NMIMS Global Access School for Continuing Education (NGA-SCE) Course: Business

Ethics Governance & Risk Internal Assignment Applicable for June 2024 Examination
1. “Business should provide goods and services in a manner that is sustainable and
safe.” Prepare an executive summary (in your own words) to showcase how the
company is delivering on this Principle 2 of the National Guidelines on Responsible
Business Conduct (NGRBC) from the Business Responsibility & Sustainability Report –
2022-23 (BRSR) of a company of your choice. Choose any ONE listed company from the
BSE/NSE list of top 100 companies by market capitalization. You must mention the
name of the selected company and include the weblink to its BRSR. (You may also refer
to the company website or its sustainability report for additional information on this
principle and its indicators) DO NOT copy paste. (10 Marks)
Ans. **Executive Summary: Delivering on Principle 2 of NGRBC - Business Responsibility
& Sustainability Report (BRSR) 2022-23**

**Introduction:**

This executive summary provides an overview of how Reliance Industries Limited (RIL) is
delivering on Principle 2 of the National Guidelines on Responsible Business Conduct
(NGRBC), which emphasizes the importance of businesses providing goods and services in a
sustainable and safe manner. Through an analysis of RIL's Business Responsibility &
Sustainability Report (BRSR) for the fiscal year 2022-23, this summary highlights the
company's initiatives and performance related to sustainability and safety in its operations.

**Concepts and Application:**

Reliance Industries Limited (RIL), a conglomerate with interests in refining, petrochemicals,

oil and gas exploration, retail, and telecommunications, is committed to integrating
sustainability and safety into its business operations and value chain. Here are some key
initiatives and performance indicators that demonstrate RIL's efforts in delivering on
Principle 2 of NGRBC:

1. **Sustainable Sourcing and Supply Chain Management:**

- RIL has implemented robust processes for sustainable sourcing of raw materials and
components across its diverse business segments. The BRSR highlights the company's
initiatives to ensure responsible sourcing practices and ethical procurement standards
throughout its supply chain.
- Through its Supplier Code of Conduct and engagement with suppliers, RIL promotes
environmental stewardship, social responsibility, and ethical labor practices, contributing to
sustainable supply chain management.
2. **Product Safety and Quality Assurance:**
- RIL prioritizes product safety and quality assurance across its business divisions,
including refining, petrochemicals, and consumer goods. The BRSR outlines the company's
adherence to stringent quality control measures and regulatory standards to ensure the safety
and reliability of its products.
- The company invests in research and development to enhance product safety features,
conduct product testing, and maintain compliance with applicable safety regulations, thereby
safeguarding the interests of consumers and stakeholders.

3. **Environmentally Sustainable Practices:**

- RIL is committed to minimizing its environmental footprint and promoting sustainability
across its operations. The BRSR details the company's initiatives to reduce carbon emissions,
conserve energy and water resources, and promote circular economy principles.
- Through investments in renewable energy, energy-efficient technologies, and waste
management solutions, RIL strives to mitigate environmental impacts while driving
operational efficiencies and cost savings.

4. **Employee Health and Safety:**

- RIL places a high priority on employee health and safety in the workplace. The BRSR
highlights the company's comprehensive safety policies, training programs, and occupational
health initiatives aimed at ensuring a safe and healthy work environment for employees.
- By fostering a culture of safety awareness and accountability, RIL empowers its
workforce to proactively identify hazards, mitigate risks, and promote a culture of continuous
improvement in workplace safety standards.
**5. Community Engagement and Stakeholder Collaboration:**
- RIL actively engages with local communities and stakeholders to address social and
environmental concerns and contribute to community development. The BRSR highlights the
company's initiatives in areas such as education, healthcare, livelihood enhancement, and
environmental conservation.
- Through partnerships with local organizations, government agencies, and non-profit
entities, RIL implements community-centric projects and initiatives that promote sustainable
development and improve the quality of life for communities near its operations.

**6. Innovation and Technology Leadership:**

- RIL leverages innovation and technology to drive sustainable business practices and
enhance operational efficiency. The BRSR showcases the company's investments in research
and development, technology adoption, and innovation initiatives aimed at addressing
sustainability challenges and driving business growth.
- By embracing digitalization, automation, and advanced manufacturing techniques, RIL
optimizes resource utilization, reduces environmental impact, and enhances product quality
and safety across its value chain.
**7. Transparency and Reporting:**
- RIL prioritizes transparency in its operations and regularly reports on its sustainability
performance through platforms like the Business Responsibility & Sustainability Report
(BRSR). The company provides detailed insights into its sustainability initiatives,
performance metrics, and future goals, allowing stakeholders to assess its progress and hold it
accountable.
- Through transparent reporting, RIL enhances trust and credibility among stakeholders,
including investors, customers, employees, and communities. The BRSR serves as a
comprehensive resource for stakeholders to understand RIL's sustainability efforts and their
impact on society, the environment, and the economy.

**8. Continuous Improvement and Adaptation:**

- RIL is committed to continuous improvement and adaptation in its sustainability and
safety practices. The company regularly evaluates its performance against key indicators,
identifies areas for improvement, and implements corrective actions to drive positive change.
- By embracing a culture of continuous learning and innovation, RIL remains agile and
responsive to emerging sustainability challenges and opportunities. The company adapts its
strategies and practices to evolving stakeholder expectations, regulatory requirements, and
market dynamics, ensuring its long-term viability and resilience.

**Conclusion:**

In conclusion, Reliance Industries Limited (RIL) exemplifies its commitment to delivering

goods and services in a sustainable and safe manner, as outlined in Principle 2 of NGRBC.
Through its multifaceted approach to sustainability and safety, encompassing sustainable
sourcing, product safety, environmental stewardship, employee health and safety, community
engagement, innovation, transparency, and continuous improvement, RIL demonstrates its
leadership in responsible business conduct.
By integrating sustainability into its core business operations and engaging stakeholders in
transparent reporting and dialogue, RIL sets a benchmark for responsible business practices
in the global marketplace. Through its unwavering commitment to sustainability and safety,
RIL contributes to the well-being of society, the preservation of the environment, and the
creation of long-term value for stakeholders.
2. Go through the ‘Corporate Governance’ section in the annual report (FY2022-23) of
the company selected in Q1 and prepare an analytical write up (in your own words) on
its corporate governance philosophy, each board member’s profile analysis in terms of
whether they are executive, non-executive, or non-executive & independent, their
skillsets/ competencies, the committees they are a part of in this company and their
other board positions outside of this company. Conclude with your analysis/insights
about the contribution that these board members make to their fiduciary duty of care
and diligence as ‘trustees of social wealth’ on the board of this listed company. (You
must go through their profiles as given on the company’s website in ‘investor’ section
for additional relevant information). You must mention the name of the company and
include the weblink to its annual report 2022-23. (10 Marks)
Ans. **Introduction:**

This analytical write-up explores the corporate governance practices of Reliance Industries
Limited (RIL) as outlined in its annual report for the fiscal year 2022-23. Corporate
governance is fundamental for ensuring transparency, accountability, and ethical conduct
within organizations, particularly listed companies. By examining RIL's corporate
governance philosophy, board member profiles, skillsets, committee memberships, and
external board positions, this analysis aims to provide insights into how RIL fulfills its
fiduciary duty of care and diligence as 'trustees of social wealth' on its board.

**Corporate Governance Philosophy:**

RIL's corporate governance philosophy is rooted in principles of transparency, integrity, and

stakeholder value creation. The company is committed to upholding the highest standards of
ethical conduct, maintaining effective risk management practices, and ensuring compliance
with laws and regulations. RIL places significant emphasis on promoting shareholder
interests while balancing the needs of other stakeholders, including employees, customers,
suppliers, and the broader community. The company's corporate governance framework is
designed to facilitate prudent decision-making, board independence, and protection of
shareholder rights.

**Board Member Profiles and Analysis:**

1. **Executive Board Members:**

- Mukesh D. Ambani: Chairman & Managing Director
- As an executive board member, Mukesh Ambani holds a pivotal leadership position
within RIL. His visionary leadership, extensive industry experience, and strategic acumen are
instrumental in driving RIL's growth and success across its diverse business verticals.
2. **Non-Executive Board Members:**
- Dipak C. Jain: Non-Executive Independent Director
- Dipak Jain brings a wealth of experience in academia and business leadership to the
board. As a non-executive independent director, his independent perspective and strategic
insights contribute to effective governance oversight and decision-making at RIL.

3. **Non-Executive & Independent Board Members:**

- Arundhati Bhattacharya: Non-Executive Independent Director
- Arundhati Bhattacharya's distinguished career in the banking sector and her expertise in
risk management and corporate governance make her a valuable addition to RIL's board. As
an independent director, she enhances the board's objectivity and brings diverse perspectives
to critical discussions.

**Committee Memberships:**

RIL's board members are actively engaged in various board committees, including:
- Audit Committee
- Nomination and Remuneration Committee
- Corporate Social Responsibility (CSR) Committee
- Risk Management Committee

**Other Board Positions:**

In addition to their roles at RIL, several board members hold positions on the boards of other
companies or organizations. These external board positions provide them with broader
industry insights, networking opportunities, and governance experience, which they can
leverage to enhance their contributions to RIL's board.

**Contribution to Fiduciary Duty:**

The board members of RIL play a pivotal role in fulfilling their fiduciary duty of care and
diligence as 'trustees of social wealth.' Through their active involvement in governance
oversight, strategic decision-making, and committee responsibilities, they ensure that the
company operates in the best interests of shareholders and other stakeholders. By upholding
high ethical standards, promoting transparency, and exercising prudent judgment, board
members safeguard the long-term sustainability and value creation of RIL. Their diverse
skillsets, independent perspectives, and collective expertise contribute to effective
governance practices and enhance shareholder confidence in the company's leadership.
**5. Community Engagement and Stakeholder Collaboration:**
- RIL actively engages with local communities and stakeholders to address social and
environmental concerns and contribute to community development. The BRSR highlights the
company's initiatives in areas such as education, healthcare, livelihood enhancement, and
environmental conservation.
- Through partnerships with local organizations, government agencies, and non-profit
entities, RIL implements community-centric projects and initiatives that promote sustainable
development and improve the quality of life for communities near its operations.

**6. Innovation and Technology Leadership:**

- RIL leverages innovation and technology to drive sustainable business practices and
enhance operational efficiency. The BRSR showcases the company's investments in research
and development, technology adoption, and innovation initiatives aimed at addressing
sustainability challenges and driving business growth.
- By embracing digitalization, automation, and advanced manufacturing techniques, RIL
optimizes resource utilization, reduces environmental impact, and enhances product quality
and safety across its value chain.

**7. Transparency and Reporting:**

- RIL prioritizes transparency in its operations and regularly reports on its sustainability
performance through platforms like the Business Responsibility & Sustainability Report
(BRSR). The company provides detailed insights into its sustainability initiatives,
performance metrics, and future goals, allowing stakeholders to assess its progress and hold it
accountable.
- Through transparent reporting, RIL enhances trust and credibility among stakeholders,
including investors, customers, employees, and communities. The BRSR serves as a
comprehensive resource for stakeholders to understand RIL's sustainability efforts and their
impact on society, the environment, and the economy.

**8. Continuous Improvement and Adaptation:**

- RIL is committed to continuous improvement and adaptation in its sustainability and
safety practices. The company regularly evaluates its performance against key indicators,
identifies areas for improvement, and implements corrective actions to drive positive change.
 - By embracing a culture of continuous learning and innovation, RIL remains agile and
responsive to emerging sustainability challenges and opportunities. The company adapts its
strategies and practices to evolving stakeholder expectations, regulatory requirements, and
market dynamics, ensuring its long-term viability and resilience.

**Conclusion:**

In conclusion, Reliance Industries Limited (RIL) demonstrates a comprehensive approach to

corporate governance, encompassing ethical conduct, board effectiveness, stakeholder
engagement, and sustainability leadership. Through its commitment to transparency, integrity,
and accountability, RIL reinforces its role as a responsible corporate citizen and creates long-
term value for shareholders and stakeholders alike. By addressing environmental and social
challenges, fostering innovation, and promoting community development, RIL sets a
benchmark for corporate governance excellence in the global marketplace. Through
continuous improvement and adaptation, RIL remains poised to navigate future challenges
and opportunities while upholding its commitment to sustainable and responsible business
practices.

3. You are a sales manager in a mid-size IT company selling IT hardware. The purchase
manager for a large company agrees to give you an order of Rs. 50 lakh (their first
order with you) on the condition that you will agree to make a Rs. 50,000 donation to his
favorite charity (NGO) that is supporting a local youth sports team being managed and
trained by his wife.
a. What according to you is/are the ethical dilemma/s in this situation? (5 Marks)
Ans. **Introduction:**

In the realm of sales, ethical dilemmas can often arise when negotiating deals with potential
clients. One such scenario involves a purchase manager for a large company who agrees to
give a substantial order to a mid-size IT company, contingent upon the sales manager
agreeing to make a donation to the purchase manager's favorite charity. In this case, the
ethical dilemma lies in the potential conflict of interest, as well as questions surrounding the
integrity of the sales process. This essay will delve into the ethical dilemmas presented in this
scenario, explore relevant concepts and applications, and provide a conclusion on how to
navigate such situations ethically.

**Concepts and Application:**

**1. Conflict of Interest:**

 - The primary ethical dilemma in this scenario is the conflict of interest. The purchase
manager's request for a donation to his favorite charity, which happens to support a local
youth sports team managed and trained by his wife, creates a situation where personal
interests may interfere with professional duties. The sales manager must consider whether
agreeing to the donation compromises their objectivity and impartiality in negotiating the
deal.

**2. Integrity of the Sales Process:**

- Another ethical dilemma is the potential compromise of the integrity of the sales process.
Accepting the purchase manager's condition of making a donation to secure the order raises
questions about the fairness and transparency of the transaction. It may create an impression
of unethical behavior or bribery, undermining trust and credibility in the business
relationship.

**3. Duty to Stakeholders:**

- The sales manager also faces a dilemma regarding their duty to stakeholders, including the
company, shareholders, and customers. While securing a significant order may benefit the
company financially, the means by which it is obtained must align with ethical principles.
The sales manager must weigh the short-term gains against the long-term reputation and
integrity of the company.

**4. Ethical Decision-Making:**

- Ethical decision-making frameworks can help guide the sales manager in navigating this
dilemma. Utilizing approaches such as the utilitarian approach, which focuses on maximizing
overall happiness or utility, the sales manager can evaluate the potential consequences of their
actions on all stakeholders involved. Additionally, the deontological approach, which
emphasizes adherence to moral principles regardless of outcomes, can assist in upholding
ethical standards in the face of conflicting interests.

**Conclusion:**

In conclusion, the scenario presented poses significant ethical dilemmas for the sales manager
in the mid-size IT company. The request for a donation to the purchase manager's favorite
charity in exchange for a substantial order raises concerns about conflicts of interest, the
integrity of the sales process, and the duty to stakeholders. To navigate this situation ethically,
the sales manager must carefully consider the implications of their actions on all parties
involved and uphold principles of honesty, fairness, and transparency. By adhering to ethical
decision-making frameworks and prioritizing the long-term reputation and integrity of the
company, the sales manager can effectively address the ethical dilemmas presented in this
scenario.

b. Explain the step wise process of how will you handle this situation? (5 Marks)
Ans. **Introduction:**

When faced with an ethical dilemma such as the one presented in this scenario, it is crucial
for the sales manager to navigate the situation with integrity, transparency, and
professionalism. This essay outlines a step-by-step process for handling the situation
ethically, considering the conflicting interests and potential consequences involved. By
following a structured approach, the sales manager can make informed decisions that uphold
ethical principles and preserve the integrity of the sales process.

**Step-Wise Process:**

**1. Assess the Situation:**

- The first step is to thoroughly assess the situation, including the request made by the
purchase manager and the potential implications of agreeing to the donation. The sales
manager should consider the ethical dilemmas presented, the company's policies and values,
and the impact on stakeholders.

**2. Identify Ethical Principles:**

- Next, the sales manager should identify the ethical principles at stake, such as integrity,
fairness, transparency, and loyalty to stakeholders. Understanding these principles will
provide a framework for evaluating the situation and guiding decision-making.

**3. Review Company Policies:**

- The sales manager should review the company's policies and guidelines related to ethical
conduct, conflicts of interest, and corporate social responsibility. This will help ensure
alignment with organizational values and compliance with regulatory requirements.

**4. Communicate with Stakeholders:**

- It is essential to communicate openly and transparently with relevant stakeholders,
including senior management, legal advisors, and the purchase manager. The sales manager
should express any concerns or reservations about the request and seek guidance on how to
proceed.
**5. Explore Alternatives:**
- The sales manager should explore alternative options for addressing the purchase
manager's request while upholding ethical principles. This may include proposing alternative
forms of support for the charity or finding other ways to demonstrate goodwill without
compromising the integrity of the sales process.

**6. Seek Clarification:**

- If necessary, the sales manager should seek clarification from the purchase manager
regarding the reasons behind the request and any potential expectations associated with the
donation. This will help ensure a clear understanding of the situation and facilitate informed
decision-making.

**7. Make a Decision:**

- Based on a thorough assessment of the situation, consideration of ethical principles, and
consultation with stakeholders, the sales manager should make a decision on how to proceed.
This decision should prioritize integrity, fairness, and transparency while also taking into
account the company's interests and objectives.

**8. Document the Decision:**

- It is important to document the decision-making process, including the rationale behind
the chosen course of action and any agreements reached with the purchase manager. This
documentation serves as a record of compliance with ethical standards and can help mitigate
risks in the event of future scrutiny.

**Conclusion:**

In conclusion, handling the ethical dilemma presented in this scenario requires a systematic
and principled approach. By assessing the situation, identifying ethical principles, reviewing
company policies, communicating with stakeholders, exploring alternatives, seeking
clarification, making a decision, and documenting the process, the sales manager can
navigate the situation ethically and preserve the integrity of the sales process. Upholding
ethical standards is paramount in maintaining trust, credibility, and long-term success in
business relationships.