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**SECTION: DIRECTORS’ RESPONSIBILITY STATEMENT** As required under Section 134 of the Companies Act, 2013, your Directors confirm having: - a) followed in the preparation of the Annual Accounts, the applicable accounting standards with proper explanation relating to material departures, if any; - b) selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent to give a true and fair view of the state of affairs of your Company at the end of the financial year and of the profit of your Company for that period; - c) taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities; - d) prepared the Annual Accounts on a going concern basis; - e) laid down internal financial controls to be followed by your Company and that such internal financial controls were adequate and were operating effectively; and - f) devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. **SECTION: CONSOLIDATED FINANCIAL STATEMENTS** Your Company’s Board of Directors is responsible for the preparation of the consolidated financial statements of your Company and its Subsidiaries, Associates, and Joint Venture entities, in accordance with the requirements of the Companies Act, 2013 and the accounting principles generally accepted in India, including the Indian Accounting Standards specified under Section 133 of the Act. The respective Boards of Directors of the companies included in the Group and of its associates and joint venture entities are responsible for maintaining adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of each company and for preventing and detecting frauds and other irregularities. **SECTION: OTHER INFORMATION** **Compliance with the conditions of Corporate Governance** The certificate from your Company’s Statutory Auditors, Messrs. S R B C & CO LLP, confirming compliance with the conditions of Corporate Governance as stipulated under the Listing Regulations, is annexed. **SECTION: Going Concern status** There was no significant or material order passed during the year by any regulator, court, or tribunal impacting the going concern status of your Company or its future operations. |
**SECTION: Dividend Distribution Policy** The Dividend Distribution Policy of your Company may be accessed on its corporate website. **SECTION: Annual Return** The Annual Return of your Company is available on its corporate website. **SECTION: Particulars of loans, guarantees or investments** Details of loans and investments covered under the provisions of Section 186 of the Companies Act, 2013 are provided in Notes 4, 5, and 9 to the Financial Statements. No guarantees were outstanding as at the year end. **SECTION: Particulars relating to Conservation of Energy and Technology Absorption** Particulars as required under Section 134 of the Companies Act, 2013 relating to Conservation of Energy and Technology Absorption are also provided in the Annexure to this Report. **SECTION: Compliance with Secretarial Standards** Your Company is in compliance with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India and approved by the Central Government under Section 118(10) of the Act. **SECTION: Employees** The total number of employees as on 31st March, 2024, stood at 24,567. There were 350 employees who were employed throughout the year and were in receipt of remuneration aggregating ₹ 102 lakh or more or were employed for part of the year and were in receipt of remuneration aggregating ₹ 8.5 lakh per month or more during the financial year ended 31st March, 2024. The information required under Section 197(12) of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided in the Annexure forming part of this Report. **SECTION: Key Financial Ratios** Key Financial Ratios for the financial year ended 31st March, 2024, are provided in the Annexure forming part of this Report. **SECTION: FORWARD-LOOKING STATEMENTS** This Report contains forward-looking statements that involve risks and uncertainties. When used in this Report, the words ‘anticipate’, ‘believe’, ‘estimate’, ‘expect’, ‘intend’, ‘will’ and other similar expressions as they relate to your Company and/or its Businesses are intended to identify such forward-looking statements. Your Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Actual results, performances, or achievements could differ materially from those expressed or implied in such forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of their dates. |
This Report should be read in conjunction with the financial statements included herein and the notes thereto. **SECTION: CONCLUSION** Your Company’s ‘Triple Bottom Line’ philosophy has spurred the creation of innovative business models that synergize the building of economic, environmental, and social capital. Enterprises of the future will need to be agile, consumer-centric, innovative, digital-first, purpose-driven, and responsibly competitive. Your Company’s goal of serving larger national priorities and creating value for all stakeholders has evolved into a new paradigm - ‘Responsible Competitiveness’ - focusing on extreme competitiveness while replenishing the environment and supporting sustainable livelihoods. The strategic Vision of creating multiple drivers of growth through the pursuit of market opportunities that best match institutional strengths has resulted in the development of strong Businesses anchored on a portfolio of purpose-led brands, future-ready products, and world-class quality. Your Company is the leading FMCG marketer in India, a pre-eminent hotel chain, and a globally acclaimed icon in green hoteliering. The non-cigarettes businesses have grown over 31-fold and presently constitute about two-thirds of Net Segment Revenue. An extensive strategy reset has been undertaken to architect the structural drivers that will power the ITC Next strategy of building a Future-Ready, Consumer-Centric, Climate Positive, and Inclusive organization anchored on the Responsible Competitiveness paradigm. The FMCG Businesses have delivered strong revenue growth along with significant margin expansion and are poised for rapid scaling. Multi-dimensional interventions have strengthened the FMCG Businesses for sustained profitable growth. The product portfolio has been further strengthened with a sharper focus on fortifying core businesses, addressing adjacent opportunities, and building emerging businesses for the future. The Branded Packaged Foods Businesses have been reorganized into product market-centric clusters with integrated and empowered teams. Investments have augmented your Company’s multi-channel go-to-market capability, resulting in significant expansion in the reach and availability of its products. The Agri Business has been a strong backbone and a key source of competitive advantage for your Company’s FMCG and Cigarettes Businesses. The scope and scale of operations have grown significantly, currently encompassing nearly 3 million tonnes of annual volume throughput in 22 states and over 20 agri-value chains. The Business has pivoted its strategic focus towards rapidly scaling up its Value-Added Agri Products portfolio to accelerate growth and margins. |
The Paperboards, Paper, and Packaging Businesses have made significant progress in terms of enhanced scale and profitability improvement. The Hotels Business has established a strong footprint of iconic properties and F&B brands on the back of an investment-led growth strategy. Your Company continues to build a dynamic ‘Future-Tech’ enterprise powered by state-of-the-art digital technologies and infrastructure. Sustainability remains a critical focus area, with your Company actively pursuing its bold Sustainability 2.0 agenda comprising multi-dimensional interventions in decarbonization, building green infrastructure, and promoting climate-smart and regenerative agriculture. Disruptive business models and value propositions anchored at the intersection of future frontiers of Digitalization and Sustainability form an integral part of your Company’s strategic roadmap. The global operating environment has become increasingly complex, uncertain, and volatile. Your Company, with its robust and dynamic strategy pillars, is well poised to rapidly scale-up and enhance its market standing across operating segments. The resilience, agility, and adaptive capacity demonstrated by your Company is a testament to the talent, determination, and efforts of its dedicated professionals, associates, and partners. Your Company’s Board and employees are inspired by the Vision of sustaining its position as one of India’s most admired and valuable companies, creating enduring value for all stakeholders. The vision of enlarging your Company’s contribution to the Indian economy is driven by its ‘Nation First: Sab Saath Badhein’ credo anchored on the core values of Trusteeship, Transparency, Empowerment, Accountability, and Ethical Citizenship. On behalf of the Board, S. PURI Chairman & Managing Director (DIN: 00280529) Kolkata S. DUTTA Director & Chief Financial Officer (DIN: 01804345) ``` ``` **SECTION: Annexure to the Report of the Board of Directors** **SECTION: For the Financial Year Ended 31st March, 2024** **SECTION: ANNUAL REPORT ON CORPORATE SOCIAL RESPONSIBILITY (CSR) ACTIVITIES OF THE COMPANY** **SECTION: 1. |
CSR Policy - Brief outline and Overview** It is ITC’s Policy to direct its CSR Programmes towards achieving one or more of the following: - Poverty alleviation - Promoting education and skill development - Promoting healthcare including preventive healthcare - Providing sanitation and drinking water - Ensuring environmental sustainability - Enabling climate resilience - Undertaking rural development projects - Creating livelihoods for people, especially those from disadvantaged sections of society - Protecting national heritage, art and culture - Preserving and promoting music and sports - Providing relief and assistance to victims of disasters and calamities. In pursuit of the above, ITC has identified the following focus areas for its CSR Programmes based on comprehensive need assessment surveys of its stakeholders: 1. Create sustainable livelihoods and alleviate poverty through water stewardship and management of natural resources, sustainable agriculture, and climate-smart practices. 2. Build capabilities for tomorrow through interventions in education, skilling, micro-enterprises, and sanitation. 3. Promote healthcare and improve critical nutritional & health status of at-risk populations. 4. Protect national heritage, art & culture, and promote music and sports. 5. Provide relief and assistance to victims of disasters and calamities. The CSR Policy of the Company may be accessed on its corporate website at [CSR Policy](https://www.itcportal.com/about-itc/policies/corporate-social-responsibility-policy.aspx). **SECTION: b. Role of the CSR and Sustainability Committee** The role of the CSR and Sustainability Committee is to review, monitor, and provide strategic direction to the Company’s CSR and sustainability practices towards fulfilling its triple bottom line objectives. The Committee guides the Company in crafting unique models to transform lives and landscapes by supporting the creation of sustainable livelihoods together with environmental regeneration. **SECTION: c. CSR Programmes / Projects** The two most important stakeholders for ITC’s CSR programmes/projects are: - Rural communities, primarily in the Company’s Agri Business areas. - Communities residing in close proximity to the Company’s production units. The Company’s stakeholder profile is varied, calling for an integrated approach to development comprising several layers of interventions summarized below, in line with Schedule VII to the Companies Act, 2013: **SECTION: i. Promoting Preventive Healthcare, Sanitation & Poverty Alleviation (Schedule VII – i)** - **Health and Nutrition:** Focus on preventive aspects through maternal and child care (MCH) & nutrition awareness and counselling. |
- **Waste Management:** Create a clean and healthy environment through awareness & behaviour change for individual & community responsibility. - **Sanitation:** Promote a hygienic environment through prevention of open defecation and reduce incidence of waterborne diseases. - **Poverty Alleviation:** Support the needy and poor through interventions that enable income generation and provide access to basic needs. **SECTION: ii. Promoting Education, Vocational Skills and Livelihood Enhancement (Schedule VII – ii)** - **Education:** Provide access to education including Early Child Care Education with focus on enrolment and learning retention. - **Skills:** Build and upgrade skills of youth with emerging job market needs. - **On-farm and Off-farm livelihoods:** Enhance incomes of farmers through income generation opportunities. **SECTION: iii. Economic Empowerment of Women (Schedule VII – iii)** Provide gainful employment and entrepreneurial opportunities to women through empowerment and capacity building programmes. **SECTION: iv. Ensuring Environmental Sustainability (Schedule VII – iv)** - **Water Stewardship:** Promote local management of water resources through community-based participation. - **Social Forestry:** Provide food, fuel & fodder security to farmers through social and agro-forestry interventions. - **Biodiversity:** Strengthen ecosystem services provided by nature. **SECTION: v. Protection of National Heritage, Art & Culture (Schedule VII – v)** Revive and restore vanishing musical sub-genres through institutions like the ITC Sangeet Research Academy. **SECTION: vi. Training to promote rural sports, nationally recognised sports, paralympic sports and Olympic sports (Schedule VII – vii)** Promote sports for the holistic development of children by working closely with schools. **SECTION: vii. Research in science, technology, engineering and medicine aimed at promoting Sustainable Development Goals (Schedule VII – ix-b)** Leverage technical expertise through partnerships and support R&D activities aimed at promoting Sustainable Development Goals (SDGs). **SECTION: viii. Rural Development (Schedule VII – x)** Introduce advanced knowledge & technologies to increase farm incomes and make agriculture resilient to climate challenges. **SECTION: 2. Composition of the CSR and Sustainability Committee as on 31st March, 2024** | Sl. No. | Name of Director | Designation / Nature of Directorship | Number of meetings of CSR and Sustainability Committee held during the year | Number of meetings of CSR and Sustainability Committee attended during the year | |---------|------------------|-------------------------------------|--------------------------------------------------------------------------|-------------------------------------------------------------------------------| | 1 | S. Puri (Chairman of the Committee) | Chairman & Managing Director | 3 | | | 2 | M. |
Gupta | Non-Executive Director | 3 | | | 3 | R. Jain1 | Non-Executive Director | N.A. | | | 4 | S. Panray | Non-Executive Director | 3 | 3 | | 5 | N. Rao | Independent Director | 3 | | | 6 | A. K. Seth | Independent Director | 3 | | | 7 | M. Shankar | Independent Director | 3 | | 1 Appointed Member w.e.f. 1st January, 2024. **SECTION: 3. Provide the web-link(s) where composition of the CSR and Sustainability Committee, CSR Policy and CSR projects approved by the Board are disclosed on the website of the Company** [CSR and Sustainability Committee](https://www.itcportal.com/sustainability/corporate-social-responsibility.aspx) **SECTION: 4. Provide the executive summary along with web-link(s) of Impact Assessment of CSR Projects carried out in pursuance of sub-rule (3) of Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014, if applicable** **SECTION: Executive Summary – Impact Assessment of ITC’s CSR Programmes for the financial year 2023-24** **SECTION: Brief Description** ITC implements its CSR Programmes across the country under a Two Horizon approach aimed at holistic development of communities. **SECTION: Thematic Areas / Programmes** The specific themes covered under the Two Horizon approach include: - Horizon – I: Strengthening today’s livelihoods - Horizon – II: Building Capabilities for Tomorrow **SECTION: Projects Covered** 49 projects with a budget of more than ₹1 crore each during the financial year 2021-22 were taken up for impact assessment. **SECTION: Projects Duration** FY 2021-22 **SECTION: States** The assessment covered interventions in various states including Andhra Pradesh, Assam, Bihar, Delhi, Jammu and Kashmir, Karnataka, Punjab, Madhya Pradesh, Maharashtra, Rajasthan, Tamil Nadu, Telangana, Uttar Pradesh, and West Bengal. **SECTION: Impact Assessment Agencies** These impact assessments were done by seven external agencies selected through a competitive bidding process. **SECTION: Period of Study** FY 2023-24 **SECTION: Methodology** The agencies used a mixed-method approach covering quantitative and qualitative data collection. **SECTION: The major impacts recorded by the impact studies are as follows –** **SECTION: Horizon – I** Projects assessed under Horizon - I were found to be relevant, effective, efficient, and sustainable. - **Climate Smart Agriculture:** Improvement in average yields of major crops and reduction in cost of cultivation. - **Water Stewardship:** Increased water availability and year-round cultivation. - **Biodiversity:** Community institutions promoted for biodiversity conservation. |
- **Social Forestry:** Improvement in household income from tree plantations. **SECTION: Horizon – II** Projects evaluated under Horizon - II positively impacted lives of children, youth, women, and communities. - **Women Empowerment:** Significant improvements in savings habits and access to loans. - **Support to Education:** Improvement in learning levels and WASH facilities in schools. - **Waste Management:** Increased practice of source segregation and overall hygiene improvement. **SECTION: Health** The impact studies indicate significant improvements in health and nutrition, sanitation, and overall community well-being. ``` ``` **SECTION: Mother and Child Health and Nutrition (MCHN)** The study done in West Bengal revealed that a higher proportion of pregnant women (82.4%) were registered for Antenatal Care (ANC) compared to the control group (75%). 100% of the women registered for ANC adhered to health monitoring procedures. 97% of adolescent girls in the project group had their BMI checked, as compared to 83% in the control group. Due to health awareness and higher antenatal check-ups, there was a lesser incidence of high blood pressure during pregnancy, which is one of the critical issues faced by women. **SECTION: Skilling of Youth** The study done for the vocational training programme in Assam and Tamil Nadu revealed that the programme has helped youth develop certain job skills and communication skills to a great extent. 85% of the youth got successfully placed after completion of training within a period of 1-3 months, with 72% of the youth getting a job in the field of their training. Another study conducted in Andhra Pradesh for the Guntur region shows that the healthcare and hospitality sectors achieved 100% placements, followed by automotive, which was 97%. In a study conducted in West Bengal and Jammu & Kashmir, 99% of the youth covered through the programme reported an increase in monthly household income after the intervention because of the salaries they earned post-placement. Complete Impact Assessment Reports are available on the Company’s website at [ITC Impact Studies](https://www.itcportal.com/sustainability/impact-studies.aspx). |
**SECTION: Financial Summary** (a) Average net profits of the Company as per Section 135(5): ` 20,173.67 crores (b) Two percent of the average net profits of the Company as per Section 135(5): ` 403.47 crores (c) Surplus arising out of the CSR projects or programmes or activities of the previous financial years: Nil (d) Amount required to be set off for the financial year, if any: Nil (e) Total CSR obligation for the financial year [(b)+(c)-(d)]: ` 403.47 crores **SECTION: CSR Expenditure** (a) Amount spent on CSR Projects (both Ongoing Project and other than Ongoing Project): ` 380.44 crores (b) Amount spent in Administrative Overheads: ` 20.20 crores (c) Amount spent on Impact Assessment, if applicable: ` 3.41 crores (d) Total amount spent for the Financial Year [(a)+(b)+(c)]: ` 404.05 crores (e) CSR amount spent or unspent for the Financial Year: - Total Amount spent for the Financial Year (in `): ` 404.05 crores - Total Amount transferred to Unspent CSR Account as per Section 135(6): Not Applicable - Amount transferred to any fund specified under Schedule VII as per second proviso to Section 135(5): Not Applicable (f) Excess amount for set-off, if any: - Sl. No., Particular, Amount (in `) (i) Two percent of average net profits of the Company as per Section 135(5): ` 403.47 crores (ii) Total amount spent for the Financial Year: ` 404.05 crores (iii) Excess amount spent for the Financial Year [(ii)-(i)]: ` 0.58 crore (iv) Surplus arising out of the CSR projects or programmes or activities of the previous Financial Years, if any: Nil (v) Amount available for set off in succeeding Financial Years [(iii)-(iv)]: ` 1.93 crores *Includes excess amounts of ` 0.76 crore and ` 0.59 crore spent during the financial years 2021-22 and 2022-23, respectively, and carried forward. **SECTION: Details of Unspent Corporate Social Responsibility amount for the preceding three Financial Years:** | Sl. No. |
| Preceding Financial Year(s) | Amount transferred to Unspent CSR Account under Section 135(6) (in `) | Balance Amount in Unspent CSR Account under Section 135(6) (in `) | Spent in the Financial Year (in `) | Amount transferred to a Fund as specified under Schedule VII as per second proviso to Section 135(5), if any | Amount (in `) | Deficiency, if any | |---------|------------------------------|--------------------------------------------------------------------------|---------------------------------------------------------------------|------------------------------------|----------------------------------------------------------------------------------------------------------------|----------------|--------------------| | 1 | 2022-23 | 23.10 crores | 17.39 crores | 5.71 crores | NIL | 17.39 crores | NIL | | 2 | 2021-22 | 3.90 crores | Nil | Nil | Not Applicable | | | **SECTION: Whether any capital assets have been created or acquired through Corporate Social Responsibility amount spent in the Financial Year:** Yes / No If Yes, enter the number of Capital assets created / acquired: Not Applicable **SECTION: Furnish the details relating to such asset(s) so created or acquired through Corporate Social Responsibility amount spent in the Financial Year:** | Sl. No. | Short particulars of the property or asset(s) [including complete address and location of the property] | Details of entity / Authority / beneficiary | Pincode of the property | Amount of CSR | Date of creation of asset(s) | CSR Registration Number, if applicable | Name | Registered address | |---------|----------------------------------------------------------------------------------------------------------|---------------------------------------------|-------------------------|---------------|------------------------------|----------------------------------------|------|-------------------| | 1 | Not Applicable | Not Applicable | Not Applicable | Not Applicable | Not Applicable | Not Applicable | Not Applicable | Not Applicable | **SECTION: Specify the reason(s), if the Company has failed to spend two percent of the average net profits as per Section 135(5):** Not Applicable On behalf of the Board, S. PURI Chairman – CSR and Sustainability Committee (DIN: 00280529) Kolkata, India 23rd May, 2024 S. DUTTA Director & Chief Financial Officer (DIN: 01804345) ``` |
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