LARSEN & TOUBRO LIMITED

CODE OF CONDUCT
FOR

S & E AND COVENANTED OFFICERS

2006

Code of Conduct of S & E and Covenanted Officers

I. PREAMBLE 3
II. APPLICABILITY
III.

CODE OF CONDUCT

I)

HONESTY, INTEGRITY, ETHICS

II)

RESPECT FOR INDIVIDUALS 4

III) SHARING OF OFFICIAL INFORMATION 4

IV) PROFESSIONAL ENGAGEMENT
V)

USE OF COMPANY ASSETS

VI) USE OF INFORMATION TECHNOLOGY 5

VII)

WORKING ENVIRONMENT

VIII)

SAFETY, HEALTH & ENVIRONMENT

IX) PROHIBITED ITEMS 5

X)

GIFT POLICY

XI) AND FINALLY

IV.

MECHANISM FOR IMPLEMENTATION AND MONITORING

A) CODE OF CONDUCT (COC) APEX COMMITTEE

i) Role of the CoC Apex Committee

ii) Meeting and Deliberations 7

B) UNIT LEVEL COC COMMITTEE 7
i) Role of the Committee

ii) Meeting and Deliberation 7

V. PROCEDURE

VI ACTION BY CMC

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Code of Conduct of S & E and Covenanted Officers

9.

PREAMBLE
1 L&T is a professionally managed Indian multinational, committed to total
customer satisfaction & enhancing stakeholders value.
2 The companys philosophy on corporate governance is built on a rich legacy of
fair & transparent governance & disclosure practices. This includes respect for
human values, individual dignity, & adherence to honest, ethical & professional
conduct. L&T-ies are guided by the vision statement & values mentioned
therein for the success & reputation of L&T.

35.

APPLICABILITY
This Code of Conduct is applicable to all Supervisory, Executive and Covenanted
Officers of Larsen & Toubro Limited and its group of Companies.
The Board Members, Executive Directors and Senior Managerial Personnel (Senior
Officers) will continue to be governed by Code of Conduct signed by them.

61.

CODE OF CONDUCT
1)

Honesty, Integrity, Ethics

All L&T-ites shall act in conformity with professional standards of personal
integrity, honesty & ethical conduct, especially when on Companys business,
at Company sponsored events, or when representing the company.
Ethical conduct is one that is free from fraud & deception and includes actual
or potential conflicts of interest between personal advantages as against
organizations needs and/or values.

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Code of Conduct of S & E and Covenanted Officers

2)

Respect for Individuals

L&T-ites shall treat their colleagues & business associates with dignity &
respect, irrespective of caste, creed, gender, religion/region, nationality,
appearance or any disability.
Superiors shall encourage their subordinates/colleagues to express their
professional views in meetings / discussions, candidly and without fear.
Feedback on performance will be provided as far as possible in private. They
shall treat them with equity & fairness.
L&T-ites shall not use abusive or offensive language, tone or gesture with
their colleagues or business associates. Superiors shall not insult/demean their
subordinates.
L&T-ites shall commit to create an environment which is free of any type of
sexual harassment & abide by the Guidelines on Sexual Harassment.

3)

Sharing of Official Information

L&T-ites shall not divulge or communicate in any manner
sensitive/confidential information to third parties, except when authorized to
do so for business reasons. Companys Policy Guideline on Designated
Spokpersons authorized for communicating to the media in this regard, shall
be strictly followed.
L&T-ite shall not speak ill about the organization to any external agency
which would tarnish the image of the organization.
Similarly, L&T-ites shall desist from indulging in rumor mongering/loose
talks, about the organization that is detrimental to the Companys interest.

4)

Professional Engagement
L&T-ites are encouraged to associate themselves with activities of
professional bodies/fora to enrich their knowledge and also help in building
organizations image. However, such engagement should not result in
dereliction of duty or in discrediting the organizations image/reputation or
abuse of organizations resources.

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Code of Conduct of S & E and Covenanted Officers

5)

Use of Company Assets

L&T-ites shall not exploit the organizational resources for ones own personal
gain/pecuniary advantage. In discharge of official duties, one shall strive for
effective and judicious use of resources entrusted to them. Resources include
both tangible assets like equipment and facilities etc. or intangible assets like
designs, information, software, or network with suppliers/customers, etc.

6)

Use of Information Technology

L&T-ites shall judiciously use the Information Technology facilities provided
to them. They shall conform to the policy on Information Technology.

7)

Working Environment
L&T-ites shall not engage in any activity that is likely to result in disturbing
peace & harmony in the workplace or engage in activities that is likely to
create tension, bitterness or confusion in the minds of colleagues.
Superiors shall endeavour to create a climate in ensuring the above.

8)

Safety, Health & Environment

L&T-ites shall endeavour to create a safe working environment by following
the policies and procedures of Health, Safety and Environment, as applicable.
L&T-ites shall strive to keep ones own place and surrounding work place
clean and hygienic.

9)

Prohibited Items
Use, sale, purchase or possession of narcotic drugs, arms/weapons by L&Tites at work place or when on duty is prohibited.

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Code of Conduct of S & E and Covenanted Officers

10) Gift Policy

L&T-ites shall not accept gift or cash equivalent which would result in any
violation of law or commitment to mutual respect. Acceptance of gifts
appropriate to the circumstances, promotional items with the logo and/or
nominal value, occasional business meals, celebratory events and
entertainment, provided that they are not excessive or create an appearance of
impropriety, do not violate this policy.

11) And Finally

All L&T-ites besides being good employees, shall endeavor to contribute
towards:

1
2

IV.

Development of the community and society.

Supporting National & Humanitarian Causes

MECHANISM FOR IMPLEMENTATION AND MONITORING

A Code of Conduct Committee shall be constituted, the details of which are as
under:

1)

Code of Conduct (CoC) Apex Committee

The Code of Conduct Apex Committee shall be constituted by the CMC at
the Company level, which will function as an Apex Body to interact, inform,
advise and coordinate with the CMC on all issues relating to the Code of
Conduct.
The Apex Level CoC Committee shall consist of a minimum of five
members, preferably of the level of VP and above, Head of Corporate HR
will be one of the members. As far as possible, it will draw upon people from
various ODs. VP - Corporate Governance and Head of Corporate HR &
Personnel, will co-opt/invite additional members from time to time depending
on the matters to be discussed/investigated.
V.P. Corporate Governance will function as Ex-Officio Secretary of the
Apex Committee.

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Code of Conduct of S & E and Covenanted Officers

1) Role of the CoC Apex Committee

1. To ensure implementation of CoC across the Company.
2.

Deal with instances of non-compliance as reported to it by the

Local Committee or directly as per the situation.

3.

Review the functioning of the Unit Level CoC Committees.

4.

Examine issues of amendment/modification of the Code of

Conduct.

5.

Recommend/advise CMC on follow up action in cases of noncompliance.

2) Meeting and Deliberations

Apex Level Committee shall meet atleast twice a year.

2)

Unit Level CoC Committee

Each unit will form a CoC Committee consisting of four members, headed by
the Unit Head with Head of Accounts, Head of HR and a Senior from
Operations. As far as possible, all major locations where sizeable number of
L&T-ites are working, should have a Unit Level CoC Committee.

1) Role of the Committee

1. Creation of awareness of the CoC.
2. Initiate steps to motivate employees to follow CoC.
3. Provide clarification to any individual employee/Business Unit
Manager regarding the meaning/applicability of any Code.
4. Monitor compliance of Code of Conduct and investigate instances
of non-compliance.
5. Send recommendation in cases of non-compliance to Apex CoC
Committee for action.
2) Meeting and Deliberation
The Unit Level Committee shall meet atleast once in a quarter.
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Code of Conduct of S & E and Covenanted Officers

PROCEDURE

22.

1)

As and when an employee senses a conflict of interest between his personal

need and that of the organization, or fears that he will not be able to follow a
particular Code, he should report, on his own, to his superiors/Unit Level CoC
Committee.

2)

The Committee, after receiving such a request should deliberate and

communicate their decision within a fortnight.

3)

Employee should abide by the directive as given by CoC Committee. Failure by

the employee would be treated as non-compliance of the Code.

4)

Every employee is entitled to seek clarification on the Code of Conduct.

5)

The Unit Level Committee shall also deal with all complaints/reports received
from any employee of non-compliance of the Codes, may evoke its own
mechanisms for monitoring and has power to call for any information as
desired and will give adequate opportunity to the person to present himself.

6)

The Committee, after due investigation, will arrive at its findings and send its
recommendations to the CoC Apex Committee for further action.

7)

Every Unit Level CoC Committee shall send an annual report of the state of the
th
observance of Code of Conduct in that unit/location by 30 April of each year
for the preceding financial year.
The CoC Apex Committee shall, on receipt of the recommendation of the Unit
CoC Committee, deliberate on the completeness of the investigation, and after
satisfying itself, recommend to CMC, action to be taken.

8)

VI

ACTION BY CMC
Depending on the gravity of the non-compliance, and the need to convey the
commitment of the organization to the Code of Conduct, CMC may take action
ranging from censure to termination of employment.

******

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