumbai for abandoned,challenged children, and the destitute.

The vulnerable

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In 1976, HUL provided a 72,500-square feet plot to set up Asha Daan in the heartof Mumbai city. This home is supported by Mother Teresa & the Missonaries of

Charity and cares for abandoned and challenged children, victims of HIV and thedestitute. HUL bears the capital and revenue expenses for maintenance,upkeep and security of the premises. At any point of time, about 370 peoplecomprising boys, girls, men and women live at the Home and their needs for food,clothing and medicines are catered to.

The needs of the abandoned / challenged children are met through special classesof basic skills, physiotherapy, etc. being taken care of by the Sisters of the Home.Wherever necessary, corrective surgery is also arranged for in the city hospitals.Mother Teresa's desire to open a ward for female HIV positive patientswas made possible by HUL in 1995. Since its inception, the AIDS Ward has takencare of 375 patients. Till date, over 15,750 individuals have benefited fromAshadaan

Ankur:

In 1993, HUL's Doom Dooma Plantation Division set up Ankur, a centre forspecial education of challenged children. The centre takes care of children withchallenges, aged between 5 and 15 years. Ankur provides educational, vocational

and recreational activities to over 35 children with a range of challenges,including sight or hearing impairment, polio related disabilities, cerebral palsyand severe learning difficulties. Ankur focuses oneducational, vocational and recreational activities. The children are taught skills,such as cookery, painting, embroidery, bamboo crafts, weaving, candle making,stitching, etc. depending on their aptitudes.

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The centre has rehabilitated 10 children, including facilitating self-employmentfor 6 children by providing them with shops, and 3 girls have been providedemployment as crche attendants. It has also helped 18 children in moving themto normal schools. Since inception it has touched over 80 children. Ankur

received the Lawrie Group's Worldaware Award for Social Progress in 1999 fromHer Royal Highness in London.

Kappagam:Encouraged by Ankur's success, Kappagam ("shelter"), the second centre forspecial education of challenged children, was set up in 1998 on HUL Plantationsin South India. It has 17 children. The focus of Kappagam is the same as that ofAnkur.

Anbagam:Yet another day care center, Anbagam ("shelter of love"), has been started in2003 also in the South India Plantations. It takes care of 11 children. Besidesmedical care and meals, they too are being taught skills such that they can becomeself-reliant and elementary studies.

EconomicEmpowering livelihoods

HUL DHAN FoundationAs a part of our 75th year initiatives, we partnered with DHAN foundation a

professionally managed development organization engaged in enhancing theincomes of 75,000 women from economically poor households in South India.The objectives of the DHAN programme are to:- ensure a minimum increase of aggregate Rs. 150 million for the selected 75,000

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poor women- support the federations of self help groups for initiating suitable projects forenhancing the incomes of the selected poor women based on their needs

Vindhya Valley ProjectThis project aimed at sharing business and marketing skills with people from thevillages. We partnered with rural below the poverty line Self Help Groups (SHG)to build a brand and set up a distribution system to succeed in a highlycompetitive urban FMCG market. This project, in partnership with theGovernment of Madhya Pradesh, seeks to generate sustainable livelihoods in ruralareas while cutting out middlemenand providing maximum value to the manufacturers.

This project leverages the core strength of the company in the areas of brand

building and activation to serve the communities in Vindhya Valley, MP andRudi, Gujarat. This not only protects the SHGs from the exploitation ofmiddlemen, but also empowers them in becoming effective marketeers andsuccessfulentrepreneurs.

HUL provided the technical know-how, business insights and marketing skills tomanufacturers to help put in place an end-to-end system that takes care of allaspects of the business operation. HUL also provided guidance for the executionof all business plans and review mechanisms. Keys areas where HUL assisted is:- upgrading rural SHG manufacturing units and training them- developing packing design- production processes- setting up the logistics- sales and distribution systems and- advertising and promotion

Vindhya Valley's portfolio of spices, honey, lentil wafers, pickles, incense sticksand others are manufactured in 12 locations with over 500 direct beneficiaries.

HUL was awarded the TERI CSR award in 2006 by the President of India inrecognition of its conceptualisation and efforts in the Vindhya Valley Project

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EnvironmentalA responsible corporate

citizenThe Pollution Control Committee of D&NH contacted our Silvassa Unit to tacklea critical problem. Drums full of toxic chemicals were dumped into the DamanGanga river by some chemical manufacturer. It was of paramount importance tocontrol the spread of these toxic chemicals before it assumed severe proportions.The task was entrusted to a team headed by our Safety Officer from our SilvassaUnit. They provided safety equipments and neutralising agents which helped todefuse the situation in four hours. Their quick and timely support was appreciated

by the local administration.

Water conservationWater scarcity is one of the biggest crisis facing India. Water management has

been a focus area for HUL, and has been made one of the key performanceindicators of all HUL factories. HUL is also committed to extending its efforts onwater management to the larger community, and has engaged in community

projects in water adjacent to our manufacturing sites. HUL's Khamgaon factory is

located in a dry and arid region of Maharashtra. Around 12 years ago the factorystarted a pilot project on 'Watershed Management' on a five hectare plot toprevent soil degradation and conserve water. The efforts have resulted in thecreation of a green belt, which is now a veritable forest of about 6,300 trees

Encouraged by the results, HUL extended the model to a neighbouring village,Parkhed, in association with TERI and Bharatiya Agro Industries Foundation. Thecommunity at Parkhed has already constructed 47 percolation bunds, 1,600trenches, 6,000 running metres of continuous contour trenching over 100 hectaresand 5 permanent check dams. Around 350 families have reaped a second crop this

year which is only possible due to construction of check dams. Total land undercultivation during second crop season is 470 acres.

The annual income of the farmers in the vicinity of 5 check dams increased fromaround an average of Rs. 36,000/- to approx. Rs. 85,000/- per annum per farmer.This has been attributed to the availability of water in the wells during the Rabbi

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season and also increase in the level of water in the wells during the Kharifseason.

Hence, along with reaping a rabbi crop, the farmers have also been able to almost

double the yield of the Kharif crop. The initiative received appreciation at theJohannesburg World Summit on Sustainable Development.

SilvassaKarchond near Silvassa spans 1491 hectares and has a population of 3253consisting of 478 families. The chief occupation of the area is farming for 4months when water is available. After this the population migrates to DamanSilvassa for labor/contract jobs. Thus, water conservation was a great necessity. Inassociation with Vanarai, an NGO, HUL's Silvassa unit embarked on a long-term

project of water harvesting, which aimed to dramatically change wateravailability, taking it up to year-round availability from 4 months.

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Corporate governance

Not to be confused with a corporate state, a corporative

government rather than the government of a corporation

Responsible corporate conduct is integral to the way we do our business. Ouractions are governed by our valuesand principles, which are reinforced at all levels within the Company. We, atHindustan Unilever, are committed todoing things the right way which means taking business decisions and acting in away that is ethical and is in compliance with the applicable legal requirements.

Our Code of Business Principles is an extension of our values and reflectsour continued commitment to ethical business practices and regulatorycompliance. We acknowledge our individual and collective responsibilities tomanage our business activities with integrity.

To succeed, we believe, requires the highest standards of corporatebehavior towards everyone we workwith, the communities we touch, and the environment on which we have an

impact.This is our road to sustainable, profitable growth and creating long-term

value for our shareholders, our people, and our business partners. During last 75years of the Companys existence, the above principles have been the guidingforce for whatever we do and shall continue to be so in the coming years.

The Board of Directors of your Company are responsible for andcommitted to sound principles of Corporate Governance in the Company. The

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Board plays a critical role in overseeing how the management serves the short andlong term interests of shareholders and other stakeholders. This belief is reflectedin our governance practices, under which we strive to maintain an active,informed, and independent Board. We keep our governance practices under

continuous review and benchmark ourselves to the best governed companiesacross the globe.

The Board of Directors

The Board of Directors (the Board) is entrusted with the ultimate responsibility ofthe management, general affairs,direction and performance of the Company and has been vested with the requisite

powers, authorities and duties. The Management Committee of the Company isheaded by the Managing Director and Chief Executive Officer and has business/functional heads as its members, which looks after management of the day-to-dayaffairs of the Company.

Appointment and Tenure

The Directors of the Company are appointed by shareholders at GeneralMeetings. All Directors, except forthe Managing Director, step down at the Annual General Meeting each year and,if eligible, offer themselves forre-election, in accordance with the Articles of Association of the Company.

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The Executive Directors on the Board serve in accordance with the terms oftheir contracts of service with the Company. As per the Company policy, theIndependent Directors do not seek re-appointment on attaining the age of 70years. The Company also follows the policy of having a ceiling of nine years on

the term of office of Independent Directors after revised Clause 49 of ListingAgreement has come into effect in October 2004.

Composition

The Board consists of 10 Directors comprising four Executive Directors, oneNon-Executive Director and five Independent Directors. The Chairman of theBoard is a Non-Executive Director. The Board represents an optimal mixof professionalism, knowledge and experience. The detailed profiles of themembers of the Board of Directors are

provided on page nos. 18 to 23 of the Annual Report.

Corporate governance is the set ofprocesses, customs, policies, laws, andinstitutions affecting the way a corporation (orcompany) is directed, administeredor controlled. Corporate governance also includes the relationships among themany stakeholders involved and the goals for which the corporation is governed.The principal stakeholders are the shareholders, theboard of directors, employees,customers, creditors, suppliers, and the community at large.

Corporate governance is a multi-faceted subject. An important theme of corporategovernance is to ensure the accountability of certain individuals in anorganization through mechanisms that try to reduce or eliminate the principal-agent problem. A related but separate thread of discussions focuses on the impactof a corporate governance system in economic efficiency, with a strong emphasison shareholders' welfare. There are yet other aspects to the corporate governancesubject, such as the stakeholder view and the corporate governance models aroundthe world There has been renewed interest in the corporate governance practicesof modern corporations since 2001, particularly due to the high-profile collapses

of a number of large U.S. firms such as Enron Corporation and MCI Inc.(formerly WorldCom). In 2002, the U.S. federal government passed the Sarbanes-Oxley Act, intending to restore public confidence in corporate governance.

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It is believed that nothing can be greater than a business, however

small it may be, that is governed by conscience; and that nothing can

be meaner or more petty than a business, however large, governed

without honesty and without brotherhood.

-William Hesketh Lever

Transparency and accountability are the two basic tenets of Corporate

Governance. Hindustan Unilever feels proud to belong to a Company whose

visionary founders had laid the foundation stone for good governance long

back and made it an integral principle of the business, demonstrated in the

words above.

HULs approach to Corporate Governance

To succeed, they believe, requires the highest standards of corporate behaviourtowards everyone they work with, the communities they touch, and theenvironment on which they have an impact. This is their road to sustainable,

profitable growth and creating long-term value for their shareholders, theirpeople, and their business partners.

Corporate Information

Registered Office

Hindustan Unilever Limited,165/166, Backbay Reclamation

Mumbai 400 020

Tel : +91 22 39830000

Fax no. : +91 22 - 22026712

Corporate Office & Research Centre

Hindustan Unilever Limited,

Unilever House,

B. D. Sawant Marg,

Chakala, Andheri (E),

Mumbai - 400 099.

Executive Director (Legal) and Company

Secretary

Dev Bajpai,

Email : [email protected]

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Tel nos. : +91-22-398 32557 / 32358

/ 32532 / 32312

Statutory Auditors

Lovelock & Lewes,

Chartered Accountants

252, Veer Savarkar Marg

Dadar, Mumbai- 400 028

Solicitors

Crawford Bayley & Co.

State Bank BuildingN.G.N. Vaidya Marg

Mumbai 400 023

Registrar and Share Transfer Agents

Karvy Computershare Private

Limited

Unit : HINDUSTAN UNILEVER

LIMITED

Plot No. 17 to 24, Vittalrao Nagar,

Madhapur, Hyderabad 500 081.

Phone : +91- 40 23420818-823

Fax : +91- 40 23420814

Email : [email protected]

Website : www.karvy.com

Subsidiary Companies

Unilever India Exports Limited

Unilever Nepal LimitedPonds Exports LimitedLakme Lever Private LimitedDaverashola Estates Private LimitedJamnagar Properties Private LimitedBrooke Bond Real Estates PrivateLimited

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Hindustan Field Services PrivateLimitedLevers Associated Trust Limited

Levindra Trust LimitedHindlever Trust Limited

HUL Policies

Unilever is committed to providing the very best not only to our customers butalso to the environment. Read up on some Unilever policies that aim to do just

that.

Environment Policy

The aim of the Policy is to do all that is reasonably practicable to prevent orminimise, encompassing all available knowledge and information, the risk of anadverse environmental impact arising from processing of the product, its use orforeseeable misuse.

Quality Policy

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HULs Quality Policy describes the principles that everyone in Unilever follows,wherever they are in the world, to ensure that they are recognised and trusted forotheir integrity, the quality of their brands and products, and the high standardsthey set.

Safety & Health Policy

Hindustan Unilever Limited (HUL) supplies high quality goods and services tomeet the daily needs of consumers and customers.

Affirmative Action Policy

HUL is a signatory to the CII Code of Conduct on Affirmative Action andaffirms its recognition.

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A Project on Hul Csr

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Transcript of A Project on Hul Csr