Corporate governance

DEFINITION and PURPOSE

 ITC defines Corporate Governance as a systemic
process by which companies are directed and
controlled to enhance their wealth generating
capacity.

 Since large corporations employ vast quantum of

societal resources, we believe that the governance
process should ensure that these companies are
managed in a manner that meets stakeholders
aspirations and societal expectations.
Core Principles

 ITC's Corporate Governance initiative is based

on two core principles. These are :
 Management must have the executive

freedom to drive the enterprise forward

without undue restraints; and
 This freedom of management should be

exercised within a framework of effective

accountability.
 ITC believes that any meaningful policy on
Corporate Governance must provide
empowerment to the executive management
of the Company, and simultaneously create a
mechanism of checks and balances which
ensures that the decision making powers
vested in the executive management is not
only not misused, but is used with care and
responsibility to meet stakeholder aspirations
and societal expectations.
DIRECTORS REPORT
During the financial year 2009/10, your Company and its
subsidiaries
 earned Rs. 3140 crores in foreign exchange.

The direct foreign exchange

 earned by your Company amounted to Rs. 2355 crores (Rs.

2226 crores in 2008-09) powered by exports of major agri-

commodities

Your Company’s
 expenditure in foreign currency amounted to Rs. 1042 crores,

comprising
 purchase of raw materials, spares and other expenses of Rs.

774 crores
 and import of capital goods at Rs. 268 crores.
PROFITS, DIVIDENDS AND RETENTION

(Rs. in Crores)

2010 2009

a) Profit before Tax 6015.31 4825.74

b) Income Tax 1954.31 1562.15

c) Profit after Tax 4061.00 3263.59

d) Add: Profit brought forward

from previous year 858.14 724.45

e) Surplus available for

Appropriation 4919.14 3988.04

f) Transfer to General Reserve 406.10 1500.00

g) Proposed Dividend for the financial

year at the rate of Rs. 4.50 per 1718.18 1396.53
ordinary share of Re. 1/- each
(previous year Rs. 3.70 per share)

h) Proposed Special Centenary

Dividend of Rs. 5.50 per ordinary 2100.00 --

share of Re. 1/- each

i) Income Tax on proposed dividends 634.15 237.34

j) Earlier year’s provision no longer

required (0.60) (3.97)

k) Retained Profit carried forward to

the following year 61.31 858.14

4919.14 3988.04