TATA MOTORSTATA MOTORS

RIZVI COLLEGE OF ARTS, SCIENCE &

COMMERCE

Off. Carter Rd, Bandra (W), Mumbai-400 052

CERTIFICATE

This is to certify that we the undersigned group members of V Semester of T.Y.B.M.S.

have successfully completed our project in the subject of ‘Business Ethics’ in the

academic year 20010-2011 on ‘Emphasis on Corporate Governance and Corporate

Social Responsibility for Tata Motors’. We hereby certified that the information

submitted is true and original to the best of our knowledge.

Roll No. Name Sign Sign and

Roll No.
Janvi Mehta 116
Nida
Sabiha
Utika
Vinita

Signature of the Head of Signature of the

Department Subject Professor

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Sign. & Stamp of Principal

ACKNOWLEDGEMENT

We express our sincere thanks to Prof. Sameer Virani , for giving an opportunity to

pursue our studies for the present project and for his valuable guidance. The subject of

Corporate Ethics is one of the important subjects in the management studies as well as

practices. It is basic factor required for any company to succeed.

We also like to thank, the library staff that helped in finding the materials

regarding this project.

For this project our group comprises of six students:-

No. Name Roll No.

116 Janvi Mehta 116

Nida
Sabiha

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Utika
Vinita

Place : Mumbai Date:

Date :

Table of Contents

Introduction....................................................................................Introduction

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Introduction

Tata Motors Ltd is a multinational corporation headquartered in Mumbai, India. Part of

the Tata Group, it was formerly known as TELCO (TATA Engineering and Locomotive

Company). Tata Motors has consolidated revenue of USD 16 billion after the acquisition

of British automotive brands Jaguar and Land Rover in 2008.

It is India's largest company in the automobile and commercial vehicle sector with

upwards of 70% cumulative market share in the domestic commercial vehicle segment,

and had a 0.81% share of the world market in 2007 according to OICA data. The OICA

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ranked it as the 19th largest automaker, based on figures for 2007, and the second largest

manufacturer of commercial vehicles in the world. The company is the world’s fourth

largest truck manufacturer, and the world’s second largest bus manufacturer. In India

Tata ranks as the leader in every commercial vehicle segment, and is in the top 3 makers

of passenger cars.

The company first began manufacturing locomotives in 1945. The company

manufactured its first commercial vehicle in 1954 through collaboration with Daimler-

Benz AG, which ended in 1969.Tata Motors is a dual-listed company traded on both the

Bombay Stock Exchange, as well as on the New York Stock Exchange. Tata Motors in

2005 was ranked among the top 10 corporations in India with an annual revenue

exceeding INR 320 billion.

History

Tata Motors is a part of the Tata Group which manages its share-holding through Tata

Sons. The company was established in 1935 as a locomotive manufacturing unit and later

expanded its operations to commercial vehicle sector in 1954. Despite the success of its

commercial vehicles, Tata realized his company had to diversify and he began to look at

other products. Based on consumer demand, he decided that building a small car would

be the most practical new venture. So in 1998 it launched Tata Indica, India's first fully

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indigenous passenger car. Designed to be inexpensive and simple to build and maintain,

the Indica became a hit in the Indian market.

In 2004 it acquired Tata Daewoo Commercial Vehicle, and in late 2005 it acquired 21%

of Aragonese Hispano Carrocera giving it controlling rights of the company. It has

formed a joint venture with Marcopolo of Brazil, and introduced low-floor buses in the

Indian Market. Recently, it has acquired British Jaguar Land Rover (JLR), which

includes the Daimler and Lanchester brand names.

Present Scenario

Awards

Tata Motors have won prestigious awards like Auto Express New Car Awards and

Golden Peacock Award for Occupational Health & Safety in the year 2010. Its IT team

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also bagged an award in IT Services and Management Category. Tata Motors new launch

“Tata Nano” also received a Golden Prize in 2010 Edison awards.

Moreover, Tata Motors have more than 85 prestigious awards to its name listing it

among the top companies worldwide.

Financial Scenario

Tata Motors Limited is India's largest automobile company, with consolidated revenues

of Rs. 92,519 crores (USD 20 billion) in 2009-10. It is the leader in commercial vehicles

in each segment, and among the top three in passenger vehicles. It is also the world's

fourth largest truck manufacturer, and the world's second largest bus manufacturer. Tata

Motors reports a Consolidated Profit of Rs. 650.26 crores in Q3FY10.

In the year 2010, Tata Motors Group global sales increased by 36%. The number of

vehicle sales was 90,646 in July.

Tata Motors also reported consolidated gross revenues of Rs. 26,774.44 crores for the

quarter ended December 31, 2009, a growth of 46.7% compared to Rs. 18,246.60 crores

in the corresponding quarter of last year. Introduction of new products and strong

continued growth in the existing portfolio, along with government stimulus and overall

economic recovery, have driven its Indian operations demand to a high during the current

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year. The diagram below indicates the present position of Tata Motors.

Products

Different categories like passenger cars, utility vehicles, trucks, commercial passenger

cars and defense vehicles are produced by Tata Motors.

Some of the few products are listed below:

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• Tata Sierra

• Tata Estate

• Tata Sumo/Spacio

• Tata Safari

• Tata Indica

• Tata Vista

• Tata Indigo

• Tata Manza

• Tata Indigo Marina

• Tata Winger

• Tata Magic

• Tata Nano

• Tata Xenon XT

• Tata Aria

Elaborate details about a few cars are mentioned below.

Tata Nano

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In January 2008, Tata Motors launched Tata Nano, the least expensive production car in

the world at about Rs. 100,000 (US $2,500). The city car was unveiled during the Auto

Expo 2008 exhibition in Pragati Maidan, New Delhi.

Tata has faced controversy over developing the Nano as some environmentalists are

concerned that the launch of such a low-priced car could lead to mass motorization in

India with adverse effects on pollution and global warming. Tata has set up a factory in

Sanand, Gujarat and the first Nanos are rolled out in summer 2010.

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Tata One CAT

Motor Development International of France has developed the world's first prototype of a

compressed air car, named OneCAT. In 2007, MDI owner Guy Negre was reported to

have "the backing of Tata".

It has air tanks that can be filled in 4 hours by plugging the car into a standard electrical

plug. In 2008 MDI planned to also design a gas station compressor, which would fill the

tanks in 3 minutes.

OneCAT is a five seat vehicle with a 200-litre (7.1 cu ft) trunk. With full tanks it is said

to run at 100 km/h (62 mph) for 90 kilometers (56 mi) range in urban cycle. There are

severe physical arguments pleading against those figures. In December 2009 Tata's vice

president of engineering systems confirmed that the limited range and low engine

temperatures were causing difficulties.

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Corporate Social Responsibility

Corporate initiative to assess and take responsibility for the company's effects on the

environment and impact on social welfare is termed as corporate social responsibility.

Corporate social responsibility may also be referred to as "corporate citizenship" and can

involve incurring short-term costs that do not provide an immediate financial benefit to

the company, but instead promote positive social and environmental change.

Corporate social responsibility is not a new concept in India. However, what is new is

the shift in focus from making profits to meeting social challenges. Now-a-days,

employees are actively participating in the social activities even when not functional.

This is mainly because employees feel a sense of pride when they are involved in such

activities.

On general basis the meaning of CSR is twofold. On one hand, it exhibits the ethical

behavior that an organization exhibits towards its internal and external stakeholders

(customers as well as employees). On the other hand, it denotes the responsibility of an

organization towards the environment and society in which it operates.

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Firms can no longer continue to exploit the environmental resources and escape from

their responsibility by acting as separate entities regardless of the interest of the society.

Organizations, now, are realizing the need to shift their focus on the interest of society.

CSR involves various voluntary efforts in which companies engage themselves in order

to give something back to the society. It involves providing innovative solutions to

societal and environmental challenges. Organizations generally believe that acting in a

socially responsible manner will create value for them.

The spectrum of CSR includes a number of areas as human rights, safety at work,

consumer protection, climate protection, caring for the environment, and sustainable

management of natural resources. From the perspective of employees, CSR activities

include providing health and safety measures, preserving employee rights and

discouraging discrimination at workplace. This helps in fostering a healthy environment

within the company.

Implementation of CSR at Tata Motors

After 1945, TATA implemented social welfare provisions for its employees that have

since become the legislative norm. From the perspectives of customers, CRS activities

may include commitment to product quality and fair pricing policies. Its main motive

primarily focuses on poverty alleviation, environmental protection and sustained

development.

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TATA Motors provides desks, benches, chairs, tables cupboards, electrical fittings and

educational and sports material to various primary schools in Singur. The company has

also planned similar programmes to upgrade school infrastructure and is also planning to

set up a computer laboratory in one of the high schools.

Employability

1085 youth from areas adjacent to the Company’s plants, were trained in various

technical and vocational trades. At the new plant location of Singur alone, over 350 local

youth have been trained in partnership with the government and the social sector,

enhancing their employability.

As a part of its skill development programme, the company has identified 10ITIs across

the country to upgrade their facilities and enhance the relevance of their programmes to

industry needs. Of these four it is have been covered in 2007-08. They have been

equipped with the latest machines and tools, the students have been taken on exposure

visits to understand manufacturing processes and Train the Trainer programmes have

been organized for their faculty

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In addition as a part of the company’s women empowerment programme 1058 women

have been trained in manufacturing food products and utility items, sewing and

beautician courses.

All the students of the company-supported Mechanic Motor Vehicle Trade course 2007-

08 in association with the Ramakrishna Mission at Sakwar, Thane district, Maharashtra

have been successfully placed at the company’s dealership. Two students from the

previous batch have been facilitated to open their own workship on the Mumbai-

Ahmedabad Highway

Health

Curative and preventive health services were provided to more than 92390 people

through the company’s community health programmes. In Jameshedpur, 374 indivisuals

benefited from cataract operations conducted free of cost.

Special country-wide programmes were conducted for drivers during service camps.

Towards the company’s drive for total sanitation in adopted villages, 1940 low cost

toilets were constructed.

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12 hand pumps were installed and 3 wells were repaired, ensuring clean drinking water

supply for over 3500 villagers. Tanker facilities were deployed during summer months to

meet drinking water requirements of rain-parched rural areas in Pune district,

Maharashtra.

Education

Shiksha Prasar Kendra, a TATA Motors society at Jamshedupur supported 18000

students from across 33 schools . Scholarships for higher studies were awarded to 375

students. Extracurricular activities were organised in 31 schools in which over 4300

students participated.

Infrastructure was improved at 13 schools, promoting higher education for 2000 children

from over 25 villages. This includes a computer lab at Beraberi High school at Singur in

West Bengal.

Environment

Over 175242 saplings have been planted with an 80% survival rate.

Community irrigation wells and check dams have been constructed at villages near Pune,

augmenting incomes of families through improved irrigation. In Jamshedpur, 85 acres of

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land has been brought under irrigation and tree plantation has extensively been carried

out in over 152 acres.

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Dr. Rohit Kumar, Divisional Manager, Medical services, Lucknow checking a patient at the
health camp organised for contract labourers from nearby villages.

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Mr. Deepak M Deshpande, AGM, Corporate HR inaugurating the bus donated to ADHAR,
Association of Mentally Disabled children.

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From the right, Dr D G Joglekar, DGM, Health Services with Dr. J U Gokhale, AGM, HR and

Mr. B G Ogale, AGM, Training & Safety at the laying down of foundation stone of the

vocational centre at Bhamchandra High School, Pune

Corporate Governance

Corporate Governance is the relation between all the stake holders in a company. This

includes the shareholders, directors, and management of a company, as defined by the

corporate charter, bylaws, formal policy and rule of law.

Tata Motors’s Philosophy on Corporate Governance

As part of the Tata group, the Company’s philosophy on Corporate Governance is

founded upon a rich legacy of fair, ethical and transparent governance practices, many of

which were in place even before they were mandated by adopting highest standards

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of professionalism, honesty, integrity and ethical behavior.

As a global organization the Corporate Governance practices followed by the Company

and its subsidiaries are compatible with international standards and best practices.

Through the Governance mechanism in the Company, the Board along with its

Committees undertakes its fiduciary responsibilities to all its stakeholders by ensuring

transparency fairplay and independence in its decision making.

The Corporate Governance philosophy has been further strengthened with the

implementation, a few years ago, by the Company of the Tata Business Excellence

Model as a means to drive excellence, the Balanced Scorecard methodology for tracking

progress on long term strategic objectives and the Tata Code of Conduct which

articulates the values, ethics and business principles and serves as a guide to the

Company.

Mode of Communication

The Quarterly, Half Yearly and Annual results are regularly submitted to the Stock

Exchanges in accordance with the Listing Agreement and are generally published in

Indian Express, Financial Express and Loksatta (Marathi). The information regarding

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the performance of the Company is shared with the shareholders every six months

through a half yearly communiqué and the Annual Report. The official news releases,

including on the quarterly and annual results and presentations made to institutional

investor’s analysts are also posted on the Company’s website www.tatamotors.com.

The ‘Investor Centre’ section on the Company’s website keeps the investors updated on

material developments in the Company by providing key and timely information like

details of Directors, Financial Results, Annual Reports, Shareholding Pattern,

presentations made to Analysts etc. Members also have the facility of raising their

queries/complaints on share related matters through a facility provided on the Company’s

website.

General Information for Members

General information for members is given by the means of annual general meetings,

financial calendar, listing and international listing.

Subsidiary Companies

The Company does not have any material non-listed Indian subsidiary company and hence, it
is not required to have an Independent Director of the Company on the Board of such

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subsidiary company. The Audit Committee also has a meeting wherein the CEO and CFO of
the subsidiary companies make a presentation on significant issues in audit, internal control,
risk management, etc. Significant issues pertaining to subsidiary companies are also
discussed at Audit Committee meetings. Apart from disclosures made in the Directors' Report
there were no strategic investments made by the Company’s non listed subsidiaries during
the year under review.

Ethics Committee

The Ethics and Compliance Committee was constituted to formulate policies relating to
the implementation of the Tata Code of Conduct for Prevention of Insider Trading (the Code),
take on record the monthly reports on dealings in securities by the “Specified Persons” and
decide penal action in respect of violations of the applicable regulations/the Code. The Ethics
and Compliance Committee comprises of Mr S M Palia, Independent Director as the Chairman
and Mr R Gopalakrishnan, Non-Executive Director. During the year under review, two meetings
of the Committee were held on August 25, 2009 and February 24, 2010 which were attended
by all the Members.

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Chairman Ratan Tata Addressing a conference

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Parts of an Organization

Conclusion

Even though companies are making serious emphasis on the concept of corporate social

responsibility and corporate governance some critics are still questioning the reason of its

existence.

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The concept of CSR is not mainly brand building but an attempt to create and internal

brand among its employees. It is also described as a noble approach for the society by an

organization.

Corporate governance is mandatory in an organization to ensure a good functioning and

fair treatment throughout the organization. It can also be called a platform were the

employees of an organization and its stake holders interact.

Bibliography

1) www.google.com

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2) www.tatamotors.com

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