CASE STUDY- I

TATA CODE OF CONDUCT

The fountainhead of the corporate governance of the Tata Power

Company is the Tata Code of Conduct. The Company is committed to
abide by it, in its letter and spirit. And the Company has earned the
Tata Brand name by virtue of this commitment. It draws its strength
from the five Tata values:

• Integrity
• Understanding
• Excellence
• Unity
• Responsibility

In Tata parlance they stand for –

• Integrity
We must conduct our business fairly, with honesty and transparency.
Everything we do must stand the test of public scrutiny.

• Understanding
We must be caring, showing respect, compassion and humanity for
our colleagues and customers around the world, and always working
for the benefit of India.

• Excellence
We must constantly strive to achieve the highest possible standards
in our day-to-day work and in the quality of the goods and services
we provide.

• Unity
We must work cohesively with our colleagues across the group and
with our customers and partners around the world, building strong
relationships, based on tolerance, understanding and mutual
cooperation.
 • Responsibility
We must continue to be responsible, sensitive to the countries,
communities and environments in which we work, always ensuring
that what comes from the people goes back to the people many times
over.

The name of TATA says it all. It encompasses the lowest common

Tata denominator – the way others see the Tata Group.

Trust
Acceptability
Transparency
Accountability
1. NATIONAL INTEREST.
• A Tata company shall be committed in all its actions to benefit
the economic development of the countries in which it operates.
• It shall not engage in any activity that would adversely affect
such an objective.
• It shall not undertake any project or activity to the detriment of
the nation's interests, or those that will have any adverse impact on
the social and cultural life patterns of its citizens.
• A Tata company shall conduct its business affairs in accordance
with the economic, development and foreign policies, objectives and
priorities of the nation's government, and shall strive to make a
positive contribution to the achievement of such goals at the
international, national and regional level, as appropriate.

2. FINANCIAL REPORTING AND RECORDS

• A Tata company shall prepare and maintain its accounts fairly and
accurately in accordance with the accounting and financial
reporting standards which represent the generally accepted
 guidelines, principles, standards, laws and regulations of the
country in which the company conducts its business affairs.
• All required information shall be accessible to company auditors
and other authorised parties and government agencies. There shall
be no wilful omissions of any company transactions from the books
and records, no advance income recognition, and no hidden bank
account and funds.
• Any wilful material misrepresentation of and/or misinformation on
the financial accounts and reports shall be regarded as a violation
of this code.

3. COMPETITION
• A Tata company shall fully strive for the establishment and support
of a competitive, open market economy in India and abroad and
shall cooperate in the efforts to promote the progressive and
judicious liberalisation of trade and investment by a country.
• A Tata company shall not engage in activities which generate or
support the formation of monopolies, dominant market positions,
cartels and similar unfair trade practices.
• A Tata company shall market its products and services on its own
merits and shall not make unfair and misleading statements about
competitors' products and services.

4. EQUAL-OPPORTUNITIES EMPLOYER
• A Tata company shall provide equal opportunities
to all its employees and all qualified applicants for
employment, without regard to their race, caste,
religion, colour, ancestry, marital status, sex, age,
nationality, disability and veteran status.
• Employees of a Tata company shall be treated
with dignity and in accordance with the Tata
policy to maintain a work environment free of
sexual harassment, whether physical, verbal or
psychological.
 A wheel-chair
worker at
Tata
5. GIFTS AND DONATIONS
• A Tata company and its employees shall neither receive nor offer
or make, directly or indirectly, any illegal payments, remuneration,
gifts, donations or comparable benefits which are intended to or
perceived to obtain business or uncompetitive favours for the
conduct of its business.
• However, a Tata company and its employees may accept and offer
nominal gifts, which are customarily given and are of a
commemorative nature, for special events.

6. GOVERNMENT AGENCIES
• A Tata company and its employees shall not offer or give any
company funds or property as donation to any government
agencies or their representatives, directly or through
intermediaries, in order to obtain any favourable performance of
official duties.

7. POLITICAL NON-ALIGNMENT
• A Tata company shall be committed to and support a functioning
democratic constitution and system with a transparent and fair
electoral system in India.
• A Tata company shall not support, directly or indirectly, any
specific political party or candidate for political office.
• The company shall not offer or give any company funds or property
as donations, directly or indirectly, to any specific political party,
candidate or campaign.

8. HEALTH, SAFETY AND ENVIRONMENT

• A Tata company shall strive to provide a
safe and healthy working environment and
comply, in the conduct of its business
affairs, with all regulations regarding the
preservation of the environment of the
territory it operates in.
• A Tata company shall be committed to prevent the wasteful use of
natural resources and minimize any hazardous impact of the
development, production, use and disposal of any of its products
and services on the ecological environment.

9. QUALITY OF PRODUCTS AND SERVICES

• A Tata company shall be committed to supply goods and services
of the highest quality standards, backed by efficient after-sales
service consistent with the requirements of the customers to
ensure their total satisfaction.
• The quality standards of the company's goods and services should
at least meet the required national standards, and the company
should endeavor to achieve international standards.

10. CORPORATE CITIZENSHIP

• A Tata company shall be committed to be a good corporate citizen,
not only in compliance with all relevant laws and regulations, but
also by actively assisting in the improvement of the quality of life
of the people in the communities in which it operates, with the
objective of making them self reliant.
• Tata companies are encouraged to develop social accounting
systems and to carry out social audit of their operations.

11. CO-OPERATION OF TATA COMPANIES

• A Tata company shall cooperate with other Tata companies by
sharing physical, human and management resources as long as
this does not adversely affect its business interests and
shareholder value.
• In the procurement of products and services, a Tata company shall
give preference to another Tata company as long as it can provide
these on competitive terms relative to third parties.

12. PUBLIC REPRESENTATION OF THE COMPANY AND THE

GROUP
• A Tata company honours the information requirements of the
public and its stakeholders.
• In all its public appearance with respect to disclosing company and
business information to public constituencies such as the media,
the financial community, employees and shareholders, a Tata
company or the Tata Group shall be represented only by
specifically authorised directors and employees.
• It will be the sole responsibility of these authorised representatives
to disclose information on the company.

13. THIRD PARTY REPRESENTATION

• Parties which have business dealings with the Tata group but are
not members of the Group, such as consultants, agents, sales
representatives, distributors, contractors, suppliers, etc. shall not
be authorised to represent a Tata company if their business
conduct and ethics are known to be inconsistent with this code.

14. USE OF THE ‘TATA’ BRAND

• The use of the Tata name and trademark owned by Tata Sons shall
be governed by manuals, codes and agreements to be issued by
Tata Sons. The use of the Tata brand is defined in and regulated by
the Tata Brand Equity & Business Promotion Agreement.

15. GROUP POLICIES

• For consistency and faithful implementation of the corporate
objectives of Tata, the Board has followed certain management
practices even prior to the same being made mandatory, viz.,
Constitution of an Audit Committee, Remuneration Committee, etc.

16. SHAREHOLDERS
• A Tata company shall be committed to enhance shareholder value
and comply with all regulations and laws that govern shareholders'
rights.
• The board of directors of a Tata company shall duly and fairly
inform its shareholders about all relevant aspects of the company's
business, and disclose such information in accordance with the
respective regulations and agreements.
17. REGULATORY COMPLIANCE
• Every employee of a Tata company shall, in his or her business
conduct, comply with all applicable laws and regulations, both in
letter and in spirit, in all the territories in which he or she operates.

18. CONCURRENT EMPLOYMENT

• An employee of a Tata company shall not, without the prior
approval of the managing director of the company, accept
employment or a position of responsibility with any other company,
nor provide ‘freelance’ services to anyone.

19. ETHICAL CONDUCT

• Every employee of a Tata company, which shall include whole-time
directors and the managing director, shall deal on behalf of the
company with professionalism, honesty and integrity, as well as
high moral and ethical standards. Such conduct shall be fair and
transparent and be perceived to be as such by third parties.
• Every employee shall be responsible for the implementation of and
compliance with this code in his professional environment. Failure
to adhere to the code could attract the most severe consequences,
including termination of employment.

20. PROTECTING COMPANY ASSETS

• The assets of a Tata company should not be misused but employed
for the purpose of conducting the business for which they are duly
authorised.

21. CITIZENSHIP
• An employee of a Tata company shall in his or
her private life be free to pursue an active
role in civic or political affairs as long as it
 does not adversely affect the business or interests of the company
or the group.

22. INTEGRITY OF DATA FURNISHED

• Every employee of a Tata company shall ensure, at all times, the
integrity of data or information furnished by him or her to the
company.

23. CONFLICT OF INTEREST

• An employee of a Tata company shall not engage in any business,
relationship or activity which might detrimentally conflict with the
interest of his company or the group. A conflict of interest, actual
or potential, may arise where, directly or indirectly:
(a) an employee of a Tata company engages in a business,
relationship or activity with anyone who is party to a transaction
with his or her company;
(b) an employee is in a position to derive a personal benefit or a
benefit to any of his or her relatives by making or influencing
decisions relating to any transaction;
(c) an independent judgment of the company's or group's best
interest cannot be exercised.

24. SECURITIES, TRANSACTIONS AND CONFIDENTIAL

INFORMATION
• An employee of a Tata company and his or her immediate family
shall not derive any benefit or assist others to derive any benefit
from the access to and possession of information about the
company or the group, which is not in the public domain and thus
constitutes insider information.
An employee of a Tata company shall not use or proliferate
information which is not available to the investing public and which
therefore constitutes insider information for making or giving
advice on investment decisions on the securities of the respective
Tata company on which such insider information has been
obtained.

Such insider information might include the following:

• Acquisition and divestiture of businesses or business units.
• Financial information such as profits, earnings and dividends.
• Announcement of new product introductions or developments.
• Asset revaluations.
• Investment decisions/plans.
• Restructuring plans.
• Major supply and delivery agreements.
• Raising finances.

25. REPORTING CONCERNS

• Every employee of a Tata company shall promptly report to the

management any actual or possible violation of this code, or an
event he or she becomes aware of that could affect the business or
reputation of his/her or any other Tata company.

26. CORPORATE GOVERNANCE

• Company's Philosophy

The Company is committed to maintaining the highest standards of

corporate governance in its dealing with its various stakeholders. It is
an integral part of the Company's core values which include
transparency, integrity, honesty and accountability. The Company
follows the philosophy of working towards the creation of wealth by
enhancing the value of stakeholders, meeting the needs of customers
and employees and the community at large.