BUSINESS: ETHICS, GOVERNANCE AND RISK

Answer-1
Executive Summary: Sustainable and Safe Business Practices at Reliance Industries Limited
Introduction-
Reliance Industries Limited (RIL), India's largest private sector company by market capitalization,
demonstrates a steadfast commitment to Principle 2 of the National Guidelines on Responsible
Business Conduct (NGRBC) by prioritizing sustainable and safe practices across its operations. A
leader in sustainable business worldwide, RIL provides high-quality goods to clients while meeting
social and environmental requirements via the use of cutting-edge technology, a highly qualified staff,
and effective utilization of resources. Their Corporate Social Responsibility Policy, Health, Safety &
Environment Policy, Business Partner Code of Conduct, and Code of Conduct all attest to their
dedication to promoting societal well-being and creating a greener planet in line with their "We Care"
attitude.
In its Business Responsibility & Sustainability Report (BRSR) for 2022-23, RIL underscores its
dedication to sustainability through various initiatives aimed at reducing environmental impact,
ensuring workplace safety, and fostering responsible supply chain practices.

• RIL uses low-carbon, safe, and resource-efficient technology in the design, manufacturing,
sourcing, and delivery of goods and services to clients. Preserving the planet's natural
resources and improving people's quality of life are contingent upon sustainable production
and consumption practices.

• RIL has implemented a comprehensive environmental management system focused on

resource efficiency, pollution prevention, and biodiversity conservation. The company invests
in advanced technologies and renewable energy projects to minimize carbon emissions and
enhance energy efficiency across its diverse business segments, including refining,
petrochemicals, retail, and telecommunications.

• Investment in research and development (R&D) projects such as the creation of high-
productivity catalysts, the removal of carbon black from tires, the creation of sustainable
fabrics and biodegradable polymers, etc., have reduced carbon footprints, increased recycling
of plastic waste, decreased the content of volatile organic compounds (VOCs), and reduced
the need for virgin raw materials.

• RIL places a paramount emphasis on ensuring the safety and well-being of its workforce,
contractors, and surrounding communities. The company implements robust safety protocols,
conducts regular training programs, and deploys state-of-the-art safety equipment to mitigate
occupational hazards and promote a culture of safety excellence.

• RIL extends its commitment to sustainability beyond its own operations to encompass its vast
network of suppliers and partners. The company collaborates with stakeholders to promote
responsible supply chain practices, including adherence to safety standards, ethical conduct,
and environmental stewardship. This collaborative approach underscores RIL's role as a
catalyst for sustainable development within its ecosystem.

• RIL also engages proactively with stakeholders to address safety concerns, gather feedback,
and continuously improve its safety performance. The company's commitment to safety
extends beyond its own operations to encompass its extensive network of suppliers and
partners, where it promotes adherence to stringent safety standards and best practices.

• RIL leverages its technological prowess and innovative capabilities to develop sustainable
solutions that address societal challenges and contribute to the circular economy. The
 company's initiatives encompass recycling, waste management, and the promotion of eco-
friendly products and services, thus aligning its business objectives with broader
sustainability goals.

• The E-waste regulations of 2016 regulate the disposal of e-waste. To handle the same, the RIL
Procurement team has certain protocols in place. For the e-waste auction, they have two
possibilities, starting with the request made by the plant or business function. They have their
own RFX Manager auction platform and the Government of India's MSTC Limited
(previously Metal Scrap Trade Corporation Limited) website.

• RIL introduced ReRouteTM, employs flexible plastic packaging waste that is difficult to
recycle and nearing its end of life, including multi-layer plastic films. It improves the quality
and durability of the road while adding value to the waste plastic that has been left behind.
ReRouteTM can replace 8% of bitumen, according to a report from the Central Road Research
Institute (CRRI), where the product was tested.

• RIL aims to increase plastic bottle recycling capacity to 5 billion bottles per year.

• 51.83% of the plastic pallets sold with partially oriented yarn (poy) were reclaimed during the
reporting period of 2022-23.

• 22.9 KT of PET (Polyethylene Terephthalate) was recycled in the reporting period of 2022-
23.

Conclusion-
In conclusion, Reliance Industries Limited (RIL) exemplifies the principles of sustainable and safe
business conduct as outlined in Principle 2 of the National Guidelines on Responsible Business
Conduct (NGRBC). Through its comprehensive sustainability initiatives, RIL demonstrates its
commitment to environmental stewardship, workplace safety, and responsible supply chain practices.
By integrating sustainability into its core business strategy, RIL not only mitigates risks but also
creates long-term value for its stakeholders and contributes to the achievement of broader societal
goals. As evidenced by its Business Responsibility & Sustainability Report (BRSR) for 2022-23, RIL
sets a benchmark for responsible business conduct, serving as a model for companies seeking to
balance profitability with social and environmental responsibility.

To access RIL's Business Responsibility & Sustainability Report (BRSR) for 2022-23, please visit
( https://www.ril.com/sites/default/files/2023-08/BRSR202223.pdf ).

Answer-2
Introduction-
Corporate Governance is a set of rules and practices that make sure a company is run responsibly,
openly, and fairly. It aims to meet the needs of everyone involved with the company and the wider
community. Good governance comes from a positive company culture and attitude. Reliance
Industries Limited (RIL) is dedicated to meeting the needs of its stakeholders, leading to benefits like
higher shareholder returns, strong credit ratings, awards, and a productive work environment focused
on performance. The core of Corporate Governance is about promoting honesty, openness, and
accountability among top management. It requires professionals to be highly skilled and ethical in
running the company. RIL's employee satisfaction is shown by the stability of its senior management,
its ability to attract talent at all levels, and its high productivity. RIL views stakeholders as partners in
its success and is committed to maximizing their value. They have clear policies for ethical behavior
based on six key values: Customer Value, Ownership Mindset, Respect, Integrity, One Team, and
Excellence.

RIL's Board of Directors is a mix of executive, non-executive, and independent directors, ensuring
balanced decision-making. The board's composition adheres to regulatory requirements, with a
significant proportion of independent directors who bring diverse perspectives and expertise to the
boardroom.

1. Mukesh D. Ambani (Chairman & Managing Director) – Expertise: Strategic Planning,

Leadership, Industry Expertise, Innovation.
• He is also Chairman of Finance Committee.
• Other Board Positions: Chairman of Reliance Life Sciences Pvt. Ltd., Principal at
Reliance Jio Infocomm Ltd., member of The Foundation Board of the World
Economic Forum, member of the Global Advisory Council of Bank of America, and
others

2. Nita M. Ambani (Non-Executive Director) – Expertise: Corporate Social Responsibility

(CSR), Cultural Development, Stakeholder Engagement.
• Other Board Positions: Board member of Reliance Foundation, chairperson of
Dhirubhai Ambani International School, and director of various Reliance Group
companies

3. Adil Zainulbhai (Independent Director) - Expertise: Management Consulting, Business

Strategy, Corporate Governance.
• He is also Chairman of Risk Management Committee and Human Resources
Committee and member of Audit Committee
• Other Board Positions: Chairman of Quality Council of India, board member of
Network18 Media & Investments Ltd., and independent director at Larsen & Toubro
Ltd.

4. Raminder Singh Gujral (Independent Director) - Expertise: Public Finance,

Administration, Policy Formulation.
• He is also Chairman of Audit Committee and member of Human Resources
committee
• Other Board Positions: Independent director at UPL Ltd., member of the board of
directors at various public sector undertakings

5. Dr. Shumeet Banerji (Independent Director) - Expertise: Business Strategy, Management

Consulting, Corporate Leadership.
• He is Chairman of Corporate Social Responsibility and Governance Committee and
member of Human Resources committee and Risk Management Committee.
• Other Board Positions: Founder of Condorcet, LP, board member of HP Inc., and
several advisory roles in global corporations

6. Arundhati Bhattacharya (Independent Director) - Expertise: Banking, Financial Services,

Risk Management.
• She is member of Stakeholders’ Relationship Committee, Environmental, Social and
Governance Committee.
• Other Board Positions: Chairperson and CEO of Salesforce India, independent
director at Wipro Ltd., Piramal Enterprises Ltd., and several other financial
institutions

7. Yasir Othman H. Al Rumayyan (Independent Director) - Expertise: Investment

Management, International Business, Strategic Planning.
 • Other Board Positions: Governor of the Public Investment Fund (Saudi Arabia),
chairman of Saudi Aramco, and member of the board at SoftBank Group.

8. K. V. Chowdary (Independent Director) - Expertise: Taxation, Regulatory Affairs,

Compliance.
• He is also chairman of Stakeholders’ Relationship Committee, member of Audit
Committee, Human Resources Committee, Risk Management Committee, Corporate
Social Responsibility and Governance Committee.
• Other Board Positions: Independent director at ICICI Bank, board member at
multiple financial regulatory bodies.

9. K. V. Kamath (Independent Director) - Expertise: Banking, Finance, Infrastructure

Development.
• Other Board Positions: Chairman of the National Bank for Financing Infrastructure
and Development, former president of the New Development Bank (BRICS), and
non-executive chairman of Infosys Ltd.

10. Nikhil R. Meswani (Executive Director) - Expertise: Chemical Engineering, Strategic

Management, Operational Efficiency.
• He is also member of Corporate Social Responsibility and Governance Committee,
Stakeholders’ Relationship Committee and Finance Committee.
• Other Board Positions: Board member of various Reliance Group companies,
executive roles within the group.

11. Hital R. Meswani (Executive Director) - Expertise: Project Management, Chemical

Engineering, Manufacturing Operations.
• He is also Chairman of Social and Governance Committee and member of following
Committees Risk Management Committee, Stakeholders’ Relationship Committee,
Environmental, Finance Committee.
• Other Board Positions: Similar executive roles within the Reliance Group
companies.

12. P.M.S. Prasad (Executive Director) - Expertise: Oil and Gas Exploration, Operational
Management, Strategic Development.
• He is also member of Risk Management Committee, Environmental, Social and
Governance Committee.
• Other Board Positions: Director of multiple subsidiaries of Reliance Industries,
including Reliance Petroleum and others.

13. Pawan Kumar Kapil (Executive Director) - expertise: Chemical Engineering, Refining
Operations, Operational Efficiency,
• He is also member of Environmental, Social and Governance Committee
• Other Board Positions: Executive roles in several Reliance Group companies

Contribution to Fiduciary Duty of Care and Diligence :

Reliance Industries Limited's board members bring a wide range of expertise and experience, which
helps them perform their fiduciary duties. Their diverse backgrounds in strategic leadership, finance,
corporate governance, and industry knowledge ensure sound decision-making processes. The
combination of executive, non-executive, and independent directors ensures a balanced approach to
oversight and governance, encouraging transparency and accountability.

Their involvement in various board positions outside of Reliance broadens their perspectives and
networks, enhancing their ability to serve as effective trustees of social wealth. This multifaceted
approach ensures that Reliance Industries adheres to high corporate governance standards, fulfilling
its obligations to stakeholders and positively contributing to social and economic development.
Conclusion:

In conclusion, RIL's board composition reflects a commitment to sound corporate governance. The
presence of both executive and non-executive directors, with a strong emphasis on independent
oversight, fosters a balanced decision-making environment. While a more detailed view of committee
memberships and external board positions would be ideal, the current information suggests a well-
equipped board. This structure positions RIL's directors to fulfill their fiduciary duty and act as
responsible trustees of social wealth, ensuring the company's long-term success and stakeholder well-
being.
To access Reliance Industries Limited's Annual Report for 2022-23, please visit
(https://www.ril.com/ar2022-23/pdf/RIL-Integrated-Annual-Report-2022-23.pdf )

Answer -3 A
Introduction -
Ethical dilemmas are like tough situations where you have to decide between two choices, and both
choices have some moral values or ethical concerns attached to them. It's like being stuck between a
rock and a hard place, not knowing which decision is the right one because both options have their
pros and cons. Ethical dilemmas can arise in various situations, like at work, in relationships, or even
in everyday life. People often struggle with ethical dilemmas because they want to do the right thing,
but it's not always clear what the right thing is.
Landing a first order of Rs. 50 lakh is a significant win, especially for a mid-size company. It's
tempting to consider the donation a small price to pay for such a big order. However, the ethical
considerations remain significant, and the potential consequences can outweigh the short-term benefit.

Certainly, here are the ethical dilemmas presented in a more structured manner:
1. Conflict of Interest: The purchase manager's decision to award a significant order to the sales
manager's company in exchange for a donation to their spouse's charity creates a conflict of interest.
The purchase manager's duty is to act in the best interests of their company, not to use their position
for personal gain.
2. Unfair Advantage: Requiring a donation to a personal charity as a condition for business dealings
may suggest that opportunities are being awarded based on personal connections rather than the
merits of the products or services offered. This undermines fair competition and ethical business
practices.
3. Misuse of Company Resources: By directing business towards the sales manager's company with
the expectation of a donation to a personal charity, the purchase manager may be misusing company
funds for personal purposes. This raises concerns about the proper stewardship of company resources.
4. Lack of Transparency and Accountability: The arrangement between the purchase manager and the
sales manager lacks transparency, as the donation requirement is not disclosed to the company's
stakeholders. This lack of transparency undermines accountability and may lead to mistrust among
employees and external partners.

Conclusion-
Landing a large first order is exciting, but not if it comes at the cost of ethics. The purchase manager's
offer presents a tricky situation: a potential bribe disguised as a charitable donation. While the desire
to support a local youth sports team might tug at your heartstrings, remember the ethical landmines
here.
Accepting the "donation" could be construed as bribery, leading to legal trouble and damaging
company's reputation. Additionally, it's a misuse of company funds and sets a dangerous precedent.
There are better ways to win this business. Focus on the value your IT hardware offers and propose a
long-term partnership built on trust. If charitable sponsorships align with your company's values,
suggest a separate, transparent donation to a reputable youth sports organization. Remember, a first
order secured through ethical conduct is the foundation for a thriving business relationship. Maintain
your integrity, and future success will follow.

Answer B-
When dealing with a request for a donation in exchange for a significant order, it's essential to
approach the situation thoughtfully and ethically. Let's walk through a strategic plan to address this
scenario professionally and uphold company's values.
Here's a step-by-step process:
1. Assess the Situation: First off, I need to understand the details and implications of the offer.
Consider the ethical and legal aspects involved in such a deal.
2. Review Company Policies: Secondly, I will check company's policies on donations and ethical
practices. I will ensure that I am aligned with company's values and guidelines.
3. Evaluate the Risks and Benefits: Will think about the potential risks and benefits of accepting or
rejecting the offer. Considering the long-term impact on company's reputation and relationships.
4. Discuss with Colleagues or Superiors: It might be a good idea to talk to colleagues or superiors
about the situation. Get their perspective and advice on how to proceed.
5. Negotiate: As I am uncomfortable with the donation request, I will try negotiating with the
purchase manager. And see if there's a way to secure the order without compromising the ethical
standards.
6. Alternative Solutions: Next, I will explore alternative ways to secure the order without making the
donation. Maybe there are other incentives or benefits I can offer instead.
7. Decision Time: After weighing all the factors and considering different perspectives, make a well-
thought-out decision. Choose the option that aligns with my values and the company's principles.

Conclusion:
By following these steps, one can navigate the situation with integrity and make a well-informed
decision that aligns with company’s principles. Remember, open communication and ethical
considerations are key in handling such negotiations effectively.