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# Transition to Ind AS 116 Ministry of Corporate Affairs ("MCA") through Companies (Indian Accounting Standards) Amendment Rules, 2019 and Companies (Indian Accounting Standards) Second Amendment Rules, has notified Ind AS 116 Leases which replaces the existing lease standard, Ind AS 17 Leases, and other interpretations. Ind AS 116 sets out the principles for the recognition, measurement, presentation and disclosure of leases for both lessees and lessors. It introduces a single, on-balance sheet lease accounting model for lessees. The Company has adopted Ind AS 116, effective annual reporting period beginning April 1, 2019 and applied the standard to its leases, retrospectively, with the TCS Annual Report 2019-20 Unconsolidated Financial Statements I 281 # Notes forming part of the Standalone Financial Statements cumulative effect of initially applying the standard, recognised on the date of initial application (April 1, 2019). Accordingly, the Company has not restated comparative information, instead, the cumulative effect of initially applying this standard has been recognised as an adjustment to the opening balance of retained earnings as on April 1, 2019. Refer note 2(f) - Significant accounting policies - Leases in the Annual report of the Company for the year ended March 31, 2019, for the policy as per Ind AS 17. # Company as a lessee # Operating leases For transition, the Company has elected not to apply the requirements of Ind AS 116 to leases which are expiring within 12 months from the date of transition by class of asset and leases for which the underlying asset is of low value on a lease-by-lease basis. The Company has also used the practical expedient provided by the standard when applying Ind AS 116 to leases previously classified as operating leases under Ind AS 17 and therefore, has not reassessed whether a contract, is or contains a lease, at the date of initial application, relied on its assessment of whether leases are onerous, applying Ind AS 37 immediately before the date of initial application as an alternative to performing an impairment review, excluded initial direct costs from measuring the right-of-use asset at the date of initial application and used hindsight when determining the lease term if the contract contains options to extend or terminate the lease. The Company has used a single discount rate to a portfolio of leases with similar characteristics. File: AR_TCS_2019_2020-1-314.md On transition, the Company recognised a lease liability measured at the present value of the remaining lease payments. The right-of-use asset is recognised at its carrying amount as if the standard had been applied since the commencement of the lease, but discounted using the lessee's incremental borrowing rate as at April 1, 2019. Accordingly, a right-of-use asset of `4,786 crore and a corresponding lease liability of `5,179 crore has been recognized. The cumulative effect on transition in retained earnings net off taxes is `330 crore (including a deferred tax of `147 crore). The principal portion of the lease payments have been disclosed under cash flow from financing activities. The lease payments for operating leases as per Ind AS 17 Leases, were earlier reported under cash flow from operating activities. The weighted average incremental borrowing rate of 7.80% has been applied to lease liabilities recognised in the balance sheet at the date of initial application. On application of Ind AS 116, the nature of expenses has changed from lease rent in previous periods to depreciation cost for the right-of-use asset, and finance cost for interest accrued on lease liability. The difference between the future minimum lease rental commitments towards non-cancellable operating leases and finance leases reported as at March 31, 2019 compared to the lease liability as accounted as at April 1, 2019 is primarily due to inclusion of present value of the lease payments for the cancellable term of the leases, reduction due to discounting of the lease liabilities as per the requirement of Ind AS 116 and exclusion of the commitments for the leases to which the Company has chosen to apply the practical expedient as per the standard. # Finance lease The Company has leases that were classified as finance leases applying Ind AS 17. For such leases, the carrying amount of the right-of-use asset and the lease liability at the date of initial application of Ind AS 116 is the carrying amount of the lease asset and lease liability on the transition date as measured applying Ind AS 17. Accordingly, an amount of `25 crore has been reclassified from property, plant and equipment to right-of-use assets. |
An amount of `6 crore has been reclassified from other current financial liabilities to lease liability - current and an amount of `33 crore has been reclassified from borrowings - non-current to lease liability - non-current. # Notes forming part of the Standalone Financial Statements # Company as a lessor The Company is not required to make any adjustments on transition to Ind AS 116 for leases in which it acts as a lessor, except for a sub-lease. The Company accounted for its leases in accordance with Ind AS 116 from the date of initial application. The Company does not have any significant impact on account of sub-lease on the application of this standard. # The details of the right-of-use asset held by the Company is as follows: | |Additions for year ended March 31, 2020|Net carrying amount as at March 31, 2020| |---|---|---| |Leasehold land|474|690| |Buildings|1,689|5,336| |Leasehold improvement|-|20| |Vehicles|-|2| |Total|2,163|6,048| # Depreciation on right-of-use assets is as follows: | |Year ended March 31, 2020| |---|---| |Leasehold land|4| |Buildings|837| |Leasehold improvement|5| |Vehicles|1| |Total|847| Interest on lease liabilities is `416 crore for the year ended March 31, 2020. The Company incurred `190 crore for the year ended March 31, 2020 towards expenses relating to short-term leases and leases of low-value assets. The total cash outflow for leases is `1,793 crore for the year ended March 31, 2020, including cash outflow for short term and low value leases. The Company has lease term extension options that are not reflected in the measurement of lease liabilities. The present value of future cash outflows for such extension periods as at March 31, 2020 is `457 crore. Lease contracts entered by the Company majorly pertains for buildings taken on lease to conduct its business in the ordinary course. The Company does not have any lease restrictions and commitment towards variable rent as per the contract. # Impact of COVID-19 The Company does not foresee any large-scale contraction in demand which could result in significant down-sizing of its employee base rendering the physical infrastructure redundant. The leases that the Company has entered with lessors towards properties used as delivery centers / sales offices are long term in nature and no changes in terms of those leases are expected due to the COVID-19. # Non-financial assets and non-financial liabilities # (a) Property, plant and equipment Property, plant and equipment are stated at cost comprising of purchase price and any initial directly attributable cost of bringing the asset to its working condition for its intended use, less accumulated depreciation (other than freehold land) and impairment loss, if any. Depreciation is provided for property, plant and equipment on a straight-line basis so as to expense the cost less residual value over their estimated useful lives based on a technical evaluation. The estimated useful lives and residual value are reviewed at the end of each reporting period, with the effect of any change in estimate accounted for on a prospective basis. # Notes forming part of the Standalone Financial Statements |Type of asset|Useful lives| |---|---| |Buildings|20 years| |Leasehold improvements|Lease term| |Plant and equipment|10 years| |Computer equipment|4 years| |Vehicles|4 years| |Office equipment|5 years| |Electrical installations|4-10 years| |Furniture and fixtures|5 years| Property, plant and equipment with finite life are evaluated for recoverability whenever there is any indication that their carrying amounts may not be recoverable. If any such indication exists, the recoverable amount (i.e. higher of the fair value less cost to sell and the value-in-use) is determined on an individual asset basis unless the asset does not generate cash flows that are largely independent of those from other assets. In such cases, the recoverable amount is determined for the Cash Generating Unit (CGU) to which the asset belongs. If the recoverable amount of an asset (or CGU) is estimated to be less than its carrying amount, the carrying amount of the asset (or CGU) is reduced to its recoverable amount. An impairment loss is recognised in the statement of profit and loss. Depreciation is not recorded on capital work-in-progress until construction and installation is complete and the asset is ready for its intended use. |
TCS Annual Report 2019-20 Unconsolidated Financial Statements I 284 # Notes forming part of the Standalone Financial Statements # Property, plant and equipment consist of the following: |(` crore)|Freehold land|Buildings|Leasehold improvements|Plant and equipment|Computer equipment|Vehicles|Office equipment|Electrical installations|Furniture and fixtures|Total| |---|---|---|---|---|---|---|---|---|---|---| |Cost as at April 1, 2019|323|7,348|1,820|539|6,273|36|2,164|1,802|1,420|21,725| |Transition impact of Ind AS 116 (Refer note 7)|-|-|(61)|-|-|-|-|-|-|(61)| |Restated cost as at April 1, 2019|323|7,348|1,759|539|6,273|36|2,164|1,802|1,420|21,664| |Additions|-|287|188|128|1,190|5|174|98|130|2,200| |Disposals|-|(7)|(123)|-|(190)|(2)|(75)|(18)|(40)|(455)| |Cost as at March 31, 2020|323|7,628|1,824|667|7,273|39|2,263|1,882|1,510|23,409| |Accumulated depreciation as at April 1, 2019|-|(2,150)|(1,010)|(166)|(4,975)|(29)|(1,740)|(1,029)|(1,104)|(12,203)| |Transition impact of Ind AS 116 (Refer note 7)|-|-|36|-|-|-|-|-|-|36| |Restated accumulated depreciation as at April 1, 2019|-|(2,150)|(974)|(166)|(4,975)|(29)|(1,740)|(1,029)|(1,104)|(12,167)| |Depreciation for the year|-|(374)|(115)|(58)|(750)|(5)|(203)|(140)|(137)|(1,782)| |Disposals|-|6|47|-|189|2|75|17|39|375| |Accumulated depreciation as at March 31, 2020|-|(2,518)|(1,042)|(224)|(5,536)|(32)|(1,868)|(1,152)|(1,202)|(13,574)| |Net carrying amount as at March 31, 2020|323|5,110|782|443|1,737|7|395|730|308|9,835| # Additional Information |(` crore)|Freehold land|Buildings|Leasehold improvements|Plant and equipment|Computer equipment|Vehicles|Office equipment|Electrical installations|Furniture and fixtures|Total| |---|---|---|---|---|---|---|---|---|---|---| |Cost as at April 1, 2018|327|7,026|1,702|489|5,695|32|2,038|1,711|1,308|20,328| |Additions|(4)|335|212|53|758|6|171|120|139|1,790| |Disposals|-|(13)|(94)|(3)|(180)|(2)|(45)|(29)|(27)|(393)| |Cost as at March 31, 2019|323|7,348|1,820|539|6,273|36|2,164|1,802|1,420|21,725| |Accumulated depreciation as at April 1, 2018|-|(1,792)|(970)|(116)|(4,526)|(26)|(1,572)|(910)|(986)|(10,898)| |Depreciation for the year|-|(368)|(134)|(52)|(626)|(4)|(213)|(142)|(145)|(1,684)| |Disposals|-|10|94|2|177|1|45|23|27|379| |Accumulated depreciation as at March 31, 2019|-|(2,150)|(1,010)|(166)|(4,975)|(29)|(1,740)|(1,029)|(1,104)|(12,203)| |Net carrying amount as at March 31, 2019|323|5,198|810|373|1,298|7|424|773|316|9,522| Net book value of leasehold improvements of `25 crore as at March 31, 2019 were under finance lease. TCS Annual Report 2019-20 Unconsolidated Financial Statements I 285 # Notes forming part of the Standalone Financial Statements # (b) Intangible assets Intangible assets purchased are measured at cost as of the date of acquisition, as applicable, less accumulated amortisation and accumulated impairment, if any. Intangible assets consist of rights under licensing agreement and software licences which are amortised over licence period which equates the economic useful life ranging between 2-5 years on a straight-line basis over the period of its economic useful life. Intangible assets with finite life are evaluated for recoverability whenever there is any indication that their carrying amounts may not be recoverable. If any such indication exists, the recoverable amount (i.e. higher of the fair value less cost to sell and the value-in-use) is determined on an individual asset basis unless the asset does not generate cash flows that are largely independent of those from other assets. In such cases, the recoverable amount is determined for the Cash Generating Unit (CGU) to which the asset belongs. If the recoverable amount of an asset (or CGU) is estimated to be less than its carrying amount, the carrying amount of the asset (or CGU) is reduced to its recoverable amount. An impairment loss is recognised in the statement of profit and loss. # Intangible assets consist of the following: |Rights under licensing agreement and software licences|(` crore)| |---|---| |Cost as at April 1, 2018|68| |Additions|161| |Disposals / Derecognised|-| |Cost as at March 31, 2019|229| |Accumulated amortisation as at April 1, 2018|(58)| |Amortisation for the year|(32)| |Disposals / Derecognised|-| |Accumulated amortisation as at March 31, 2019|(90)| |Net carrying amount as at March 31, 2019|139| The estimated amortisation for the years subsequent to March 31, 2020 is as follows: |Year ending March 31,|Amortisation expense (` crore)| |---|---| |2021|83| |2022|83| |2023|57| |2024|16| |Thereafter|-| Cost as at April 1, 2019: 229 Additions: 172 Disposals / Derecognised: - Cost as at March 31, 2020: 401 Accumulated amortisation as at April 1, 2019: (90) Amortisation for the year: (72) Disposals / Derecognised: - Accumulated amortisation as at March 31, 2020: (162) Net carrying amount as at March 31, 2020: 239 # Notes forming part of the Standalone Financial Statements # (c) Other assets # Other assets - Current Other assets consist of the following: | |As at March 31, 2020|As at March 31, 2019| |---|---|---| |Considered good| | | |Contract assets|3,341|2,723| |Prepaid expenses|1,381|344| |Prepaid rent|4|35| |Contract fulfillment costs|396|468| |Advance to suppliers|75|79| |Advance to related parties|11|8| |Indirect taxes recoverable|1,131|962| |Other advances|114|123| |Others|85|51| |Considered doubtful| | | |Advance to suppliers|3|3| |Indirect taxes recoverable|2|2| |Other advances|3|3| |Less: Allowance on doubtful assets|(8)|(8)| | |6,538|4,793| # Advance to related parties, considered good comprise: |TCS e-Serve International Limited|-|7| |---|---|---| |The Titan Company Limited|3|1| |Tata AIG General Insurance Company Limited|-|1| |Tata AIA Life Insurance Company Limited|1|-| |Tata Sons Private Limited|7|-| *Represents value less than `0.50 crore. # Notes forming part of the Standalone Financial Statements Prepaid rent of `366 crore has been reclassified to right-of-use asset pursuant to transition to Ind AS 116. # (e) Provisions Provisions consist of the following: # Provisions - Current |(` crore)|As at March 31, 2020|As at March 31, 2019| |---|---|---| |Provision for foreseeable loss|199|150| |Other provisions|36|24| |Total|235|174| # (d) Inventories Inventories consists of a) Raw materials, sub-assemblies and components, b) Work-in-progress, c) Stores and spare parts and d) Finished goods. |
Inventories are carried at lower of cost and net realisable value. The cost of raw materials, sub-assemblies and components is determined on a weighted average basis. Cost of finished goods produced or purchased by the Company includes direct material and labour cost and a proportion of manufacturing overheads. Inventories consist of the following: |(` crore)|As at March 31, 2020|As at March 31, 2019| |---|---|---| |Raw materials, sub-assemblies and components|5|9| |Finished goods and work-in-progress*|-|-| |Stores and spares|-|1| |Total|5|10| *Represents value less than `0.50 crore. # (f) Other liabilities Other liabilities consist of the following: # Other liabilities - Non-current |(` crore)|As at March 31, 2020|As at March 31, 2019| |---|---|---| |Operating lease liabilities|-|358| # Other liabilities - Current |(` crore)|As at March 31, 2020|As at March 31, 2019| |---|---|---| |Advance received from customers|226|269| |Indirect taxes payable and other statutory liabilities|1,762|1,556| |Operating lease liabilities|2|47| |Others|58|70| |Total|2,048|1,942| Operating lease liability of `395 crore has been reclassified to retained earnings pursuant to transition to Ind AS 116. # Notes forming part of the Standalone Financial Statements # 9) Other equity |Other equity consist of the following:|As at March 31, 2020 (` crore)|As at March 31, 2019 (` crore)| |---|---|---| |(ix) Transfer from Special Economic Zone re-investment reserve|2,347|3,334| |Capital reserve#|-|-| |(i) Opening balance|8|106| |(ii) Transfer from retained earnings|-|8| |(iii) Issue of bonus shares*|-|(106)| | |8|8| |Special Economic Zone re-investment reserve| | | |(i) Opening balance|994|1,578| |(ii) Transfer from retained earnings|2,947|2,750| |(iii) Transfer to retained earnings|(2,347)|(3,334)| | |1,594|994| |Retained earnings| | | |(i) Opening balance|77,159|74,080| |(ii) Transition impact of Ind AS 116 (Refer note 7)|(330)|-| |(iii) Profit for the year|33,260|30,065| |(iv) Remeasurement of defined employee benefit plans|(323)|(14)| |(v) Utilised for buy-back of equity shares*|-|(15,992)| |(vi) Expense relating to buy-back of equity shares*|-|(45)| |(vii) Issue of bonus shares*|-|(86)| |(viii) Realised loss on equity shares carried at fair value through OCI|-|(1)| | | | | | |73,993|78,523| *Refer note 6(m). #Represents value less than `0.50 crore. # Notes forming part of the Standalone Financial Statements # 10) Revenue recognition The Company earns revenue primarily from providing IT services, consulting and business solutions. The Company offers a consulting-led, cognitive powered, integrated portfolio of IT, business and engineering services and solutions. Revenue is recognised upon transfer of control of promised products or services to customers in an amount that reflects the consideration which the Company expects to receive in exchange for those products or services. - Revenue from time and material and job contracts is recognised on output basis measured by units delivered, efforts expended, number of transactions processed, etc. - Revenue related to fixed price maintenance and support services contracts where the Company is standing ready to provide services is recognised based on time elapsed mode and revenue is straight-lined over the period of performance. - In respect of other fixed-price contracts, revenue is recognised using percentage-of-completion method ('POC method') of accounting with contract costs incurred determining the degree of completion of the performance obligation. The contract costs used in computing the revenues include cost of fulfilling warranty obligations. - Revenue from the sale of distinct internally developed software and manufactured systems and third party software is recognised upfront at the point in time when the system/software is delivered to the customer. In cases where implementation and/or customisation services rendered significantly modifies or customises the software, these services and software are accounted for as a single performance obligation and revenue is recognised over time on a POC method. - Revenue from the sale of distinct third party hardware is recognised at the point in time when control is transferred to the customer. - The solutions offered by the Company may include supply of third-party equipment or software. In such cases, revenue for supply of such third party products are recorded at gross or net basis depending on whether the Company is acting as the principal or as an agent of the customer. The Company recognises revenue in the gross amount of consideration when it is acting as a principal and at net amount of consideration when it is acting as an agent. Revenue is measured based on the transaction price, which is the consideration, adjusted for volume discounts, service level credits, performance bonuses, price concessions and incentives, if any, as specified in the contract with the customer. Revenue also excludes taxes collected from customers. Revenue from subsidiaries is recognised based on transaction price which is at arm's length. Contract fulfilment costs are generally expensed as incurred except for certain software licence costs which meet the criteria for capitalisation. |
Such costs are amortised over the contractual period or useful life of licence whichever is less. The assessment of this criteria requires the application of judgement, in particular when considering if costs generate or enhance resources to be used to satisfy future performance obligations and whether costs are expected to be recovered. Contract assets are recognised when there is excess of revenue earned over billings on contracts. Contract assets are classified as unbilled receivables (only act of invoicing is pending) when there is unconditional right to receive cash, and only passage of time is required, as per contractual terms. Unearned and deferred revenue ("contract liability") is recognised when there is billings in excess of revenues. The billing schedules agreed with customers include periodic performance based payments and/or milestone based progress payments. Invoices are payable within contractually agreed credit period. In accordance with Ind AS 37, the Company recognises an onerous contract provision when the unavoidable costs of meeting the obligations under a contract exceed the economic benefits to be received. Contracts are subject to modification to account for changes in contract specification and requirements. The Company reviews modification to contract in conjunction with the original contract, basis which the transaction price could be allocated to a new. # Notes forming part of the Standalone Financial Statements Revenue disaggregation by geography is as follows: | | | | | |(` crore)|Geography|Year ended March 31, 2020|Year ended March 31, 2019| |---|---|---|---|---|---|---|---|---| | | | |Americas|74,882|71,554| | | | | | |Europe| |35,999|32,120| | | | | | |India| | |8,716|8,277| | | | | |Others| | |11,709|11,219| | | | |Total| | | |131,306|123,170| | | Geographical revenue is allocated based on the location of the customers. Information about major customers: No single customer represents 10% or more of the Company's total revenue during the year ended March 31, 2020 and March 31, 2019. While disclosing the aggregate amount of transaction price yet to be recognised as revenue towards unsatisfied (or partially) satisfied performance obligations, along with the broad time band for the expected time to recognise those revenues, the Company has applied the practical expedient in Ind AS 115. Accordingly, the Company has not disclosed the aggregate transaction price allocated to unsatisfied (or partially satisfied) performance obligations which pertain to contracts where revenue recognised corresponds to the value transferred to customer typically involving time and material, outcome based and event based contracts. Unsatisfied (or partially satisfied) performance obligations are subject to variability due to several factors such as terminations, changes in scope of contracts, periodic revalidations of the estimates, economic factors (changes in currency rates, tax laws etc). The aggregate value of transaction price allocated to unsatisfied (or partially satisfied) performance obligations is `94,910 crore out of which 48.31% is expected to be recognised as revenue in the next year and the balance thereafter. No consideration from contracts with customers is excluded from the amount mentioned above. # Notes forming part of the Standalone Financial Statements # Changes in contract assets are as follows: Balance at the beginning of the yearRevenue recognised during the yearInvoices raised during the yearTranslation exchange differenceBalance at the end of the year # Changes in unearned and deferred revenue are as follows: Balance at the beginning of the yearRevenue recognised that was included in the unearned and deferred revenue at the beginning of the yearIncrease due to invoicing during the year, excluding amounts recognised as revenue during the yearTranslation exchange differenceBalance at the end of the year # Reconciliation of revenue recognised with the contracted price is as follows: |(` crore)|(` crore)|Year ended March 31, 2020|Year ended March 31, 2019| | |---|---|---|---|---| |Contracted price|2,823|2,281|133,098|125,101| |Reductions towards variable consideration components|(1,792)|(1,931)| | | |Revenue recognised|11,514|9,578|(10,999)|(9,093)| |The reduction towards variable consideration comprises of volume discounts, service level credits, etc.| | | | | # Impact of COVID-19 |(` crore)|Year ended March 31, 2020|Year ended March 31, 2019| | |---|---|---|---| |2,466|1,711| | | |(1,934)|(1,648)| | | |2,240|2,418| | | |customers postponing their discretionary spend due to change in priorities| | | | The Company has assessed that customers in Retail, Travel, Transportation and Hospitality, Energy and Manufacturing verticals are more prone to immediate impact due to disruption in supply chain and drop in demand while customers in Banking, Financial Services and Insurance would re-prioritise their discretionary spend in immediate future to conserve resources and assess the impact that they would have due to dependence of revenues from the impacted verticals. |
The Company has considered such impact to the extent known and available currently. However, the impact assessment of COVID-19 is a continuing process given the uncertainties associated with its nature and duration. TCS Annual Report 2019-20 Unconsolidated Financial Statements I 292 # Notes forming part of the Standalone Financial Statements The Company has taken steps to assess the cost budgets required to complete its performance obligations in respect of fixed price contracts and incorporated the impact of likely delays/increased cost in meeting its obligations. Such impact could be in the form of provision for onerous contracts or re-setting of revenue recognition in fixed price contracts where revenue is recognised on percentage-completion basis. The Company has also assessed the impact of any delays and inability to meet contractual commitments and has taken actions such as engaging with the customers to agree on revised SLAs in light of current crisis, invoking of force-majeure clause etc., to ensure that revenue recognition in such cases reflect realisable values. # 11) Other Income Dividend income is recorded when the right to receive payment is established. Interest income is recognised using the effective interest method. Other income consist of the following: | |Year ended March 31, 2020|Year ended March 31, 2019| |---|---|---| |Interest income|3,197|2,651| |Dividend income|3,980|3,571| |Net gain on investments carried at fair value through profit or loss|183|416| |Net gain on sale of investments other than equity shares carried at fair value through OCI|14|-| |Net gain on disposal of property, plant and equipment|50|84| |Net foreign exchange gain / (loss)|632|844| |Rent income|2|7| |Other income|24|54| |Total|8,082|7,627| | |Year ended March 31, 2020|Year ended March 31, 2019| |---|---|---| |Interest income comprise:| | | |Interest on bank balances and bank deposits|479|157| |Interest on financial assets carried at amortised cost|531|506| |Interest on financial assets carried at fair value through OCI|1,878|1,838| |Other interest (including interest on tax refunds)|309|150| |Dividend income comprise:| | | |Dividends from subsidiaries|3,980|3,571| |Dividend from mutual fund units*|-|-| |*Represents value less than `0.50 crore.|*Represents value less than `0.50 crore.|*Represents value less than `0.50 crore.| # 12) Employee benefits Defined benefit plans For defined benefit plans, the cost of providing benefits is determined using the Projected Unit Credit Method, with actuarial valuations being carried out at each balance sheet date. Remeasurement, comprising actuarial gains and losses, the effect of the changes to the asset ceiling and the return on plan assets (excluding interest), is reflected immediately in the balance sheet with a charge or credit recognised in other comprehensive income in the period in which they occur. Past service cost, both vested and unvested, is recognised as an expense at the earlier of (a) when the plan amendment or curtailment occurs; and (b) when the entity recognises related restructuring costs or termination benefits. TCS Annual Report 2019-20 Unconsolidated Financial Statements I 293 # Notes forming part of the Standalone Financial Statements The retirement benefit obligations recognised in the balance sheet represents the present value of the defined benefit obligations reduced by the fair value of scheme assets. Any asset resulting from this calculation is limited to the present value of available refunds and reductions in future contributions to the scheme. The Company provides benefits such as gratuity, pension and provident fund (Company managed fund) to its employees, which are treated as defined benefit plans. # Employee benefit expenses consist of the following: |(` crore)|Year ended March 31, 2020|Year ended March 31, 2019| |---|---|---| |Salaries, incentives and allowances|59,140|54,080| |Contributions to provident and other funds|4,020|3,665| |Staff welfare expenses|1,746|1,632| | |64,906|64,906| | |59,377|59,377| # Employee benefit obligations consist of the following: # Employee benefit obligations - Non-current |(` crore)|As at March 31, 2020|As at March 31, 2019| |---|---|---| |Gratuity liability|-|7| |Other employee benefit obligations|91|75| | |91|91| | |82|82| # Employee benefit obligations - Current |(` crore)|As at March 31, 2020|As at March 31, 2019| |---|---|---| |Compensated absences|2,034|1,756| |Other employee benefit obligations|23|20| | |2,057|2,057| | |1,776|1,776| # Notes forming part of the Standalone Financial Statements Employee benefit plans consist of the following: (* crore)* # Gratuity and pension File: AR_TCS_2019_2020-1-314.md In accordance with Indian law, the Company operates a scheme of gratuity which is a defined benefit plan. The gratuity plan provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount equivalent to 15 to 30 days' salary payable for each completed year of service. Vesting occurs upon completion of five continuous years of service. The Company manages the plan through a trust. Trustees administer contributions made to the trust. |
# Change in plan assets | |Year ended March 31, 2020|Year ended March 31, 2019| |---|---|---| |Fair value of plan assets, beginning of the year|2,671|2,432| |Plan assumed on insourcing of employees|30|-| |Interest income|234|193| |Employers' contributions|766|171| |Benefits paid|(171)|(147)| |Remeasurement - return on plan assets excluding amount included in interest income|111|22| |Fair value of plan assets, end of the year|3,641|2,671| # Change in benefit obligations | |Year ended March 31, 2020|Year ended March 31, 2019| |---|---|---| |Benefit obligations, beginning of the year|2,678|2,307| |Plan assumed on insourcing of employees|30|-| |Service cost|357|289| |Interest cost|222|190| |Remeasurement of the net defined benefit liability|520|39| |Benefits paid|(171)|(147)| |Benefit obligations, end of the year|3,636|2,678| # Funded status | |As at March 31, 2020|As at March 31, 2019| |---|---|---| |Deficit of plan assets over obligations|-|(7)| |Surplus of plan assets over obligations|5|-| | |5|(7)| # Notes forming part of the Standalone Financial Statements |Category of assets|As at March 31, 2020 (` crore)|As at March 31, 2019 (` crore)| |---|---|---| |Corporate bonds|1,004|684| |Equity instruments|17|20| |Government bonds and securities|1,695|1,150| |Insurer managed funds|850|759| |Bank balances|-|6| |Others|75|52| |Total|3,641|2,671| # Net periodic gratuity cost, included in employee cost consists of the following components: | |Year ended March 31, 2020 (` crore)|Year ended March 31, 2019 (` crore)| |---|---|---| |Service cost|357|289| |Net interest on net defined benefit (asset) / liability|(12)|(3)| |Net periodic gratuity cost|345|286| # Actual return on plan assets | |Year ended March 31, 2020 (` crore)|Year ended March 31, 2019 (` crore)| |---|---|---| |Actual return on plan assets|345|215| # Remeasurement of the net defined benefit (asset) / liability: | |As at March 31, 2020 (` crore)|As at March 31, 2019 (` crore)| |---|---|---| |Actuarial (gains) and losses arising from changes in demographic assumptions|(5)|(17)| |Actuarial (gains) and losses arising from changes in financial assumptions|345|-| |Actuarial (gains) and losses arising from changes in experience adjustments|180|56| |Remeasurement of the net defined benefit liability|520|39| |Remeasurement - return on plan assets excluding amount included in interest income|(111)|(22)| |Total|409|17| # The assumptions used in accounting for the defined benefit plan are set out below: | |Year ended March 31, 2020|Year ended March 31, 2019| |---|---|---| |Discount rate|6.50%|7.75%| |Rate of increase in compensation levels of covered employees|6.00%|6.00%| |Rate of return on plan assets|6.50%|7.75%| |Weighted average duration of defined benefit obligations|8 Years|8 Years| # Notes forming part of the Standalone Financial Statements The expected benefits are based on the same assumptions as are used to measure the Company's defined benefit plan obligations as at March 31, 2020. The Company is expected to contribute `424 crore to defined benefit plan obligations funds for the year ending March 31, 2021. The significant actuarial assumptions for the determination of the defined benefit obligations are discount rate and expected salary increase. The sensitivity analysis below have been determined based on reasonably possible changes of the respective assumptions occurring at the end of the reporting period, while holding all other assumptions constant. If the discount rate increases / decreases by 0.50%, the defined benefit obligations would increase / (decrease) as follows: | |As at March 31, 2020|As at March 31, 2019|Year ending March 31, 2021| |---|---|---|---| |Increase of 0.50%|(151)|(100)|279| |Decrease of 0.50%|163|108|294| | | | |332| | | | |363| | | | |411| | | | |2,584| If the expected salary growth increases / decreases by 0.50%, the defined benefit obligations would increase / (decrease) as follows: | |As at March 31, 2020|As at March 31, 2019| |---|---|---| |Increase of 0.50%|163|109| |Decrease of 0.50%|(152)|(102)| The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligations as it is unlikely that the change in the assumptions would occur in isolation of one another as some of the assumption may be correlated. Each year an Asset-Liability matching study is performed in which the consequences of the strategic investment policies are analysed in terms of risk and return profiles. Investment and contribution policies are integrated within this study. The defined benefit obligations shall mature after year ended March 31, 2020 as follows: |Year|Defined benefit obligations (` crore)| |---|---| |2021|279| |2022|294| |2023|332| |2024|363| |2025|411| |2026-2030|2,584| In accordance with Indian law, all eligible employees of the Company in India are entitled to receive benefits under the provident fund plan in which both the employee and employer (at a determined rate) contribute monthly to a Trust set up by the Company to manage the investments and distribute the amounts entitled to employees. |
This plan is a defined benefit plan as the Company is obligated to provide its members a rate of return which should, at the minimum, meet the interest rate declared by Government administered provident fund. A part of the Company's contribution is transferred to Government administered pension fund. # Notes forming part of the Standalone Financial Statements The contributions made by the Company and the shortfall of interest, if any, are recognised as an expense in statement of profit and loss under employee benefit expenses. In accordance with an actuarial valuation of provident fund liabilities on the basis of guidance issued by Actuarial Society of India and based on the assumptions as mentioned below, there is no deficiency in the interest cost as the present value of the expected future earnings of the fund is greater than the expected amount to be credited to the individual members based on the expected guaranteed rate of interest of Government administered provident fund. The details of fund and plan assets are given below: | |As at March 31, 2020|As at March 31, 2019| |---|---|---| |Fair value of plan assets|17,072|14,555| |Present value of defined benefit obligations|(17,072)|(14,555)| |Net excess / (shortfall)|-|-| The plan assets have been primarily invested in Government securities and corporate bonds. The principal assumptions used in determining the present value obligation of interest guarantee under the deterministic approach are as follows: | |As at March 31, 2020|As at March 31, 2019| |---|---|---| |Discount rate|6.50%|7.75%| |Average remaining tenure of investment portfolio|7.73 years|8.38 years| |Guaranteed rate of return|8.50%|8.65%| The Company contributed `1,035 crore and `856 crore for the years ended March 31, 2020 and 2019, respectively, to the provident fund. # Superannuation All eligible employees on Indian payroll are entitled to benefits under Superannuation, a defined contribution plan. The Company makes monthly contributions until retirement or resignation of the employee. The Company recognises such contributions as an expense when incurred. The Company has no further obligation beyond its monthly contribution. The Company contributed `248 crore and `232 crore for the years ended March 31, 2020 and 2019, respectively, to the Employees' Superannuation Fund. # Foreign defined contribution plan The Company contributed `549 crore and `475 crore for the years ended March 31, 2020 and 2019, respectively, towards foreign defined contribution plans. # Cost recognition Costs and expenses are recognised when incurred and have been classified according to their nature. The costs of the Company are broadly categorised in employee benefit expenses, cost of equipment and software licences, depreciation and amortisation expense and other expenses. Other expenses mainly include fees to external consultants, facility expenses, travel expenses, communication expenses, bad debts and advances written off, allowance for doubtful trade receivable and advances (net) and other expenses. Other expenses is an aggregation of costs which are individually not material such as commission and brokerage, recruitment and training, entertainment, etc. # Notes forming part of the Standalone Financial Statements # (a) Cost of equipment and software licences Cost of equipment and software licences consist of the following: | |Year ended March 31, 2020|Year ended March 31, 2019| |---|---|---| |Raw materials, sub-assemblies and components consumed|18|40| |Equipment and software licences purchased|1,578|1,963| |Finished goods and work-in-progress|1,596|2,003| |Opening stock*|-|-| |Less: Closing stock|(1)|-| *Represents value less than `0.50 crore. # (b) Other expenses Other expenses consist of the following: | |Year ended March 31, 2020|Year ended March 31, 2019| |---|---|---| |Fees to external consultants|13,916|12,259| |Facility expenses|2,175|3,275| |Travel expenses|2,569|2,718| |Communication expenses|985|837| |Bad debts and advances written off, allowance for doubtful trade receivables and advances (net)|132|188| |Other expenses|7,674|7,549| |Total|27,451|26,826| # (c) Research and development expenditure Research and development expenditure including capital expenditure aggregating `302 crore and `305 crore was incurred in the years ended March 31, 2020 and 2019, respectively. # (d) Corporate Social Responsibility (CSR) expenditure As per section 135 of the Companies Act, 2013, amount required to be spent by the Company during the year ended March 31, 2020 and 2019 is `600 crore and `542 crore, respectively, computed at 2% of its average net profit for the immediately preceding three financial years, on CSR. The Company incurred an amount of `602 crore and `434 crore during the years ended March 31, 2020 and 2019, respectively, towards CSR expenditure for purposes other than construction / acquisition of any asset. |
# 14) Finance costs Finance costs consist of the following: | |Year ended March 31, 2020|Year ended March 31, 2019| |---|---|---| |Interest on lease liabilities|416|7| |Interest on tax matters|256|162| |Other interest costs|71|1| |Total|743|170| # Notes forming part of the Standalone Financial Statements # 15) Income taxes Income tax expense comprises current tax expense and the net change in the deferred tax asset or liability during the year. Current and deferred taxes are recognised in statement of profit and loss, except when they relate to items that are recognised in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognised in other comprehensive income or directly in equity, respectively. # Current income taxes The current income tax expense includes income taxes payable by the Company and its branches in India and overseas. The current tax payable by the Company in India is Indian income tax payable on worldwide income after taking credit for tax relief available for export operations in Special Economic Zones (SEZs). Deferred income tax assets are recognised to the extent that it is probable that taxable profit will be available against which the deductible temporary differences and the carry forward of unused tax credits and unused tax losses can be utilised. The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilised. Deferred tax assets and liabilities are measured using substantively enacted tax rates expected to apply to taxable income in the years in which the temporary differences are expected to be received or settled. Current income tax payable by overseas branches of the Company is computed in accordance with the tax laws applicable in the jurisdiction in which the respective branch operates. The taxes paid are generally available for set off against the Indian income tax liability of the Company's worldwide income. For operations carried out in SEZs, deferred tax assets or liabilities, if any, have been established for the tax consequences of those temporary differences between the carrying values of assets and liabilities and their respective tax bases that reverse after the tax holiday ends. # Deferred income taxes Deferred income tax is recognised using the balance sheet approach. Deferred income tax assets and liabilities are recognised for deductible and taxable temporary differences arising between the tax base of assets and liabilities and their carrying amounts. Deferred tax assets and liabilities are offset when they relate to income taxes levied by the same taxation authority and the relevant entity intends to settle its current tax assets and liabilities on a net basis. Deferred tax assets include Minimum Alternate Tax (MAT) paid in accordance with the tax laws in India, to the extent it would be available for set off against future current income tax liability. Accordingly, MAT is recognised as deferred tax asset in the balance sheet when the asset can be measured reliably and it is probable that the future economic benefit associated with the asset will be realised. TCS Annual Report 2019-20 Unconsolidated Financial Statements I 300 # Notes forming part of the Standalone Financial Statements # The income tax expense consists of the following: | |Year ended March 31, 2020|Year ended March 31, 2019| |---|---|---| |Current tax| | | |Current tax expense for current year|8,440|8,672| |Current tax expense pertaining to prior years|572|1,271| |Total Current Tax|9,012|9,943| |Deferred tax| | | |Deferred tax expense for current year|1,168|697| |Deferred tax benefit pertaining to prior years|(1,449)|-| |Total Deferred Tax|(281)|697| |Total income tax expense recognised in current year|8,731|10,640| # The reconciliation of estimated income tax expense at statutory income tax rate to income tax expense reported in statement of profit and loss is as follows: | |Year ended March 31, 2020|Year ended March 31, 2019| |---|---|---| |Profit before taxes|41,991|40,705| |Indian statutory income tax rate|34.94%|34.94%| |Expected income tax expense|14,673|14,224| |Tax effect of adjustments to reconcile expected income tax expense to reported income tax expense| | | |Tax holidays|(4,856)|(4,735)| |Income exempt from tax|(14)|(21)| |Undistributed earnings in branches|(15)|299| |Tax on income at different rates|(300)|(403)| |Tax pertaining to prior years|(877)|1,271| |Others (net)|120|5| |Total income tax expense|8,731|10,640| The Company benefits from the tax holiday available for units set up under the Special Economic Zone Act, 2005. These tax holidays are available for a period of fifteen years from the date of commencement of operations. |
Under the SEZ scheme, the unit which begins providing services on or after April 1, 2005 will be eligible for deductions of 100% of profits or gains derived from export of services for the first five years, 50% of such profit or gains for a further period of five years and 50% of such profits or gains for the balance period of five years subject to fulfillment of certain conditions. From April 1, 2011 profits from units set up under SEZ scheme are subject to Minimum Alternate Tax (MAT). # Notes forming part of the Standalone Financial Statements # Significant components of net deferred tax assets and liabilities for the year ended March 31, 2020 are as follows: |Gross deferred tax assets and liabilities are as follows:|(` crore) As at March 31, 2020| | | |Assets|Liabilities|Net| |---|---|---|---|---|---|---|---| |Opening balance| | | | | | | | |Recognised in profit and loss| | | | | | | | |Recognised in other comprehensive income| | | | | | | | |Closing balance| | | | | | | | |Deferred tax assets / (liabilities) in relation to Property, plant and equipment and Intangible assets| | | | |225|63|162| | | | | |Provision for employee benefits|468|-|468| | | | | |Cash flow hedges|7|-|7| | | | | |Receivables, financial assets at amortised cost|327|-|327| | | | | |MAT credit entitlement|1,049|-|1,049| | | | | |Branch profit tax|-|284|(284)| |Unrealised gain on securities carried at fair value through profit or loss / other comprehensive income| | | | |(483)|-|(483)| | | | | |Lease liabilities|308|-|308| | | | | |Others|318|-|318| | | | | |Total deferred tax assets / (liabilities)|2,219|347|1,872| *Opening balance of deferred tax on lease liabilities has been restated by `147 crore to give impact of transition to Ind AS 116 (Refer note 7). TCS Annual Report 2019-20 Unconsolidated Financial Statements I 302 # Notes forming part of the Standalone Financial Statements # Significant components of net deferred tax assets and liabilities for the year ended March 31, 2019 are as follows: |(` crore)|Opening balance|Recognised in profit and loss|Recognised in / reclassified from other comprehensive income|Closing balance| |---|---|---|---|---| |Deferred tax assets / (liabilities) in relation to Property, plant and equipment and intangible assets|67|30|-|97| |Provision for employee benefits|311|57|-|368| |Cash flow hedges|10|-|(22)|(12)| |Receivables, financial assets at amortised cost|238|46|-|284| |MAT credit entitlement|2,204|(1,047)|-|1,157| |Branch profit tax|(400)|101|-|(299)| |Unrealised gain on securities carried at fair value through profit or loss / other comprehensive income|-|-|(149)|(149)| |Lease liabilities|80|8|-|88| |Others|117|108|-|225| |Total deferred tax assets / (liabilities)|2,626|(697)|(171)|1,758| # Gross deferred tax assets and liabilities are as follows: |(` crore)|Assets|Liabilities|Net| |---|---|---|---| |Deferred tax assets / (liabilities) in relation to Property, plant and equipment and Intangible assets|137|40|97| |Provision for employee benefits|368|-|368| |Cash flow hedges|(12)|-|(12)| |Receivables, financial assets at amortised cost|284|-|284| |MAT credit entitlement|1,157|-|1,157| |Branch profit tax|-|299|(299)| |Unrealised gain on securities carried at fair value through profit or loss / other comprehensive income|(149)|-|(149)| |Lease liabilities|88|-|88| |Others|224|-|224| |Total deferred tax assets / (liabilities)|2,097|339|1,758| Under the Income-tax Act, 1961, the Company is liable to pay Minimum Alternate Tax in the tax holiday period. MAT paid can be carried forward for a period of 15 years and can be set off against the future tax liabilities. MAT is recognised as a deferred tax asset only when the asset can be measured reliably and it is probable that the future economic benefit associated with the asset will be realised. Accordingly, the Company has recognised a deferred tax asset of `1,049 crore. TCS Annual Report 2019-20 Unconsolidated Financial Statements I 303 # Notes forming part of the Standalone Financial Statements # Direct tax contingencies The Company has ongoing disputes with income tax authorities relating to tax treatment of certain items. The disputes relate to tax treatment of certain expenses claimed as deductions, computation or eligibility of tax incentives or allowances, and characterisation of fees for services received. The Company has contingent liability in respect of demands from direct tax authorities in India and other jurisdictions, which are being contested by the Company on appeal amounting `1,453 crore and `1,501 crore as at March 31, 2020 and March 31, 2019 respectively. In respect of tax contingencies of `318 crore and `318 crore as at March 31, 2020 and March 31, 2019, respectively, not included above, the Company is entitled to an indemnification from the seller of TCS e-Serve Limited. The Company periodically receives notices and inquiries from income tax authorities related to the Company's operations in the jurisdictions it operates in. |
The Company has evaluated these notices and inquiries and has concluded that any consequent income tax claims or demands by the income tax authorities will not succeed on ultimate resolution. The number of years that are subject to tax assessments varies depending on tax jurisdiction. The major tax jurisdictions of Tata Consultancy Services Limited include India, United States of America and United Kingdom. In India, tax filings from fiscal 2017 are generally subject to examination by the tax authorities. In United States of America, the federal statute of limitation applies to fiscals 2016 and earlier and applicable state statutes of limitation vary by state. In United Kingdom, the statute of limitation generally applies to fiscal 2017 and earlier. # 16) Earnings per share Basic earnings per share is computed by dividing profit or loss attributable to equity shareholders of the Company by the weighted average number of equity shares outstanding during the year. The Company did not have any potentially dilutive securities in any of the years presented. | |Year ended March 31, 2020|Year ended March 31, 2019| |---|---|---| |Profit for the year (` crore)|33,260|30,065| |Weighted average number of equity shares|375,23,84,706|378,97,49,350| |Basic and diluted earnings per share (`)|88.64|79.34| |Face value per equity share (`)|1|1| # 17) Auditors remuneration | |Year ended March 31, 2020|Year ended March 31, 2019| |---|---|---| |Services as statutory auditors (including quarterly audits)|7|7| |Tax audit|1|1| |Services for tax matters|-*|-*| |Other services|4|4| |Re-imbursement of out-of-pocket expenses|1|-*| *Represents value less than `0.50 crore. # 18) Segment information The Company publishes the standalone financial statements of the Company along with the consolidated financial statements. In accordance with Ind AS 108, Operating Segments, the Company has disclosed the segment information in the consolidated financial statements. # 19) Commitments and Contingencies # Capital commitments The Company has contractually committed (net of advances) `1,272 crore and `1,258 crore as at March 31, 2020 and March 31, 2019, respectively, for purchase of property, plant and equipment. # Contingencies - Direct tax matters Refer note 15. - Indirect tax matters The Company has ongoing disputes with tax authorities mainly relating to treatment of characterisation and classification of certain items. The Company has demands amounting to `464 crore and `325 crore as at March 31, 2020 and March 31, 2019, respectively from various indirect tax authorities which are being contested by the Company based on the management evaluation and on the advice of tax consultants. - Other claims Claims aggregating `133 crore and `96 crore as at March 31, 2020 and March 31, 2019, respectively, against the Company have not been acknowledged as debts. In addition to above in October 2014, Epic Systems Corporation (referred to as Epic) filed a legal claim against the Company in the Court of Western District Madison, Wisconsin for alleged infringement of Epic's proprietary information. In April 2016, the Company received an unfavourable jury verdict awarding damages totalling `7,091 crore (US $940 million) to Epic. In September 2017, the Company received a Court order reducing the damages from `7,091 crore (US $940 million) to `3,168 crore (US $420 million) to Epic. Pursuant to US Court procedures, a Letter of Credit has been made available to Epic for `3,319 crore (US $440 million) as financial security in order to stay execution of the judgment pending post-judgment proceedings and appeal. Pursuant to reaffirmation of the Court order in March 2019, the Company has filed a notice of appeal in the superior Court to fully set aside the Order. Epic has also filed a cross appeal challenging the reduction by the trial judge of `754 crore (US $100 million) award and `1,509 crore (US $200 million) in punitive damages. The Company has received legal advice to the effect that the order and the reduced damages awarded are not supported by evidence presented during the trial. - Bank guarantees and letter of comfort The Company has given letter of comfort to banks for credit facilities availed by its subsidiaries. As per the terms of letter of comfort, the Company undertakes not to divest its ownership interest directly or indirectly in the subsidiary and provide such managerial, technical and financial assistance to ensure continued successful operations of the subsidiary. The Company has provided guarantees to third parties on behalf of its subsidiaries. The Company does not expect any outflow of resources in respect of the above. The amounts assessed as contingent liability do not include interest that could be claimed by counter parties. |
# 20) Social Security Code, 2019 The proposed Social Security Code, 2019, when promulgated, would subsume labour laws including Employees' Provident Funds and Miscellaneous Provisions Act and amend the definition of wages on which the organisation and its employees are to contribute towards Provident Fund. The Company believes that there will be no significant impact on its contributions to Provident Fund due to the proposed amendments. Additionally, there is uncertainty and ambiguity in interpreting and giving effect to the guidelines of Hon. Supreme Court vide its ruling in February 2019, in relation to the scope of compensation on which the organisation and its employees are to contribute towards Provident Fund. The Company will evaluate its position and act, as clarity emerges. TCS Annual Report 2019-20 Unconsolidated Financial Statements I 305 # Notes forming part of the Standalone Financial Statements # 21) Related party transactions The Company's principal related parties consist of its holding company, Tata Sons Private Limited and its subsidiaries, its own subsidiaries, affiliates and key managerial personnel. The Company's material related party transactions and outstanding balances are with related parties with whom the Company routinely enter into transactions in the ordinary course of business. Refer note 21 of consolidated financial statement for list of subsidiaries of the Company. Transactions with related parties are as follows: | |Tata Sons Private Limited|Subsidiaries of the Company|Subsidiaries of Tata Sons Private Limited|Associates / joint ventures of Tata Sons Private Limited and their subsidiaries|Other related parties|Total| |---|---|---|---|---|---|---| |Revenue|31|16,998|409|1,859|-|19,297| |Dividend income|-|3,979|-|-|-|3,979| |Rent income*|-|-|-|-|-|-| |Other income|-|39|-|-|-|39| |Purchases of goods and services (including reimbursements)|1|8,943|550|448|-|9,942| |Brand equity contribution|100|-|-|-|-|100| File: AR_TCS_2019_2020-1-314.md |Facility expenses|-|28|2|1|-|31| |Lease rental|2|-|68|26|-|96| |Bad debts and advances written off, allowance for doubtful trade receivables and advances (net)|1|-|-|1|-|2| |Contribution and advance to post employment benefit plans|-|-|-|-|2,684|2,684| |Purchase of property, plant and equipment|-|-|219|110|-|329| |Loans and advances given|-|1|4|85|-|90| |Loans and advances recovered|-|7|3|30|-|40| |Dividend paid|22,971|-|9|-|-|22,980| |Guarantees given|-|2|-|-|-|2| |Cost recovery|-|2,998|-|-|-|2,998| *Represents value less than `0.50 crore. # Notes forming part of the Standalone Financial Statements |(` crore)| | | |Year ended March 31, 2019| | | | | | | |---|---|---|---|---|---|---|---|---|---|---| |Tata Sons Private Limited|Subsidiaries of the Company|Subsidiaries of Tata Sons Private Limited|Associates / joint ventures of Tata Sons Private Limited and their subsidiaries|Other related parties| | | | | |Total| |Revenue|27|15,999|266| | | |2,215| |-|18,507| |Dividend income|-|3,571|-|-|-|3,571| | | | | |Rent income|-|7|-|-|-|7| | | | | |Other income|-|38|-|-|-|38| | | | | |Purchases of goods and services (including reimbursements)|1|8,178|415| | | |369| |-|8,963| |Brand equity contribution|101|-|-|-|-|101| | | | | |Facility expense|1|-|37| | | |15|-| |53| |Bad debts and advances written off, allowance for doubtful trade receivables and advances (net)|-|-|(7)|-|-|(7)| | | | | |Contribution and advance to post employment benefit plans|-|-|-|-| | | | |816|816| |Purchase of property, plant and equipment|-|-|2| | | |48|-| |50| |Loans and advances given|-|6|2| | | |1|-| |9| |Loans and advances recovered|-|1|-| | | |3|-| |4| |Dividend paid|7,254|-|3|-|-| | | | |7,257| |Guarantees given|-|13|-|-|-|13| | | | | |Buy-back of shares|10,455|-|4|-|-| | | | |10,459| |Cost recovery|-|2,302|-|-|-|2,302| | | | | |Issue of bonus shares|-|-|-|-|-|-| | | | | 1Refer note 6(m). |
# Notes forming part of the Standalone Financial Statements # Material related party transactions are as follows: | |As at March 31, 2020|As at March 31, 2019| |---|---|---| |Tata Consultancy Services Sverige AB|1,713|1,657| |Tata Consultancy Services Canada Inc.|1,934|1,919| |Tata Consultancy Services Deutschland GmbH|2,020|1,924| |Tata Consultancy Services Netherlands BV|3,364|2,449| |Jaguar Land Rover Limited|1,142|651| |Jaguar Cars Limited (dormant)|9|671| # Purchases of goods and services (including reimbursements) | |As at March 31, 2020|As at March 31, 2019| |---|---|---| |Tata America International Corporation|3,416|3,898| |Tata Consultancy Services De Mexico S.A.,De C.V.|1,414|1,314| |TCS Foundation|552|91| # Dividend income | |As at March 31, 2020|As at March 31, 2019| |---|---|---| |Tata America International Corporation|1,752|2,747| |Tata Consultancy Services Canada Inc.|694|236| # Material related party balances are as follows: | |As at March 31, 2020|As at March 31, 2019| |---|---|---| |Trade receivables| | | |Tata America International Corporation|98|627| |Tata Consultancy Services Sverige AB|650|362| |Tata Consultancy Services France SA|900|710| |Tata Consultancy Services Netherlands BV|727|233| |Tata Consultancy Services Asia Pacific Pte Ltd.|635|245| |Jaguar Land Rover Limited|209|362| |Trade payables| | | |Tata America International Corporation|1,314|1,413| |Tata Consultancy Services De Mexico S.A.,De C.V.|402|284| |Unbilled receivables and contract assets| | | |Diligenta Limited|311|173| # Notes forming part of the Standalone Financial Statements # Balances receivable from related parties are as follows: | | | | | | | | | | |(` crore)| |---|---|---|---|---|---|---|---|---|---|---| | |Tata Sons Private Limited|Subsidiaries of the Company|Subsidiaries of Tata Sons Private Limited|Associates / joint ventures of Tata Sons Private Limited and their subsidiaries|Other related parties| | | | |Total| |As at March 31, 2020| |4| |6,582|223| |449| |-|7,258| |Trade receivables, unbilled receivables and contract assets| |10| |62|30| |65| |-|167| | | |14| |6,644|253| |514| |-|7,425| | | | | | | | | | |(` crore)| | |---|---|---|---|---|---|---|---|---|---|---| | |Tata Sons Private Limited|Subsidiaries of the Company|Subsidiaries of Tata Sons Private Limited|Associates / joint ventures of Tata Sons Private Limited and their subsidiaries|Other related parties| | | |Total| | |As at March 31, 2019| |6| |4,332|97| |644| |-|5,079| |Trade receivables, unbilled receivables and contract assets| |2| |6|28|6| | |-|42| | | |8| |4,338|125| |650| |-|5,121| TCS Annual Report 2019-20 Unconsolidated Financial Statements I 309 # Notes forming part of the Standalone Financial Statements # Balances payable to related parties are as follows: | |Tata Sons Private Limited|Subsidiaries of the Company|Subsidiaries of Tata Sons Private Limited|Associates / joint ventures of Tata Sons Private Limited and their subsidiaries|Other related parties|Total| |---|---|---|---|---|---|---| |As at March 31, 2020|93|4,152|245|215|-|4,705| |Trade payables, unearned and deferred revenue, other financial liabilities and other liabilities| | | | | | | |Commitments and guarantees|-|4,302|11|367|-|4,680| | |Tata Sons Private Limited|Subsidiaries of the Company|Subsidiaries of Tata Sons Private Limited|Associates / joint ventures of Tata Sons Private Limited and their subsidiaries|Other related parties|Total| |---|---|---|---|---|---|---| |As at March 31, 2019|91|3,195|102|129|-|3,517| |Trade payables, unearned and deferred revenue, other financial liabilities and other liabilities| | | | | | | |Commitments and guarantees|-|4,263|14|53|-|4,330| TCS Annual Report 2019-20 Unconsolidated Financial Statements I 310 # Notes forming part of the Standalone Financial Statements Transactions with key management personnel are as follows: |(` crore)|Year ended March 31, 2020|Year ended March 31, 2019| |---|---|---| |Short-term benefits|28|33| |Dividend paid during the year|2|1| | |30|34| The remuneration of directors and key executives is determined by the remuneration committee having regard to the performance of individuals and market trends. The above figures do not include provisions for encashable leave, gratuity and premium paid for group health insurance, as separate actuarial valuation / premium paid are not available. 22) The sitting fees and commission paid to non-executive directors is `9 crore and `12 crore as at March 31, 2020 and 2019, respectively. Dividends declared by the Company are based on the profit available for distribution. On April 16, 2020, the Board of Directors of the Company have proposed a final dividend of `6 per share in respect of the year ended March 31, 2020 subject to the approval of shareholders at the Annual General Meeting. The proposal is subject to the approval of shareholders at the Annual General Meeting, and if approved, would result in a cash outflow of approximately `2,251 crore. As per our report of even date attached For and on behalf of the Board For B S R & Co. |
LLP N Chandrasekaran Rajesh Gopinathan Keki M Mistry Chartered Accountants Chairman CEO and Managing Director Director Firm's registration no: 101248W/W-100022 Yezdi Nagporewalla V Ramakrishnan Rajendra Moholkar Partner CFO Company Secretary Membership No: 049265 # 23) Subsequent event Dividends paid during the year ended March 31, 2020 include an amount of `18 per equity share towards final dividend for the year ended March 31, 2019 and an amount of `67 per equity share towards interim dividends (including special dividend) for the year ended March 31, 2020. Dividends paid during the year ended March 31, 2019. TCS Annual Report 2019-20 Unconsolidated Financial Statements I 311 # Statement pursuant to first proviso to sub-section (3) of section 129 of the Companies Act 2013, read with rule 5 of Companies (Accounts) Rules, 2014 in the prescribed Form AOC-1 relating to subsidiary companies |Sr. No.|Name of the subsidiary company|Date of becoming subsidiary|Start date of accounting period of subsidiary|End date of accounting period of subsidiary|Reporting currency|Exchange rate|Share capital|Reserves and surplus|Total Assets|Total Liabilities|Investments|Turnover|Profit before tax|Provision for tax|Profit after tax|Proposed dividend|% of shareholding|Country| |---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---| |1|APTOnline Limited|August 9, 2004|April 1, 2019|March 31, 2020|INR|1.000000|2|101|164|61|26|180|42|11|31|-|89%|India| |2|MP Online Limited|September 8, 2006|April 1, 2019|March 31, 2020|INR|1.000000|1|98|137|38|15|70|24|7|17|-|89%|India| |3|C-Edge Technologies Limited|January 19, 2006|April 1, 2019|March 31, 2020|INR|1.000000|10|236|331|85|-|294|108|27|81|-|51%|India| |4|MahaOnline Limited|September 23, 2010|April 1, 2019|March 31, 2020|INR|1.000000|3|76|161|82|38|88|29|7|22|-|74%|India| |5|CMC Americas, Inc.|August 9, 2004|April 1, 2019|March 31, 2020|USD|75.435000|12|15|61|34|-|113|44|18|26|-|100%|U.S.A.| |6|TCS e-Serve International Limited|December 31, 2008|April 1, 2019|March 31, 2020|INR|1.000000|10|9|512|493|12|1,231|(141)|(15)|(126)|-|100%|India| |7|TCS e-Serve America, Inc.|February 10, 2009|January 1, 2019|December 31, 2019|USD|75.435000|2|83|177|92|-|285|38|12|26|-|100%|U.S.A.| |8|Diligenta Limited|August 23, 2005|January 1, 2019|December 31, 2019|GBP|93.071718|9|1,082|2,224|1,133|270|3,666|370|77|293|-|100%|U.K.| |9|Tata Consultancy Services Canada Inc.|October 1, 2009|April 1, 2019|March 31, 2020|CAD|53.231953|38|593|1,712|1,081|-|5,686|672|180|492|-|100%|Canada| |10|Tata America International Corporation|August 9, 2004|April 1, 2019|March 31, 2020|USD|75.435000|2|1,555|3,098|1,541|35|3,735|1,268|347|921|-|100%|U.S.A.| |11|Tata Consultancy Services Asia Pacific Pte Ltd.|August 9, 2004|April 1, 2019|March 31, 2020|USD|75.435000|33|643|1,725|1,049|816|2,243|266|32|234|-|100%|Singapore| |12|Tata Consultancy Services (China) Co., Ltd.|November 16, 2006|January 1, 2019|December 31, 2019|CNY|10.631985|215|(46)|286|117|-|699|(12)|-|(12)|-|93.2%|China| |13|Tata Consultancy Services Japan, Ltd.|July 1, 2014|April 1, 2019|March 31, 2020|JPY|0.696184|301|1,059|2,786|1,426|-|5,340|292|93|199|-|66%|Japan| |14|Tata Consultancy Services Malaysia Sdn Bhd|August 9, 2004|April 1, 2019|March 31, 2020|MYR|17.552003|4|83|207|120|-|438|(9)|-|(9)|-|100%|Malaysia| |15|PT Tata Consultancy Services Indonesia|October 5, 2006|April 1, 2019|March 31, 2020|IDR|0.004609|-|26|66|40|-|69|17|5|12|-|100%|Indonesia| |16|Tata Consultancy Services (Philippines) Inc.|September 19, 2008|April 1, 2019|March 31, 2020|PHP|1.485526|(41)|205|477|313|-|647|15|3|12|-|100%|Philippines| # Statement pursuant to first proviso to sub-section (3) of section 129 of the Companies Act 2013, read with rule 5 of Companies (Accounts) Rules, 2014 in the prescribed Form AOC-1 relating to subsidiary companies |Sr. No.|Name of the subsidiary company|Date of becoming subsidiary|Start date of accounting period of subsidiary|End date of accounting period of subsidiary|Reporting currency|Exchange rate|Share capital|Reserves and surplus|Total Assets|Total Liabilities|Investments|Turnover|Profit before tax|Provision for tax|Profit after tax|Proposed dividend|% of shareholding|Country| |---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---| |17|Tata Consultancy Services (Thailand) Limited|May 12, 2008|April 1, 2019|March 31, 2020|THB|2.306916|2|10|30|18|-|73|16|3|13|-|100%|Thailand| |18|Tata Consultancy Services Belgium|August 9, 2004|April 1, 2019|March 31, 2020|EUR|83.023789|2|331|964|631|-|1,998|144|49|95|-|100%|Belgium| |19|Tata Consultancy Services Deutschland GmbH|August 9, 2004|April 1, 2019|March 31, 2020|EUR|83.023789|1|469|2,003|1,533|-|4,844|281|83|198|-|100%|Germany| |20|Tata Consultancy Services Sverige AB|August 9, 2004|April 1, 2019|March 31, 2020|SEK|7.477993|-|539|1,495|956|-|3,279|100|22|78|-|100%|Sweden| |21|Tata Consultancy Services Netherlands BV|August 9, 2004|April 1, 2019|March 31, 2020|EUR|83.023789|548|2,202|4,176|1,426|1,592|5,340|(373)|79|(452)|-|100%|Netherlands| |22|TCS Italia s.r.l.|August 9, 2004|April 1, 2019|March 31, 2020|EUR|83.023789|18|12|266|236|-|440|19|11|8|-|100%|Italy| |23|Tata Consultancy Services Luxembourg S.A.|October 28, 2005|April 1, 2019|March 31, 2020|EUR|83.023789|46|75|263|142|-|519|76|22|54|-|100%|Capellen (G.D. de Luxembourg)| |24|Tata Consultancy Services Switzerland Ltd.|October 31, 2006|April 1, 2019|March 31, 2020|CHF|78.406611|12|379|1,171|780|-|2,776|217|39|178|-|100%|Switzerland| |25|Tata Consultancy Services Osterreich GmbH|March 9, 2012|April 1, 2019|March 31, 2020|EUR|83.023789|-|5|38|33|-|39|-|-|-|-|100%|Austria| |26|Tata Consultancy Services Danmark ApS|March 16, 2012|April 1, 2019|March 31, 2020|DKK|11.117743|1|4|25|20|-|35|1|-|1|-|100%|Denmark| |27|Tata Consultancy Services De Espana S.A.|August 9, 2004|April 1, 2019|March 31, 2020|EUR|83.023789|-|39|197|158|-|384|12|-|12|-|100%|Spain| |28|Tata Consultancy Services (Portugal) Unipessoal, Limitada|July 4, 2005|April 1, 2019|March 31, 2020|EUR|83.023789|-|-|22|22|-|24|3|-|3|-|100%|Portugal| |29|Tata Consultancy Services France SA|June 28, 2013|April 1, 2019|March 31, 2020|EUR|83.023789|4|(408)|1,335|1,739|-|1,936|16|17|(1)|-|100%|France| |30|Tata Consultancy Services Saudi Arabia|July 2, 2015|April 1, 2019|March 31, 2020|SAR|20.049702|8|242|299|49|-|390|76|15|61|-|76%|Saudi Arabia| |31|Tata Consultancy Services (Africa) (PTY) Ltd.|October 23, 2007|April 1, 2019|March 31, 2020|ZAR|4.193326|6|39|45|-|45|-|28|-|28|-|100%|South Africa| TCS Annual Report 2019-20 Unconsolidated Financial Statements I 313 # Statement pursuant to first proviso to sub-section (3) of section 129 of the Companies Act 2013, read with rule 5 of Companies (Accounts) Rules, 2014 in the prescribed Form AOC-1 relating to subsidiary companies |Sr. |
No.|Name of the subsidiary company|Date of becoming subsidiary|Start date of accounting period of subsidiary|End date of accounting period of subsidiary|Reporting currency|Exchange rate|Share capital|Reserves and surplus|Total Assets|Total Liabilities|Investments|Turnover|Profit before tax|Provision for tax|Profit after tax|Proposed dividend|% of shareholding|Country| |---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---| |32|Tata Consultancy Services (South Africa) (PTY) Ltd.|October 31, 2007|April 1, 2019|March 31, 2020|ZAR|4.193326|8|58|301|235|-|737|34|10|24|-|100%|South Africa| |33|TCS FNS Pty Limited|October 17, 2005|April 1, 2019|March 31, 2020|AUD|46.709352|174|(53)|121|-|1|-|70|-|70|-|100%|Australia| |34|TCS Financial Solutions Beijing Co., Ltd.|December 29, 2006|January 1, 2019|December 31, 2019|CNY|10.631985|39|(13)|64|38|-|73|9|-|9|-|100%|China| |35|TCS Financial Solutions Australia Holdings Pty Limited|October 19, 2005|April 1, 2019|March 31, 2020|AUD|46.709352|-|-|-|-|-|70|-|70|-|-|Australia| | |36|TCS Financial Solutions Australia Pty Limited|October 19, 2005|April 1, 2019|March 31, 2020|AUD|46.709352|-|100|143|43|34|70|62|16|46|-|100%|Australia| |37|TCS Iberoamerica SA|August 9, 2004|April 1, 2019|March 31, 2020|USD|75.435000|742|876|1,632|14|1,631|-|418|25|393|-|100%|Uruguay| |38|TCS Solution Center S.A.|August 9, 2004|April 1, 2019|March 31, 2020|UYU|1.724504|62|188|411|161|-|691|136|34|102|-|100%|Uruguay| |39|Tata Consultancy Services Argentina S.A.|August 9, 2004|April 1, 2019|March 31, 2020|ARS|1.171760|6|-|40|34|-|43|(8)|-|(8)|-|100%|Argentina| |40|Tata Consultancy Services Do Brasil Ltda|August 9, 2004|January 1, 2019|December 31, 2019|BRL|14.522091|255|(103)|434|282|-|641|20|(5)|25|-|100%|Brazil| |41|Tata Consultancy Services De Mexico S.A., De C.V.|August 9, 2004|January 1, 2019|December 31, 2019|MXN|3.138809|1|721|1,171|449|-|1,877|257|94|163|-|100%|Mexico| |42|Tata Consultancy Services Chile S.A.|August 9, 2004|January 1, 2019|December 31, 2019|CLP|0.088034|150|202|514|162|59|534|28|12|16|-|100%|Chile| |43|TCS Inversiones Chile Limitada|August 9, 2004|January 1, 2019|December 31, 2019|CLP|0.088034|135|150|302|17|283|28|78|1|77|-|100%|Chile| |44|TATASOLUTION CENTER S.A.|December 28, 2006|January 1, 2019|December 31, 2019|USD|75.435000|23|36|157|98|-|485|(10)|14|(24)|-|100%|Ecuador| |45|TCS Uruguay S.A.|January 1, 2010|April 1, 2019|March 31, 2020|UYU|1.724504|-|91|178|87|-|358|126|12|114|-|100%|Uruguay| |46|MGDC S.C.|January 1, 2010|January 1, 2019|December 31, 2019|MXN|3.138809|-|168|354|186|-|985|26|23|3|-|100%|Mexico| |47|Technology Outsourcing S.A.C.|October 30, 2015|January 1, 2019|December 31, 2019|PEN|21.955585|12|8|33|13|-|75|8|-|8|-|100%|Peru| TCS Annual Report 2019-20 Unconsolidated Financial Statements I 314 # Statement pursuant to first proviso to sub-section (3) of section 129 of the Companies Act 2013, read with rule 5 of Companies (Accounts) Rules, 2014 in the prescribed Form AOC-1 relating to subsidiary companies |Sr. No.|Name of the subsidiary company|Date of becoming subsidiary|Start date of accounting period of subsidiary|End date of accounting period of subsidiary|Reporting currency|Exchange rate|Share capital|Reserves and surplus|Total Assets|Total Liabilities|Investments|Turnover|Profit before tax|Provision for tax|Profit after tax|Proposed dividend|% of shareholding|Country| |---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---| |48|Tata Consultancy Services Qatar S.S.C.|December 20, 2011|April 1, 2019|March 31, 2020|QAR|20.415426|4|28|66|34|-|76|15|2|13|-|100%|Qatar| |49|W12 Studios Limited|October 31, 2018|June 1, 2019|May 31, 2020|GBP|93.071718|-|26|27|1|-|3|3|1|2|-|100%|U.K.| |50|TCS Business Services GmbH|March 9, 2020|April 1, 2019|March 31, 2020|EUR|83.023789|-|-|-|-|-|-|-|-|-|-|100%|Germany| |51|TCS Foundation|March 25, 2015|April 1, 2019|March 31, 2020|INR|1.000000|1|994|999|4|53|-|282|-|282|-|100%|India| # Notes: 1. Indian Rupee equivalents of the figures given in foreign currencies in the accounts of the subsidiary companies, are based on the exchange rates as on March 31, 2020. 2. TCS Financial Solutions Australia Holdings Pty Limited liquidated w.e.f. January 29, 2020. 3. TCS Business Services GmbH was acquired w.e.f. March 9, 2020. # For and on behalf of the Board N Chandrasekaran Chairman Rajesh Gopinathan CEO and Managing Director Keki M Mistry Director V Ramakrishnan CFO Rajendra Moholkar Company Secretary Mumbai, April 16, 2020 # TCS Annual Report 2019-20 Unconsolidated Financial Statements I 315 # Glossary 5G Fifth generation wireless technology is expected to be much faster and enable much higher volumes of data sharing than earlier generations of cellular networks. Its massive capacity and ultra-low latency are expected to usher in an era of hyper-connectivity, enabling newer use cases such as autonomous cars, and accelerating the adoption of IoT. AgilityDebt™ AgilityDebt™ is a simple index for digital cellular networks, developed by TCS, which uniquely indicates the burden carried by an organization that restricts its Agility. The index is arrived at based on a holistic Agile maturity assessment framework that measures the gap against required Agile talent, roles, team composition, delivery practices, Agile culture, Agile technology and DevOps enablers. TCS uses AgilityDebt™ to assess where the customer's teams are in the Agile journey, find the bottlenecks, and accelerate their Agile transformations. ADM See Application Development and Maintenance. Agile A collaborative approach for IT and business teams to develop software incrementally and faster. TCS has pioneered the Location Independent Agile™ model that allows for deployment at scale, and helps globally distributed organizations execute large transformational programs quickly, while ensuring stability and quality. Agile Workspaces These are key enablers of TCS' Location Independent Agile model, and represent the next generation work environment that facilitates greater collaboration among teams. It is characterized by partition-less open offices, informal seating, interactive surfaces for information capture, and modern collaboration devices for increased productivity. AI See Artificial Intelligence. |
TCS Annual Report 2019-20 # TCS Annual Report 2019-20 # Glossary |Algo Retail™|TCS' proprietary approach and suite of intellectual property that enables retailers to seamlessly integrate and orchestrate data flows across the retail value chain, harnessing the power of analytics, AI and machine learning in the areas of personalization, pricing optimization, marketing, online search and commerce to unlock exponential business value.| |---|---| |Artificial Intelligence|Technology that emulates human performance by learning, coming to its own conclusions, understanding complex content, engaging in natural dialogs with people, augmenting human effort or replacing people on execution of non-routine tasks. Also known as Cognitive Computing.| |ASEAN|Acronym for Association of Southeast Asian Nations| |Assets Under Custody|A measure of the total assets for which a financial institution, typically a custodian bank, provides custodian services.| |Amortization|An accounting concept similar to depreciation, but used to measure the consumption of intangible assets.| |Analytics|In the enterprise context, this is the discovery, interpretation, and communication of meaningful patterns in business data to predict and improve business performance.| |AUC|See Assets Under Custody| |Attrition|Measures what portion of the workforce left the organization (voluntarily and involuntarily) over the last 12 months (LTM).| |Attrition (LTM)|Total number of departures in the LTM / closing headcount| |APAC|Acronym for Asia Pacific| |API|See Application Programming Interface| |Augmented Reality|Technology that superimposes a computer-generated image on a user's view of the real world to enrich the interaction.| |APIfication|The process of exposing a discrete business function or data within an enterprise's systems through APIs.| |Application Development and Maintenance|Design, development, and deployment of custom software; ongoing support, upkeep, and enhancement of such software over its lifetime.| |Application Programming Interface|A set of easily accessible protocols for communication among various software components.| |AR|See Augmented Reality| |Basis Point|One hundredth of a percentage point, that is, 0.01 percent.| |BFSI|Acronym for Banking, Financial Services and Insurance| # TCS Annual Report 2019-20 # Glossary |Big Data|A high volume, high velocity, and/or high variety information asset that require new forms of processing to enable enhanced decision making, insight discovery, and process optimization.| |---|---| |Business Process Services|Designing, enabling, and executing business operations including data management, analytics, interactions and experience management.| |Buyback|A corporate action in which a company returns excess cash to shareholders by buying back its shares from them and usually extinguishing those shares thereafter. The company's equity share capital and the number of shares outstanding in the market correspondingly reduces.| |Blockchain|A distributed database that maintains a continuously growing list of records, called blocks, secured from tampering and revision.| |Bp|See Basis Point| |CAGR|See Compounded Annual Growth Rate| |BPaaS|See Business Process as a Service| |BPS|See Business Process Services| |Business 4.0|TCS' thought leadership framework that helps enterprises leverage technology to further their growth and transformation agenda. Successful Business 4.0 enterprises use technology to deliver mass personalization, leverage ecosystems, embrace risk and create exponential value. Such enterprises are agile, intelligent, automated and on the cloud.| |Capital Expenditure (CapEx)|Funds used by a company to acquire, upgrade, and maintain physical assets such as property, buildings, an industrial plant, technology, or equipment.| |Cash and Cash Equivalents|Cash comprises cash on hand and demand / time / fixed deposits. Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Cash and cash equivalents are held for the purpose of meeting short-term cash commitments rather than for investment or other purposes.| |Cash Flow|Inflows and outflows of cash and cash equivalents.| |Cash Flow from Operating Activities|Primarily derived from the principal revenue producing activities. Therefore, they generally result from the transactions and other events that enter into the determination of profit or loss.| |CBO|See Cognitive Business Operations| |CC|See Constant Currency| # TCS Annual Report 2019-20 # Glossary |Chatbots|Computer programs designed to simulate conversation with human users, especially over the internet. |
They are typically used in dialog systems for various practical purposes like customer service or information acquisition.| |---|---| |Compounded Annual Growth Rate (CAGR)|The annual growth rate between any two points in time, assuming that it has been compounding during that period.| |Connected Clinical Trials (CCT) Platform|Part of the TCS ADD suite, CCT is an innovative software-as-a-service platform that enables life sciences companies to significantly transform patient engagement in clinical trials and improve adherence to protocols, as well as the efficiency and accountability of clinical trials.| |Cloud|See Cloud Computing| |Cloud Computing|The delivery of easily provisionable computing resources - servers, storage, databases, networking, software, analytics and more - over the internet, consumed on a pay-as-you-go basis.| |Constant Currency|The basis for restating the current period's revenue growth after eliminating the impact of movements in exchange rates during the period.| |CMT|Acronym for Communication, Media and Technology| |Cognitive Automation|The use of AI and machine learning to automate relatively more complex tasks that require reasoning capability and contextual awareness. TCS' ignio™ a leading cognitive automation software product in the market today.| |Contextual Knowledge|This is tacit knowledge pertaining to, and specific to, the granular nuances of a customer's business and IT landscape, acquired on the job over a period of time. TCS teams use their contextual knowledge to design technology solutions that are uniquely tailored for that customer, and therefore, a potential source of competitive differentiation.| |Cognitive Business Operations (CBO)|An integrated offering where TCS takes responsibility for the outcome of an entire slice of the customers' operations including the business processes and the underlying IT infrastructure, and uses cognitive automation to transform that operational stack.| |CPG|Acronym for Consumer Packaged Goods| |Core Banking System|A back-end system that processes daily banking transactions and posts updates to accounts and other financial records; typically includes deposit, loan and credit processing capabilities, with interfaces to general ledger systems and reporting tools.| |Cognitive Computing|See Artificial Intelligence| |COIN|See Co-Innovation Network| |Co-Innovation Network|This is an extended, global innovation ecosystem curated by TCS, to harness the innovation efforts of start-ups and academia, and incorporate them into transformational solutions built by TCS for its customers.| # TCS Annual Report 2019-20 # Glossary # Core Transformation Modernization initiatives that target the one or more elements of the organization's operations stack consisting of business processes, software systems and underlying infrastructure, usually to enable greater agility, scalability, resilience and a superior customer experience. These are typically large in scale and scope, and entail the integrated delivery of multiple capabilities. # Digital Twin A digital replica of a physical entity. For instance, a digital twin of a factory is a virtual model of the factory built using its data, process, people information. Impact of any change in a process in the real factory can be studied by simulating the change in the digital twin. # Discretionary Spend Also known as Change the Business (CTB) spend, it is that portion of the IT budget which is used to fund projects that are not, strictly speaking, essential for day to day operations, but are more transformational in nature. In uncertain economic times, when businesses are forced to cut spends in response to decline in income, discretionary spend is often the first to be scrutinized. However, what is considered discretionary is subjective and may differ considerably amongst businesses even within the same sector. # Days' Sales Outstanding (DSO) A popular way of depicting the Trade Receivable relative to the company's Revenue. DSO = Trade Receivable * 365 / LTM Revenue # Depreciation A method of allocating the cost of a tangible long-term asset over its useful life. It is a non-cash accounting entry found in the statement of profit and loss. # Dividend One form of distribution of profits earned by the Company and is usually declared as an amount per equity share held by the Shareholders. TCS has a policy of declaring quarterly interim dividends and the final dividend is approved by the shareholders in the Annual General Meeting. # DevOps Represents a new way of working to rapidly deploy new releases of a software in production using high levels of automation and tooling. TCS recommends adoption of DevOps, along with Agile for speed to market. # Earnings Per Share The amount of that period's Net Income attributable to a single share after deducting any preference dividend and related taxes. |
EPS = [Net profit attributable to Shareholders of the Company - Preference dividend, if any] / Weighted average number of equity shares outstanding during the period # TCS Annual Report 2019-20 # Glossary |Edge Computing|Computing and storage that is located on servers on the edge of the network, in close proximity to the users, but not through an on-premise data center; usually reserved for low latency use cases.| |---|---| |Effective Tax Rate|The proportion of the Profit Before Tax that is provided towards income taxes.| |ETR = Tax expense / Profit Before Tax| | |Engineering and Industrial Services|Consists of next generation product engineering, manufacturing operations transformation, services transformation, embedded software and Internet of Things.| |Enterprise Agile|The adoption of Agile methods across all the business functions of the enterprise, designed to empower employees, foster collaboration and drive a culture of continuous innovation at scale.| |EPS|See Earnings Per Share| |ETR|See Effective Tax rate| |Fair Value|The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.| |Fintech|Businesses that use technology to make financial services more efficient. Some fintech developments have improved traditional services, for example mobile banking apps, while others have revolutionized services such as pay per mile car insurance, or created new products, such as Bitcoin.| |Free Cash Flow|Represents the cash a company generates through its operations, less the capital expenditure.| |Free cash flow = Cash flow from operating activities - Capital expenditure| | # TCS Annual Report 2019-20 # Glossary |Furlough|A temporary cessation of work without pay for the employees, usually implemented by organizations facing under difficult economic conditions, and in lieu of laying off employees.| |---|---| |Gamification|The process of adding games or game-like elements to any activity in order to enrich experiences and encourage user participation.| |GDPR|Acronym for General Data Protection Regulation, a European Union regulation for data protection and privacy.| |Hybrid Cloud|An enterprise IT infrastructure model that combines private clouds, public clouds and on premise data centers, to meet the compute and storage needs of the business.| |Innovation Days|Focused workshops with a TCS customer where researchers and business leaders from both organizations participate to explore emerging technologies for specific customer problems.| |Innovation Forum|TCS' thought leadership event that is held in North America, UK, Latin America and Japan. It brings together researchers from academia, innovators from the start-up ecosystem, technology watchers, futurists and customers to brainstorm around emerging technologies.| File: AR_TCS_2019_2020-1-314.md |Inorganic Growth|Growth in revenue due to mergers, acquisitions or takeovers, rather than due to an increase in the company's own business activity.| |Involuntary Attrition|A reduction in the workforce due to the employer's decision to terminate employment, instead of the employees' decision to leave.| |IoT|See Internet of Things| |IP|See Intellectual Property| # KMP See Key Managerial Personnel # Market Capitalization The total market value of a company's total outstanding equity shares at a point in time. Market Cap = Last Trading Price * Total number of outstanding shares # MEA Acronym for Middle East and Africa # LatAm Acronym for Latin America # MFDM™ Acronym for Machine First Delivery Model # Location Independent A method to orchestrate globally distributed stakeholders and talent into Agile teams for improved speed to market in large transformational programs. It comprises processes, structure, and the technology that allows enterprises to overcome location constraints and embrace Agile methods on a global scale. # Agile and talent into Agile teams for improved speed to market in large transformational programs. It comprises processes, structure, and the technology that allows enterprises to overcome location constraints and embrace Agile methods on a global scale. # Minimum Viable Product The most basic version of a new product, with the bare minimum functionality, which can be released to the users at the earliest, to be augmented with incremental features and functionality over subsequent iterative cycles. MVPs can be used by teams to learn about user behavior and validate the product value with minimum investment. # Machine First™ Delivery Model A model that integrates analytics, AI and automation deep within the enterprise to redefine how humans and machines work together and to effectively deliver superior outcomes. # Mobility Information, convenience, and social media all combined together, and made available across a variety of screen sizes and hand-held devices. # Machine Learning A type of artificial intelligence that provides computers with the ability to learn behaviors without being explicitly programmed. |
# MSP See Managed Services Provider # MVP See Minimum Viable Product # Non-Controlling Interest The share of the net worth attributable to non-controlling shareholders of the subsidiaries. # Non-discretionary Spend Also known as Run the Business (RTB) spend, is that portion of the IT budget that covers the basic IT activities required to keep a business running. Even in tough economic times, non-discretionary spend remains relatively unaffected. # Managed Services This is the practice of outsourcing to one service provider, also known as the Managed Services Provider (MSP), the end-to-end responsibility for providing, or orchestrating the provision through third party providers of, services around a range of processes and functions, in order to improve efficiency, service quality, agility and scalability. # Managed Services Provider Service providers with the sole, end-to-end responsibility of providing Managed Services. # TCS Annual Report 2019-20 Glossary I 323 # TCS Annual Report 2019-20 # Glossary # Options Contract A hedging instrument that offers the buyer the right to buy or sell the underlying asset (such as stocks or currency) on a future date, at a specified price, for small upfront fee called options premium. Eg: TCS purchases an options contract to sell USD 1mn @ `77/$ after 3 months, paying an option premium of `1 million. With this, TCS will have the right to sell USD 1mn at an exchange rate of `77, even if the prevailing market rate at the end of three months is, say `75. On the other hand, if the market rate is higher, say `79, then TCS can choose to let the options contract lapse and instead sell at the market rate. # Platform as a Service (PaaS) A category of cloud computing that provides a platform and environment to allow developers to build applications and services over the internet. PaaS services are hosted in the cloud and accessed by users simply via their web browser. # Pricing The price charged to the customer for a billable effort, turnkey project or a certain process outcome, depending on the nature of the contract. Some use this term interchangeably (and somewhat inaccurately) with the average revenue realized by the company per utilized effort on an aggregate basis. See Realization. # Private Cloud Refers to a model of cloud computing where IT infrastructure, in terms of compute and storage resources, are provisioned for the dedicated use of a single organization. # Product In the technology context, refers to a packaged software program that is made available to multiple customers either on a license basis, or on a subscription basis, to enable the execution of certain common tasks or processes or business functions in a standardized way. This is the opposite of bespoke or custom software which is built to specifications to meet a customer's unique needs. # Platforms A group of technologies that are used as a base upon which other applications, processes or technologies are developed. Useful for optimizing costs and efforts, and eliminating iterative tasks to drive strategic business initiatives. # Public Cloud A computing service model used for the provisioning of storage and computational services to the general public over the internet. Public cloud facilitates access to IT resources on a 'pay as you go' billing model. # R&I Acronym for Research & Innovation. # TCS Annual Report 2019-20 # Glossary # Realization The revenue received by the company per utilized effort. Pricing varies by service and by market. Consequently, there can be changes in realization compared to a prior period, due to changes in the underlying business or geographic mix during the period. This does not necessarily mean that like-to-like pricing has changed. Also, realization doesn't take into account the costs and therefore, higher realization is not necessarily more profitable. # Robotic Process Automation The use of software tools to automate high-volume, repeatable tasks that previously required humans to perform. RPA is best suited for relatively simple and stable processes. Dynamic changes in the environment require ongoing upkeep of the robots, diluting the economic benefit of the automation. Increasingly, customers are preferring cognitive automation over RPA. # Related Party Transactions Any transaction between a company and its related party involving transfer of services, resources or any obligation, regardless of whether a price is charged. Please refer to the Company's policy on Related Party Transactions: http://www.tcs.com/ir-corporate-governance. # Revenue The income earned by the Company from operations by providing IT and consulting services, software licenses, and hardware equipment to customers. |
# RFP Acronym for Request for Proposal, meaning a document that solicits proposal, often made through a bidding process, by an entity interested in procurement of IT services, to potential service providers to submit business proposals. An RFP is floated early in the procurement cycle and requested information may include basic corporate information and history, financial information, technical capability and estimated completion period, and customer references. # SEZ See Special Economic Zone # SBWS™ See Secure Borderless Workspaces # Secure Borderless Workspaces™ TCS' innovative operating model rolled out in response to the COVID-19 disruption. It is a fully location agnostic extension of the Location Independent Agile model, enabling employees to work remotely, while retaining the same high rigor in project management, governance and security. The fully distributed nature of this model is better suited to ensure business continuity. It leverages TCS' prior investments and incorporates the learnings and best practices around network management, standard service delivery environment, digitized governance processes, heavy use of collaborative and cloud based technologies and an internal SOC benchmarked to the best in the industry. # TCS Annual Report 2019-20 # Glossary |Shareholder Payout Ratio|The proportion of earnings paid to shareholders as a percentage of the Company's earnings, i.e. Net Income attributable to Shareholders of the Company. Payout can be in the form of dividend (including dividend distribution tax) and share buyback.| |---|---| |Simplification|The rationalization of IT architectures through consolidation of systems and elimination of redundant systems and layers. The primary purpose is to shrink the IT footprint and make operations leaner and more efficient.| |Sole Sourced Contract|Non-competitive agreements that allow a single vendor to fulfill the needs of the contractual requirements. These types of contracts can be won when the competitor set narrows down significantly and comes down to a single vendor discussion, given the nature of the client's solution requirements.| |Special Economic Zone|In India, these are designated areas in which business and trade laws are different from the rest of the country, with various benefits and tax breaks to promote exports, attract investments, and create local jobs.| |STEM|An acronym for education in the fields of science, technology, engineering and math.| |T&M|See Time and Materials Contract| |TCS Pace™|A brand promise that represents the way TCS channels its domain knowledge and organizational units - business and technology services, industry solutions units, and the research and innovation organization - into internal and external co-innovation programs.| |TCV|See Total Contract Value| |Time and Materials Contract|A form of services contract where the customer is billed for the effort (in hours, days, weeks, etc.) logged by the project team members. Project risk is borne by the customer. This contrasts with Fixed Price Contracts.| |Total Contract Value|An aggregation of the value of all the contracts signed during a period and a useful indicator of demand, and near term business visibility.| |Turnkey Contracts|See Fixed Price Contracts| |Unearned and Deferred Revenue|For invoices raised in line with agreed milestones for services yet to be delivered. In other words, it is the amount that has been invoiced although the underlying effort is yet to be expended.| |VR|See Virtual Reality| |Virtual Reality|Artificial, computer-generated simulation or recreation of a real-life environment or situation. It engages users by offering simulated reality experiences firsthand, primarily by stimulating their vision and hearing.| |Virtualization|The abstraction of IT resources - like a server, client, storage or network - that masks the physical nature and boundaries of those resources from the users of those resources.| # TCS Annual Report 2019-20 # Glossary |Voluntary Attrition|Refers to reduction in workforce resulting from employees willingly leaving the organization to pursue other opportunities, spend time with family, or for some other personal reason.| |---|---| |XR|Extended reality, an umbrella term that covers augmented reality, virtual reality and mixed reality.| |Y-o-Y|Year-on-Year| Disclaimer: This glossary is intended to help understand commonly used terms and phrases in this report. The explanations are not intended to be technical definitions. If explanations provided here are found to be different from what is described in the Company's periodic financial statements (not limited to Notes to Accounts), then the definition provided in the certified financial statements will prevail. # TCS Safe Harbor Clause Certain statements in this release concerning our future prospects are forward-looking statements. Forward-looking statements by their nature involve a number of risks and uncertainties that could cause actual results to differ materially from market expectations. |
These risks and uncertainties include, but are not limited to, our ability to manage growth, intense competition among global IT services companies, various factors which may affect our profitability, such as wage increases or an appreciating Rupee, our ability to attract and retain highly skilled professionals, time and cost overruns on fixed-price, fixed-time frame contracts, client concentration, restrictions on cross-border movement of skilled personnel, our ability to manage our international operations, reduced demand for technology in our key focus areas, disruptions in telecommunication networks, our ability to successfully complete and integrate potential acquisitions, liability for damages on our service contracts, the success of the companies in which TCS has made strategic investments, withdrawal of governmental fiscal incentives, political instability, legal restrictions on raising capital or acquiring companies outside India, unauthorized use of our intellectual property, pandemics, natural disasters and general economic conditions affecting our industry. TCS may, from time to time, make additional written and oral forward-looking statements, including our reports to shareholders. These forward-looking statements represent only the Company's current intentions, beliefs or expectations, and any forward-looking statement speaks only as of the date on which it was made. The Company assumes no obligation to revise or update any forward-looking statements. # IT Services # Business Solutions # Consulting Tata Consultancy Services Limited 9th Floor, Nirmal Building, Nariman Point, Mumbai 400 021 www.tcs.com File: AR_TCS_2020_2021.md # ICS IUASONTULTANGY # TCS/SE/28/2021-22 # May 18, 2021 National Stock Exchange of India Limited BSE Limited Exchange Plaza, Bandra Kurla Complex, Mumbai-400051 Symbol: TCS Scrip Code No. 532540 Dear Sirs, # Sub: Annual General Meeting- Integrated Annual Report 2020-21 The twenty-sixth Annual General Meeting ("AGM") of the Company will be held on Thursday, June 10, 2021 at 3.30 p.m. IST through Video Conferencing / Other Audio Visual Means. Pursuant to Regulation 34(1) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, we are submitting herewith the Integrated Annual Report of the Company along with the Notice of AGM for the financial year 2020-21 which is being sent only through electronic mode to the Members. The Integrated Annual Report containing the Notice is also uploaded on the Company's website https://on.tcs.com/Annual-Report-2021. This is for your information and records. Thanking you, Yours faithfully, For Tata Consultancy Services Limited Rajendra Moholkar Company Secretary # cc: 1. National Securities Depository Limited 2. Central Depository Services (India) Limited 3. TSR Darashaw Consultants Private Limited Tata Consultancy Services Limited TCS House Raveline Street Fort Mumbai Maharashtra 400001 India Telephone +91 22 6778 9999 e-mail [email protected] www.tcs.com Registered Office 9th Floor Nirmal Building Nariman Point Mumbai 400021 Corporate Identification No. (CIN) L22210MH1995PLC084781 # Building on belief # Integrated Annual Report 2020-21 Backdrop: The iconic campus of the Tata Research Design and Development Center at Hadapsar in Pune, India # Integrated Annual Report 2020-21 # Content |About TCS|03|Statutory Section| | |---|---|---|---| |Board of Directors|04|Notice|35| |Management Team|05|Directors' Report|47| |Letter from the Chairman|07|Corporate Governance Report|72| |Letter from the CEO|09|Management Discussion and Analysis|98| |Performance Highlights|15|The Year Gone By|16| | | |Standalone Statement of Changes in Equity|269| | | |Standalone Statement of Cash Flows|272| | | |Notes forming part of the Standalone Financial Statements|274| | | |Statement under section 129 of the Companies Act, 2013 relating to Subsidiary Companies|324| | | |Consolidated Financial Statements| | | | |Independent Auditors' Report|174| | | |Consolidated Balance Sheet|183| | | |Consolidated Statement of Profit and Loss|185| | | |Consolidated Statement of Changes in Equity|187| | | |Consolidated Statement of Cash Flows|190| | | |Notes forming part of the Consolidated Financial Statements|192| |GRI Annexures| |About this Report|337| | | |Stakeholder Engagement Framework|338| | | |Identification of Material Topics|340| | | |GRI Content Index|344| |Standalone Financial Statements| |Independent Auditors' Report|255| | | |Standalone Balance Sheet|266| | | |Standalone Statement of Profit and Loss|268| | | |Building Digital India: Reserve Bank of India|34| # About TCS Tata Consultancy Services is an IT services, consulting and business solutions organization that has been partnering with many of the world's largest businesses in their transformation journeys for over 50 years. |
TCS offers a consulting-led, # Board of Directors |Non-Independent, Non Executive|Independent, Non Executive| | |---|---|---| |60|50|70| # Average Tenure on the Board (Years) | | |5| | |---|---|---|---| | | |2|14| # Board Independence (%) |N Chandrasekaran|Aarthi Subramanian|O P Bhatt|Don Callahan|Keki M Mistry| |---|---|---|---|---| |Chairman|M|M|M|C| |C|C|M|56%|44%| # Average Tenure of Independent Directors on the Board (Years) | | | | | | | |4| |---|---|---|---|---|---|---|---| | | | | | | |2|9| # Board Committees |Committee|C Chairman|M Member| |---|---|---| |Audit Committee|Rajesh Gopinathan|N G Subramaniam| |Dr Pradeep Kumar|Hanne Birgitte|Breinbjerg Sorensen| |Nomination and Remuneration Committee| | | |Stakeholders' Relationship Committee| | | |Corporate Social Responsibility Committee| | | |Executive Committee| | | |Risk Management Committee*| | | * Ramakrishnan V (Chief Financial Officer), is also a member of the Committee Integrated Annual Report 2020-21 # Management Team # Corporate |Rajesh Gopinathan|Chief Executive Officer and Managing Director| |---|---| |N G Subramaniam|Chief Operating Officer and Executive Director| |V Ramakrishnan|Chief Financial Officer| |Milind Lakkad|Chief Human Resources Officer| |Samir Seksaria|Head - Business Finance and CFO Designate| |Rajashree R|Chief Marketing Officer| |---|---| |K Ananth Krishnan|Chief Technology Officer| |Madhav Anchan|General Counsel Legal and Corporate Affairs| |Rajendra Moholkar|Company Secretary| # Integrated Annual Report 2020-21 Management Team | 5 # Business Heads |Surya Kant|Krishnan Ramanujam|K Krithivasan|Shankar Narayanan|Kamal Bhadada| |---|---|---|---|---| |Chairman - TCS North America|Business and Technology Services|Banking, Financial Services and Insurance|Retail, Travel and Consumer Products|Communication, Media and Information Services| |Amit Bajaj|Suresh Muthuswami|Susheel Vasudevan|Debashis Ghosh| | |North America, UK and Europe|BFSI Platforms|Manufacturing and Utilities|Life Sciences, Healthcare and Public Services| | Integrated Annual Report 2020-21 Management Team | 6 Dear Stakeholder, Even as I write this, India and many other parts of the world are in the grip of second or even third waves of the pandemic, much fiercer than anything we saw last year. It is a health crisis of the kind we have not seen in generations. My heart goes out to everyone out there who has suffered the loss of loved ones. I am confident we will eventually get it under control, but until then, I urge you to stay safe, follow covid discipline, get vaccinated if you are eligible and keep your spirits up. On the business front, your company weathered the pandemic very well. It adapted quickly and embraced a new operating model that prioritized the health and wellbeing of its employees, while enabling it to continue supporting its customers not just in their mission-critical operations but also in their growth and transformation journeys. Its Vision 25x25 and pioneering work around talent clouds have reinforced its credentials as a thought leader on the future of work, and a trend setter in the industry. TCS' agility, resilience and responsiveness during the crisis earned it tremendous goodwill from customers and enhanced its standing in the market. After the initial impact from lockdown-related disruptions, it swiftly returned to a sharp growth trajectory over the next nine months, and exited the year on a very strong note, with an expanded market share, industry-leading profitability and an all-time high order book. # Letter from the Chairman Integrated Annual Report 2020-21 Integrated Annual Report 2020-21 Letter From The Chairman | 7 # Letter From The Chairman Technological change is far more perceptible when it comes to consumer technology, and less so in the enterprise world. Enterprise adoption of new technologies tends to be very measured, and it is only much later, with the benefit of hindsight, that the scale of change and the key inflection points become more evident. To my mind, the year gone by saw an important inflection point that has huge ramifications on enterprise consumption of technology in the coming years, and on demand for your company's services. Your company is very well positioned to benefit from this multi-year technology upgradation cycle, and help customers translate their transformative visions into reality. To better articulate its mission and its aspirations, your company adopted a new brand statement this year, 'Building on Belief'. I think it describes what TCS does very accurately, and also reflects the ethos of the Tata Group and its evolution over the last century and a half. The pressing need for operational resilience and for enhancing customer experiences in digital channels accelerated enterprise decision-making, committing to future technology investments around the all-encompassing hyperscaler cloud stacks. This represents an important inflection point in the enterprise embrace of the cloud, and will drive significant spending on migrating workloads to public clouds in the coming years. Moving workloads to the cloud is just the start of their digital transformation journeys. |
The rich native capabilities of these stacks, particularly in the areas of analytics, machine learning and artificial intelligence open up a vast array of possibilities for enterprises to pursue new business models, address new customer segments, and provide highly personalized, differentiated experiences across the entire customer journey. Your company has been guided by a set of strong beliefs, right from the time it was founded. Belief in our core values, belief in putting the customer above all, belief in investing in people and empowering them, belief in constantly trying out new ideas and models, and belief in doing right by all the stakeholder communities we work with. This is why the new brand statement resonates so well, and feels so right. Looking ahead, your company sees immense opportunities for growth, riding the new technology cycle that has kicked off, powered by the belief that its differentiated capabilities and collaborative, solution-centric approach makes it the preferred transformation partner of its customers. It is building on that belief, and investing in sharpening the capabilities needed to expand its footprint in this large opportunity. On behalf of the Board of Directors of Tata Consultancy Services, I want to thank you for your continued trust, confidence, and support. Warm regards, N Chandrasekaran Chairman Integrated Annual Report 2020-21 # Letter from the CEO Dear Stakeholder, It has been a difficult year for everybody. Despite the ferocity with which the second and third waves of the pandemic are now hitting us, we are in a far better place as we exit FY 2021 than we were at the start. With a plethora of vaccines and new therapies that modern science and the pharmaceutical industry have delivered at unmatched speed, humanity is not as helpless as when the pandemic first struck. We are a resilient and adaptable species. With discipline, focus and fortitude, we shall overcome. Our business performance in the year gone by is also a reflection of that innate resilience and adaptability. In the early months of the pandemic, when the worldwide lockdown disrupted economic activity across virtually all sectors, your company responded with speed and agility, embracing a new operating model, Secure Borderless Workspaces (SBWS™). Working remotely, our teams helped customers maintain business continuity during peak disruption, and thereafter, to accelerate their growth and transformation (G&T). The dedication shown by TCSers, our agility and our innovation, won us much appreciation from our customers, and incremental business. Despite a sharp fall in revenues in the first quarter, progressively strengthening demand for our services helped us stage a swift recovery during the rest of the year, helping clock full year revenues of ₹164,177 crore in FY 2021, growing 4.6% over the prior year in reported terms, and degrowing by 0.8% in constant currency terms. The uneven impact of the pandemic on the different sectors shows up clearly in our segmental reporting. Three of our six industry verticals showed growth (in constant currency) over the prior year. As is to be expected in a pandemic year, 1 Integrated Annual Report 2020-21 Integrated Annual Report 2020-21 Letter From The CEO | 9 when the world looked to the pharma majors to switch entirely to online-only modes, triggering a lot of resources to support their core transformation. save humanity from the scourge of disease, our Life Sciences and Healthcare business grew 17.1%. The other two verticals were Banking, Financial Services and Insurance which grew 2.4%1, and Technology and Services which grew 0.2%. Our operating margin continued to be industry-leading at 25.9%*, an expansion of 1.3%* over the prior year. Net profit was ₹33,388 crore*, a net margin of 20.3%*. Our cash conversion continues to be very strong, with a cash conversion ratio of 116.2%* and free cash flow of ₹35,663 crore, growing 21.8% over the prior year. The Board has recommended a final dividend of ₹15 for the year, bringing the total dividend for the year to ₹38 per share. In keeping with our shareholder friendly capital allocation policy, your company has paid out ₹33,873 crore in dividends and a buyback in FY 2021, amounting to 95% of the free cash flow. # Strong Business Momentum Demand was driven by the confluence of two big trends. First, with consumers preferring contactless, digital transactions, enterprises were forced to rely more on their digital channels, and in some cases, save humanity from the scourge of disease, our Life Sciences and Healthcare business grew 17.1%. |
The other two verticals were Banking, Financial Services and Insurance which grew 2.4%1, and Technology and Services which grew 0.2%. This decision triggered many engagements around cloud migration, application modernization and data modernization. As a precursor to the core transformation and cloud migration, many customers are revisiting their current operations to look for opportunities for optimization and to free up the art of the possible, opening up newer opportunities for technology-driven differentiation. These trends resulted in a steady and strong flow of deals of all sizes, across all our industry verticals, throughout the year. We had two large deal wins, with Deutsche Bank and with Prudential Financial Inc respectively, that saw us strengthen our German presence and establish a strong local presence in Ireland. The order book signed every quarter was higher than that in the prior year. We closed the year with an all-time high quarterly TCV of $9.2 billion. In terms of technology choices, both these drivers converged on the hyperscaler cloud stacks, also known as public clouds. FY 2021 will be remembered as the year when many enterprises took the leap and committed to channeling their future technology investments into one or more of these cloud stacks, significantly accelerating what had been a measured movement over the last few years. 1 Excluding Regional Markets and Others * Excluding an exceptional item provided towards a contested legal claim # A Multi-year Technology Cycle conversational systems, AI, ML and IoT. Today's customers' cloud transformation journeys play out over three horizons, spread over the next three to five years and beyond. The enterprise embrace of the hyperscaler cloud has ramifications that go beyond the current year, extending to the medium and the longer term as well. This is a decadal technology shift that goes far beyond just the server and storage aspects of the IT infrastructure, and represents a crystallization of technology choices at a much broader level. This is because all the major hyperscale providers have been steadily building out their technology stacks over the last few years, expanding the offerings to include richer native choices around databases, data warehouses, applications and even cutting-edge tools like machine vision. Once an enterprise enters this ecosystem, it is virtually certain that all of its future innovation and technology programs will stay within that ecosystem. So we see this technology shift as the start of a multi-year technology upgradation cycle in which the abundance of native capabilities will constantly expand the art of the possible, opening up newer opportunities for technology-driven differentiation. Of course, the technology by itself doesn't deliver differentiation. If anything, cloud models are predicated on standardization and commoditization. Enterprises will start realizing the full value of their cloud investments in the subsequent two horizons. Differentiation takes place when enterprises invest in bespoke solutions that harness the native capabilities of the cloud, and are contextualized to each customer's unique circumstances, which amplify their unique strengths, and manage the nuances and idiosyncrasies to reduce risks. This is exactly what we have been doing for our customers over the last few years, leveraging our deep contextual knowledge of their business and technology landscapes, our research and innovation, intellectual property and expertise across digital technologies. As more and more enterprises get on to this journey, the cloud will become the seamless technology fabric that will bring together enterprises from across industries to form collaborative ecosystems which co-innovate around their individual products and services. It will help launch larger, purpose-driven offerings, each representing much more value to power their growth and transformation. Our verticalized, customer-centric organization structure has helped us foster domain and contextual knowledge within the Industry Solution Units. Our sustained investments in organic talent development, in research and innovation, and in creating intellectual property have helped build up solutioning expertise and boost our innovation credentials. Integrated Annual Report 2020-21 Letter From The CEO | 11 # Integrated Annual Report 2020-21 # Letter From The CEO their common customers than the sum of its parts. This differentiated approach is helping us win several G&T engagements that represent a promising beachhead in a market where our participation has been quite low traditionally. We also refreshed our brand last month, and launched a new brand statement, 'Building on Belief', to reflect who we are today, and to support our, and our customers' aspirations in the G&T space. It celebrates the power of reinvention and instils hope into business and trust in the enterprise. |
# Building on Belief We believe this boundaryless innovation has the power to change industry after industry. Given our deep domain knowledge across multiple industry verticals, and our work on innovation at their intersections, it presents us an opportunity to be the transformation agents and potential orchestrators of such ecosystems. With many of our customers embarking on multi-year, enterprise-wide transformation journeys, we are very well positioned to benefit from this expanding opportunity. Most importantly, we believe that this represents a unique opportunity to redefine how enterprises have traditionally approached transformations. We believe that enterprises can build sustainable, inclusive, and greater futures for their stakeholders by adopting an organic, inside out transformation model, rather than outside in, externally driven standardized change agendas. Our own journey over the last two decades in one of the most competitive industries in the world highlights the strengths of this approach. Our transformation approach values the collective knowledge between us and the customer, and combines it with a deep understanding of technologies and an innovation mindset to build their aspirations into reality. We have created structures that help stitch together different capabilities from across TCS to put together holistic solutions that help our customers achieve their business objectives. Our sustained investments in organic talent development, in research and innovation, and in creating intellectual property have helped build up solutioning expertise and boost our innovation credentials. Moreover, we have launched newer learning and development initiatives that will identify high potential candidates and put them through experiential courses that will help them become more effective transformation leaders. We are strengthening our partnerships with large technology providers as well as startups, academia and domain specialists towards co-innovating and collaborating to create new service offerings. Our focus and investments will now be on growing further and gaining more market share in this space. Towards this, we are investing in deepening our transformation capabilities. While we stay open to inorganic acquisitions, our focus and commitment to organic talent development remains unwavering. Masters program, that identifies individuals who have developed deep contextual knowledge on the job and are using that to create value for our customers. # Purpose, People, Planet We are entering FY 2022 with strong growth momentum and with much better visibility for future growth than we did last year, powered by a strong order book built up throughout the year and a robust deal pipeline. I have spoken earlier2 about how a purpose-driven approach can infuse greater resilience, adaptability and innovation within the organization, and drive greater rootedness in the community. In FY 2021, alongside a new brand statement, we also articulated our core purpose: building greater futures through innovation and collective knowledge. The first three words capture our forward-looking worldview very well. We truly believe that everything we do should result in better outcomes, and therefore greater futures, for our stakeholders. The emphasis on innovation and collective knowledge represents core tenets of the belief system that has sustained TCS over the last five decades, and shaped our culture and guided our strategy. We also refreshed our brand last month, and launched a new brand statement, Building on Belief, to reflect who we are today, and to support our, and our customers' aspirations in the G&T space. It celebrates the power of reinvention and instils hope into business and trust in the enterprise. Our belief conveys our optimistic outlook and reflects our limitless potential to create greater futures. It was this purpose-led approach which helped us keep our employees safe and well even during the bleakest phases of this pandemic. The proactive outreach of our HR, touching over 400,000 employees, the 24/7 medical hotline, online counseling services, and virtual sessions to foster physical and emotional wellness brought us all closer together during the year. We tied up with ambulance services and hospitals and set up isolation centers and quarantine accommodation at our facilities to support the growth ahead. While this influx of fresh talent is very important for our growth, even more critical has been our ability to consistently retain the talent that we have cultivated and grown in the organization. This year, we set a new benchmark in talent retention. Our attrition in IT services was 7.2%, the lowest in the industry globally, and an all-time low by our own standards. We honored all the job offers we had made pre-pandemic, and also onboarded all the trainees to whom we had given offer letters. We had our normal annual salary increase in October, and promotions as well. |
In line with the strong recovery in demand, we also ramped up our lateral hiring during the second half of the year and ended the year with a net addition of 40,185. By onboarding over 60,000 freshers over the last couple of years and training them on the technologies most in demand, we have created for ourselves a secure talent pool. Integrated Annual Report 2020-21 Letter From The CEO | 13 We continued to work with communities across the world, pursuing our long-standing commitment to programs in the areas of health, STEM education, skills development and the bridging of digital divides. In addition, we helped in the fightback against the pandemic. Our researchers used AI to identify promising new molecules which could potentially inhibit the spread of the virus. Our data marketplace solution is powering a critical national initiative to double India's COVID testing capacity. Even more fulfilling is the work we do for our customers which helps further their mission to save lives. In the Life Sciences domain, our teams used our innovative platform to streamline drug development processes, speed up clinical trials, and help pharma companies rush new therapies and vaccines to the market. At a time when the world desperately needed more ventilators and manufacturers were struggling to increase production, our team worked with the engineers at GE Healthcare to automate the late-point configuration of ventilators. This reduced the production time per ventilator by 6 minutes, enabling production of an additional 340 ventilators per month, helping ease suffering and saving lives. # Looking Ahead We are entering FY 2022 with strong growth momentum and with much better visibility for future growth than we did last year, powered by a strong order book built up throughout the year and a robust deal pipeline. In the medium and longer term, we see strong structural growth drivers triggered by the multi-year technology refresh cycle that our customers are embarking on, and their increased focus on G&T initiatives. On the environment front, while I am pleased that our large-scale switch to remote working helped us cut our absolute carbon footprint by 48.8% over the prior year, we are working on a longer-term roadmap to neutralize our carbon footprint and bring down atmospheric carbon towards helping the world reach net-zero levels by 2050. Our Vision 25x25 will be pivotal in this fight for our planet. Equally important is the leading role we are playing in helping our customers become more energy efficient, whether it is by deploying our Clever Energy solution that uses IoT and AI to remotely monitor and optimize energy consumption across distributed facilities, or by helping them switch from energy-inefficient in-house data centers to more efficient public clouds. That puts us in a very advantageous position. In addition to the large outsourcing opportunity which we continue to dominate, we are now entering a large, growing opportunity that significantly expands our addressable market. It is an exciting growth journey we are embarking on for the next few years. We thank you for your trust and look forward to your continued support on the journey ahead. |
Best Regards, Rajesh Gopinathan Chief Executive Officer & Managing Director # Performance Highlights | |Revenue Trend| |Operating Profit Trend| | | |Client Metrics| |Employee Metrics| | | | | | |---|---|---|---|---|---|---|---|---|---|---|---|---|---|---| | | |₹ crore|₹ crore| | | | |$50 Mn+ Clients|$100 Mn+ Clients| | | | | | | |FY 2017|FY 2018|FY 2019|FY 2020|FY 2021| | | | | | | | | | File: AR_TCS_2020_2021.md | |117,966|66.71|123,104|67.10| | | | | | | | | | | |CAGR 8.6%| | | | | | | | | | |11.3%|12.1%|25.9%| | | | | | |Operating Profit| |Operating Margin| | | |Total Headcount| | |Attrition (IT Services)| | |30,324|25,223| | | | | | |44|49| | | | | | |30,502|25,067|48|35| | | | | | | | | | | | |30,502|25,067|97.1%|9.7%| | | | | | | | | | | | |37,450|Capex|28,593|16,000| | | | | | | | | | | | |38,580|32,369| | | | | | | | | |16,000| |17,840| | # Operating Cash Flow |FY 2017|FY 2018|FY 2019|FY 2020|FY 2021*| |---|---|---|---|---| |42,481|38,802| | | | # Notes # Operating Cash Flow OCF OCF to Net Profit Ratio ## Cash usage for the period FY 2017 to FY 2021 ^Earnings per share is adjusted for bonus issue # Includes proposed final dividend * FY 2021 numbers are excluding provision towards legal claim # The Year Gone By # EUROPE # EUROPEAN IT CUSTOMER SATISFACTION SURVEY # Q4 Unveiled a new brand statement, 'Building on Belief', to articulate TCS' mission and relationship with customers, and putting its vast experience in purpose-led transformation at the core of its brand story as it embarks on its next decade of transformation-led growth. # RANKS CUSTOMER SATISFACTION TCS #1 in BY WHITELANE RESEARCH Across annual value of Combined contracts over 1700+ CXOs Polled European Countries €40 BILLION 4050 + IT Contracts # th YEAR 8 in a row # #1 in 12 countries | |Average Delivery Quality|#1 Service Capability|#1 Cloud for TCS| |---|---|---|---| |TCS|82%|81%|73%| |Industry Average|74%|64%|72%| # Customer Satisfaction TCS has showcased their capabilities, flexibility and agility in supporting their clients in their digital transformation efforts regardless of the situation. They have more than proved to be the reliable, innovative and trusted digital partner customers are looking for. - JEF LOOS, HEAD OF RESEARCH, WHITELANE RESEARCH *BASED ON STUDIES CONDUCTED BY WHITELANE RESEARCH, PA CONSULTING, QUINT WELLINGTON REDWOOD, NAVISCO AND VLERICK BUSINESS SCHOOL IN 2020. Integrated Annual Report 2020-21 The Year Gone By | 16 # Ranked #1 in Customer Satisfaction across Europe in an independent survey of 1,700 CxOs of top IT spending organizations by Whitelane Research. Additionally, in the individual country rankings, TCS was ranked #1 in UK, France, Germany, Austria, Switzerland, Netherlands, Belgium, Luxembourg and the Nordics. # Ranked among the Top 3 brands in IT services by Brand Finance TCS clocked the highest absolute brand value growth in the sector in 2020 and was named the fastest growing brand in the industry over the last decade (2010-2020). # Augmented the Banking Service Bureau built and run by TCS for the digital banking industry in Israel, with a new transformative Digital Bank Guarantee platform, powered by the Quartz® Blockchain solution. Bank Hapoalim, Israel's largest bank that manages over 30% of the total bank guarantees in the country, is the anchor customer for the SaaS platform. # Deepened the relationship with Deutsche Bank by acquiring its subsidiary, Postbank Systems AG (PBS), its full-range IT captive that provides project management, application management and infrastructure support services. The addition of PBS' 1,500 employees further adds to TCS' scale in Germany, and strengthens its growth outlook. # Launched TCS Clever Energy™ an energy and emission management system that uses a digital twin setup based on IoT, AI and cloud, to help commercial and industrial organizations manage their energy consumption better, drive energy and cost efficiencies, decrease carbon emissions, and accelerate their carbon neutral journeys. # Selected as a Superbrand in the US and UK, based on the strength of its brand reputation across channels, business performance, industry-leading job creation, scale of employee training and development, and dedication to nationwide corporate social responsibility initiatives. # The TCS family deeply mourns the passing of its founding CEO and the Father of Indian IT Industry, Shri Faqir Chand Kohli, 19th March 1924 - 26th November 2020. Your sense of purpose. Your clarity of vision. Your unwavering belief in investing in people. These have shaped TCS into what it is today. |
We continue to draw inspiration from your pioneering spirit. # Integrated Annual Report 2020-21 # The Year Gone By | 17 # Launched new cloud practice units to gain leadership in the rapidly expanding opportunity around the three major hyperscale platforms - AWS, Microsoft Azure and Google Cloud Platform. Each unit is a full-service, multidisciplinary organization offering customers the full range of transformational and operational services on the respective technology stacks, spanning advisory services, migration, application and data modernization, including SaaS and enterprise productivity suites, infrastructure, cyber-security and edge. # Ranked #2 by revenue in the UK market for software and IT services in TechMarketView's UK SITS rankings, up from #5 in 2019. Further, based on revenues earned, TCS was ranked #1 in Applications and #2 in Consulting and Solutions. # Ran a TV campaign in India for the first time, titled #TCSPartOfYourStory showcasing the central role played by TCS in building the technology backbone of Digital India, transforming various sectors, and becoming part of every Indian's life. # Built and deployed a blockchain-based digital supply chain platform powered by the TCS Data Marketplace solution, to support Indigenisation of Diagnostics, an ambitious new project launched by the Government of India to scale up indigenous Covid-19 diagnostic test-kit production capacity to a million test kits a day. # Launched TCS Safe Workplace a return-to-work solution for global enterprises that uses existing enterprise platforms to create a workplace command center that assesses the readiness of employees, the work environment and the workforce model; automates the return-to-work processes, including contact tracing, shift management, and workspace planning; and monitors critical risk factors. # The Contextual Masters program that recognizes experienced TCSers who demonstrate high levels of contextual knowledge, crossed the 10,000 masters milestone. Contextual knowledge is highly valuable tacit knowledge about a customer's business, operations and technology landscape, acquired on the job by immersing oneself into that environment, a key differentiator for TCS. # Operationalized 10 new Threat Management Centers at Bloomington, Minnesota - US, Manchester - UK, Madrid - Spain, as well as at major Indian cities. These will offer comprehensive and integrated cybersecurity and threat management services across IT, OT, IoT and cloud ecosystems, helping customers stay secure and cyber-resilient. # Presenting transFormiNG INDIA #TCSPartOfYourStory Integrated Annual Report 2020-21 The Year Gone By | 18 # Integrated Annual Report 2020-21 # The Year Gone By Held India's first ever virtual AGM, enabling participation by a record number of shareholders from different parts of India, some of them for the very first time. Access to the videoconference was from the NSDL e-voting page, seamlessly linking the event to the online voting process as well. Successfully deployed TCS DynaPORT, a state-of-the-art terminal operating system at Tilbury2 Ro-Ro, London's latest freight ferry terminal. TCS implemented this solution in under twelve weeks, 100% virtually during the COVID-19 lockdown, leveraging the Secure Borderless Workspaces™ (SBWS™) model. Offered free of cost access to TCS iON Digital Glass Room, a virtual learning platform, to educational institutions in the US, Europe and India, to enable educators and students to connect in a secure virtual environment, moving lessons from classrooms to interactive digital glass rooms. Fully institutionalized the SBWS operating model and also replicated it for customers. The model was strengthened with additional analytics and extended to cover the end-to-end customer engagement lifecycle, including prospecting, sale and even new project ramp ups. Launched a SaaS version of the ignio™ suite of autonomous software. Further, the suite was expanded to include three new products: ignio Cognitive Procurement to help enterprises make smarter purchase decisions, ignio AI.Digital Workspace, a self-healing, end-user experience management software, and ignio Studio, a low-code toolkit that allows customers to extend the out-of-the-box capabilities of the ignio software suite. # TRDDC: Built on a Belief in the Future The idea of setting up a technology research center in India, when none existed, was born out of a core belief that the future would be shaped by computers, and that R&D was key to value creation. For FC Kohli ("FCK"), the visionary who helmed TCS in its start-up years, the complete lack of technology research in India in the 70s was simply unacceptable. Around 1980, having launched TCS' global ambitions with the first overseas office in New York, he turned his attention to this problem. He commissioned academicians at MIT and the University of Waterloo to think through the scope and mandate of such a center, and come up with a report. |
He pulled in Prof E C Subba Rao, who was teaching at IIT Kanpur to drive this endeavor. At the time, an industrial research center by a business house was unheard of in India. But the House of Tatas, with its history of pioneering many other firsts, was best suited for it. JRD Tata was very supportive. He was keen that the Group establishes an institution that would apply science and technology for the benefit of Indian industry and people. So it came to be that FCK's dream was realized on October 8, 1981, the new Tata Research Design and Development Centre (TRDDC), was officially open. Right from the start, TRDDC's mandate was broad, researching problems not just in IT, but also in other domains. This too was an outcome of FCK's belief that "computers would be the tool that all industry would use, willy-nilly, in the future." # Mastering Automation A core research theme at TRDDC in its early years was a topic close to FCK's heart - the automation of software development. The technology landscape in the 80s was in a state of ferment, with newer, more powerful computers, operating systems, databases and programming languages. But software was still hand coded and very artisanal. So customers wishing to upgrade were dissuaded by the effort and cost of re-engineering their existing systems. TRDDC built language translators, converters and compilers using which TCS was able to win many of these upgradation opportunities. It used automation to transform the legacy systems much faster, and with higher quality, reliability and traceability than its competitors of that era. TRDDC's tools foundry represented the ultimate conversion toolset, automatically generating compilers for any source and target programming language. Depending on the needs of individual projects, compilers could be created on demand and shipped to those project teams. Integrated Annual Report 2020-21 # TRDDC: Built on a Belief in the Future Continued research around software engineering, computing and materials, biosciences, mathematical and behavioral sciences. Such blue-sky research at the intersections of industries is today foundational to TCS' ability to orchestrate purpose-driven, cross-industry ecosystems for boundaryless innovation on the cloud. Founded forty years ago, one of many firsts that TCS pioneered over the last five decades, the Tata Research Design and Development Center lived up to its founder's belief and went on to shape the company's present-day approach to research, innovation, growth and transformation. TRDDC's outstanding contributions over the decades to the company's growth, to the expansion of knowledge and to society truly make it the embodiment of the TCS ethos of building greater futures through innovation and collective knowledge. # Research for Social Good With its expansive mandate and the Tata Group's guiding ethos, TRDDC took up many research themes around social and environmental issues. These resulted in frugal innovations like low-maintenance water filters for rural areas, eco-friendly cement, award-winning test kits for tuberculosis, and of course, the game-changing Computer-based Functional Literacy software that was to be the mainstay of large-scale adult literacy programs in India and elsewhere. # Innovating at the Intersections TCS' collaborative approach to co-innovation with customers, leveraging collective knowledge, which is helping it differentiate itself in the growth and transformation market today, has its roots in how TRDDC engaged with its clients in those early years. In an interview1, Subba Rao recalled, "The two sides had lots of dialogue. This was unlike what most consultants did. We always took the view that the client should be part of the solution. The clients and we published case studies and research papers of successful solutions, jointly." This tradition of pursuing a broad set of ideas which benefit society at large continues to this day. TCS' Research & Innovation group uses technology for such diverse social causes as helping the differently abled, scaling up Covid test kit production in India, designing tests for biomarkers to predict premature birth, identifying promising molecules for drug development and innovative ways to help customers reduce their carbon footprint. Scientists at TRDDC were an eclectic set. |
Different research teams, working side by side, made possible cross-pollination of ideas and multidisciplinary research at the intersection of different domains: 1 Research by Design - Innovation at TCS, 2007 # Powering Phoenix Group's Growth Strategy with a Fully Digital Operating Model Phoenix Group has evolved into the UK's largest long-term savings and retirement business, pursuing a growth strategy that leverages key industry trends to consolidate and scale up its Heritage business, while organically growing its Open business and deepening existing customer relationships to meet broader customer needs as they journey to and through retirement. This in turn supports Phoenix Group in delivering its purpose of helping people secure a life of possibilities. The primary focus has been on migration to TCS' digital and customer-centric operating model that helps us take innovative new products faster to market and delivers more personalized experiences to our customers and advisers. The TCS partnership will support our growth ambitions and accelerate our ability to innovate whilst continuing to deliver excellent customer service. At the core of this model is the TCS BFSI Platform for Life & Pensions powered by TCS BaNCS™, which has simplified and modernized Phoenix Group's technology stack, enabled greater innovation through easier and faster design and rollout of new products, and transformed all the processes across the end-to-end customer journey, hyper-automating them with straight-through-processing for faster turnaround times. By previously consolidating more than 7.4 million policies scattered across disparate systems on the new platform, TCS has helped Phoenix Group retire hundreds of legacy systems, drive synergies from its acquisitions and unlock significant value. It is currently transforming another 6 million policies. On the front-end, TCS is helping the Phoenix Group enhance and personalize the customer, employer, and adviser experiences, adopting a more data and insights-driven approach. These initiatives have resulted in a 400% increase in site visits to its online customer self-service tool, the use of which has seen an 8x improvement in individual life cover claims processing, as well as 85% of encashment claims settled in under 3 days compared to 12 days on traditional channels. It also has reduced customer complaints and enhanced customer satisfaction. At the new, jointly developed Innovation Hub in Edinburgh, designers and domain experts from both organizations will work with end-users to envision new offerings and innovative experiences. Partnering with TCS for its growth and transformation is enabling the Phoenix Group to adapt quickly to regulatory and market changes, and provide intuitive, personalized experiences to customers, advisers, and employers on a fully digital platform. With a new operating model that is establishing industry benchmarks in efficiency, agility and customer-centricity, Phoenix Group is set to power ahead with its strategy to capture new growth opportunities. # Customer Stories 22 # Enabling Toyo Tire to Launch an Innovative, IoT-powered Business Model Toyo Tire Corporation, one of the world's leading tire manufacturers headquartered in Japan, seeks to delight its customers with its products through constant technological innovation, enabled by fostering creativity and entrepreneurial thinking. Recognizing the importance of proper tire maintenance in ensuring safety and maximizing efficiency, Toyo Tire partnered with TCS to explore how technology could be used to help its customers - fleet owners and transport service providers - reduce the time and effort spent in physically inspecting individual tires for wear. By partnering with TCS in this journey, Toyo Tire is poised to launch an innovative business model, offering a whole host of predictive maintenance and advisory services to its customers, and powering its future growth. Our new tire wear estimation model, built in collaboration with TCS, enables an innovative services-based business model that powers our future growth. TCS brought a lot of digital expertise, creative ideas and intellectual property. Their passion for innovation and shared values have made them a key part of our digital innovation journey. TCS used its Bringing Life to Things™ IoT framework to envision a new automated system that would meet Toyo Tire's vision. The solution uses components of TCS DigiFleet™, its IoT-enabled suite for fleet managers, to automatically gather data on tire conditions from sensors installed on wheels of trucks, buses, and other transport vehicles, help visualize the data, provide real time insights and transmit it to the cloud. This data along with other information is then used by Toyo's proprietary AI model to accurately estimate the extent of wear of the tires. |
Tetsuo Shimomura DGM - DX Promotion Division Toyo Tire Corporation # Integrated Annual Report 2020-21 Customer Stories | 23 # WHAT DOES YOUR NEW BRAND STATEMENT # BUILDING ON BELIEF: 'BUILDING ON BELIEF' MEAN TO YOU AND TO CUSTOMERS? # A Panel Discussion KAK: Every new idea or innovation is born out of the belief that it will build something better. In research and innovation, belief is central to the survival of an idea at every stage, determining whether it will be picked from among other worthy candidates for further development, or will get past resistance when further progress looks impossible. Only by striving on with passion and faith, can ideas be brought to fruition, making a big difference to the enterprise. NGS: Everything that Ananth just mentioned about innovation applies equally to business transformation. To me, digital transformation is innovation applied at scale to an organization's business model, its customer engagement, and its operations. The most successful business transformation programs are those which are purpose-led. We help every customer realize that purpose. TCS has intrinsically been built on strong beliefs which have profoundly shaped our organization culture. By adopting a purpose-led approach--putting the customer at the center, continually investing in people, and helping them build long, fulfilling careers with TCS--we have created a sustainable business model that has proved itself over the last five decades. # FEATURING Krishnan Ramanujam President - Business & Technology Services N G Subramaniam Chief Operating Officer K Ananth Krishnan Chief Technology Officer Integrated Annual Report 2020-21 Panel Discussion | 24 Customers truly appreciate this and see us as a strategic partner who remains current across cycles while helping them also stay current. Employees appreciate this too and it has resulted in industry-leading talent retention and an invaluable repository of contextual knowledge, both of which are competitive differentiators. KR: There is a large growth and transformation market in which we want to expand TCS' footprint and gain further share from legacy consulting organizations. In that context, the new brand statement is very timely and reflects that aspiration. Building on Belief is a way for us to signal to all customers and prospects that TCS will work alongside them in their G&T journeys, with a sense of shared purpose and help them realize their vision. # HOW DO YOU ACTUALLY WIN THESE DEALS? # ARE THERE RFPS FOR GROWTH AND TRANSFORMATION? NGS: There are multiple scenarios: RFP driven transformation deals and proactive proposals. In the first scenario, customers typically know what they want to accomplish and look to us for knowhow. Whereas, in the latter, account teams proactively identify business problems that are critical for a customer, and put together high-level solution ideas which they pitch to customers. This is often followed by more detailed workshops that eventually culminate in a full-fledged engagement. YOU HAVE BEEN SPEAKING ABOUT GROWTH AND TRANSFORMATION FOR THE LAST THREE YEARS. WHY THE RENEWED FOCUS NOW? NGS: Yes, we have been winning quite a few growth and transformation engagements with the Business 4.0™ thought leadership framework. Some of these stories have been showcased in our recent annual reports. While the number of such deals has been steadily increasing, it is only a small foothold in the larger opportunity. KAK: In the second scenario, TCS Research & Innovation is a catalyst. We often organize account-level ideathons to crowdsource creative ideas which address our customers' most pressing business problems, leveraging our contextual knowledge. We brainstorm on these and other proactive ideas at our Innovation Days and deliver selected ones in rapid Agile sprints to the customer. Many of these activities are now anchored at our PacePorts™. Our Annual Innovation Forums and TCS PacePorts are key avenues that fuel innovation. At the Innovation Forums, our customers and partners, including start-ups, talk about the innovative work they are doing in partnership with TCS, while PacePorts showcase our innovative solutions across different verticals, often triggering new ideas among customers and resulting in productive conversations. Integrated Annual Report 2020-21 Panel Discussion | 25 KR: Chance favors the prepared mind. In addition to the avenues described by NGS and Ananth, TCS' Business 4.0 thought leadership framework that has been updated to address pandemic and post-pandemic challenges and our multi-horizon cloud transformation roadmap, provide a great starting point to jointly envision the aspirational end-state capabilities with the C-Suite. Our sales teams leverage a steadily expanding suite of transformation offerings aligned to emerging themes, which they can readily adapt to each customer's unique circumstances. |
One very successful approach has been to benchmark the customer against best-in-class metrics in their industry, identify the gaps across different areas of their operations, and then use design thinking principles to help top management chalk an inside-out roadmap for their growth and transformation. Across industries, we are picking up promising themes that emerge from ongoing G&T engagements which address broader business problems that may be relevant to other enterprises, and are productizing those offerings. This organic manner of steadily expanding our portfolio of transformation offerings lowers the execution risk for our customers. One of the world's largest pharmaceutical companies deployed TCS ADD Analytics & Insights, an AI-powered adaptive monitoring solution to transform the oversight of over 200 clinical trials, strengthening oversight effectiveness and improving the efficacy of the studies. # WHAT ROLE DOES YOUR INTELLECTUAL PROPERTY, PRODUCTS AND PLATFORMS PLAY IN THE G&T OPPORTUNITY? NGS: Intellectual property is one of TCS' biggest differentiators, and it has played a pivotal role in many of our largest G&T engagements. Our patents, products, and platforms stand testimony to our technology expertise and business knowledge. With each successful G&T engagement, the positive references build up and we are sought by other customers facing similar business problems to help them in their transformation journeys. For example, a recent annual report highlighted how we helped the Bayer Group build a replicable business carve-out model to execute quick divestitures. The TCS BFSI Platform for Life and Pensions continues to be the operating model of choice for insurers looking to reimagine customer experience. In last year's annual report, we had carried the M&G story. In FY 2021 too, we signed a very large deal with the Phoenix Group, to drive the growth and organization's ability to quickly launch innovative products and services. KAK: Many G&T initiatives are centered around enhancing the customer journey and scaling up the organization's ability to quickly launch innovative products and services. Our AI-based TwinX supports the digital simulation of an enterprise, or an. 1 Page 19, TCS Annual Report 2018-19 2 Page 21, TCS Annual Report 2019-20 Integrated Annual Report 2020-21 # Panel Discussion 26 # Enterprise Digital Twin Key entities such as customer, product, process, network, and resource are mapped, so businesses can test strategic decisions such as new product rollouts or the launch of new channels, before piloting them in the market. Several customers are using TwinX today for what-if analyses especially in areas like the ideal customer journey, reducing customer churn as well as potential fraud. # What Gives You the Confidence That You Are on a Longer-Term Growth Trajectory and Not Just Benefiting from Short Term Pent-Up Demand? File: AR_TCS_2020_2021.md KR: While I don't deny some amount of pent-up demand playing out, but as NGS mentioned earlier, the adoption of hyperscaler clouds by our customers is a pivotal point, setting them on a course of increasing technology investments over the next few years, all aimed at harnessing the rich native capabilities available within the hyperscaler stacks for innovation, growth and transformation. # Your Peers Have Also Been Winning a Lot of Very Large Deals in Recent Times. Does This Represent a Loss of Market Share for TCS? NGS: Fourteen years ago, when we won our first billion-dollar deal, it was path breaking because it represented our coming of age. Having won against the largest names of that era, it demonstrated our ability to put together winning, multi-tower deal constructs. Today, winning such large outsourcing deals is essential for revenue growth and visibility, but it is a hygiene factor and no longer a differentiator. We win more than a fair share of such very large deals every year. In FY 2021, we had an order book of $31.6 billion, 17% higher than the previous year. Very importantly, these are not just large plain vanilla outsourcing deals, but also higher-value G&T deals. Every year, we close several very large transformational deals, including one in FY 2021 with a TCV of over $2.4 billion. # Our Sharpened Focus on the High Value G&T Opportunity Our sharpened focus on the high value G&T opportunity and investments around deepening our solutioning capabilities will result in a quantum leap in the size of our addressable market. We are confident that the secular tailwind from increased spends and our own investments and focused efforts will drive a better growth trajectory in the years ahead. |
# Another Important Driver of Longer Term Growth NGS: Another important driver of longer term growth is the structural shift within the technology market, leading to growing primacy of IT services. We see that cycle repeating now with packaged software. SaaS models are driving standardization and commoditization of software. So even as enterprises invest in upgrading their technologies, they will invest even more on IT services because only service-providers like TCS can help them harness these very powerful and commoditized technologies to create unique combinatorial solutions that provide competitive differentiation. The next decade will clearly be the decade of IT services. Integrated Annual Report 2020-21 Panel Discussion | 27 # Enabling bpost to Deliver not just Parcels but also Smiles With e-commerce making inroads at an exponential pace and declining mail volumes, bpost is on a multi-year growth and transformation journey to transform into a customer centric and sustainable global omni-commerce leader, with the vision of making Belgium a gateway for e-commerce logistics. TCS is a strategic advisor, helping bpost shape its transformation journey by reimagining the customer experience and building a digital core that will drive new business opportunities and accelerate innovation. The parcel delivery business not only rides high on customer emotions but is highly competitive and entails logistical complexity which can drive up the cost of customer service. Experience designers from TCS Interactive Design labs digitally reimagined the end-to-end parcel lifecycle by mapping all customer touchpoints and analyzing key factors impacting Net Promoter Score (NPS), including social media sentiment analysis. They designed an intuitive and engaging digital experience with a mobile-first approach and also enabled 24x7 digital customer service across all channels with chatbots. bpost customers can now track and trace parcels through proactive notifications and enjoy flexible options for receiving parcels at home, at neighbors, or at a participating store. Returns processing is simplified with just 3 steps, including the ability to print shipping labels. With a penetration of 1 in every 4 Belgian households, and a rating much higher than similar apps from competitors, the mybpost app has contributed to an 8% growth in NPS and 18% reduction in customer service requests. With the use of advanced analytics for optimized parcel delivery, TCS helped bpost successfully handle a 2.5X growth in parcel volumes in 2020, with margin and EBIT growth, increased efficiency, and most importantly, higher customer satisfaction, bringing it closer to its ambition. Nico Cools CIO & Chief Digital Officer, bpost SA Integrated Annual Report 2020-21 Customer Stories | 28 # Helping the State of Connecticut Provide Pandemic Relief to the Unemployed Following the devastating job losses due to the pandemic, Connecticut's Department of Labor (CTDOL) found itself inundated with over a million applications for unemployment insurance, almost ten years' worth of applications in a single year. Additionally, it had to administer the federally funded Pandemic Unemployment Assistance (PUA) program under the CARES Act and extended by the Continued Assistance Act, which provided up to $600/week for up to fifty weeks to the self-employed, independent contractors, and gig workers who were ordinarily ineligible for unemployment assistance, but whose livelihoods had been affected by the pandemic. In just five weeks, TCS, working closely with CTDOL, quickly designed and deployed a new cloud-based standalone PUA system, and integrated it with CTDOL's legacy unemployment insurance system. The new PUA system streamlined the workflows and leveraged advanced analytics to prevent fraudulent claims. Its cloud-native architecture scaled well - easily handling the 10,000 claims filed on the very first day of its launch. Till date, over $1 billion in benefits has been paid through the new system. The unemployment benefit programs are a critical safety net for the citizens during this pandemic. TCS and Connecticut DOL teams have worked closely in partnership to pay out over a Billion dollars in benefits through this new system and help the citizens of Connecticut. Kurt Westby Commissioner of Labor State of Connecticut # Integrated Annual Report 2020-21 # Customer Stories 29 # Q&A with V RAMAKRISHNAN, CFO & MILIND LAKKAD, CHRO # HAS A FULL YEAR OF WORKING REMOTELY RESULTED IN ANY STRUCTURAL CHANGES TO YOUR BUSINESS? WILL GLOBAL SOURCING BE MUCH MORE OF THE NORM IN THE FUTURE? VR: Yes, I think so. In service delivery, any and every in-person activity that entailed travel and other overheads, was successfully executed entirely remotely last year using SBWS. |
It is faster, safer, and in many cases, results in better outcomes because we can assign the best talent for the job, unconstrained by location, mobility and visa availability. In the longer term, this significantly de-risks service delivery for customers, and our business model. ML: The other structural change is to our workplace. Whenever the pandemic is contained and we start normalizing, we will start transitioning to a more hybrid working model in line with our Vision 25x25, that captures all the benefits of the remote model and addresses its challenges. To recap, we envisage that by year 2025, no more than 25% of our employees would need to be at a TCS facility at a point in time, and no individual would have to spend more than 25% of their time at a TCS facility to be 100% productive. We believe this is a more balanced approach, and will give our employees the best of both worlds. In this model, the role of the office itself will change significantly. Earlier, the office was where one performed day-to-day activities, and offsites were meant for business planning or team motivation. The new model flips that. Our offices will become ideation. and innovation hubs, using in-person interactions for brainstorming and team-building, while day-to-day work can be performed from anywhere. # YOUR MARGINS IMPROVED IN FY 2021, BENEFITING FROM LOWER TRAVEL AND FACILITIES EXPENSES. HOW SUSTAINABLE IS THIS? VR: We believe our industry-leading operating margin is a reflection of our relative competitiveness. While there may be some small movements here and there, our margins have shown tremendous resilience over the last decade. We don't see any structural threat to our competitiveness in the foreseeable future, so our margins should remain stable. Specific to FY 2021, we started off with a very sudden ramp down in demand, our Q1 revenue reducing by 6.3% year on year in constant currency. However we took an industry-defining stand that we would not let go any employees due to the demand contraction, and also committed to onboarding all 45,000 job offers we had made. The industry-wide reductions in travel, facilities and some marketing expenses helped offset this. The second half of the year saw a sharp growth recovery, and the emergence of a multi year growth cycle. We immediately rewarded our employees with a normal salary hike in October and regular promotions, much ahead of the rest of the industry. We are now using AI to autonomously match individuals with the requisite skill profiles to open opportunities, regardless of their physical location. This is enabling access to a larger pool of talent, better fitment, significantly faster allocations and superior outcomes. So overall, I am very pleased with the way we were able to deal with a very fluid situation, balancing the needs of our customers, employees, and communities, and yet deliver an industry-leading operating margin of 25.9%*, an expansion of 1.3%* over the prior year. Looking ahead, we expect demand, revenue and operating costs to normalize and come back to our long term comfort zones. That, along with higher quality revenues from our expanding participation in the growth and transformation opportunity, greater operating efficiencies from continuing innovations to the delivery model - such as talent clouds - will help us sustain our operating margin at current levels. # WHAT ARE TALENT CLOUDS AND HOW DO THEY CHANGE THE DELIVERY MODEL? # HOW DOES YOUR NEW FOCUS ON GROWTH AND TRANSFORMATION DEALS AFFECT YOUR MARGINS AND YOUR INVESTMENTS? HOW WILL IT AFFECT CAPITAL ALLOCATION? WILL YOU ALSO ACQUIRE A CONSULTING OUTFIT? ML: The talent cloud is an innovation enabled by our SBWS operating model. Historically, we serviced customers from specific delivery centers, and staffed any new project largely with individuals based out of those locations. With SBWS, we did away with that. VR: These deals have lower competitive intensity, and customers evaluate us on the merits of our solution and not on price. So these are high quality. * Excluding an exceptional item provided towards a contested legal claim Integrated Annual Report 2020-21 Q&A | 31 revenues, and as their share increases, they will lend innovation, and in the various HR initiatives that Milind will speak about. We won't acquire something just to grow our consulting revenue. # SOME OF YOUR PEERS HAVE SPOKEN OF A WAR FOR TALENT. YOU DON'T LOOK TOO WORRIED. WHY? ML: Our sustained investments in organic talent development at scale are paying off. |
Our state of the art talent development infrastructure is helping us align our planning with emerging customer requirements. So we are fulfilling most of the open positions requiring new technology skills using in-house groomed candidates, and don't rely too much on lateral recruits. Additionally, we have created a deep pipeline of digital talent by hiring over 30,000 fresh engineering graduates each year, including a cadre of high performers, and training them on new technologies which are most in demand. Even more important than acquiring new talent is retaining our existing talent that we have invested in, and groomed over the years. We continue to be the industry leader in talent retention, with our IT services attrition rate falling to an all-time low of 7.2% this year. So we are very proud of our talent strategy and investments, and immensely excited about the future growth it is helping power. We believe our industry-leading operating margin is a reflection of our relative competitiveness. While there may be some small movements here and there, our margins have shown tremendous resilience over the last decade. We don't see any structural threat to our competitiveness in the foreseeable future, so our margins should remain stable. In terms of investment, keep in mind that our approach to growth and transformation engagements is very differentiated. We are not trying to replicate the legacy consulting model. To expand our presence in this opportunity, we will invest in deepening our solutioning capabilities, organically. We will invest in more research and innovation, and in the various HR initiatives that support our industry-leading profitability. Our capital allocation policy continues to be to return most of the free cash flow we generate each year to our shareholders. On the people front, we continue to believe in growing our own talent, and are scaling up our campus recruitment of management graduates from premier business schools in India and elsewhere, as well as engineering talent from top technology institutes. Given our differentiated, inside-out approach to growth and transformation, we are investing in various programs to promote business thinking and foster contextual knowledge across the organization. Our Contextual Masters program has identified 16,000 individuals till date with deep insights of our customers' business and technology contexts. We are bringing them and others into our strategic talent development initiatives, and scaling these programs to create a large and diverse cadre of next generation growth and transformation leaders, who can help customers explore the art of the possible in their respective contexts and steer them through organizational change. # Transforming Novolex into a Futuristic, Intelligent Enterprise To achieve hyper-growth and become an industry leader, Novolex launched Project Optimus for optimizing and transforming the entire business. TCS and Novolex established a true partnership in successfully implementing the Optimus program and set a secured path for reaping continuous business value. After years of strong top line growth driven by multiple acquisitions, Novolex, a leader in packaging innovation, recognized that to continue to drive profitable growth through M&A, it would need to fix the disparate set of processes, organizational structures and customer experiences, all resulting from a sprawl of 11 disparate ERP systems built up from years of acquisitions. The siloed operations were hindering the company's ability to drive sustainable synergies and deliver a unified customer experience. Applying design thinking principles and leveraging its domain depth and expertise across digital technologies, TCS helped Novolex realize its vision of delivering a 'One Novolex' experience to its customers. Today, TCS continues to engage with Novolex in a sustain mode to drive perpetual transformation and further increase its return on investment. Don Ray VP - Manufacturing Services, Novolex Novolex partnered with TCS to drive its end-to-end business transformation and create a new cloud-based digital core using the SAP S/4HANA platform to support its future growth. TCS' consultants worked with Novolex through the full lifecycle of its business transformation, starting with the development of the business case and roadmap, establishment of a transformation management office, design of a standardized global template, all the way through to deployment and realization of benefits. TCS has helped ensure timely business transformation that can empower Novolex as an 'Intelligent Enterprise' with industry leading solutions and help accelerate our growth as a world-class packaging company. Paul Palmisano Former CFO, Novolex The new platform has eliminated the silos, enabled significant savings and ongoing SGA efficiencies, improved executive visibility into business performance and delivered faster time to market. The simplified consolidated financial reporting. |
Integrated Annual Report 2020-21 Customer Stories | 33 # Partnering RBI in Building Payment Systems for Digital India The Reserve Bank of India (RBI) has been the driving force in creating the nation's payment systems, operating with the strong belief that innovative, secure and efficient payment mechanisms are central to economic growth. TCS has been RBI's digital transformation partner for the last two decades, building the systems needed to help the central bank realize this belief. This has led to faster settlements, improved liquidity, reduced cost for retail payment systems, and enhanced ease of doing business, fulfilling the purpose of giving further impetus to Digital India's progress. The two important online payment systems run by the Reserve Bank of India, namely, National Electronic Funds Transfer (NEFT) and Real Time Gross Settlement (RTGS), have both been enabled by robust and scalable technology platforms built and maintained by TCS. The underlying messaging infrastructure that enables the smooth interchange of data is the Structured Financial Messaging System, a TCS innovation that connects over 70,000 branches of over 200 banks and clearing houses in India. Today, these two platforms process over 260 million payment transactions, worth $1.5 trillion, every month. In the latest development, TCS teams enhanced both platforms and their related ecosystems to enable successful introduction of NEFT 24x365 in 2019, and then RTGS 24x365 in 2020, making India one of the few countries in the world to operate a real-time, large value payment system round the clock. It is a testimony to the robustness of their design and the quality of their services that the RTGS and NEFT platforms and its underlying messaging system have scaled up over time to handle the immense growth in volumes without any disruption over the last many years. Their teams went above and beyond and supported us solidly when we needed it the most, at the height of the pandemic last year. Dr Deepak Kumar Chief General Manager, Department of Information Technology, Reserve Bank of India (Views expressed in the quote are personal) Integrated Annual Report 2020-21 Customer Stories | 34 # Notice Notice is hereby given that the twenty-sixth Annual General Meeting of Tata Consultancy Services Limited will be held on Thursday, June 10, 2021 at 3:30 p.m. (IST) through Video Conferencing ("VC") / Other Audio Visual Means ("OAVM") to transact the following business: # 1. To receive, consider and adopt: - a. the Audited Standalone Financial Statements of the Company for the financial year ended March 31, 2021, together with the Reports of the Board of Directors and the Auditors thereon; and - b. the Audited Consolidated Financial Statements of the Company for the financial year ended March 31, 2021, together with the Report of the Auditors thereon. # 2. To confirm the payment of Interim Dividends on Equity Shares and to declare a Final Dividend on Equity Shares for the financial year 2020-21. # 3. To appoint a Director in place of N Chandrasekaran (DIN 00121863) who retires by rotation and, being eligible, offers himself for re-appointment. Notes: 1. In view of the continuing COVID-19 pandemic, the Ministry of Corporate Affairs ("MCA") has vide its circular nos. 14/2020 and 17/2020 dated April 8, 2020 and April 13, 2020 respectively, in relation to "Clarification on passing of ordinary and special resolutions by companies under the Companies Act, 2013 and the rules made thereunder on account of the threat posed by Covid-19", circular no. 20/2020 dated May 5, 2020 in relation to "Clarification on holding of annual general meeting (AGM) through video conferencing (VC) or other audio visual means (OAVM)" and Circular no. 02/2021 dated January 13, 2021 in relation to "Clarification on holding of annual general meeting (AGM) through video conferencing (VC) or other audio visual means (OAVM)" (collectively referred to as "MCA Circulars") and Securities and Exchange Board of India ("SEBI") vide its circular no. SEBI/HO/CFD/CMD1/CIR/P/2020/79 dated May 12, 2020 in relation to "Additional relaxation in relation to compliance with certain provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 - Covid-19 pandemic" and circular no. SEBI/HO/CFD/CMD2/CIR/P/2021/11 dated. January 15, 2021 in relation to "Relaxation Company. Since this AGM is being held pursuant payment of such dividend subject to deduction from compliance with certain provisions of the MCA Circulars and SEBI Circulars of tax at source will be made on Monday, June 14, 2021 as under: i. |
To all Beneficial Owners in respect of shares held in dematerialized form as per the data as may be made available by the National Securities Depository Limited ("NSDL") and the Central Depository Services (India) Limited ("CDSL"), collectively "Depositories", as of end of day on Thursday, May 27, 2021; ii. To all Members in respect of shares held in physical form after giving effect to valid transmission or transposition requests lodged with the Company as of the close of business hours on Thursday, May 27, 2021. 4. Institutional / Corporate shareholders (i.e. other than individuals, HUF, NRI, etc.) are required to send a scanned copy (PDF / JPG Format) of their respective Board or governing body Resolution / Authorization etc., authorizing their representative to attend the AGM through VC / OAVM on their behalf and to vote through remote e-Voting. The said Resolution / Authorization shall be sent to the Scrutinizer by e-mail on its registered e-mail address to [email protected] with a copy marked to [email protected]. 5. The Company has fixed Thursday, May 27, 2021 as the 'Record Date' for determining entitlement of members to final dividend for the financial year ended March 31, 2021, if approved at the AGM. 6. If the final dividend, as recommended by the Board of Directors, is approved at the AGM, payment of such dividend subject to deduction of tax at source will be made on Monday, June 14, 2021 as under: 7. As per Regulation 40 of SEBI Listing Regulations, as amended, securities of listed companies can be transferred only in dematerialized form with effect from, April 1, 2019, except in case of request received for transmission or transposition and relodged transfers of securities. Further, SEBI vide its circular no. SEBI/HO/MIRSD/RTAMB/CIR/P/2020/236 dated December 2, 2020 had fixed March 31, 2021 as the cut-off date for re-lodgement of transfer deeds and the proxy need not be a Member of the Company. shares that are re-lodged for transfer shall be issued only in demat mode. In view of this and to eliminate all risks associated with physical shares and for ease of portfolio management, members holding shares in physical form are requested to consider converting their holdings to dematerialized form. Members can contact the Company or Company's Registrars and Transfer Agents, TSR Darashaw Consultants Private Limited ("TCPL") for assistance in this regard. Members may also refer to Frequently Asked Questions ("FAQs") on Company's website https://on.tcs.com/demat-faq. # 8. Members who have not yet registered their e-mail addresses are requested to register the same with their Depository Participants ("DP") in case the shares are held by them in electronic form and with TCPL in case the shares are held by them in physical form. # 9. Members are requested to intimate changes, if any, pertaining to their name, postal address, e-mail address, telephone / mobile numbers, Permanent Account Number (PAN), mandates, nominations, power of attorney, etc., to their DPs if the shares are held by them in electronic form and to TCPL if the shares are held by them in physical form. # Process for registration of e-mail id for obtaining Notice of the AGM along with Integrated Annual Report. To register e-mail address for all future correspondence and update the bank account details, please follow the below process: |Physical Holding|Send a request to TCPL at [email protected]:| |---|---| | |i) To register e-mail address, please provide Folio No., Name of shareholder, scanned copy of the share certificate (front and back), PAN and AADHAR (self-attested scanned copy of both PAN card and Aadhar card)| | |ii) To update bank account details, please send the following additional documents / information followed by the hard copies:| | |a) Name of the bank and branch address,| | |b) Type of bank account i.e., savings or current,| | |c) Bank account no. allotted after implementation of core banking solutions,| | |d) 9-digit MICR code no., and| | |e) 11-digit IFSC code| | |f) Original cancelled cheque bearing the name of the first shareholder, failing which a copy of the bank passbook / statement attested by a bank| If your e-mail address is not registered with the Depositories (if shares held in electronic form) / Company (if shares held in physical form), you may register on or before 5:00 p.m. (IST) on Thursday, June 3, 2021 to receive the Notice of the AGM along with the Integrated Annual Report 2020-21 by completing the process as under: 1. Visit the link https://tcpl.linkintime.co.in/EmailReg/Email_Register.html 2. Select the name of the Company from dropdown File: AR_TCS_2020_2021.md 3. |
Enter details in respective fields such as DP ID and Client ID (if shares held in electronic form) / Folio no. and Certificate no. (if shares held in physical form), Shareholder name, PAN, mobile no. and e-mail id. Integrated Annual Report 2020-21 Notice | 37 # Integrated Annual Report 2020-21 # Notice d. System will send OTP on mobile no. and e-mail id. e. Enter OTP received on mobile no. and e-mail id. Members may note that the Notice and Integrated Annual Report 2020-21 will also be available on the Company's website www.tcs.com, websites of the Stock Exchanges i.e. BSE Limited and National Stock Exchange of India Limited at www.bseindia.com and www.nseindia.com respectively, and on the website of NSDL https://www.evoting.nsdl.com. Members holding shares in physical form, in identical order of names, in more than one folio are requested to send to the Company or TCPL, the details of such folios together with the share certificates for consolidating their holdings in one folio. A consolidated share certificate will be issued to such Members after making requisite changes. Members are requested to claim their dividends from the Company, within the stipulated timeline. The Members, whose unclaimed dividends / shares have been transferred to IEPF, may claim the same by making an online application to the IEPF Authority in web Form No. IEPF-5 available on www.iepf.gov.in. For details, please refer to corporate governance report which is a part of this Integrated Annual Report and FAQ of investor page on Company's website https://on.tcs.com/IR-FAQ. In case of joint holders, the Member whose name appears as the first holder in the order of names as per the Register of Members of the Company will be entitled to vote during the AGM. Members seeking any information with regard to the financial statements or any matter to be placed at the AGM, are requested to write to the Company on or before June 9, 2021 through e-mail on [email protected]. The same will be replied by the Company suitably. Pursuant to Finance Act 2020, dividend income is taxable in the hands of shareholders w.e.f. April 1, 2020 and the Company is required to deduct tax at source from dividend paid to shareholders at the prescribed rates. For the prescribed rates for various categories, please refer to the Finance Act, 2020 and the amendments thereof. The shareholders are requested to update their PAN with the DP (if shares held in electronic form) and Company / TCPL (if shares held in physical form). Members are requested to note that, dividends if not encashed for a period of 7 years from the date of transfer to Unpaid Dividend Account of the Company, are liable to be transferred to the Investor Education and Protection Fund ("IEPF"). Further, all the shares in respect of which dividend has remained unclaimed for 7 consecutive years or more from the date of transfer to unpaid dividend account shall also be transferred to IEPF Authority. Members attending the meeting through VC / OAVM shall be counted for the purpose of reckoning the quorum under Section 103 of the Act. A Resident individual shareholder with PAN and who is not liable to pay income tax can submit a yearly declaration in Form No. 15G / 15H, to avail the benefit of non-deduction of tax at source by e-mail to [email protected] by 11:59 p.m. IST on May 25, 2021. Shareholders are requested to note that in case their PAN is not registered, the tax will be deducted at a higher rate of 20%. Non-resident shareholders [including Foreign Institutional Investors (FIIs) / Foreign Portfolio Investors(FPIs)] can avail beneficial rates under the tax treaty between India and their country of tax residence, subject to providing necessary documents i.e. No Permanent Establishment and Beneficial Ownership Declaration, Tax Residency Certificate, Form 10F, any other document which may be required to avail the tax treaty benefits. For this purpose the shareholder may submit the above documents (PDF / JPG Format) by e-mail to [email protected]. The aforesaid declarations and documents need to be submitted by the shareholders by 11:59 p.m. IST on May 25, 2021. For further details and formats of declaration, please refer to FAQs on Taxation of Dividend available on the Company's website at https://on.tcs.com/IR-FAQ. # 18. Instructions for e-Voting and joining the AGM are as follows: # A. VOTING THROUGH ELECTRONIC MEANS i. |
In compliance with the provisions of Section 108 of the Act, read with Rule 20 of the Companies (Management and Administration) Rules, 2014, as amended from time to time, Regulation 44 of the SEBI Listing Regulations and in terms of SEBI vide circular no. SEBI/HO/CFD/CMD/CIR/P/2020/242 dated December 9, 2020 in relation to e-Voting Facility Provided by Listed Entities, the Members are provided with the facility to cast their vote electronically, through the e-Voting services provided by NSDL, on all the resolutions set forth in this Notice. The instructions for e-Voting are given herein below. ii. The remote e-Voting period commences on Monday, June 7, 2021 (9:00 a.m. IST) and ends on Wednesday, June 9, 2021 (5:00 p.m. IST). During this period, Members holding shares either in physical form or in dematerialized form, as on Thursday, June 3, 2021 i.e. cut-off date, may cast their vote electronically. The e-Voting module shall be disabled by NSDL for voting thereafter. Members have the option to cast their vote on any of the resolutions using the remote e-Voting facility either during the period commences June 7, 2021 to June 9, 2021 or e-Voting during the AGM. Members who have voted on some of the resolutions during the said voting period are also eligible to vote on the remaining resolutions during the AGM. iii. The Members who have cast their vote by remote e-Voting prior to the AGM may attend / participate in the AGM through VC / OAVM but shall not be entitled to cast their vote on such resolution again. iv. The Board of Directors have appointed P N Parikh (Membership No. FCS 327) and failing him Jigyasa Ved (Membership No. FCS 6488) of Parikh & Associates, Practicing Company Secretaries as the Scrutinizer to scrutinize the e-Voting process in a fair and transparent manner. v. The voting rights of Members shall be in proportion to their shares in the paid-up capital of the Company. # vii. The details of the process and manner voting process. Individual demat account holders would be able to cast their vote without having to register again with the e-Voting service provider (ESP) thereby not only facilitating seamless authentication but also ease and convenience of participating in e-Voting process. # vi. Any person holding shares in physical form and non-individual shareholders, who acquires shares of the Company and becomes a Member of the Company after sending of the Notice and holding shares as of the cut-off date, may obtain the login ID and password by sending a request at [email protected]. However, if he / she is already registered with NSDL for remote e-Voting then he / she can use his / her existing User ID and password for casting the vote. In case of Individual Shareholders holding securities in demat mode and who acquires shares of the Company and becomes a Member of the Company after sending of the Notice and holding shares as of the cut-off date may follow steps mentioned below under "Login method for remote e-Voting and joining virtual meeting for Individual shareholders holding securities in demat mode." # Step 1: Access to NSDL e-Voting system # Step 2: Cast your vote electronically and join virtual meeting on NSDL e-Voting system. Details on Step 1 are mentioned below: # I) Login method for remote e-Voting and joining virtual meeting for Individual shareholders holding securities in demat mode. Pursuant to SEBI circular no. SEBI/HO/CFD/CMD/CIR/P/2020/242 dated December 9, 2020 on "e-Voting facility provided by Listed Companies", e-Voting process has been enabled to all the individual demat account holders, by way of single login credential, through their demat accounts / websites of Depositories / DPs in order to increase the efficiency of the. Shareholders are advised to update their mobile number and e-mail ID with their DPs in order to access e-Voting facility. # Type of shareholders # Login Method # Individual Shareholders holding securities in demat mode with NSDL 1. Visit the e-Services website of NSDL. Open web browser by typing the following URL: https://eservices.nsdl.com/ either on a Personal Computer or on a mobile. 2. Once the home page of e-Services is launched, click on the "Beneficial Owner" icon under "Login" which is available under "IDeAS" section. 3. A new screen will open. You will have to enter your User ID (i.e. your sixteen digit demat account number held with NSDL), Password / OTP and a Verification Code as shown on the screen. 4. |
After successful authentication, you will be redirected to NSDL website wherein you can see e-Voting page. Click on options available against company name or e-Voting service provider - NSDL and you will be redirected to e-Voting website of NSDL for casting your vote during the remote e-Voting period or joining virtual meeting and e-Voting during the meeting. # Individual Shareholders holding securities in demat mode with CDSL 1. Existing users who have opted for Easi / Easiest, can login through their user id and password. Option will be made available to reach e-Voting page without any further authentication. The URL for users to login to Easi / Easiest is https://web.cdslindia.com/myeasi/home/login or www.cdslindia.com and click on New System Myeasi. 2. After successful login of Easi / Easiest the user will also be able to see the e-Voting Menu. The Menu will have links of ESP i.e. NSDL portal. Click on NSDL to cast your vote. 3. If the user is not registered for Easi/Easiest, option to register is available at https://web.cdslindia.com/myeasi/Registration/EasiRegistration. Alternatively, the user can directly access e-Voting page by providing demat Account Number and PAN from a link in www.cdslindia.com home page. The system will authenticate the user by sending OTP on registered Mobile and e-mail as recorded in the demat Account. After successful authentication, user will be provided links for the respective ESP i.e. NSDL where the e-Voting is in progress. # e-Voting website of NSDL 1. Open web browser by typing the following URL: https://www.evoting.nsdl.com/ either on a personal computer or on a mobile phone. 2. Once the home page of e-Voting system is launched, click on the icon "Login" which is available under 'Shareholder/Member' section. Integrated Annual Report 2020-21 Notice | 41 # Type of shareholders # Login Method Individual Shareholders (holding securities in demat mode) logging through their depository participants: 1. You can also login using the login credentials of your demat account through your DP registered with NSDL / CDSL for e-Voting facility. 2. Once logged-in, you will be able to see e-Voting option. Once you click on e-Voting option, you will be redirected to NSDL / CDSL Depository site after successful authentication, wherein you can see e-Voting feature. 3. Click on options available against company name or e-Voting service provider - NSDL and you will be redirected to e-Voting website of NSDL for casting your vote during the remote e-Voting period or joining virtual meeting and e-Voting during the meeting. Important note: Members who are unable to retrieve User ID / Password are advised to use Forgot User ID and Forgot Password option available at respective websites. # Helpdesk for Individual Shareholders holding securities in demat mode for any technical issues related to login through Depository i.e. NSDL and CDSL. |Login type|Helpdesk details| |---|---| |Securities held with NSDL|Please contact NSDL helpdesk by sending a request at [email protected] or call at toll free no.: 1800 1020 990 and 1800 22 44 30| |Securities held with CDSL|Please contact CDSL helpdesk by sending a request at [email protected] or contact at 022- 23058738 or 022-23058542-43| # II) Login method for e-Voting and joining virtual meeting for shareholders other than Individual shareholders holding securities in demat mode and shareholders holding securities in physical mode. # How to Log-in to NSDL e-Voting website? 1. Visit the e-Voting website of NSDL. Open web browser by typing the following URL: https://www.evoting.nsdl.com/ either on a personal computer or on a mobile. 2. Once the home page of e-Voting system is launched, click on the icon "Login" which is available under "Shareholders / Member" section. 3. A new screen will open. You will have to enter your User ID, your Password / OTP and a Verification Code as shown on the screen. 4. Alternatively, if you are registered for NSDL eservices i.e. IDEAS, you can log-in at https://eservices.nsdl.com/ with your existing IDEAS login. Once you log-in to NSDL eservices after using your log-in credentials, click on e-Voting and you can proceed to Step 2 i.e. cast your vote electronically. 5. Your User ID details are given below: |Manner of holding shares|Your User ID is:| |---|---| |a) For Members who hold shares in demat account with NSDL.|8 Character DP ID followed by 8 Digit Client ID. For example, if your DP ID is IN300*** and Client ID is 12****** then your user ID is IN300***12******| |b) For Members who hold shares in demat account with CDSL.|16 Digit Beneficiary ID. |
For example, if your Beneficiary ID is 12************** then your user ID is 12**************| |c) For Members holding shares in Physical Form.|EVEN Number followed by Folio Number registered with the company. For example, if EVEN is 123456 and folio number is 001*** then user ID is 123456001***| Integrated Annual Report 2020-21 Notice | 42 # 6. Your password details are given below: for shares held in physical form. d) Members can also use the one-time password (OTP) based login for casting the votes on the e-Voting system of NSDL. a) If you are already registered for e-Voting, then you can use your existing password to login and cast your vote. b) If you are using NSDL e-Voting system for the first time, you will need to retrieve the 'initial password' which was communicated to you by NSDL. Once you retrieve your 'initial password', you need to enter the 'initial password' and the system will force you to change your password. c) How to retrieve your 'initial password'? i) If your e-mail ID is registered in your demat account or with the company, your 'initial password' is communicated to you on your e-mail ID. Trace the e-mail sent to you from NSDL in your mailbox from [email protected]. Open the e-mail and open the attachment i.e. a .pdf file. The password to open the .pdf file is your 8-digit client ID for NSDL account, last 8 digits of client ID for CDSL account or folio number. ii) In case you have not registered your e-mail address with the Company / Depository, please follow instructions mentioned below in this notice. # 7. If you are unable to retrieve or have not received the 'initial password' or have forgotten your password: a) Click on "Forgot User Details / Password?" (If you are holding shares in your demat account with NSDL or CDSL) option available on www.evoting.nsdl.com. b) "Physical User Reset Password?" (If you are holding shares in physical mode) option available on www.evoting.nsdl.com. c) If you are still unable to get the password by aforesaid two options, you can send a request at [email protected] mentioning your demat account number / folio number, your PAN, your name and your registered address. # 8. After entering your password, click on Agree to "Terms and Conditions" by selecting on the check box. # 9. Now, you will have to click on "Login" button. # 10. After you click on the "Login" button, Home page of e-Voting will open. # Details on Step 2 are mentioned below: # How to cast your vote electronically on NSDL e-Voting system? 1. After successful login at Step 1, you will be able to see all the companies "EVEN" in which you are holding shares and whose voting cycle and General Meeting is in active status. 2. Select "EVEN 115987" of company for which you wish to cast your vote during the remote e-Voting period and casting your vote during the General Meeting. For joining virtual meeting, you need to click on "VC/OAVM" link placed under "Join General Meeting". # 3. Now you are ready for e-Voting as the Voting page opens. # 4. Cast your vote by selecting appropriate options i.e. assent or dissent, verify / modify the number of shares for which you wish to cast your vote and click on "Submit" and also "Confirm" when prompted. # 5. Upon confirmation, the message "Vote cast successfully" will be displayed and you will receive a confirmation by way of a SMS on your registered mobile number from depository. # 6. You can also take the printout of the votes cast by you by clicking on the print option on the confirmation page. # 7. Once you confirm your vote on the resolution, you will not be allowed to modify your vote. # B. INSTRUCTIONS FOR MEMBERS FOR ATTENDING THE AGM THROUGH VC / OAVM ARE AS UNDER: # 1. Members will be able to attend the AGM through VC / OAVM or view the live webcast of the AGM provided by NSDL at https://www.evoting.nsdl.com following the steps mentioned above for access to NSDL e-Voting system. After successful login, you can see link of VC / OAVM placed under Join General meeting menu against company name. You are requested to click on VC / OAVM link placed under Join General Meeting menu. # 2. |
In case of any queries relating to e-Voting you may refer to the FAQs for Shareholders and e-Voting user manual for Shareholders available at the download section of https://www.evoting.nsdl.com or call on toll free no.: 1800 1020 990 and 1800 22 44 30 or send a request at [email protected]. # 3. Members may send a request to [email protected] for procuring user id and password for e-voting by providing demat account number / Folio number, client master or copy of Consolidated Account statement, PAN (self attested scanned copy of PAN card), AADHAR (self attested scanned copy of Aadhar Card). If you are an Individual shareholders holding securities in demat mode, you are requested to refer to the login method explained above. # 4. The instructions for members for e-Voting on the day of the AGM are mentioned in point number 18 (A). # General Guidelines for shareholders It is strongly recommended not to share your password with any other person and take utmost care to keep your password confidential. Login to the e-Voting website will be disabled upon five unsuccessful attempts to key in the correct password. # Facility of joining the AGM through VC / OAVM shall open 30 minutes before the time scheduled for the AGM. # 3. Members who need assistance before or during the AGM, can contact NSDL on [email protected] / 1800 1020 990 and 1800 22 44 30 or contact Amit Vishal, Senior Manager - NSDL at [email protected]/ or Sagar Ghosalkar, Assistant Manager- NSDL at [email protected]. # 4. Members who would like to express their views or ask questions during the AGM may register themselves as a speaker by sending their request from their registered e-mail address mentioning their name, DP ID and Client ID / folio number, PAN, mobile number at [email protected] from June 4, 2021 (9:00 a.m. IST) to June 6, 2021 (5:00 p.m. IST). Those Members who have registered themselves as a speaker will only be allowed to express their views / ask questions during the AGM. The Company reserves the right to restrict the number of speakers depending on the availability of time for the AGM. # Other Instructions 1. The Scrutinizer shall, immediately after the conclusion of voting at the AGM, unblock the votes cast through remote e-Voting (votes cast during the AGM and votes cast through remote e-Voting) and make, not later than 48 hours of conclusion of the AGM, a consolidated Scrutinizer's Report of the total votes cast in favour or against, if any, to the Chairman or a person authorised by him in writing, who shall countersign the same. 2. The result declared along with the Scrutinizer's Report shall be placed on the Company's website www.tcs.com and on the website of NSDL https://www.evoting.nsdl.com / immediately. The Company shall simultaneously forward the results to National Stock Exchange of India Limited and BSE Limited, where the shares of the Company are listed. By Order of the Board of Directors Rajendra Moholkar Company Secretary Membership No. ACS 8644 Mumbai, April 12, 2021 Registered Office: 9th Floor, Nirmal Building, Nariman Point, Mumbai 400 021 CIN: L22210MH1995PLC084781 Tel: 91 22 6778 9595 E-mail: [email protected] Website: www.tcs.com # Annexure to the Notice # Particulars # N Chandrasekaran |DIN|00121863| |---|---| |Memberships / Chairmanships of committees of other companies|Tata Sons Private Limited| | |* Nomination and Remuneration Committee| | |* Corporate Social Responsibility Committee*| | |Tata Steel Limited| | |* Nomination and Remuneration Committee| | |* Executive Committee of the Board*| | |Tata Motors Limited| | |* Nomination and Remuneration Committee| | |The Indian Hotels Company Limited| | |* Nomination and Remuneration Committee| | |The Tata Power Company Limited| | |* Nomination and Remuneration Committee| | |* Executive Committee of the Board*| | |Tata Consumer Products Limited| | |* Nomination and Remuneration Committee| | |Tata Chemicals Limited| | |* Nomination and Remuneration Committee| | |TCS Foundation| | |Tata Chemicals Limited| |Number of shares held in the Company|177,056| *Chairman of the Committee For other details such as number of meetings of the board attended during the year, remuneration drawn and relationship with other directors and key managerial personnel in respect of above directors, please refer to the corporate governance report which is a part of this Integrated Annual Report. Integrated Annual Report 2020-21 Notice | 46 # Directors' Report To the Members, The Directors present the Integrated Annual Report of Tata Consultancy Services Limited (the Company or TCS) along with the audited financial statements for the financial year ended March 31, 2021. |
The consolidated performance of the Company and its subsidiaries has been referred to wherever required. # 1. Financial results |(` crore)| | |Standalone|Consolidated| | |---|---|---|---|---|---| |Financial Year 2020-21 (FY 2021)|Financial Year 2019-20 (FY 2020)|Financial Year 2020-21 (FY 2021)|Financial Year 2019-20 (FY 2020)| | | | |Revenue from operations|135,963|131,306|164,177|156,949| | |Other income|5,400|8,082|3,134|4,592| | |Total income|141,363|139,388|167,311|161,541| | |Expenses| | | | | | |Operating expenditure|95,653|93,953|117,631|114,840| | |Depreciation and amortisation expense|3,053|2,701|4,065|3,529| | |Total expenses|98,706|96,654|121,696|118,369| | |Profit before finance costs, exceptional item and tax|42,657|42,734|45,615|43,172| | |Finance costs|537|743|637|924| | |Profit before exceptional item and tax|42,120|41,991|44,978|42,248| | |Exceptional item| | | | | | |Provision towards legal claim|1,218|-|1,218|-| | |Profit before tax|40,902|41,991|43,760|42,248| | |Tax expense|9,942|8,731|11,198|9,801| | |Profit for the year|30,960|33,260|32,562|32,447| | |Attributable to:| | | | | | |Shareholders of the Company|30,960|33,260|32,430|32,340| | |Non-controlling interests|NA|NA|132|107| | |Opening balance of retained earnings|71,532|77,159|78,810|85,520| | |Closing balance of retained earnings|70,928|71,532|79,586|78,810| # 2. COVID-19 The COVID-19 pandemic has emerged as a global challenge, creating disruption across the world. Global solutions are needed to overcome the challenges - businesses & business models have transformed to create a new work order. The swift transition to remote working was facilitated by the Secure Borderless Workspaces™ model adopted by the Company. The physical and emotional wellbeing of employees continues to be a top priority for the Company, with several initiatives to support employees and their families during the pandemic. The Company has invested in setting up medical helplines, ambulance services and first line Covid Care Centers within TCS premises, and has also extended counselling and self-help services providing mental & emotional support to employees. The Company has reimagined employee engagement, which transcends geographic barriers by embracing virtual technologies and embraces our diverse workforce. Initiatives like the #OneTCS channel, designed to reduce stress and the feeling of isolation, hosted inspirational leaders, mental health experts, virtual town halls and a global talent hunt competition to boost morale of employees. File: AR_TCS_2020_2021.md The SBWS™ model has been institutionalized and based on the Company's performance, the Directors have declared interim dividends of `23 per equity share involving a cash outflow of `8,598 crore. The Directors have also recommended a final dividend of `15 per equity share, the final dividend on equity shares, if approved by the Members, would involve a cash outflow of `5,549 crore. The total dividend for FY 2021 amounts to `38 per equity share and would involve a total cash outflow of `14,147 crore, resulting in a dividend payout of 44.3 percent* of the standalone profits of the Company. In addition to the above, the Company bought back 5,33,33,333 equity shares at a price of `3,000 per equity share for an aggregate consideration of `16,000 crore. The offer size of the buy-back was 19.96 percent and 18.11 percent of the aggregate paid-up equity share capital and free reserves as per audited condensed standalone interim financial statements and audited condensed consolidated interim financial statements of the Company as on September 30, 2020, respectively. The buy-back represented 1.42 percent of the total issued and paid-up equity share capital of the Company. The buy-back process was completed and the shares were extinguished on January 6, 2021. *Excluding provision towards legal claim. # 3. Return of surplus funds to Shareholders In line with the practice of returning 80 to 100 percent free cash flow to shareholders. # 5. Company's performance The shareholder's payout with respect to dividend and buy-back including tax on buy-back (excluding transaction costs, other incidental and related expenses) aggregated to ₹33,873 crore, resulting in a payout of 106.1 percent* of the standalone profits of the Company. In FY 2020, the Company paid a total dividend of ₹73 per equity share, including a special dividend of ₹40 per equity share, which resulted in an outflow of ₹31,895 crore and a dividend payout of 95.9 percent of the standalone profits of the Company. On a consolidated basis, the revenue for FY 2021 was ₹164,177 crore, higher by 4.6 percent over the previous year's revenue of ₹156,949 crore. The profit after tax (PAT) attributable to shareholders and non-controlling interests for FY 2021 and FY 2020 was ₹33,520 crore* and ₹32,447 crore, respectively. The profit after tax (PAT) attributable to shareholders for FY 2021 and FY 2020 was ₹33,388 crore* and ₹32,340 crore, respectively. The Dividend Distribution Policy, in terms of Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations") is available on the Company's website on https://on.tcs.com/Dividend. # 6. |
Human resource development The Company continued its track record of pioneering industry-first practices by embracing online hiring, conducting around 100,000 virtual interviews, and pivoting the TCS NQT completely to virtual mode. Over 368K students from 3,100+ colleges attended the TCS NQT from the safety of their homes. This year the Company's Learning Intensity has increased significantly, by almost 37%. The Company launched TCS Elevate, a merit-based talent framework to bring further tighter linkage between learning and careers, and to drive a culture of continuous learning and aspiration for accelerated career paths. Over 138,000 associates have been on-boarded to this program. The closing balance of the retained earnings of the Company for FY 2021, after all appropriation and adjustments was ₹70,928 crore. *Excluding provision towards legal claim. # Integrated Annual Report 2020-21 # Directors' Report these top campuses. The Company had a net information security practices and mature Enablement Functions such as HR, Marketing, Administration, IT Infrastructure, Delivery Excellence, Internal IT, and Research. addition of 40,185, taking its total associate count to 488,649. A digital online onboarding model helped the Company to effectively integrate associates hired across the globe. Its diverse workforce includes 154 nationalities across 46 countries. The Company is one of the largest employers of women in the world. Sustained efforts to improve gender diversity, through focused hiring, mentoring and coaching women employees, have resulted in women currently accounting for 36.5 percent of the workforce. TCS' commitment to its employees and its pioneering and innovative HR initiatives have won it many awards and accolades from top Industry bodies such as ATD and Brandon Hall. The Company's internal associate satisfaction survey PULSE showed the highest associate satisfaction and engagement scores in the last 13 years. This is also reflected in its LTM attrition rate of 7.2 percent, which is an industry benchmark, and its lowest ever. # Quality initiatives The Company continues to sustain its commitment to the highest levels of quality, superior service management, robust business continuity management by successfully completing annual re-certification/surveillance audits for various industry standards and models. While standard Agile pushes for collaboration within a physical setting, TCS had to invent a method to bring agility without the need for physical co-location of teams. TCS created the Location Independent Agile™ providing comprehensive blueprints of team configurations, practices and technology for collaboration such as Open Agile Collaborative Workspace (OACW) so that team members from any part of the world can work together without location constraints. Agile is a method to accelerate the speed of delivery in software development. TCS saw an opportunity to elevate Agile by applying it to everything an organization does spanning market research, innovation, product development, sales, delivery, and support functions, allowing organization wide delivery and innovation at high speeds, breaking departmental barriers and transcending location constraints. TCS calls this as Enterprise Agile. By converting Agile into a strategic enterprise transformation lever, TCS created many capabilities, including the world's largest Agile workforce. TCS has filed five patents in the Agile space. Today, industry Agile experts and analysts acknowledge TCS' leadership in Agile. TCS handles over 12,000 Agile projects contributing to 85 percent of IT services revenue. TCS has also added a key term to the worldwide agile vocabulary by introducing the concept of Agility Debt™ - an index that uniquely measures an organization's agility. TCS saw customers who undertook holistic Agile Transformations growing faster than their peers, and more than 90 percent of customers. # 8. Subsidiary companies Services Ireland Limited was incorporated as a wholly owned subsidiary of the Company in Ireland to provide the aforesaid services. The Company has 50 subsidiaries as on March 31, 2021. There are no associates or joint venture companies within the meaning of Section 2(6) of the Companies Act, 2013 ("Act"). There has been no material change in the nature of the business of the subsidiaries. - CMC Americas, Inc., a US based subsidiary of the Company was voluntarily dissolved with effect from December 16, 2020 as CMC Americas Inc. and TCS both provide similar services. This would also enable rationalization of the number of entities in the US. - The Equity stake in Technology Outsourcing S.A.C., was sold to Banco Pichincha Peru on December 1, 2020, at book value, consequent to which Technology Outsourcing S.A.C. ceased to be the subsidiary of the Company. |
- On January 1, 2021, Tata Consultancy Services Netherlands B.V., a wholly owned subsidiary of the Company acquired 100 percent shares of Postbank Systems AG (PBS), a subsidiary of Deutsche Bank AG at an estimated transaction value at a symbolic 1 Euro. PBS is the full-range captive IT service provider that provides project management, application management and infrastructure support services to Postbank and other subsidiaries of Deutsche Bank. As a part of transaction, PBS and its around 1,500 employees become part of TCS which helped in deepening the relationship between the two organizations and add to TCS' scale in Germany and strengthen its growth outlook. - In November 2020, TCS entered into an agreement with Prudential Financial, Inc.(PFI) to acquire over 1,500 staff and select assets of Pramerica Systems Ireland Ltd. (Pramerica), PFI's subsidiary based in Letterkenny, Ireland. The intent of the transaction was for TCS to establish a new global delivery centre in Ireland to provide PFI with a range of business and technology services, while also expanding TCS nearshore capabilities to provide multifunctional, digital services and solutions to other customers in Ireland, the UK, Europe and the US. The Company accomplished the Enterprise Agile 2020 vision by October 2020 satisfying all the KPI's that were set, which the Company believes is first of its kind in the industry. The Company has 427,000+ Agile Ready workforce with 86 percent of them functioning as Practitioners in client projects. The Company's AgiltyDebt™ stands below 0.25 and more than 70 percent of new projects getting initiated are following agile methods. Technologies and Investments from 'Enterprise Agile' initiative gave the foundation for Secure Borderless Workspaces (SBWS™), which is the backbone for our associates to work remotely from wherever they feel safe. To reduce the delivery risks during the pandemic, the Company had rolled out Guidelines for "Service Delivery under SBWS™ and the SBWS™ Governance utility. It has been monitoring the 20,000+ projects across the globe through digitized dashboards. The customer-centricity, rigor in operations and focus on delivery excellence have resulted in consistent improvements in customer satisfaction levels in the periodic surveys conducted by the Company. This is validated by top rankings in third party surveys as well. Pursuant to the provisions of Section 129(3) of the Act, a statement containing the salient features of financial statements of the Company's subsidiaries in Form No. AOC-1 is attached to the financial statements of the Company. Further, pursuant to the provisions of Section 136 of the Act, the financial statements of the Company, consolidated financial statements along with relevant documents and separate audited financial statements in respect of subsidiaries, are available on the Company's website on https://www.tcs.com/investor-relations. # 9. Directors' responsibility statement Pursuant to Section 134(5) of the Act, the Board of Directors, to the best of its knowledge and ability, confirm that: 1. in the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures; 2. they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period; 3. they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; 4. they have prepared the annual accounts on a going concern basis; 5. they have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and operating effectively; 6. they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively. Based on the framework of internal financial controls and compliance systems established and maintained by the Company, the work performed by the internal, statutory and secretarial auditors and external consultants, including the audit of internal financial controls over financial reporting by the statutory auditors and the reviews performed by management and the relevant board committees, including the audit committee, the Board is of the opinion that the Company's internal financial controls were adequate and effective during FY 2021. N. Chandrasekaran retires by rotation and being eligible, offers himself for re-appointment. |
A resolution seeking shareholders' approval for his re-appointment along with other required details forms part of the Notice. Pursuant to the provisions of Section 149 of the Act, the independent directors have submitted declarations that each of them meet the criteria of independence as provided in Section 149(6) of the Act along with Rules framed thereunder and Regulation 16(1)(b) of the SEBI Listing Regulations. There has been no change in the circumstances affecting their status as independent directors of the Company. During the year under review, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees, commission and reimbursement of expenses, if any. Pursuant to the provisions of Section 203 of the Act, Rajesh Gopinathan, Chief Executive Officer and Managing Director, N. Ganapathy Subramaniam, Chief Operating Officer and other key managerial personnel. # 12. Board evaluation The Board and the Nomination and Remuneration Committee reviewed the performance of individual directors on the basis of criteria such as the contribution of the individual director to the board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc. The Board of Directors has carried out an annual evaluation of its own performance, board committees, and individual directors pursuant to the provisions of the Act and SEBI Listing Regulations. The performance of the board was evaluated by the Board after seeking inputs from all the directors on the basis of criteria such as the board composition and structure, effectiveness of board processes, information and functioning, etc. At the board meeting that followed the meeting of the independent directors and meeting of Nomination and Remuneration Committee, the performance of the Board, its Committees, and individual directors was also discussed. Performance evaluation of independent directors was done by the entire Board, excluding the independent director being evaluated. The performance of the committees was evaluated by the Board after seeking inputs from the committee members on the basis of criteria such as the composition of committees, effectiveness of committee meetings, etc. The above criteria are broadly based on the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India on January 5, 2017. # 13. Policy on directors' appointment and remuneration and other details The Company's policy on appointment of directors is available on the Company's website on https://on.tcs.com/ApptDirectors. The policy on remuneration and other matters provided in Section 178(3) of the Act has been disclosed in the Corporate Governance Report, which is a part of this report and is also available on the Company's website on https://on.tcs.com/remuneration-policy. # 11. Number of meetings of the Board Seven meetings of the Board were held during the year. For details of meetings of the Board, please refer to the Corporate Governance Report, which is a part of this report. Executive Director, Ramakrishnan V., Chief Financial Officer and Rajendra Moholkar, Company Secretary are the Key Managerial Personnel of the Company as on March 31, 2021. Ramakrishnan V. has been the Chief Financial Officer since February 21, 2017. He will be retiring from the services of the Company effective April 30, 2021. The Board places on record its appreciation for his invaluable contribution and guidance during his tenure with the Company. During the year under review, the Board at its meeting held on October 7, 2020 appointed Samir Seksaria as the Chief Financial Officer Designate of the Company to take over from Ramakrishnan V. as Chief Financial Officer, with effect from May 1, 2021. Samir Seksaria has been with TCS since 1999 and has held various positions in business consulting and finance. He is a commerce graduate from Narsee Monjee College, Mumbai and a member of the Institute of Chartered Accountants of India. # 14. Corporate social responsibility The brief outline of the corporate social responsibility (CSR) policy of the Company and the initiatives undertaken by the Company on CSR activities during the year are set out in Annexure I of this report in the format prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014. For other details regarding the CSR Committee, please refer to the Corporate Governance Report, which is a part of this report. This Policy is available on the Company's website on https://on.tcs.com/Global-CSR-Policy. # 15. Internal financial control systems and their adequacy The details in respect of internal financial control and their adequacy are included in the Management Discussion and Analysis, which is a part of this report. # 16. |
Audit committee The details pertaining to the composition of the Audit Committee are included in the Corporate Governance Report, which is a part of this report. # 17. Auditors At the twenty-second AGM held on June 16, 2017 the Members approved appointment of B S R & Co. LLP, Chartered Accountants (Firm Registration No.101248W/W-100022) as Statutory Auditors of the Company to hold office for a period of five years from the conclusion of that AGM till the conclusion of the twenty-seventh AGM, subject to ratification of their appointment by Members at every AGM, if so required under the Act. # 18. Auditor's report and Secretarial audit report The statutory auditor's report and the secretarial auditor's report do not contain any qualifications, reservations, or adverse remarks or disclaimer. Secretarial audit report is attached to this report as Annexure II. # 19. Risk management The Board of Directors of the Company has formed a Risk Management Committee to frame, implement and monitor the risk management plan for the Company. The Committee is responsible for monitoring and reviewing the risk management plan and ensuring its effectiveness. The Audit Committee has additional oversight in the area of financial risks and controls. The major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis. The development and implementation of risk management policy has been covered in the Management Discussion and Analysis, which forms part of this report. # 20. Vigil Mechanism The Company has a Whistle Blower Policy and has established the necessary vigil mechanism for directors and employees in confirmation with Section 177(9) of the Act and Regulation 22 of Listing Regulations, to report concerns about unethical behavior. This Policy is available on the Company's website on https://on.tcs.com/WhistleBP. # 21. Particulars of loans, guarantees and investments The particulars of loans, guarantees and investments as per Section 186 of the Act by the Company, have been disclosed in the financial statements. # 22. Transactions with related parties None of the transactions with related parties fall under the scope of Section 188(1) of the Act. Accordingly, the disclosure of related party transactions as required under Section 134(3)(h) of the Act in Form AOC-2 is not applicable to the Company for FY 2020-21 and hence does not form part of this report. # 23. Annual Return Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return as on March 31, 2021 is available on the Company's website on https://on.tcs.com/annual-return-20-21. # 24. Particulars of employees The information under Section 197 of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014: # a. The ratio of the remuneration of each director to the median remuneration of the employees of the Company and percentage increase in remuneration of each Director, Chief Executive Officer, Chief Financial Officer and Company Secretary in the financial year: |Name|Ratio to median remuneration|% increase in remuneration in the financial year| | |---|---|---|---| |Non-executive Directors:| | | | |N. Chandrasekaran*|-|-| | |O P Bhatt|36.91|15.00| | |Aarthi Subramanian#|-|-| | |Dr. Pradeep Kumar Khosla|29.69|32.14| | |Hanne Sorensen|29.69|32.14| | |Keki Mistry|32.09|42.86| | |Don Callahan|32.09|42.86| | |Executive Directors:| | | | |Rajesh Gopinathan|326.81|52.21| | |N. Ganapathy Subramaniam|258.43|59.18| | |Chief Financial Officer|Ramakrishnan V.|-|60.30| |Company Secretary|Rajendra Moholkar|-|76.00| * As a policy, N. Chandrasekaran, Chairman, has abstained from receiving commission from the Company and hence not stated. # In line with the internal guidelines of the Company, no payment is made towards commission to the Non-Executive Directors of the Company, who are in full time employment with any other Tata Company and hence not stated. # 25. Integrated Report The Company being one of the top companies in the country in terms of market capitalization, has voluntarily provided Integrated Report, which encompasses both financial and non-financial information to enable the Members to take well informed decisions and have a better understanding of the Company's long term perspective. The Report also touches upon aspects such as organisation's strategy, governance framework, performance and prospects of value creation based on the six forms of capital viz. financial capital, manufactured capital, intellectual capital, human capital, social and relationship capital and natural capital. # b. The percentage increase in the median remuneration of employees in the financial year: (0.03) percent owing to decrease in remuneration of 15 percent in FY 2020 in view of the economic conditions impacted by the COVID-19 pandemic. # c. The number of permanent employees on the rolls of Company: 488,649. # d. |
Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration: The average annual increase was 5.2 percent in India. However, during the course of the year, the total increase is approximately 6.4 percent, after accounting for promotions and other event based compensation revisions. Employees outside India received a wage increase varying from 2 percent to 6 percent. The increase in remuneration is in line with the market trends in the respective countries. # e. Affirmation that the remuneration is as per the remuneration policy of the Company: The Company affirms that the remuneration is as per the remuneration policy of the Company. # f. The statement containing names of top ten employees in terms of remuneration drawn and the particulars of employees as required under Section 197(12) of the Act read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in a separate annexure forming part of this report. # 26. Disclosure requirements As per SEBI Listing Regulations, the Corporate Governance Report with the Auditors' Certificate thereon, and the integrated Management Discussion and Analysis including the Business Responsibility Report are attached, which forms part of this report. The Company has devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by the Institute of Company Secretaries of India and that such systems are adequate and operating effectively. Further, the report and the accounts are being sent to the Members excluding the aforesaid annexure. In terms of Section 136 of the Act, the said annexure is open for inspection and any Member interested in obtaining a copy of the same may write to the Company Secretary. # 27. Deposits from public The Company has not accepted any deposits from public and as such, no amount on account of principal or interest on deposits from public was outstanding as on the date of the balance sheet. # 28. Conservation of energy, technology absorption, foreign exchange earnings and outgo # Conservation of energy The Company saw a year-on-year reduction in absolute energy use by 46.6 percent in MWh and an absolute carbon footprint reduction (across Scope 1 and Scope 2) by 48.8 percent (in tonnes of carbon dioxide equivalent). This reduction was not commensurate to the extremely low occupancy because some utilities had to be run to maintain the infrastructure. TCS' specific greenhouse gas emissions (Scope 1 + Scope 2) comes to 0.54 tCO2e/ FTE (Full Time Equivalent)/Annum in the current reporting year, a reduction of 53 percent Y-O-Y. This is estimated with the actual carbon footprint and a notional FTE (working out of TCS offices), considering an increase of 8.23 percent in the FTE over the last reporting year. This increase in FTE, is in line with the TCS global headcount growth. # Technology absorption, adaption and innovation The total rooftop solar energy generation across the campuses increased to 8.1 MWp contributing to 2.5 percent of total electricity use in the reporting year. Total renewable energy used - from rooftop solar power plants and through power purchase agreements was 45.5 million units amounting to 15.6 percent of the total electricity consumption. File: AR_TCS_2020_2021.md The Company achieved the target power utilization efficiency (PUE) of 1.65 across 21 of 23 target data centers. The Company has also taken up additional 44 data centers for this initiative and reduced weighted average PUE of all DCs to 1.77 in reporting year from 2.4 in 2017. The Company has focused on temporary closure of ODCs and hub rooms as SBWSTM was approved by customers and all stakeholders, leading to further reduction in energy consumption. The investment in IoT based energy management system helped the Company to define a new normal of consumption profile, leveraging cognitive AI/ML algorithms and monitoring performance against it to drive efficiency. TCS continues to expand its foundational research, in core computing areas and the intersections with other sciences. New areas of focus include DNA computing, AI for protein design, cognitive robotics, meta materials, quantum computing and sensing. Research and Innovation teams worked with cross-functional teams across the Company on strategic initiatives such as Patents, Products & Platforms (3P), Technology Change Management, 5G, Cloud and Cyber Security. |
TCS Research and Innovation (R&I) commemorated the 40th year of its founding by adopting a new brand statement "Inventing for Impact". In keeping with its purpose-driven worldview, TCS R&I teams were engaged in 72 COVID related initiatives around the world, working with local, national and international bodies, adopting multiple approaches: leveraging TCS IP, collaborating with partners, and offering individual consultative inputs across many areas, such as drug candidate molecule discovery, COVID data management, diagnostic kits, epidemiological study and management. # TCS R&I continues to build its intellectual property More than 240 papers were presented at conferences or published in journals. The New Products and Solutions Development framework that governs the emerging pipeline of IP, and IP-leveraged offerings continued to expand the Company's portfolio with new offerings like TCS Dynaport™, TCS Consent Management Solution, and TCS Omnistore™ to support the next wave of growth. Numerous new technology use cases were piloted for customers in various industry segments. # Innovation Culture TCS continued to foster the culture of innovation, organizing one crowdsourced innovation a week. The TCS Innovista competition attracted over 10,290 entries from across the organization. The Company set up a community of Innovation Champions who serve as innovation ambassadors, helping customers leverage the best of TCS for their growth and transformation. Its Co-Innovation Network (TCS COIN™) initiative continued to expand, with 67 ongoing projects in emerging technologies with global academic partners, and with over 2,400 start-ups in its emerging technology ecosystem. # Future Course of Action TCS will continue to scale the Patents, Products and Platforms strategy across the organization, harnessing the collective knowledge and creativity of internal teams and of partners to deliver innovative solutions in support of the Company's pursuit of the growth and transformation opportunity and longer term sustainability goals. # Expenditure on R&D TCS innovation Labs are located in India and other parts of the world. These R&D centers, as certified by Department of Scientific & Industrial Research (DSIR) function from Pune, Chennai, Bengaluru, Delhi- NCR, Hyderabad, Kolkata and Mumbai. # Awards and Recognition TCS won CII's Industrial Intellectual Property Awards 2020. R&I won the Business Culture Award, and several of the Company's products and platforms won multiple awards across the world. The Company continued to contribute to standards bodies especially in ISO SC7 and Systems Engineering. As of March 31, 2021, the Company has applied for 5,879 patents cumulatively and has been granted 1,850 patents. # PACE Ports The Company's existing portfolio of products and platforms continued to grow, with new releases in FY 2021 with additional features and functionality, and expansion of the ignio™, TCS ADD and TCS BaNCS™ suites with new products covering adjacencies. The Company's Pace Ports, which are experiential spaces connecting customers to all of TCS' organizational capabilities in innovation, technology and industry expertise, hosted several events and workshops. In FY 2021, three new PACE Ports, in Pittsburgh, Toronto and Amsterdam respectively, commenced virtual operations. The PACE Internship Program was launched this year in Amsterdam with a batch of students pursuing Masters in Innovation & Digitalization from Nyenrode Business University. # Expenditure incurred in the R&D centers and innovation centers of TCS during FY 2021 and FY 2020 |Expenditure on R&D and innovation| |Standalone| |Consolidated| | |---|---|---|---|---|---| | | |FY 2021|FY 2020|FY 2021|FY 2020| |a. Capital| |1|2|1|2| |b. Recurring| |298|300|302|304| |c. Total R&D expenditure (a+b)| |299|302|303|306| |d. Innovation center expenditure| |1,546|1,458|1,614|1,561| |e. Total R&D and innovation expenditure (c+d)| |1,845|1,760|1,917|1,867| |f. R&D and innovation expenditure as a percentage of total turnover| |1.4%|1.3%|1.2%|1.2%| # Foreign exchange earnings and outgo Export revenue constituted 94.0 percent of the total standalone revenue in FY 2021 (93.4 percent in FY 2020). |Foreign exchange earnings and outgo|FY 2021|FY 2020| |---|---|---| |a. Foreign exchange earnings|130,720|128,501| |b. CIF Value of imports|241|569| |c. Expenditure in foreign currency|54,800|51,748| # Acknowledgements Padma Bhushan Shri. F. C. Kohli, founder and the first CEO of TCS, passed away on November 26, 2020. The Directors place on record their deep appreciation of his vision, leadership, enormous contribution and monumental work in laying the foundation of the Indian IT Industry and express a deep gratitude to his indefatigable, influential spirit for shaping TCS and the fabric of TCS culture. The Directors thank the Company's employees, customers, vendors, investors and academic partners for their continuous support. The Directors also thank the Government of India, Governments of various states in India, Governments of various countries and concerned Government departments and agencies for their co-operation. |
The Directors mourn the loss of life due to COVID-19 pandemic and are deeply grateful and have immense respect for every person who risked their life and safety to fight this pandemic. The Directors appreciate and value the contribution made by every member of the TCS family. On behalf of the Board of Directors N. Chandrasekaran Chairman Mumbai, April 12, 2021 # Annexure I # Annual Report on CSR Activities # 1. Brief outline on CSR Policy of the Company TCS' vision is to empower communities by connecting people to opportunities in the digital economy and mission is to build inclusive, equitable and sustainable pathways for all including youth, women and marginalized communities. By prioritizing TCS' focus on education, skilling, entrepreneurship and employment it seeks to help people and communities bridge the opportunity gap. The Company also supports health, wellness, water, sanitation and hygiene needs of communities, especially those that are marginalized. TCS also supports conservation and relief efforts to communities at the time of natural and man-made disasters. Its focus on preserving art and heritage as well as supporting action against climate change remains consistent. By applying its resources towards communities that need it the most, TCS ensures equitable access. The Company's CSR strategy incorporates an inclusive approach into the design of every program. In India this is aligned to its support of the Government of India's Affirmative Action Policy and the Tata Group's Affirmative Action Program. To achieve transformational impact, TCS leverages the best of the Company's capabilities - its intellectual, technology, human and financial capital. TCS aims to create innovative solutions to societal challenges applying its contextual knowledge while harnessing the expertise of a diverse network of leaders; execute and scale programs using its technology capabilities; engage its large employee base to volunteer their time, skills and expertise as last-mile connectors and make impact investments in large scale, sustainable, multi-year programs that empower communities. The projects undertaken are within the broad framework of Schedule VII of the Companies Act, 2013. Details of the CSR policy and projects or programs undertaken by the Company are available on links given below: https://on.tcs.com/Global-CSR-Policy https://www.tcs.com/corporate-social-responsibility # 2. Composition of the CSR committee: |Sr. No.|Name of Director|Designation / Nature of Directorship|Number of meetings of CSR Committee held during the year|Number of meetings of CSR Committee attended during the year| |---|---|---|---|---| |1|N. Chandrasekaran|Chairman, Non-independent Non-Executive Director|4|4| |2|O. P. Bhatt|Member, Independent, Non-Executive Director|4|4| |3|N. Ganapathy Subramaniam|Member, Non-Independent, Executive Director|4|4| # 3. Provide the web-link where Composition of CSR committee, CSR Policy and CSR projects approved by the board are disclosed on the website of the Company Composition of the CSR committee shared above and is available on the Company's website on https://www.tcs.com/corporate-governance. CSR policy - https://on.tcs.com/Global-CSR-Policy CSR projects - https://www.tcs.com/corporate-social-responsibility # 4. Provide the details 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 (attach the report). TCS has been conducting internal impact assessments to monitor and evaluate its strategic CSR programs. The Company takes cognizance of sub-rule (3) of rule 8 of the Companies CSR Policy Rules 2014 and has initiated steps to conduct impact assessment of CSR projects through an independent agency. There are no projects undertaken or completed after January 22, 2021, for which the impact assessment report is applicable in FY 2021. # 5. Details of the amount available for set off in pursuance of sub-rule (3) of rule 7 of the Companies (Corporate Social responsibility Policy) Rules, 2014 and amount required for set off for the financial year, if any |Sr. No.|Financial Year|Amount available for set-off from preceding financial years (in `)|Amount required to be setoff for the financial year, if any (in `)| |---|---|---|---| |-| |NIL|NIL| Integrated Annual Report 2020-21 Directors' Report | 61 # 6. Average net profit of the Company as per Section 135(5): `33,153 crore # 7. # (a) Two percent of average net profit of the Company as per section 135(5) : `663 crore # (b) Surplus arising out of the CSR projects or programmes or activities of the previous financial years : NIL # (c) Amount required to be set off for the financial year, if any : NIL # (d) Total CSR obligation for the financial year (7a+7b-7c) : `663 crore # 8. # (a) CSR amount spent or unspent for the financial year: |Total Amount Spent for the Financial Year. |
(` crore)|Total Amount transferred to Unspent CSR Account as per Section 135(6)| | |---|---|---| |674|NIL| | |Amount Unspent (` crore)|Amount transferred to any fund specified under Schedule VII as per second proviso to Section 135(5)| | |Name of the Fund|Amount|Date of transfer| |-|NIL|-| Integrated Annual Report 2020-21 Directors' Report | 62 # (b) Details of CSR amount spent against ongoing projects for the financial year: |Sr. No.|Name of the Project|Item from the list of activities in Schedule VII to the Act|Local area (Yes/No)|State|District| |---|---|---|---|---|---| |1|Tata Translational Cancer Research Center|(i)|Yes|West Bengal|Kolkata| |2|BridgeIT - CADAM (Project 2)|(ii)|Yes|Madhya Pradesh|Satna, Rewa| | | | | |Uttar Pradesh|Datia, Chhatarpur, Nawada| | | | | |Bihar|Ranchi, Ramgarh| | | | | |Jharkhand|North 24 Parganas| |3|BridgeIT - DF (Project 2)|(ii)|Yes|Karnataka|Raichur, Yadgir, Gajapati and Rayagada| |4|BridgeIT - DF (Project 1)|(ii)|No|Mizoram|Aizawl, Raichur| |5|BridgeIT - CADAM (Project 1)|(ii)|Yes|Haryana|Ambala, Kurukshetra| | | | | |Rajasthan|Bharatpur, Dholpur| TOTAL *Represents value less than `0.50 crore. |Project duration (in `)|Amount allocated for the project (in `)|Amount spent in the current financial Year (in `)|Amount transferred to Unspent CSR Account for the project as per Section 135(6) (in `)|Mode of Implementation - Direct (Yes/No)|Mode of Implementation - Through Name|CSR Registration number| |---|---|---|---|---|---|---| |6 years|79|3|-|No|Tata Medical Center Trust|CSR00002920| |5 years|6|1|-|No|Centre for Alternative Dalit Media|CSR00004191| |5 years|3|1|-|No|Development Focus|CSR00002377| |5 years|1|-*|-|No|Development Focus|CSR00002377| |5 years|3|-*|-|No|Centre for Alternative Dalit Media|CSR00004191| # Details of CSR amount spent against other than ongoing projects for the financial year: |Sr. No.|Name of the Project|Item from the list of activities in schedule VII to the Act|Local area (Yes/ No)|Location of the project State|District|Amount spent (` crore)|Mode of implementation - Direct (Yes/No)|Mode of implementation - Through implementing agency Name|CSR registration number| |---|---|---|---|---|---|---|---|---|---| |1|Contribution for Schedule VII activities|(i), (ii), (iv), (v)|Yes|Pan India| |351|No|TCS Foundation|CSR00002960| |2|COVID support - PM CARES Fund|(viii)|Yes|Pan India| |256|No|PM CARES Fund|-| |3|COVID support - Quarantine centre, supply of disinfectant and food packets distribution|(i), (xii)|Yes|Uttar Pradesh|Noida|12|Yes|-|-| |4|Education and skill building projects|(ii)|Yes|Pan India| |7|Yes|-|-| |5|Digital Nerve Centre|(i)|Yes|Pan India| |6|Yes|-|-| |6|COVID support - Food distribution for frontline healthcare workers|(i), (xii)|Yes|Maharashtra|Mumbai|5|No|Taj Public Service Welfare Trust|CSR00000540| |7|Community transformation projects|(ii) (iii)|Yes|Pan India| |5|Yes|-|-| |8|Hospital Management System at Cancer Institute and Tata Medical Centre|(i)|Yes|Tamil Nadu|Chennai|2|Yes|-|-| |9|Centre of Excellence in Cyber Security|(ii) (iii)|Yes|Tamil Nadu|Coimbatore|2|No|Coimbatore Institute of Technology|Registration in progress| Integrated Annual Report 2020-21 Directors' Report | 64 |(1)|(2)|(3)|(4)| |(5)|(6)|(7)| |(8)| |---|---|---|---|---|---|---|---|---|---| |Sr. No.|Name of the Project|Item from the list of activities in schedule VII to the Act|Local area (Yes/ No)|Location of the project|Amount spent for the project (` crore)|Mode of implementation - Direct (Yes/No)|Mode of implementation - Through implementing agency Name|CSR registration number| | |10|Support towards Museum of Art & Photography|(v)|Yes|Karnataka|Bengaluru|1|No|Art & Photography Foundation|Registration in progress| |11|Adult Literacy Program|(ii)|Yes|Madhya Pradesh|Ujjain, Allahabad, Uttar Pradesh, Jaipur, Dausa, Rajasthan, Haryana|-*|No|Humana People To People India|CSR00000929| |12|Impact India Foundation|(i)|Yes|Maharashtra|Mumbai|-*|Yes|-|-| |13|Infrastructure support to Hospital|(i)|Yes|Maharashtra|Mumbai|-*|No|Society for Rehabilitation of Crippled Children|CSR00003225| |14|Restoration and rejuvenation of Siruseri Lake|(iv)|Yes|Tamil Nadu|Chengalpattu|-*|Yes|-|-| |15|Andhra Pradesh Social Welfare Residential Educational Institutions Society (APSWREIS) - Student Digital Innovation Program goIT|(ii)|Yes|Andhra Pradesh|Ananthapur, Vizianagaram, Srikakulam, Kadapa, Guntur|-*|Yes|-|-| |16|Scholarship program|(ii)|Yes|Madhya Pradesh|Chhindwara|-*|No|NIIT Foundation|CSR00000621| |17|Holistic empowerment of differently abled children|(ii)|Yes|Tamil Nadu|Chennai|-*|No|Ramana Sunritya Aalaya Trust|Registration in progress| *Represents value less than `0.50 crore. Integrated Annual Report 2020-21 Directors' Report | 65 |(1)|(2)|(3)|(4)| |(5)|(6)|(7)| |(8)| | |---|---|---|---|---|---|---|---|---|---|---| |Sr. No.|Name of the Project|Item from the list of activities in schedule VII to the Act|Local area (Yes/ No)| |Location of the project|Amount spent for the project (` crore)|Mode of implementation - Direct (Yes/No)|Mode of implementation - Through implementing agency Name|CSR registration number| | |18|Jal Jeevan Mission|(i)|Yes|Himachal, Uttarakhand, Maharashtra, Rajasthan, Jharkhand, Guajrat, Sikkim, Manipur, Goa| | |-*|Yes#|Tata Community Initiatives Trust|CSR00002739| |19|Archaeometallurgical insights on ancient excavations|(v)|Yes|Tamil Nadu Keeladi, Kodumanal, Adichanallur| | |-*|No|National Institute of Advanced Studies|Registration in progress| | |TOTAL| | | | |647| | | | | *Represents value less than `0.50 crore. # Jal Jeevan Mission project is being jointly implemented with Tata Community Initiatives Trust, CSR reg. no. - CSR00002739 (d) Amount spent in Administrative Overheads: `22 crore (e) Amount spent on Impact Assessment, if applicable: NIL (f) Total amount spent for the Financial Year (8b+8c+8d+8e): `674 crore (g) Excess amount for set off, if any |Sr. No.|Particular|Amount (` crore)| |---|---|---| |(i)|Two percent of average net profit of the Company as per Section 135(5)|663| |(ii)|Total amount spent for the Financial Year|674| |(iii)|Excess amount spent for the financial year [(ii)-(i)]|11| |(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)]|11| Integrated Annual Report 2020-21 Directors' Report | 66 # 9. |
Details of Unspent CSR amount for the preceding three financial years: |Sr. No.|Preceding Financial Year|Amount transferred to Unspent CSR Account under Section 135 (6) (` crore)|Amount spent in the reporting Financial Year (` crore)|Amount transferred to any fund specified under Schedule VII as per Section 135(6), if any|Name of the Fund|Amount (` crore)|Date of transfer| |---|---|---|---|---|---|---|---| |1|-|NIL|-|-|NIL|-|-| # (b) Details of CSR amount spent in the financial year for ongoing projects of the preceding financial year(s): |Sr. No.|Project ID|Name of the Project|Financial Year in which the project was commenced| |---|---|---|---| |1|TTCRC|Tata Translational Cancer Research Centre|FY 2016| |2|BridgeIT|BridgeIT - CADAM (Project 2)|FY 2020| |3|BridgeIT|BridgeIT - DF (Project 2)|FY 2020| |4|BridgeIT|BridgeIT - DF (Project 1)|FY 2018| |5|BridgeIT|BridgeIT - CADAM (Project 1)|FY 2018| |6|BridgeIT|BridgeIT - Humana|FY 2020| |7|IIT|Setting up of IIIT at Guwahati, Vadodara, Srirangam, Ranchi and Nagpur in PPP mode|FY 2014| # TOTAL |Project duration|Total amount allocated for the project (` crore)|Amount spent on the project in the reporting Financial Year (` crore)|Cumulative amount spent at the end of reporting Financial Year (` crore)|Status of the project| |---|---|---|---|---| |6 years|79|3|47|Ongoing| |5 years|6|1|2|Ongoing| |5 years|3|1|1|Ongoing| |5 years|1|-*|1|Ongoing| |5 years|3|-*|2|Ongoing| |5 years|1|-|-*|Ongoing| |Open ended|29|-|16|Ongoing| # 10. In case of creation or acquisition of capital asset, furnish the details relating to the asset so created or acquired through CSR spent in the financial year (asset-wise details) - (a) Date of creation or acquisition of the capital asset(s) : None - (b) Amount of CSR spent for creation or acquisition of capital asset : NIL - (c) Details of the entity or public authority or beneficiary under whose name such capital asset is registered, their address etc. : Not Applicable - (d) Provide details of the capital asset(s) created or acquired (including complete address and location of the capital asset) : Not Applicable # 11. Specify the reason(s), if the company has failed to spend two per cent of the average net profit as per Section 135(5) : Not Applicable Rajesh Gopinathan Chief Executive Officer and Managing Director N. Chandrasekaran Chairman, Corporate Social Responsibility Committee Integrated Annual Report 2020-21 Directors' Report | 68 # Annexure II # Form No. MR-3 # Secretarial Audit Report for the financial year ended March 31, 2021 [Pursuant to Section 204(1) of the Companies Act, 2013 and Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014] To, The Members, Tata Consultancy Services Limited We have conducted the secretarial audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by Tata Consultancy Services Limited (hereinafter called "the Company"). Secretarial Audit was conducted in a manner that provided us a reasonable basis for evaluating the corporate conducts/ statutory compliances and expressing our opinion thereon. Based on our verification of the Company's books, papers, minute books, forms and returns filed and other records maintained by the Company, to the extent the information provided by the Company, its officers, agents and authorized representatives during the conduct of secretarial audit, the explanations and clarifications given to us and the representations made by the Management and considering the relaxations granted by the Ministry of Corporate Affairs and Securities and Exchange Board of India, we hereby report that in our opinion, the Company has during the audit period covering the financial year ended on March 31, 2021, generally complied with the statutory provisions listed hereunder and also that the Company has proper Board processes and compliance mechanism in place to the extent, in the manner and subject to the reporting made hereinafter: # We have examined the books, papers, minute books, forms and returns filed and other records made available to us and maintained by the Company for the financial year ended on March 31, 2021 according to the applicable provisions of: 1. The Companies Act, 2013 (the Act) and the rules made thereunder; 2. The Securities Contract (Regulation) Act, 1956 ('SCRA') and the rules made thereunder; 3. The Depositories Act, 1996 and the Regulations and Bye-laws framed thereunder; # The following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 ('SEBI Act'): 1. The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011; 2. The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015; 3. |
The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018 and amendments from time to time; Integrated Annual Report 2020-21 Directors' Report | 69 # Directors' Report (d) The Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014; (Not applicable to the Company during the audit period) (b) Special Economic Zones Act, 2005 and the rules made thereunder; (c) Software Technology Parks of India rules and regulations (e) The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008; (Not applicable to the Company during the audit period) (d) The Indian Copyright Act, 1957 (e) The Patents Act, 1970 (f) The Trade Marks Act, 1999 (f) The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations, 1993 regarding the Companies Act and dealing with client; (Not applicable to the Company during the audit period) (g) The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009; (Not applicable to the Company during the audit period) (h) The Securities and Exchange Board of India (Buyback of Securities) Regulations, 2018; (Not applicable to the Company during the audit period) (vi) Other laws applicable specifically to the Company namely:- (a) Information Technology Act, 2000 and the rules made thereunder; We further report that: The Board of Directors of the Company is duly constituted with proper balance of Executive Directors, Non-Executive Directors and Independent Directors. There were no changes in the composition of the Board of Directors that took place during the period under review. Adequate notice was given to all directors to schedule the Board Meetings, agenda and detailed notes on agenda were sent at least seven days in advance for meetings other than those held at shorter notice, and a system exists for seeking and obtaining further information and clarifications on the agenda items before the meeting and for meaningful participation at the meeting. As per the minutes, the decisions at the Board Meetings were taken unanimously. We further report that there are adequate systems and processes in the Company commensurate with the size and operations of the Company to monitor and ensure compliance with applicable laws, rules, regulations and guidelines etc. We further report that during the audit period the following events occurred which had bearing on the Company's affairs in pursuance of the above referred laws, rules, regulations, guidelines, standards etc. During the period under review, the Company has complied with the provisions of the Act, Rules, Regulations, Guidelines, standards etc. mentioned above. # The Company has completed buyback of 'Annexure A' 5,33,33,333 (Five crore thirty three lakh thirty three thousand three hundred and thirty three) fully paid-up equity shares of face value of `1 (Rupee One) each ("Equity Shares"), on a proportionate basis, through the Tender Offer route through the Stock Exchange mechanism as prescribed under the Securities and Exchange Board of India (Buy-back of Securities) Regulations, 2018, at a price of `3,000 (Rupees Three Thousand only). # To, The Members Tata Consultancy Services Limited Wherever required, we have obtained the Management Representation about the Compliance of laws, rules and regulations and happening of events etc. # 1. Maintenance of secretarial record is the responsibility of the management of the Company. Our responsibility is to express an opinion on these secretarial records based on our audit. # 2. We have followed the audit practices and process as were appropriate to obtain reasonable assurance about the correctness of the contents of the secretarial records. The verification was done on test basis to ensure that correct facts are reflected in secretarial records. We believe that the process and practices, we followed provide a reasonable basis for our opinion. # 3. We have not verified the correctness and appropriateness of financial records and Books of Accounts of the Company. Our report of even date is to be read along with this letter. # 6. The Secretarial Audit report is neither an assurance as to the future viability of the Company nor of the efficacy or effectiveness with which the management has conducted the affairs of the Company. For Parikh & Associates Company Secretaries P. N. Parikh Partner FCS No: 327 CP No: 1228 Place: Mumbai Date: April 12, 2021 UDIN: F000327C000063984 This Report is to be read with our letter of even date which is annexed as Annexure A and Forms an integral part of this report. For Parikh & Associates Company Secretaries P. N. |
Parikh Partner FCS No: 327 CP No: 1228 Place: Mumbai Date: April 12, 2021 UDIN: F000327C000063984 # Integrated Annual Report 2020-21 # Directors' Report | 71 # I. Company's Philosophy on Corporate Governance In addition, the Company has adopted a Code of Conduct for its non-executive directors which includes Code of Conduct for Independent Directors that suitably incorporates the duties of independent directors as laid down in the Companies Act, 2013 ("the Act"). Effective corporate governance practices constitute the strong foundation on which successful commercial enterprises are built to last. The Company's philosophy on corporate governance oversees business strategies and ensures fiscal accountability, ethical corporate behaviour and fairness to all stakeholders comprising regulators, employees, customers, vendors, investors and the society at large. Strong leadership and effective corporate governance practices have been the Company's hallmark inherited from the Tata culture and ethos. File: AR_TCS_2020_2021.md The Company is in compliance with the requirements stipulated under Regulation 17 to 27 read with Schedule V and clauses (b) to (i) of sub-regulation (2) of Regulation 46 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations"), as applicable, with regard to corporate governance. The Company follows the Tata Group philosophy of building sustainable businesses that are rooted in the community and demonstrate care for the environment. Being a part of the Tata Group, which epitomizes sustainability, TCS has inherited a strong legacy of fair and transparent ethical governance, as embodied in the Tata Code of Conduct (TCoC). The details of TCS' board structure and the various committees that constitute the governance structure1 of the organization are covered in detail in this report. 1 102-18 # Corporate Governance Report The various material aspects of corporate governance and TCS' approach to them are discussed in the table below: |Material Topic|TCS' Approach|Material Topic|TCS' Approach| |---|---|---|---| |Avoidance of conflict of interest|Chairmanship of the Board is a non-executive position and separate from that of the Chief Executive Officer and Managing Director (CEO and MD). TCoC2 for non-executive directors, and for Independent Directors, carries explicit clauses covering avoidance of conflict of interest. Likewise, it explicitly prohibits any employee - including the Managing Director and executive directors - from accepting any position of responsibility, with or without remuneration, with any other organization without TCS' prior written approval. For executive directors and the Managing Director, such approval must be obtained from the Board.|Board independence and minority shareholders' interests|Board independence is ensured by having independent members in majority (five out of nine), and by setting a high bar in terms of the qualifications, expertise and experience in selecting the right mix of individuals to serve on the Board, who can collectively serve the best interests of all stakeholders, maintain board and management accountability and drive corporate ethics, values and sustainability. Board effectiveness is further enhanced by ensuring diversity in terms of gender, nationality, industry and areas of expertise. TCS' Policy on Appointment of Directors and Board Diversity can be found at https://on.tcs.com/appointment-BoD.| | |Additionally, TCS strives to reduce information asymmetry through transparency, extensive disclosures and detailed commentary of the demand environment and the state of the business. The company provides a variety of channels including a structured global investor outreach program, through which minority shareholders can interact with the management or the Board. Shareholders can communicate concerns and grievances to the Company Secretary's office through a well-publicized channel, where complaints are tracked to closure. The Stakeholders' Relationship Committee oversees the redressal of these complaints.|Values, Ethics and Compliance|Over the last five decades, TCS has consistently demonstrated a very principled conduct and has earned its reputation for trust and integrity while building a highly successful global business. The company's core values are: Leading Change, Integrity, Respect for the Individual, Excellence, and Learning and Sharing. The TCoC serves as a moral guide and a governing framework for responsible corporate citizenship. It sets out guidelines on various topics including respect for human rights, prohibition of bribery and corruption, recognition of employees' freedom of association, and avoidance of conflicts of interest.| | |Every employee is required to sign the TCoC at the time of joining the company. Annual refresher courses are mandated to ensure continued awareness of the code. |
Further, frequent communications from the leadership reiterate the importance of our values and the TCoC.| | | 2 https://www.tcs.com/tata-code-of-conduct 3 102-16 Integrated Annual Report 2020-21 # Material Topic # TCS' Approach Customers and suppliers are made aware of the TCoC principles in contract discussions, and through inclusion of specific clauses in proposals and contracts. The TCS Supplier Code of Conduct is shared with suppliers as part of the procurement process and is published on the TCS website. Employees can raise ethics concerns on Ultimatix - the intranet portal of the Company, which are investigated and tracked to closure by the HR department. Employees and other stakeholders can also report any non-compliance to the TCoC or to the laws of the land by any one directly to the Chairman of the Audit Committee under the Whistle blower Policy without fear of retaliation. Information about these channels is communicated to employees as part of the mandatory training modules. # Tax Strategy TCS is committed to comply with the applicable laws and regulations, and believes in reporting to the respective tax authority, relevant information that is complete and accurate, in a timely manner. TCS does not engage in aggressive and contrived tax planning or tax structuring for the purpose of gaining tax advantages. TCS's tax policy is to optimize the tax cost, avail tax incentives where available, while achieving 100% compliance with the spirit as well as the letter of the tax laws and regulations in all countries in which it operates. Compliance is achieved through a robust compliance reporting and monitoring process, with a strong governance on minimizing the tax risk. TCS has zero tolerance towards tax evasion, or the facilitation of tax evasion, by itself or by its employees or vendors. TCS maintains open and collaborative relationships with governments and tax authorities worldwide. Where appropriate, TCS seeks advance clearance from tax authorities on the proposed tax treatment of transactions, helping pre-empt future disputes. # Succession Planning TCS' philosophy of empowering employees, its industry-leading talent retention, and a decentralized organization structure that devolves executive decision-making across over 150 business units have resulted in a large and deep bench of leadership talent that enables robust succession planning and continuity and consistency in strategy. Succession planning for the top two leadership positions in each business unit is reviewed by senior management. Additionally, heads of business units carry out succession planning for key functions within their units. Succession planning at senior management levels is reviewed by the Board. Business or unit heads are invited to present on specific topics at Board meetings from time to time, offering an opportunity for the directors to assess their values, competencies, and capabilities. Integrated Annual Report 2020-21 Corporate Governance Report | 74 # II. Board of Directors # i. As on March 31, 2021, the Company has nine Directors. Of the nine Directors, seven (i.e. 77.8 percent) are Non-Executive Directors out of which five (i.e. 55.6 percent) are Independent Directors. The profiles of Directors are available at https://www.tcs.com/ir-corporate-governance. The composition of the Board is in conformity with Regulation 17 of the SEBI Listing Regulations read with Section 149 of the Act. # ii. None of the Directors on the Board: - holds directorships in more than ten public companies; - serves as Director or as Independent Directors (ID) in more than seven listed entities; and - who are the Executive Directors serves as IDs in more than three listed entities. Necessary disclosures regarding Committee positions in other public companies as on March 31, 2021 have been made by the Directors. None of the Directors is related to each other except N Ganapathy Subramaniam and N Chandrasekaran. # iii. Independent Directors are non-executive directors as defined under Regulation 16(1)(b) of the SEBI Listing Regulations and Section 149(6) of the Act along with rules framed thereunder. In terms of Regulation 25(8) of SEBI Listing Regulations, they have confirmed that they are not aware of any circumstance or situation which exists or may be reasonably anticipated that could impair or impact their ability to discharge their duties. Based on the declarations received from the Independent Directors, the Board of Directors has confirmed that they meet the criteria of independence as mentioned under Regulation 16(1)(b) of the SEBI Listing Regulations and that they are independent of the management. |
Further, the Independent Directors have included their names in the data bank of Independent Directors maintained with the Indian Institute of Corporate Affairs in terms of Section 150 of the Act read with Rule 6 of the Companies (Appointment & Qualification of Directors) Rules, 2014. # iv. Seven Board Meetings were held during the year under review and the gap between two meetings did not exceed one hundred and twenty days. The said meetings were held on: - April 16, 2020; - July 9, 2020; - September 29, 2020; - October 7, 2020; - November 23, 2020; - January 8, 2021; - and March 18, 2021. The necessary quorum was present for all the meetings. # v. The names and categories of the Directors on the Board, their attendance at Board Meetings held during the year under review and at the last Annual General Meeting ("AGM"), name of other listed entities in which the Director is a director and the number of Directorships and Committee Chairmanships / Memberships held by them in other public limited companies as on March 31, 2021 are given herein below. Other directorships do not include directorships of private limited companies, foreign companies and companies registered under Section 8 of the Act. Further, none of them is a member of more than ten committees or chairman of more than five committees across all the public companies in which he / she is a Director. For the purpose of determination of limit of the Board Committees, chairpersonship and membership of the Audit Committee and Stakeholders' Relationship Committee has been considered as per Regulation 26(1)(b) of SEBI Listing Regulations. Corporate Governance Report | 75 |Name of the Director|Category|Number of Board Meetings attended|Whether attended last AGM held on June 11, 2020|Number of Directorships in other Public Companies|Number of Committee positions held in other Public Companies|(Category of Directorship)| |---|---|---|---|---|---|---| |N Chandrasekaran (Chairman)|Non-Independent, Non-Executive|7|Yes|6|-|-| |1. Tata Steel Limited @ 2. Tata Motors Limited @ 3. Tata Consumer Products Limited (Formerly known as Tata Global Beverages Limited) @ 4. The Tata Power Company Limited @ 5. The Indian Hotels Company Limited @ 6. Tata Chemicals Limited @|1. Tata Steel Limited @ 2. Tata Motors Limited @ 3. Tata Consumer Products Limited (Formerly known as Tata Global Beverages Limited) @ 4. The Tata Power Company Limited @ 5. The Indian Hotels Company Limited @ 6. Tata Chemicals Limited @|1. Tata Steel Limited @ 2. Tata Motors Limited @ 3. Tata Consumer Products Limited (Formerly known as Tata Global Beverages Limited) @ 4. The Tata Power Company Limited @ 5. The Indian Hotels Company Limited @ 6. Tata Chemicals Limited @|1. Tata Steel Limited @ 2. Tata Motors Limited @ 3. Tata Consumer Products Limited (Formerly known as Tata Global Beverages Limited) @ 4. The Tata Power Company Limited @ 5. The Indian Hotels Company Limited @ 6. Tata Chemicals Limited @|1. Tata Steel Limited @ 2. Tata Motors Limited @ 3. Tata Consumer Products Limited (Formerly known as Tata Global Beverages Limited) @ 4. The Tata Power Company Limited @ 5. The Indian Hotels Company Limited @ 6. Tata Chemicals Limited @|1. Tata Steel Limited @ 2. Tata Motors Limited @ 3. Tata Consumer Products Limited (Formerly known as Tata Global Beverages Limited) @ 4. The Tata Power Company Limited @ 5. The Indian Hotels Company Limited @ 6. Tata Chemicals Limited @|1. Tata Steel Limited @ 2. Tata Motors Limited @ 3. Tata Consumer Products Limited (Formerly known as Tata Global Beverages Limited) @ 4. The Tata Power Company Limited @ 5. The Indian Hotels Company Limited @ 6. Tata Chemicals Limited @| |Rajesh Gopinathan (Chief Executive Officer and Managing Director)|Non-Independent, Executive|7|Yes|-|-|-| |N Ganapathy Subramaniam (Chief Operating Officer and Executive Director)|Non-Independent, Executive|7|Yes|1|-|-| |O P Bhatt|Independent, Non-Executive|7|Yes|-|4|2| |1. Hindustan Unilever Limited # 2. Tata Steel Limited # 3. Tata Motors Limited # 4. Aadhar Housing Finance Limited (Debt Listed) #|1. Hindustan Unilever Limited # 2. Tata Steel Limited # 3. Tata Motors Limited # 4. Aadhar Housing Finance Limited (Debt Listed) #|1. Hindustan Unilever Limited # 2. Tata Steel Limited # 3. Tata Motors Limited # 4. Aadhar Housing Finance Limited (Debt Listed) #|1. Hindustan Unilever Limited # 2. Tata Steel Limited # 3. Tata Motors Limited # 4. Aadhar Housing Finance Limited (Debt Listed) #|1. Hindustan Unilever Limited # 2. Tata Steel Limited # 3. Tata Motors Limited # 4. Aadhar Housing Finance Limited (Debt Listed) #|1. Hindustan Unilever Limited # 2. Tata Steel Limited # 3. Tata Motors Limited # 4. |
Aadhar Housing Finance Limited (Debt Listed) #|1. Hindustan Unilever Limited # 2. Tata Steel Limited # 3. Tata Motors Limited # 4. Aadhar Housing Finance Limited (Debt Listed) #| Integrated Annual Report 2020-21 Corporate Governance Report | 76 # Integrated Annual Report 2020-21 # Corporate Governance Report |Name of the Director|Category|Number of Board Meetings attended|Whether attended last AGM held on June 11, 2020|Number of Directorships in other Public Companies|Number of Committee positions held in other Public Companies|(Category of Directorship)| |---|---|---|---|---|---|---| |Aarthi Subramanian|Non-Independent, Non-Executive|7|Yes|2|5|1 Chairman, 2 Member Tata Capital Limited (Debt Listed) @| |Dr Pradeep Kumar Khosla|Independent, Non-Executive|7|Yes|-|-|-| |Hanne Sorensen|Independent, Non-Executive|7|Yes|-|1|2 Member Tata Motors Limited #| |Keki Mistry|Independent, Non-Executive|7|Yes|-|5|1 Chairman, 5 Member 1. Housing Development Finance Corporation Limited $ 2. Torrent Power Limited # 3. HDFC Life Insurance Company Limited ^ 4. HDFC Asset Management Company Limited @| |Don Callahan|Independent, Non-Executive|6|Yes|-|-|-| # Category of directorship held: @ Non-Independent, Non-Executive # Independent, Non-Executive $ Executive Director ^ Nominee, Non-Executive Due to the exceptional circumstances caused by the COVID-19 pandemic and consequent relaxations granted by MCA and SEBI, all Board meetings in FY 2021 were held through Video Conferencing. # vi. During FY 2021, information as mentioned in Part A of Schedule II of the SEBI Listing Regulations, has been placed before the Board for its consideration. # vii. During FY 2021, one meeting of the Independent Directors was held on April 15, 2020. The Independent Directors, inter-alia, reviewed the performance of Non-Independent Directors, Board as a whole and Chairman of the Company, taking into account the views of Executive Directors and Non-Executive Directors. # viii. The Board periodically reviews the compliance reports of all laws applicable to the Company. # ix. Details of equity shares of the Company held by the Directors as on March 31, 2021 are given below: |Name|Category|Number of equity shares| |---|---|---| |N Chandrasekaran|Non-Independent, Non-Executive|177,056| |Aarthi Subramanian|Non-Independent, Non-Executive|5,600| |Rajesh Gopinathan|Non-Independent, Executive|2,760| |N Ganapathy Subramaniam|Non-Independent, Executive|197,760| |Keki Mistry*|Independent, Non-Executive|4,150| *includes shares held jointly with relative The Company has not issued any convertible instruments. Integrated Annual Report 2020-21 Corporate Governance Report | 78 # III. Committees of the Board i. There are six Board Committees as on March 31, 2021, details of which are as follows: |Name of the Committee|Extract of terms of reference|Category and composition|Other details| |---|---|---|---| |Audit Committee|Committee is constituted in line with the provisions of Regulation 18 of SEBI Listing Regulations and Section 177 of the Act. * Oversight of financial reporting process. * Reviewing with the management, the annual financial statements and auditors' report thereon before submission to the Board for approval. * Evaluation of internal financial controls and risk management systems. * Recommendation for appointment, remuneration and terms of appointment of auditors of the Company. * Approve policies in relation to the implementation of the Insider Trading Code and to supervise implementation of the same. * To consider matters with respect to the Tata Code of Conduct, Anti-Bribery and Anti-Corruption Policy and Gifts Policy.|Name Keki Mistry (Chairman) O P Bhatt Aarthi Subramanian Dr Pradeep Kumar Khosla Hanne Sorensen Don Callahan Category Independent, Non-Executive Independent, Non-Executive Non-Independent, Non-Executive Independent, Non-Executive Independent, Non-Executive Independent, Non-Executive|* Four meetings of the Audit Committee were held during the year under review and the gap between two meetings did not exceed one hundred and twenty days. * Committee invites such of the executives as it considers appropriate, representatives of the statutory auditors and internal auditors, to be present at its meetings. * The Company Secretary acts as the Secretary to the Audit Committee. * Rajendra Moholkar is the Compliance Officer to ensure compliance and effective implementation of the Insider Trading Code. * Quarterly Reports are sent to the members of the Committee on matters relating to the Insider Trading Code. * The previous AGM of the Company was held on June 11, 2020 and was attended by Keki Mistry, Chairman of the Audit Committee.| Integrated Annual Report 2020-21 Corporate Governance Report | 79 # Extract of terms of reference # Nomination and Remuneration Committee Committee is constituted in line with the provisions of Regulation 19 of SEBI Listing Regulations and Section 178 of the Act. - Recommend to the Board the setup and composition of the Board and its Committees. - Recommend to the Board the appointment / re-appointment of Directors and Key Managerial Personnel. - Support the Board and Independent Directors in evaluation of the performance of the Board, its Committees and individual Directors. |
- Recommend to the Board the Remuneration Policy for Directors, executive team or Key Managerial Personnel as well as the rest of employees. - Oversee familiarization programs for Directors. |Name|Category| |---|---| |O P Bhatt (Chairman)|Independent, Non-Executive| |N Chandrasekaran|Non-Independent, Non-Executive| |Aarthi Subramanian|Non-Independent, Non-Executive| |Hanne Sorensen|Independent, Non-Executive| * Two Nomination and Remuneration Committee meetings were held during the year under review. * The Company does not have any Employee Stock Option Scheme. * Details of Performance Evaluation Criteria and Remuneration Policy are provided at serial no. III(iii) below. * The previous AGM of the Company was held on June 11, 2020 and was attended by O P Bhatt, Chairman of the Nomination and Remuneration Committee. # Stakeholders' Relationship Committee Committee is constituted in line with the provisions of Regulation 20 of SEBI Listing Regulations and Section 178 of the Act. The broad terms of reference are as under: - Consider and resolve the grievances of security holders. - Consider and approve issue of share certificates, transfer and transmission of securities, etc. - Review activities with regard to the Health Safety and Sustainability initiatives of the Company. |Name|Category| |---|---| |Dr Pradeep Kumar Khosla (Chairman)|Independent, Non-Executive| |Rajesh Gopinathan|Non-Independent, Executive| |Keki Mistry|Independent, Non-Executive| * Two meetings of the Stakeholders' Relationship Committee were held during the year under review. * Details of Investor complaints and Compliance Officer are provided at serial no. III(ii) below. * The previous AGM of the Company was held on June 11, 2020 and was attended by Dr Pradeep Kumar Khosla, Chairman of the Stakeholders' Relationship Committee. # Extract of terms of reference # Corporate Social Responsibility ("CSR") Committee Committee is constituted in line with the provisions of Section 135 of the Act. - Formulate and recommend to the Board, a CSR Policy indicating the activities to be undertaken by the Company as specified in Schedule VII of the Act. - Recommend the amount of expenditure to be incurred on the activities mentioned in the CSR Policy. - Monitor the CSR Policy. |Name|Category| |---|---| |N Chandrasekaran (Chairman)|Non-Independent, Non-Executive| |O P Bhatt|Independent, Non-Executive| |N Ganapathy Subramaniam|Non-Independent, Executive| * Four meetings of the CSR Committee were held during the year under review. * Four Board meetings of TCS Foundation, a Section 8 company which was incorporated with sole objective of carrying on Corporate Social Responsibility (CSR) activities of the Company were held during the year. # Risk Management Committee ("RMC") Committee is constituted in line with the provisions of Regulation 21 of SEBI Listing Regulations. - Formulate, monitor and review risk management policy and plan, inter alia, covering investment of surplus funds, management of foreign exchange risks, cyber security risks, data privacy risks and intellectual property infringements risks. - Approve addition / deletion of banks from time to time for carrying out Treasury transactions and delegate the said power to such person as may deem fit. |Name|Category| |---|---| |Keki Mistry (Chairman)|Independent, Non-Executive| |Don Callahan|Independent, Non-Executive| |Rajesh Gopinathan|Non-Independent, Executive| |N Ganapathy Subramaniam|Non-Independent, Executive| |Ramakrishnan V|Chief Financial Officer| * Four meetings of the RMC were held during the year under review. * Fortnightly reports on management of foreign exchange risks are made available to the members of the RMC. # Executive Committee Detailed review of the following matters which form part of terms of Executive Committee, were presented to the Board: - Business and strategy review; - Long-term financial projections and cash flows; - Capital and revenue budgets and capital expenditure programmes; - Acquisitions, divestments and business restructuring proposals; - Senior management succession planning; - Any other item as may be decided by the Board. |Name|Category| |---|---| |N Chandrasekaran (Chairman)|Non-Independent, Non-Executive| |Rajesh Gopinathan|Non-Independent, Executive| * The said matters were discussed in various Board meetings held during the year under review in the presence of the Executive Committee Members with the intent to avail expertise of all Board members. The terms of reference of these committees are available on the website https://www.tcs.com/ir-corporate-governance Integrated Annual Report 2020-21 Corporate Governance Report | 81 # ii. Stakeholders' Relationship Committee participation and contribution by a director, other details # a. Name, designation and address of Compliance Officer: Rajendra Moholkar Company Secretary Tata Consultancy Services Limited 9th Floor, Nirmal Building, Nariman Point, Mumbai 400 021. Telephone: 91 22 6778 9595 # b. Details of investor complaints received and redressed during FY 2021 are as follows: |Opening balance|Received during the year|Resolved during the year|Closing balance| |---|---|---|---| |-|86|86|-| # iii. Nomination and Remuneration Committee - other details # Remuneration Policy: Remuneration policy of the Company is designed to create a high-performance culture. |
It enables the Company to attract, retain and motivate employees to achieve results. Our business model promotes customer centricity and requires employee mobility to address project needs. The remuneration policy supports such mobility through pay models that are compliant to local regulations. In each country where the Company operates, the remuneration structure is tailored to the regulations, practices and benchmarks prevalent in the IT industry. The Company pays sitting fees of `30,000 per meeting to its Non-Executive Directors for attending meetings of the Board and meetings of committees of the Board. The Company also pays commission to the Non-Executive Directors within the ceiling of 1 percent of the net profits of the Company as computed under the applicable provisions of the Act, with the approval of the members. The said commission is decided each year by the Board of Directors, on the recommendation of the Nomination and Remuneration Committee and distributed amongst the Non-Executive Directors based on the Board evaluation process, considering criteria such as their attendance and contribution at the Board and Committee meetings, as well as the time spent on operational matters other than at meetings. The Company also reimburses the out-of-pocket expenses incurred by the Directors for attending the meetings. The Remuneration policy is available on https://on.tcs.com/remuneration-policy. # Performance Evaluation Criteria for Independent Directors: The performance evaluation criteria for independent directors is determined by the Nomination and Remuneration Committee. An indicative list of factors on which evaluation was carried out includes annual increments recommended by the Nomination and Remuneration Committee within the salary scale approved by the Board and Members and are effective April 1, each year. # iv. Details of the Remuneration for the year ended March 31, 2021: # a. Non-Executive Directors: |Name|Commission|Sitting Fees| |---|---|---| |N Chandrasekaran, Chairman@|-|3.90| |O P Bhatt|230.00|5.40| |Aarthi Subramanian@@|-|3.90| |Dr Pradeep Kumar Khosla|185.00|4.20| |Hanne Sorensen|185.00|4.20| |Keki Mistry|200.00|5.40| |Don Callahan|200.00|4.50| |Total|1,000.00|31.50| @ As a policy, N Chandrasekaran, Chairman, has abstained from receiving commission from the Company. @@ In line with the internal guidelines of the Company, no payment is made towards commission to the Non-Executive Directors of the Company, who are in full time employment with any other Tata company. # b. Managing Director and Executive Director |Name of Director|Salary|Benefits, Perquisites and Allowances|Commission|ESPS| |---|---|---|---|---| |Rajesh Gopinathan|127.50|209.04|1,700.00|-| |Chief Executive Officer and Managing Director (w.e.f. February 21, 2017 for a period of 5 years)| | | | | |N Ganapathy Subramaniam|121.50|188.93|1,300.00|-| |Chief Operating Officer and Executive Director (w.e.f. February 21, 2017 for a period of 5 years)| | | | | The above figures do not include provisions for encashable leave, gratuity and premium paid for group health insurance, as separate actuarial valuation / premium paid are not available. Services of the Managing Director and Executive Director may be terminated by either party, giving the other party six months' notice or the Company paying six months' salary in lieu thereof. There is no separate provision for payment of severance pay. Integrated Annual Report 2020-21 Corporate Governance Report | 83 File: AR_TCS_2020_2021.md # v. Number of committee meetings held and attendance records |Name of the Committee|Audit Committee|Nomination and Remuneration Committee|Stakeholders' Relationship Committee|Corporate Social Responsibility Committee|Risk Management Committee| |---|---|---|---|---|---| |No. of meetings held|4|2|2|4|4| |Date of meetings|April 16, 2020; July 9, 2020; October 7, 2020 and January 8, 2021|April 16, 2020 and October 7, 2020|July 14, 2020 and January 15, 2021|April 29, 2020; July 23, 2020; October 30, 2020 and February 11, 2021|April 6, 2020; July 3, 2020; January 15, 2021| |Name of Member|No. of Meetings Attended|Audit Committee|Nomination and Remuneration Committee|Stakeholders' Relationship Committee|Corporate Social Responsibility Committee|Risk Management Committee| |---|---|---|---|---|---|---| |N Chandrasekaran|-|2|-|4|-| | |Rajesh Gopinathan|-|-|2|-|4| | |O P Bhatt|4|2|-|4|-| | |N Ganapathy Subramaniam|-|-|-|4|4| | |Aarthi Subramanian|4|2|-|-|-| | |Dr Pradeep Kumar Khosla|4|-|2|-|-| | |Hanne Sorensen|4|2|-|-|-| | |Keki Mistry|4|-|2|-|4| | |Don Callahan|4|-|-|-|4| | |Ramakrishnan V|-|-|-|-|4| | Whether quorum was present for all the meetings: The necessary quorum was present for all the above committee meetings. @ TCS Foundation, a Section 8 company incorporated in 2015 with sole objective of carrying on Corporate Social Responsibility (CSR) activities of the Company, has held four meetings during the FY 2021. Due to the exceptional circumstances caused by the COVID-19 pandemic all Committee meetings in FY 2021 were held through Video Conferencing. Integrated Annual Report 2020-21 Corporate Governance Report | 84 # IV. General Body Meetings # i. General Meeting # a. |
Annual General Meeting ("AGM"): |Financial Year|Date|Time|Venue| |---|---|---|---| |2018|June 15, 2018| |Birla Matushri Sabhagar, 19, Sir Vithaldas Thackersey Marg, New Marine Lines, Mumbai - 400 020| |2019|June 13, 2019|3.30 p.m.| | |2020|June 11, 2020| |Meeting conducted through VC / OAVM pursuant to the MCA Circular| # b. Extraordinary General Meeting: No extraordinary general meeting of the members was held during FY 2021. # c. Special resolution: Special resolution for re-appointment of O P Bhatt as an Independent Director was passed at the AGM held in 2019 and no special resolution was passed in the previous AGMs held in 2018 and 2020. The Company had sought the approval of the shareholders by way of a Special Resolution through notice of postal ballot dated October 7, 2020 for buy-back of its equity shares, which was duly passed and the results of which were announced on November 18, 2020. P N Parikh (Membership No. FCS 327) of Parikh & Associates, Practising Company Secretaries, was appointed as the Scrutinizer to scrutinize the postal ballot process only by voting through electronic means (remote e-voting) in a fair and transparent manner. # Description of the Resolution |Resolution|Number of members voted|Number of valid Votes cast (Shares)|Percentage of valid votes cast|Number of members voted against the resolution|Number of valid votes cast (Shares)|Percentage of valid votes cast|Total number of members whose votes were declared invalid (Shares)|Total number of invalid votes cast| |---|---|---|---|---|---|---|---|---| |Approval for Buy-back of Equity Shares|5,202|3,482,270,324|99.57|289|14,932,052|0.43|0|0| # Procedure for postal ballot The postal ballot was carried out as per the provisions of Sections 108 and 110 and other applicable provisions of the Act, read with the Rules framed thereunder and read with the Circular No. 14/2020 dated April 8, 2020, Circular No. 17/2020 dated April 13, 2020 and Circular No. 33/2020 dated September 28, 2020, issued by the Ministry of Corporate Affairs. # Details of special resolution proposed to be conducted through postal ballot None of the businesses proposed to be transacted at the ensuing AGM requires passing of a special resolution through postal ballot. # Auditor Information A certificate has been received from Parikh & Associates, Practising Company Secretaries, that none of the Directors on the Board of the Company has been debarred or disqualified from being appointed or continuing as directors of companies by the Securities and Exchange Board of India, Ministry of Corporate Affairs or any such statutory authority. # Statutory Auditors B S R & Co. LLP, Chartered Accountants (Firm Registration No. 101248W/W - 100022) has been appointed as the Statutory Auditors of the Company. The particulars of payment of Statutory Auditors' fees, on consolidated basis for FY 2021 is given below: |Particulars|Amount (` lakh)| |---|---| |Services as statutory auditors (including quarterly audits)|910.1| |Tax audit|63.5| |Services for tax matters|24.8| |Other matters|389.4| |Re-imbursement of out-of-pocket expenses|78.7| |Total|1,466.5| Integrated Annual Report 2020-21 Corporate Governance Report | 86 # VII. Other Disclosure |Particulars|Statutes|Details|Website link for details / policy| |---|---|---|---| |Related party transactions|Regulation 23 of SEBI Listing Regulations and as defined under the Act|There are no material related party transactions during the year under review that have conflict with the interest of the Company. Transactions entered into with related parties during FY 2021 were in the ordinary course of business and at arms' length basis and were approved by the Audit Committee. The Board's approved policy for related party transactions is uploaded on the website of the Company.|https://on.tcs.com/RPT| |Details of non-compliance by the Company, penalty, strictures imposed on the Company by the stock exchange, or Securities and Exchange Board of India ('SEBI') or any statutory authority on any matter related to capital markets during the last three financial years.|Schedule V (C) 10(b) to the SEBI Listing Regulations|Nil| | |Whistle Blower Policy and Vigil Mechanism|Regulation 22 of SEBI Listing Regulations|The Company has this Policy and has established the necessary vigil mechanism for directors and employees to report concerns about unethical behaviour. No person has been denied access to the Chairman of the Audit Committee. The said policy has been uploaded on the website of the Company.|https://on.tcs.com/WhistleBP| |Discretionary requirements|Schedule II Part E of the SEBI Listing Regulations|- A message from the Chief Executive Officer and Managing Director on the half-yearly financial performance of the Company including a summary of the significant events in the six month period ended September 30, 2020 was sent to every member. - The auditors' report on financial statements of the Company are unmodified. - Internal auditors of the Company make quarterly presentations to the audit committee on their reports. |
| | # Particulars |Statutes|Details|Website link for details / policy| |---|---|---| |Subsidiary Companies|Regulation 24 of the SEBI Listing Regulations The audit committee reviews the consolidated financial statements of the Company and the investments made by its unlisted subsidiary companies. The minutes of the Board meetings along with a report on significant developments of the unlisted subsidiary companies are periodically placed before the Board of Directors of the Company. The Company does not have any material unlisted subsidiary company. The Company has a policy for determining 'material subsidiaries' which is disclosed on its website.|https://on.tcs.com/Subsidiary| |Policy on Determination of Materiality for Disclosures|Regulation 30 of SEBI Listing Regulations The Company has adopted this policy.|https://on.tcs.com/Material| |Policy on Archival and Preservation of Documents|Regulation 9 of SEBI Listing Regulations The Company has adopted this policy.|https://on.tcs.com/Archival| |Reconciliation of Share Capital Audit Report|Regulation 76 of the Securities and Exchange Board of India (Depositories and Participants) Regulations, 2018 and SEBI Circular No D&CC / FITTC/ Cir-16/2002 dated December 31, 2002. A qualified practising Company Secretary carried out a share capital audit to reconcile the total admitted equity share capital with the National Securities Depository Limited ("NSDL") and the Central Depository Services (India) Limited ("CDSL") and the total issued and listed equity share capital. The audit report confirms that the total issued / paid-up capital is in agreement with the total number of shares in physical form and the total number of dematerialized shares held with NSDL and CDSL.|https://www.tcs.com/corporate-governance| |Code of Conduct|Regulation 17 of the SEBI Listing Regulations The members of the Board and Senior Management Personnel have affirmed compliance with the Code of Conduct applicable to them during the year ended March 31, 2021. The Integrated Annual Report of the Company contains a certificate by the Chief Executive Officer and Managing Director, on the compliance declarations received from the members of the Board and Senior Management.|https://www.tcs.com/tata-code-of-conduct| # Particulars |Dividend Distribution Policy|Regulation 43A of the SEBI Listing Regulations|A regular annual dividend generally consists of three interim dividends after each of the first three quarters of the fiscal year, topped up with a final dividend after the fourth quarter. In addition, every second or third year, the accumulated surplus cash has been returned to shareholders through a special dividend.|https://on.tcs.com/Dividend| |---|---|---|---| |Terms of Appointment of Independent Directors|Regulation 46 of SEBI Listing Regulations and Section 149 read with Schedule IV of the Act|Terms and conditions of appointment / re-appointment of Independent Directors are available on the Company's website.|https://on.tcs.com/ApptID| |Familiarization Program|Regulations 25(7) and 46 of SEBI Listing Regulations|Details of familiarization program imparted to Independent Directors are available on the Company's website.|https://on.tcs.com/familiarization-programme| |Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2018|Section 134 of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014|The details have been disclosed in the Business Responsibility Report forming part of the Integrated Annual Report.| | # VIII. Means of Communication The quarterly, half-yearly and annual financial results of the Company are published in leading newspapers in India which include The Indian Express, Financial Express, Loksatta, Business Standard, The Hindu Business Line, Hindustan Times and Sandesh. The results are also displayed on the Company's website www.tcs.com. Statutory notices are published in The Free Press Journal, Business Standard and Navshakti. The Company also issues press releases from time to time. Financial Results, Statutory Notices, Press Releases and Presentations made to the institutional investors / analysts after the declaration of the quarterly, half-yearly and annual results are submitted to the National Stock Exchange of India Limited (NSE) and BSE Limited (BSE) as well as uploaded on the Company's website. Frequently Asked Questions (FAQs) giving details about the Company and its shares is uploaded on the Company's website https://www.tcs.com/investor-relations. A Management Discussion and Analysis Report is a part of this Integrated Annual Report. Integrated Annual Report 2020-21 Corporate Governance Report | 89 # IX. General shareholder information # vi. Stock Codes / Symbol Annual General Meeting for FY 2021 Date: June 10, 2021 Time: 3.30 p.m. (IST) Venue: Meeting is being conducted through VC/OAVM pursuant to the MCA Circular dated May 5, 2020 read with circulars dated April 8, 2020, April 13, 2020 and January 13, 2021 and as such there is no requirement to have a venue for the AGM. For details, please refer to the Notice of this AGM. |
As required under Regulation 36(3) of the SEBI Listing Regulations and Secretarial Standard 2 on General Meetings, particulars of Directors seeking re-appointment at this AGM are given in the Annexure to the Notice of this AGM. # vii. Corporate Identity Number (CIN) of the Company: L22210MH1995PLC084781 # viii. Market Price Data: High, Low (based on daily closing prices) and number of equity shares traded during each month in FY 2021 on NSE and BSE: |Month|NSE|NSE|NSE|BSE|BSE|BSE| |---|---|---| | |High (`)|Low (`)|Total number of equity shares traded|High (`)|Low (`)|Total number of equity shares traded| |Apr-2020|2,014.45|1,654.20|88,921,044|2,014.85|1,654.40|2,933,547| |May-2020|2,020.35|1,891.65|65,346,426|2,018.95|1,891.25|2,336,179| |Jun-2020|2,118.85|2,016.10|73,994,030|2,115.60|2,010.90|5,655,678| |Jul-2020|2,309.75|2,092.05|106,381,350|2,309.20|2,092.55|4,563,262| |Aug-2020|2,308.10|2,238.55|65,561,599|2,307.70|2,237.10|2,141,484| |Sep-2020|2,522.95|2,246.35|116,408,785|2,523.55|2,245.30|4,232,712| |Oct-2020|2,830.00|2,523.45|128,618,662|2,831.20|2,522.75|4,370,785| |Nov-2020|2,726.60|2,604.60|65,135,883|2,725.90|2,603.85|2,612,896| |Dec-2020|2,930.50|2,709.45|62,832,148|2,930.65|2,708.45|3,035,676| |Jan-2021|3,308.80|2,928.25|84,685,394|3,308.20|2,928.20|6,356,022| |Feb-2021|3,214.10|2,894.30|65,464,843|3,215.15|2,896.05|3,780,459| |Mar-2021|3,177.85|2,924.20|71,839,687|3,177.60|2,926.20|3,093,672| Listing on Stock Exchanges: National Stock Exchange of India Limited Exchange Plaza, C-1, Block G, Bandra Kurla Complex Bandra (East), Mumbai 400 051 BSE Limited P. J. Towers, Dalal Street, Mumbai 400 001 # Performance of the share price of the Company in comparison to the BSE Sensex: # TCS Share price and BSE Sensex Movement 220.00200.00180.00160.00140.00120.00100.0080.0060.00 Apr-20 May-20 Jun-20 Jul-20 Aug-20 Sep-20 Oct-20 Nov-20 Dec-20 Jan-21 Feb-21 Mar-21 TCS Share Price BSE Sensex Base100= Wednesday, April 1, 2020 # Effective April 1, 2021 The registered address of TCPL has changed to the abovementioned address from 6, Haji Moosa Patrawala Industrial Estate, 20, Dr. E. Moses Road, Mahalaxmi, Mumbai 400 011. # Places for acceptance of documents: Documents will be accepted at the above address between 10.00 a.m. and 3.30 p.m. (Monday to Friday except bank holidays). For the convenience of the shareholders, documents will also be accepted at the following branches of TCPL: # Branches of TCPL: |Bengaluru|Jamshedpur| |---|---| |C/o. Mr. D. Nagendra Rao|Bungalow No. 1, 'E' Road, Northern Town Bistupur, Jamshedpur - 831001| |3rd Cross, Hanumanthnagar|Bengaluru - 560019| # Kolkata C/o Link Intime India Private Limited Vaishno Chamber, Flat No. 502 & 503, 5th Floor, 6, Brabourne Road, Kolkata - 700001 # New Delhi C/o Link Intime India Private Limited Noble Heights, 1st Floor, Plot No NH-2, C-1 Block, LSC Near Savitri Market, Janakpuri, New Delhi - 110058 # Ahmedabad C/o Link India Intime Private Limited Amarnath Business Centre-1 (ABC-1), Beside Gala Business Centre, Nr. St. Xavier's College Corner, Off. C.G. Road, Ellisbridge, Ahmedabad - 380006 # Registrars and Transfer Agents Name and Address: TSR Darashaw Consultants Private Limited (TCPL) C-101, 1st Floor, 247 Park, Lal Bahadur Shastri Marg, Vikhroli West, Mumbai 400083 Telephone: 022 6656 8484 Extn: 411/412/413 Fax: 022 6656 8494 E-mail: [email protected] Website: https://www.tcplindia.co.in # xii. Share Transfer System: In terms of Regulation 40(1) of SEBI Listing Regulations, as amended from time to time, securities can be transferred only in dematerialized form with effect from April 1, 2019, except in case of request received for transmission or transposition of securities. Further, SEBI has fixed March 31, 2021 as the cut-off date for re-lodgement of transfer deeds and the shares that are re-lodged for transfer shall be issued only in demat mode. Members holding shares in physical form are requested to consider converting their holdings to dematerialized form. Transfers of equity shares in electronic form are effected through the depositories with no involvement of the Company. The Directors and certain Company officials (including Chief Financial Officer and Company Secretary) are authorized by the Board severally to approve transfers, which are noted at subsequent Board Meetings. # xiii. Shareholding as on March 31, 2021: # a. Distribution of equity shareholding as on March 31, 2021: |Number of shares|Holding to capital|Percentage|Number of accounts|Percentage to total accounts| |---|---|---|---|---| |1 - 100|22,300,258|0.6|875,220|78.8| |101 - 500|39,873,938|1.1|195,829|17.6| |501 - 1000|15,299,099|0.4|21,296|1.9| |1001 - 5000|28,370,143|0.7|14,577|1.3| |5001 - 10000|9,465,878|0.3|1,337|0.1| |10001 - 20000|9,558,427|0.3|675|0.1| |20001 - 30000|6,285,683|0.2|257|0.0| |30001 - 40000|6,191,165|0.2|179|0.0| |40001- 50000|5,588,711|0.1|124|0.0| |50001 -100000|25,925,253|0.7|359|0.1| |100001 - above|3,530,192,818|95.4|909|0.1| |GRAND TOTAL|3,699,051,373|100.0|1,110,762|100.0| # c. Top ten equity shareholders of the Company as on March 31, 2021: |Sr. No.|Name of the shareholder*|Number of equity shares held|Percentage of holding| |---|---|---|---| |1|Tata Sons Private Limited|2,669,125,829|72.2| |2|Life Insurance Corporation of India|143,882,693|3.8| |3|Invesco Oppenheimer Developing Markets Fund|29,442,588|0.8| |4|SBI Mutual Fund|26,771,470|0.7| |5|Axis Mutual Fund Trustee Limited|20,931,890|0.6| |6|Vanguard Emerging Markets Stock Index Fund, A Series Of Vanguard International Equity Index Funds|13,581,105|0.4| |7|NPS Trust Account|13,327,027|0.4| |8|Government Of Singapore|13,123,054|0.4| |9|Vanguard Total International Stock Index Fund|12,174,731|0.3| |10|First State Investments Icvc- Stewart Investors Asia Pacific Leaders Fund|11,529,019|0.3| *Shareholding is consolidated based on Permanent Account Number (PAN) of the shareholder. # xiv. Dematerialization of shares and liquidity: The Company's shares are compulsorily traded in dematerialized form on NSE and BSE. Equity shares of the Company representing 99.97 percent of the Company's equity share capital are dematerialized as on March 31, 2021. |
Under the Depository System, the International Securities Identification Number (ISIN) allotted to the Company's shares is INE467B01029. # xv. Outstanding GDRs / ADRs / Warrants or any convertible instruments, conversion date and likely impact on equity: The Company has not issued any GDRs / ADRs / Warrants or any convertible instruments in the past and hence, as on March 31, 2021, the Company does not have any outstanding GDRs / ADRs / Warrants or any convertible instruments. # xvi. Commodity price risk or foreign exchange risk and hedging activities: The Company does not deal in commodities and hence the disclosure pursuant to SEBI Circular dated November 15, 2018 is not required to be given. For a detailed discussion on foreign exchange risk and hedging activities, please refer to Management Discussion and Analysis Report. # xvii. Equity shares in the suspense account: In accordance with the requirement of Regulation 34(3) and Part F of the Schedule V to the SEBI Listing Regulations, details of equity shares in suspense account are as follows: |Particulars|Number of shareholders|Number of equity shares| |---|---|---| |Aggregate number of shareholders and the outstanding shares in the suspense account lying as on April 1, 2020|26|1,640| |Shareholders who approached the Company for transfer of shares from suspense account during the year|-|-| |Shareholders to whom shares were transferred from the suspense account during the year|-|-| |Shareholders whose shares are transferred to the demat account of the IEPF Authority as per Section 124 of the Act|-|-| |Aggregate number of shareholders and the outstanding shares in the suspense account lying as on March 31, 2021|26|1,640| The voting rights on the shares outstanding in the suspense account as on March 31, 2021 shall remain frozen till the rightful owner of such shares claims the shares. # xviii. Transfer of unclaimed / unpaid amounts to the Investor Education and Protection Fund: Pursuant to Sections 124 and 125 of the Act read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 ("IEPF Rules"), dividend, if not claimed for a period of seven years from the date of transfer to Unpaid Dividend Account of the Company, are liable to be transferred to the Investor Education and Protection Fund ("IEPF"). Further, all the shares in respect of which dividend has remained unclaimed for seven consecutive years or more from the date of transfer to unpaid dividend account shall also be transferred to IEPF Authority. The said requirement does not apply to shares in respect of which there is a specific order of Court, Tribunal or Statutory Authority, restraining any transfer of the shares. In light of the aforesaid provisions, the Company has during the year under review, transferred to IEPF the unclaimed dividends, outstanding for seven years, of the Company, erstwhile TCS e-Serve Limited and CMC Limited (since amalgamated with the Company). Further, shares of the Company, in respect of which dividend has not been claimed for seven consecutive years or more from the date of transfer to unpaid dividend account, have also been transferred to the demat account of IEPF Authority. # The details of unclaimed dividends and shares transferred to IEPF during FY 2021 are as follows: |Financial year|Amount of unclaimed dividend transferred (` lakh)|Number of shares transferred| |---|---|---| |2012-13|144.57*|15,391| |2013-14|121.45|226,716| |TOTAL|266.02|242,107| *Includes final dividend of erstwhile TCS e-Serve Limited and erstwhile CMC Limited In the interest of the shareholders, the Company sends periodical reminders to the shareholders to claim their dividends in order to avoid transfer of dividends / shares to IEPF Authority. Notices in this regard are also published in the newspapers and the details of unclaimed dividends and shareholders whose shares are liable to be transferred to the IEPF Authority, are uploaded on the Company's website https://on.tcs.com/unclaimed-dividend. The members who have a claim on above dividends and shares may claim the same from IEPF Authority by submitting an online application in web Form No. IEPF-5 available on the website www.iepf.gov.in and sending a physical copy of the same, duly signed to the Company, along with requisite documents enumerated in the Form No. IEPF-5. No claims shall lie against the Company in respect of the dividend / shares so transferred. Integrated Annual Report 2020-21 Corporate Governance Report | 94 # Outstanding Dividends The following tables give information relating to various outstanding dividends and the dates by which they can be claimed by the shareholders from the Company's Registrar and Transfer Agent: # a. |
For shareholders of TCS: |Financial Year|Date of declaration|Last date for claiming unpaid dividend| |---|---|---| |2020-21|July 9, 2020|August 8, 2027| | |October 7, 2020|November 6, 2027| | |January 8, 2021|February 7, 2028| |2013-14|June 27, 2014|July 27, 2021| |2014-15|July 17, 2014|August 18, 2021| | |October 16, 2014|November 16, 2021| | |January 15, 2015|February 15, 2022| | |June 30, 2015|July 30, 2022| |2015-16|July 9, 2015|August 9, 2022| | |October 13, 2015|November 12, 2022| | |January 12, 2016|February 11, 2023| | |June 17, 2016|July 17, 2023| |2016-17|July 14, 2016|August 15, 2023| | |October 13, 2016|November 16, 2023| | |January 12, 2017|February 12, 2024| | |June 16, 2017|July 16, 2024| |2017-18|July 13, 2017|August 13, 2024| | |October 12, 2017|November 12, 2024| | |January 11, 2018|February 10, 2025| | |June 15, 2018|July 15, 2025| |2018-19|July 10, 2018|August 9, 2025| | |October 11, 2018|November 10, 2025| | |January 10, 2019|February 9, 2026| | |June 13, 2019|July 13, 2026| |2019-20|July 9, 2019|August 8, 2026| | |October 10, 2019|November 9, 2026| | |January 17, 2020|February 16, 2027| | |March 10, 2020|April 9, 2027| | |June 11, 2020|July 11, 2027| # b. For shareholders of erstwhile CMC Limited which has merged with the Company: |Financial Year|Date of declaration|Last date for claiming unpaid dividend| |---|---|---| |2013-14|June 23, 2014|July 22, 2021| |2014-15|June 11, 2015|July 10, 2022| |2015-16|July 16, 2015|August 18, 2022| # xix. Plant locations: In view of the nature of the Company's business viz. Information Technology (IT) Services and IT Enabled Services, the Company operates from various offices in India and abroad. The Company has a manufacturing facility at 17-B, Tivim Industrial Estate, Karaswada, Mapusa- Bardez, Goa. # xx. Address for correspondence: Tata Consultancy Services Limited 9th Floor, Nirmal Building Nariman Point, Mumbai 400 021 Telephone: 91 22 6778 9595 Designated e-mail address for Investor Services: [email protected] For queries on IEPF related matters: [email protected] Website: www.tcs.com # DECLARATION REGARDING COMPLIANCE BY BOARD MEMBERS AND SENIOR MANAGEMENT PERSONNEL WITH THE COMPANY'S CODE OF CONDUCT This is to confirm that the Company has adopted a Code of Conduct for its employees including the Managing Director and Executive Directors. In addition, the Company has adopted a Code of Conduct for its Non-Executive Directors and Independent Directors. These Codes are available on the Company's website. I confirm that the Company has in respect of the year ended March 31, 2021, received from the Senior Management Team of the Company and the Members of the Board a declaration of compliance with the Code of Conduct as applicable to them. For the purpose of this declaration, Senior Management Team means the Chief Financial Officer, Global Head - HR, Global Business Unit Heads, Global Head - Legal and the Company Secretary as on March 31, 2021. Rajesh Gopinathan Chief Executive Officer and Managing Director Mumbai, April 12, 2021 # PRACTISING COMPANY SECRETARIES' CERTIFICATE ON CORPORATE GOVERNANCE To the Members of the Company has complied with the conditions of Tata Consultancy Services Limited Corporate Governance as stipulated in the SEBI Listing Regulations for the year ended on March 31, 2021. We have examined the compliance of the conditions of Corporate Governance by Tata Consultancy Services Limited ('the Company') for the year ended on March 31, 2021, as stipulated under Regulations 17 to 27, clauses (b) to (i) of sub-regulation (2) of Regulation 46 and para C, D and E of Schedule V of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations"). The compliance of the conditions of Corporate Governance is the responsibility of the management of the Company. Our examination was limited to the review of procedures and implementation thereof, as adopted by the Company for ensuring compliance with conditions of Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company. |
In our opinion and to the best of our information and according to the explanations given to us, and the representations made by the Directors and the Management and considering the relaxations granted by the Ministry of Corporate Affairs and Securities and Exchange Board of India warranted due to the spread of the COVID-19 pandemic, we certify that Integrated Annual Report 2020-21 Corporate Governance Report | 96 # CERTIFICATE OF NON-DISQUALIFICATION OF DIRECTORS (pursuant to Regulation 34(3) and Schedule V Para C clause (10)(i) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015) To, below for the Financial Year ending on March 31, 2021 have been debarred or disqualified from being appointed or continuing as Directors of companies by the Securities and Exchange Board of India, Ministry of Corporate Affairs, or any such other Statutory Authority. Ensuring the eligibility of every Director on the Board is the responsibility of the management of the Company. Our responsibility is to express an opinion on these based on our verification. This certificate is neither an assurance as to the future viability of the Company nor of the efficiency or effectiveness with which the management has conducted the affairs of the Company. |Sr. No.|Name of Director|DIN|Date of Appointment in Company *| |---|---|---|---| File: AR_TCS_2020_2021.md |1.|N Chandrasekaran|00121863|September 6, 2007| |2.|Rajesh Gopinathan|06365813|February 21, 2017| |3.|N Ganapathy Subramaniam|07006215|February 21, 2017| |4.|O P Bhatt|00548091|April 2, 2012| |5.|Aarthi Subramanian|07121802|March 12, 2015| |6.|Dr. Pradeep Kumar Khosla|03611983|January 11, 2018| |7.|Hanne Sorensen|08035439|December 18, 2018| |8.|Keki Mistry|00008886|December 18, 2018| |9.|Don Callahan|08326836|January 10, 2019| *the date of appointment is as per the MCA Portal. In our opinion and to the best of our information and according to the verifications (including Directors Identification Number (DIN) status at the portal www.mca.gov.in) as considered necessary and explanations furnished to us by the Company & its officers, We hereby certify that none of the Directors on the Board of the Company as stated. For Parikh & Associates Company Secretaries P N Parikh Partner FCS No: 327 CP No: 1228 UDIN: F000327C000064655 Mumbai, April 12, 2021 # Management # OVERVIEW OF THE INDUSTRY While the spending showed a decline on a full year basis, technology was center-stage in enterprises' response to the pandemic-related lockdowns and thereafter. The pandemic is estimated to have caused a 3.3% contraction of the world output in CY 20201, with advanced economies contracting 4.7%, and many sectors such as travel, hospitality, transportation, aerospace, consumer discretionary and small enterprises getting impacted severely across the world. Consequently, global technology spend2 declined 3.2% to about $1.4 trillion in 2020. Within that, IT services spending declined more, down 3.9%, while Business Process Management declined by 2.4%. # Global Market |USD Billion|TCS| |---|---| |1400|1355| |1300|1.3x| |1200| | |1100| | |1000|1014| |900| | |800| | |700| | |600| | |500| | |400| | |300|TCS has grown at the rate of the market growth over the last decade| |200| | |100|22.174| |0|8.187| FY 2011 FY 2021 21 World Economic Outlook, IMF, April 2021 Nasscom Strategic Review Report 2021 Integrated Annual Report 2020-21 Integrated Annual Report 2020-21 Management Discussion and Analysis | 98 Very importantly, as consumers shifted to digital channels for most of their needs, enterprises realized the need to invest in enhancing customer experience. This significantly accelerated investments in digital transformation and cloud adoption. The global market for IT services continues to be a highly fragmented one, with even the largest provider having a mid-single digit market share. TCS is among the largest IT services providers globally, with a market share of 1.6%, and has significantly outperformed the market, growing at twice the rate of market growth over the last decade. This may be attributed to market share gains resulting from TCS' customer-centric strategy and organization structure, focused investments in building superior capabilities, better execution resulting in greater customer satisfaction, and steadily expanding participation in customers' growth and transformation spends. # TCS' BUSINESS # An Overview TCS is an IT services, consulting and business solutions organization partnering many of the world's largest businesses in their transformational journeys for the last 50 years. It has a global presence, deep domain expertise in multiple industry verticals and a complete portfolio of offerings - grouped under consulting and service integration, digital transformation services, cloud services, cognitive business operations, and products and platforms - targeting every C-suite stakeholder. TCS geographic footprint covers North America, Latin America, the United Kingdom, Continental Europe, Asia-Pacific, India, and Middle-East and Africa. # Key Industry Verticals TCS considers industry verticals as its go-to-market business segments. |
The five key vertical clusters are: Banking, Financial Services and Insurance (BFSI), Retail and Consumer Business, Communications, Media and Technology (CMT), Manufacturing and Others. The last category includes Life Sciences and Healthcare, Energy, Resources and Utilities, Public Services and others. |UK & Ireland|Europe|Japan|North America|MEA|India|APAC*|LATAM| |---|---|---|---|---|---|---|---| |20 locations|7 locations|2 locations|19 locations|1 location|107 locations|8 locations|19 locations| *PC - 8 (China - 5, Philippines -2, Singapore -1) The Company leverages all these and its deep contextual knowledge of its customers' businesses to craft unique, high quality, high impact solutions designed to deliver differentiated business outcomes. These solutions are delivered using its Secure Borderless Workspaces™ (SBWS™) operating model which enables a highly distributed, Location Independent Agile™ delivery. Banking, Financial Services and Insurance Retail and Consumer Business Communications, Media and Technology Manufacturing Life Sciences and Healthcare Energy, Resources and Utilities Public Services Management Discussion and Analysis | 99 # Integrated Business Model # Intellectual Capital Domain knowledge, contextual knowledge, patents, products and platforms # Partners Technology and COIN # Human Capital Skills, competencies, capabilities, knowledge and motivation of employees # OPERATIONS # Research & Innovation # Products & Platforms # Services & Solutions # FINANCIAL CAPITAL Sources of funds from business operations, financing or investing activities # NATURAL CAPITAL Renewable & Non-renewable Resources # TALENT ACQUISITION # TALENT ENGAGEMENT # TALENT DEVELOPMENT # MANUFACTURED CAPITAL Physical Infrastructure including Buildings, Agile Workspaces, Equipment & Software # SOCIAL & RELATIONSHIP CAPITAL Investors, Customers, Employees, Communities Goodwill # VALUE Customer Goodwill/Brand Value/CSR/Taxes # STAKEHOLDER PAYOUT, RESERVES Integrated Annual Report 2020-21 Management Discussion and Analysis | 100 # Integrated Annual Report 2020-21 # Management Discussion and Analysis |INPUT|OUTPUT|OUTCOMES| |---|---|---| |* ₹164,177 crore Revenue|* 116.2%* Operating cash flow to Net income ratio|* Strong growth creates more jobs, and career growth opportunities for employees| |* 4.4x growth over the last decade|* 101.5%* Shareholder payout to Net income ratio|* Best in class profitability and strong balance sheet provide greater ability to invest in newer capabilities and to weather economic downturns| |* ₹50,430 crore Invested Funds| |* Consistently high shareholder returns enhances relationship capital| |* 5,879 Patents applied| |* Enabled new business models, new revenue streams| |* 1,850 Patents granted| |* Expanded the addressable market| |* 67 academic partnerships and ecosystem of 2,400 startups in COIN program| |* Differentiated positioning; superior speed to market and generate higher quality revenues| |* 6,000+ innovators nurtured till date| |* inning large growth and transformation engagements| |* 40,185 Net addition of employees|* 379k+ associates trained in new technologies|* Best in class talent retention helps foster contextual knowledge, ensures stability in delivery teams| |* 7.2% attrition|* 457k+ associates trained in agile|* Upskilling and reskilling at scale has created a large and deep pool of expertise| |* 43 million learning hours logged| | | |* 48.8% reduction in absolute carbon footprint YoY (Scope 1 + Scope 2)| |* Limited the impact of the company's physical operations| |* 63.9% Reduction in fresh water consumption YoY| |* Fulfilled responsibilities towards environmental stewardship| |* 1.65 Power utilization efficiency achieved at 21 data centers| | | |* 1,000+ Number of agile workspaces| |* Enabled wider adoption of TCS' pioneering Location independent agile model, pre-pandemic| |* 5 PacePorts| |* Easy switchover to the SBWS during the pandemic| |* 30+ innovation labs| |* Greater visibility of TCS' Research and Innovation| |* 11 cities with Covid care centers within TCS Facilities| |* More innovation engagements| | | |* Relief to employees needing Covid care| |* 48 $100M+ clients|* ₹737 crore CSR spend|* Deep and enduring customer relationships with high repeat business| |* 101 $50M+ clients|* 1.8 million+ Number of beneficiaries of global CSR initiatives|* Greater revenue visibility, lower selling expense| |* $14.9 billion Brand Valuation| |* Stronger brand, helping drive higher quality revenue| | |* 787k+ Volunteering hours spent on CSR|* Very high goodwill in the community, fulfilling the company's purpose| * Excluding provision towards legal claim # Value Creation Model TCS applies some of its intellectual capital towards business solutions that address the customer's investments in research and innovation (R&I), business problems. Further, its ability to stitch together complex, holistic solutions that address the needs of all stakeholders in the enterprise, along with the high levels of trust engendered in customer relationships, helps it win large transformation deals. These deals bring in high quality revenues, powering industry-leading organic growth and margins, boosting the company's financial capital. Talent and creativity, that is represented by human capital, is at the core of TCS' value creation engine. |
TCS continually enhances its human capital by acquiring the best talent available in each of the markets it operates in, providing a supportive and vibrant workplace to engage that talent, investing in upskilling individuals with the latest technology skills, and giving them career paths matching their aspirations. The immediate tangible outcomes of TCS' R&I, produced by in-house teams or co-created with customers or partners, are patents, proofs of business concepts, and pilot solutions. The latter two are showcased at various innovation centers and Pace Ports™, and trigger conversations with customers on innovation in their specific business contexts. These often culminate in them signing up TCS as their innovation partner. A firm belief in organic talent development, and of investing in people has helped TCS successfully navigate through multiple technology cycles over the last five decades, pivoting and adapting each time to build relevant new capabilities through reskilling of the workforce at scale and helping customers realize the benefits of emerging technologies. Some of the innovative software solutions piloted by R&I, that are assessed to have a material market potential are productized, adding to TCS' large portfolio of products and platforms. These expand the organization's intellectual capital; create new, higher value revenue streams, adding to the financial capital; and enhance its brand positioning i.e. relationship capital. This domain expertise, contextual knowledge, project management experience and technology expertise gained on the job represents a conversion of human capital into intellectual capital. # Customer Engagement TCS uses its intellectual capital and human capital to build impactful, customized technology and solutions that create immense value for its customers by helping them embrace new business models, pursue new revenue streams, deliver superior customer experiences or build resilience and efficiency into their operations, and gain competitive differentiation. The company's strong service orientation, willingness to invest in the relationship, commitment to deliver impactful outcomes and track record of execution excellence have resulted in consistently high customer satisfaction levels and long, enduring customer relationships. The resultant expansion in relationship capital translates into a very high level of repeat business that lends greater visibility and predictability to the business model. TCS constantly invests in building newer capabilities and expanding its offerings. By cross-selling and up-selling these new offerings, customer engagements continually expand over the years, covering newer and newer areas of the enterprise's operations. This further broadens and deepens the contextual knowledge of customers' business and IT landscapes, further enhancing TCS' intellectual capital. Over time, this combination of business knowledge, contextual knowledge, technology depth, and intellectual property has become a steadily deepening moat around the company's business model and sharpened its differentiated positioning. # Value Sharing Best in class profitability, reduced cost of capital due to a more predictable and resilient business, and high cash conversion on account of superior execution have resulted in a high return on equity. All this and a shareholder-friendly capital allocation policy have boosted the company's relationship capital with shareholders. The investments in people, research and innovation, and intellectual property creation are all charged off and not capitalized. The company's capital expenditure to support its growth - manufacturing capital - towards building campuses, Agile workspaces, innovation centers, and Pace Ports is modest relative to its size. That and the focus on pursuing organic business growth opportunities maximizes the free cash flow available for distribution to shareholders. TCS' physical operations consume social capital in the form of license to operate in each of the communities where it has its facilities, and natural capital in terms of its environmental footprint. TCS enhances its social capital with local communities across the world by investing in areas such as education, skill development, employability, health and wellness, and the environment, mapped to UN Development Goals6. # Strategy for Sustainable Growth Customer-centricity is at the heart of TCS' strategy, organization structure and investment decisions. TCS' customer-centric worldview helps spot trends early, embrace business opportunities by making the right investments and mitigating risks while discharging its social and environmental responsibilities. The company invests in broadening and deepening customer relationships by continually looking for new areas in their value chain where the company can add value, proactively investing in building newer capabilities, reskilling its workforce and launching newer services, solutions, products and platforms. Over time, TCS' participation has also extended into the departmental budgets of other stakeholders within the customers' organizations - business heads, CMOs, CROs, COOs, CFOs and even CEOs. |
This has not only embedded TCS deeper into their businesses but has also resulted in a continual increase in services consumed, revenues and share of wallet, as evidenced by the client metrics reported every quarter and every year. TCS' business model and strategy have resulted in deep and enduring customer relationships, a vibrant and engaged workforce, a steady expansion of its addressable market, a strong reputation as a responsible corporate citizen and a proven track record in delivering longer term stakeholder value. At an aggregate level, this strategy has resulted in all of this significantly enhancing the company's deep and enduring customer relationships, a vibrant and engaged workforce, a steady expansion of the addressable market, and a proven track record in delivering longer term stakeholder value. 6 102-12: TCS is a signatory to the UN Global Compact and aligned with its ten principles. It is also one of the earliest companies in India to participate in the Carbon Disclosure Project (CDP). Management Discussion and Analysis | 103 # Enabling Investments Amsterdam, Pittsburgh and Toronto respectively - became operational digitally. TCS pioneered the use of the word 'digital' to describe the new family of technologies that emerged in the last few years. Quick to recognize their potential, the company made investments ahead of time7 in developing relevant capabilities - in terms of reskilling the workforce, research and innovation around the creative use of these technologies to address business problems across different industries, building collaborative workspaces and innovation centers, IP in these new areas, and alliances and partnerships. Those early investments have given TCS a head start in participating in its customers' growth and transformation journeys. To showcase the outcomes of its own Research and Innovation, and to provide ideation and prototyping spaces for collaborating with customers on their innovation, TCS has been investing in creating a network of Pace Ports in all its major markets. These co-innovation and advanced research centers consist of TCS COIN™ accelerators, Agile workspaces, academic research labs and an innovation showcase, and will help engage customers through the discovery, definition, refinement and delivery phases of innovation. The company set up its first Pace Port in Tokyo (FY 2019) and the second in New York (FY 2020), at the Tata Innovation Center in the Cornell Tech campus. In FY 2021, three new Pace Ports - at 7 Ref MD&A - AR FY 2011, CEO's Letter - AR FY 2012 TCS continued to invest in intellectual property and launched several new products within the ignio™ suite, the TCS BaNCS™ suite and the TCS ADD suite. There were also new service offerings launched, catering to the |London|Amsterdam (2021)|Toronto (2021)|Pittsburgh (2021)| |---|---|---|---| |Paris| | | | |Tokyo (2019)|New York (2020)|Largest pace port in collaboration with the universities of Toronto and Waterloo|@ Carnegie Mellon University| |TCS' first European Pace Port| |TCS' first Pace Port|Sydney| |In pipeline|In pipeline|In pipeline|In pipeline| # TCS Digital Library An interactive channel that delivers cutting-edge thought leadership digitally # TCS COIN TM Accelerator An entrepreneurial forum to bring together client teams to solve specific customer problems # TCS Rapid Labs An innovation factory for quick turnaround of proofs of concepts and MVPs # TCS Agile Workspace An environment to produce working-quality pilots and MVP software in short and fast increments # TCS Academic Research Lab A collaborative medium to strike partnerships with academia # TCS Innovation Showcase A sensory experience of TCS' ongoing research and innovation stories # TCS Pace PortTM Network Integrating Capabilities to Drive Innovation Integrated Annual Report 2020-21 Management Discussion and Analysis | 104 # Management Discussion and Analysis # Outcomes TCS' thought leadership and investments have made it the preferred innovation and transformation partner to progressive enterprises across different industry verticals. Customers bank on TCS' contextual knowledge and solutioning capabilities to leverage new technologies to change their business models, drive new revenue streams, strengthen customer relationships by offering superior experiences, or transform their operations. This has increased demand for the entire gamut of services, solutions, products and platforms offered by TCS, resulting in a stronger order book, more robust revenue growth, and improved market share. These transformational engagements are raising TCS' profile within C-suites, embedding its teams more deeply within customers' businesses and resulting in greater predictability and resilience. # Thought Leadership TCS' Business 4.0™ thought leadership framework to guide customers in their growth and transformation journeys was refreshed in FY 2021 to include the defining attributes of evolving needs of customers during the pandemic. Successful organizations: purpose-driven, resilient and adaptable. |
These attributes develop from following four behaviors: mass personalize, leverage ecosystems, embrace risk and create exponential value. This is accomplished by harnessing the abundance of resources - compute power, storage, talent, market reach - created by the convergence of intelligence, agility, automation and cloud. Building on the success of its SBWS model, TCS is now further innovating with service delivery models, launching talent clouds, which enable greater fungibility of talent, resulting in faster project ramp-ups and better delivery outcomes for customers while resulting in higher employee satisfaction. # Cyber Security Services TCS also operationalized ten new Threat Management Centres (TMCs) across locations - including the US, UK, Spain and India - for providing cyber security services locally to its enterprise customers. These centres will focus on providing cyber security solutions and services, including managed detection and response services, incident management and breach support, on-demand cyber vigilance services, digital forensics and regulatory compliance. # Cloud Transformation Journey In addition to this, TCS articulated its three-horizon cloud transformation journey roadmap to guide customers in their core transformation and cloud investments. While these provide a way for customers to think through their digital transformation journeys at a business model level, TCS' thought-leading execution framework consisting of the Location Independent Agile model and the Machine First™ Delivery Model found significant traction in FY 2021, as customers sought greater operational resiliency and efficiency. Operating model transformations using a Machine First approach were seen by customers as foundational for their growth and transformation initiatives. # Service Delivery Models TCS launched dedicated practice units around AWS, Microsoft Azure and Google Cloud Platform. Each unit is a full-service, multidisciplinary organization offering customers the full range of transformational and operational services on the respective technology stacks, spanning advisory services, migration, application and data modernization, including SaaS and enterprise productivity suites, infrastructure, cyber-security and edge. # TCS Strategy |Market Trends|TCS Approach|Outcomes| |---|---|---| |More and more industries are leveraging technology to differentiate themselves|Position as a growth and transformation partner|Industry-defining mega deals| |Customers want solutions to business problems and not just technology skills|More investment in research and innovation, co-innovation and collaboration|Thinner competitive set| | |Domain-specific IP|Higher quality revenue| | |Greater focus on contextual knowledge|More fulfilling work; better retention| | |Proactive solution selling| | |Non-CIO buyers emerging in enterprises|Full stakeholder services and solutions|Expansion of addressable market| | | |More deeply embedded in customer's business; greater resilience and visibility| | | |Higher profile, strategically more important engagements| |Transformational partners selected based on solution quality and time to market|Leverage TCS' contextual knowledge, Location Independent Agile, Machine First Delivery Model and Intellectual Property|Thinner competitive set| | | |Higher quality revenue| |Greater platformization of business|Launch of cloud based platforms and new business models|Large deals that improve business visibility| | |Leverage IP portfolio|Expansion of addressable market| | | |Frees up spends for systems of differentiation| |Pandemic disruption highlights need for operational resilience and enterprise adaptability|Launch of SBWS|Highlights company's responsiveness| | |Greater focus on Location Independent Agile and MFDM|Market share expansion| | |Promote operating model transformation using AI| | Integrated Annual Report 2020-21 Management Discussion and Analysis | 106 # FY 2021 PERFORMANCE OVERVIEW: Global, Diverse Workforce # HUMAN CAPITAL Talent Management The ability to attract, motivate, develop and retain talent is critical to TCS' continued success. The company's HR strategy is focused on attracting the best talent globally, reskilling and transforming the workforce and providing a stimulating workplace, which is flexible, nurtures social contract, fosters innovation, and builds a result-oriented, high performance culture. The progressive policies, continual investment in upgrading employees' skills and the philosophy of empowering individuals and helping them realize their potential have made TCS' HR processes and outcomes an industry benchmark. TCS also announced Vision 25x25, wherein by year 2025, only 25% of the workforce will need to be physically present in TCS offices at any point, and an employee needs to spend no more than 25% of their time in a TCS office to be 100% productive. This is expected to make a significant difference to employees' quality of life, open up opportunities to demographic segments disadvantaged by the current way of working, help enhance TCS' ability to attract and retain diverse talent further and reduce its environmental footprint. |488,649|employees| |---|---| |154|nationalities| |36.5%|women| # Talent Development 43 million learning hours logged in Agile 457K trained # Pandemic Support Employee health and wellbeing continued to be a key priority in FY 2021. |
In addition to existing health care benefits, which are a benchmark in the industry, the company launched several initiatives to help employees receive prompt medical attention. Besides a medical helpline, TCS partnered with leading healthcare chains to provide ambulance services, hospital admission assistance and home healthcare services to employees in India. # Talent Retention 7.2% Attrition in IT services 9 103-2, 103-3 Integrated Annual Report 2020-21 Management Discussion and Analysis | 107 TCS also set up first-line COVID-19 Care Centers at its premises in 11 cities in India to help employees and their dependents quarantine safely and receive medical attention. The functioning of the existing Occupational Health Centers (OHC) was revisited to ensure better preparedness for medical emergencies from a COVID-19 perspective, with round the clock availability of OHC doctors, and telemedicine. TCS provided self-help resources and counselling services to help employees overcome mental and emotional challenges through the TCS Cares initiative. Thousands of employees and their families who were stranded overseas due to flight cancellations were repatriated through the Vande Bharat Mission. TCS provided a break-up of the workforce by region, age and gender in the charts below. # INDIA |<30 years|31%| |---|---| |30-40 years|26%| |40-50 years|6%| |years>50|1%| # NORTH AMERICA |<30 years|16%| |---|---| |30-40 years|21%| |40-50 years|23%| |years>50|16%| # UNITED KINGDOM |<30 years|13%| |---|---| |30-40 years|18%| |40-50 years|24%| |years>50|19%| # EUROPE |<30 years|15%| |---|---| |30-40 years|20%| |40-50 years|16%| |years>50|12%| # PC |<30 years|15%| |---|---| |30-40 years|23%| |40-50 years|13%| |years>50|6%| # EMERGING MARKETS |<30 years|25%| |---|---| |30-40 years|26%| |40-50 years|11%| |years>50|5%| # TCS Employees by Region, Age and Gender Male Female 10 102-8 Integrated Annual Report 2020-21 Management Discussion and Analysis | 108 # Talent Acquisition The company remains the preferred employer at leading engineering campuses in India. In FY 2021, the company had a net addition of 40,185 employees to its global workforce. TCS' talent acquisition strategy is to identify, engage and hire Top Talent with the right competencies required by the business at the right time to promote future business growth. TCS continues to be the Employer of Choice and delivers a meaningful experience to associates and business through an agile, and data driven ecosystem. TCS was one of the largest job creators in IT services in several major markets. In the United States, TCS has hired over 21,500 employees over the last five years. # TCS National Qualifier Test This nationwide online test administered by TCS iON™ has helped TCS tap into the larger national talent pool and boosted the quality of entry-level talent. The FY 2021 was fully virtual, so students could attend it from the safety and comfort of their homes. | |India|Outside India| |---|---|---| |Institutes|686 institutes|422 institutes| |Student Workshops|1,069 student workshops; 120,996 students|330 student workshops; 21,991 students| |Faculty Development Programs|524 Faculty Development Programs; 20,306 teachers|10 Faculty Development Programs; 651 teachers| |Internships|1,302 internships, incl 20 global interns|296 internships| Participation by 368,894 students from 3,157 colleges represented. 2,332 associates are pursuing higher studies under the TCS Higher Education program. # Gamified hiring Programming contests to spot top talent. 3,708 Gamified hiring offers made. 354,000+ registrations from 98 countries in CodeVita's 9th season. # Launchpad 2021 File: AR_TCS_2020_2021.md Exclusive Campus Commune channel to engage 2020-21 batch through blogs, quizzes, podcasts, webinars, to nurture the talent and also prepare them for the upcoming National Qualifier Test (NQT). 247,000+ students of the FY 2021 batch participated. 11 102-9 Integrated Annual Report 2020-21 Management Discussion and Analysis | 109 # Talent Development menti-meters, peer tagging, simulation, online other virtually. The Company's internal associate satisfaction survey PULSE showed the highest associate satisfaction and engagement scores in the last 13 years. # Junior Rollout of virtual versions of previously in-person leadership and soft skills programs for uninterrupted upskilling. # Middle Segmentation of employees to achieve focused learning objectives. Eg: by allocation status, by experience levels, by extent of digital skills etc. # Senior |Male|Female| |---|---| |60|58| |53|60| # FY 2021 Average learning hours per employee TCS takes a purpose-centric approach to learning and development that leverages horizontal collaboration and the abundance of internal talent in an ecosystem where the training is just-in-time, just-for-me and just-enough. In response to COVID-19, rigor in learning was intensified, with a focus on building deeper and higher competencies. Starting with the post-offer engagement to onboarding - the entire process has been 100% virtual. This virtual ecosystem has enabled trainees to become SBWS-enabled and start their business journey immediately after joining. In the new way of working, engagement with learners has changed significantly. |
# Some of the platforms and initiatives used by TCS to enhance and enrich employee engagement are: - Cara: AI-based HR assistant that answers employee questions on HR policies. - Milo: Chatbot to facilitate the mentoring process. - Knome, KnowMax, GEMS: Platforms for social collaboration within the organization, learning, sharing and for rewards and recognition. - Safety First: Initiative focused on employee safety and security. - Fit4life: Builds a fraternity of health and fitness conscious employees and creates a culture of fitness. - Purpose4life: Forum for volunteering for community projects in the areas of education, health and environment. - Maitree: Community of TCSers and their families who plan activities that help create a bond among employees and promote work-life balance. TCS has proactively reimagined employee engagement with its "Engagement with Purpose" model focused on health and wellbeing, lifelong learning, career development, living TCS' values, social collaboration and community service. It is a virtual, mass-personalized subscription-based program with continuous real time feedback. The company has meaningfully engaged with over 400,000 employees, helping foster togetherness during trying times. The #OneTCS Channel has seen very good response and has helped employees meet, connect, learn, share and spend some time with each other. 12 103-2, 103-3 13 404-1 # Integrated Annual Report 2020-21 # Management Discussion and Analysis # Employee Engagement and Satisfaction - PULSE: TCS' annual employee engagement and satisfaction survey is the organization's formal listening forum. - TCS Cares: Program aimed at creating robust avenues to build an emotionally strong and mentally resilient workforce. # Career Management TCS has multiple initiatives to help employees grow in their careers: - Xcelerate: An integrated platform to capture associates' aspirations and mapping them to future opportunities. - iConnect: A highly collaborative tool designed to help employees reach out to senior mentors for guidance on career paths, have face to face dialogues about their role and career. It provides flexibility for group mentoring as well as individual mentoring. - Inspire: The high potential program for mid-level employees. It helps identify high potentials as early as possible, invest in them continuously, enable accelerated growth, and transition them to leadership roles, and reward and recognize their efforts and success. # Competitive Compensation TCS' business model depends on its ability to attract and retain talent in the highly competitive, global market for software engineers with graduate or post-graduate degrees in engineering and with relevant technical skills. Compensation levels are merit based, determined by qualification, experience levels, special skills if any, and individual performance. Compensation structures are driven by prevailing practices in each country that TCS operates in. The company regularly benchmarks its compensation plans and benefits with the market to ensure competitiveness. # Parental Leave The company offers a variety of benefits to full time employees including parental leave. In FY 2021, a total of 16,907 employees availed of parental leave. Of these, 116 were men and 16,791 were women. Of the 18,767 employees whose parental leave ended during the year, 127 were men and 18,640 were women. Of these, 91 men and 16,176 women employees rejoined work, amounting to a retention rate of 72% and 87% respectively. # Additional Information Across the enterprise, remuneration is the same for men and women working full-time, in the same grade, in the same role, and at the same location. Where relevant, the company publishes the raw mean and median pay differences between genders (not normalized for part-timers or grade and role differences) on its own website as well as on public sites. At TCS, three months' notice is required from either side for termination. In India, 0.03% of the workforce is unionized. Although most of the compensation levels are merit based, they are also influenced by the prevailing practices in each country. Footnotes: - 14 405-2 - 15 401-3 - 16 402-1 - 17 102-41 # Talent Diversity Towards creating a more inclusive and equitable workplace, the company has programs like: TCS is an equal opportunity employer, embracing diversity in race, nationality, religion, ethnicity, marital status, gender, age, physical ability, and sexual orientation. - Champions of Equity, a company-wide campaign that entails senior leaders pledging to fair and equitable practices and serving as role models to the rest of the organization. - Allies of Diversity, a larger dialog on diversity and inclusion that also includes leaders from customer organizations. - Race Education, a learning initiative to build awareness around socio-cultural understanding of race and its manifestation at the workplace. |
# Talent Retention TCS' empowering culture, philosophy of investing in people, career growth opportunities, and progressive HR policies have resulted in consistently high retention levels and developed a strong employer brand. In recent years, the company's investments in organic talent development and initiatives like Contextual Masters have further reassured employees that the company values them for the contextual knowledge they possess and is prepared to invest in equipping them with new-age technology skills that they do not have. This has made TCS the employer of choice, and its employee retention record an industry benchmark. In FY 2021, TCS' IT services attrition rate was at an all-time low of 7.2%. # Women in the Workforce TCS is one of the world's largest employers of women. The company has multiple initiatives for helping women employees realize their potential, while striking a good work-life balance. These include discussion circles and support groups to help women through major life stages, re-orientation programs to reconnect employees after long childcare leave, interactions with inspirational women leaders, and special leadership development programs to address the needs and aspirations of women at different stages in their careers, learning modules to equip mid-level managers to work with diverse teams, tie-ups with day care centers near the workplace, virtual support groups and parenting workshops. 18 103-2, 103-3 # iExcel Program Overview iExcel is TCS' flagship program to groom mid-level women managers for business leadership roles through an immersive curriculum designed to improve problem solving, learning agility and innovation. Till date, over 969 employees have undergone this program, including 343 women leaders in the virtual editions organized in FY 2021. # Key Outcomes # * Mentorship Participants in these programs are also helping develop and advance others. 343 iExcellers are active mentors, having mentored 2,310 employees till date, an average of 7 mentees per iExcel mentor. # * Innovation This is a high focus area, helping TCS gain a differentiated positioning in the market. Of the 2,837 unique inventors responsible for the 1,850 granted patents till date, 607 are women. # * Participation The overall percentage of women in the workforce has gone up from 33.8% in FY 2016 to 36.5% in FY 2021. There has been significant improvement in women's participation across different levels over the last five years: |FY|Junior|Middle|Senior| |---|---|---|---| |2016|26.8%|11.4%|12.6%| |2021|30.3%|41.4%|44.0%| # * Role Mobility 67% of the participants in the iExcel program reported role movements thereafter. 42% experienced upward progression, 4% had enhanced responsibilities, while 21% had lateral movements. # Occupational Health and Safety TCS has a well-defined Occupational Health and Safety policy and supporting processes to ensure the safety and well-being of its employees. Safety lead and lag indicators are measured across the organization and reported. The board-level Stakeholders' Relationship Committee reviews the company's health and safety performance on a regular basis. Over 96% of the workforce is represented in joint management-employee health and safety committees that monitor, advise and drive occupational, health and safety initiatives. The SBWS Ergo track was instituted to help employees understand ergonomic stressors and equip them with ways to adopt the best feasible posture while working from home. Ergonomics @ Home webinars were conducted every week, reaching over 10,000 employees. There were also sessions on ergonomics for employees' kids. A series of self-help tools were created for employees including tips and videos on home ergonomic postures and workstation stretches, blog posts on ergonomics and wellbeing and an ergo self-assessment quiz. The program has reached over 27,000 employees since the start of SBWS. # Awards and Accolades for Human Capital Given the Best of Best award by the Association of Talent Development for the second time in a row, for sustained excellence in learning integration and effectiveness, strategic value of learning and individual and company performance. Occupational Health and Safety References: 19 103-2, 103-3 20 403-4 # Awards and Recognition - Awarded 18 Stevies® at the 2020 Great Employers Awards; six Gold Stevies, eight Silver Stevies and four Bronze Stevies in recognition of TCS' talent management, CSR and business practices that have helped it attract retain the best talent to build a global, diverse workforce, and a vibrant workplace. - Won the Top Women Award for Corporate Citizenship in South Africa, hosted by Standard Bank, in recognition of its role in advancing women to leadership roles. |
- Won three awards for talent management and excellence in learning at the 2020 Brandon Hall Group Awards; two Gold awards for 'Best Advance in Creating a Talent Strategy' and 'Best Learning Program Supporting a Change Transformation Business Strategy' and a Silver award in the category 'Best Use of Games and Simulations for Learning'. # Global Top Employer Named a Global Top Employer by the Top Employers Institute for the sixth successive year for its employee-friendly workplace practices and continued investments in building up talent across the organization through professional development initiatives and digital skills programs. In addition, it has been certified as a Top Employer in Europe, UK, North America, APAC, MEA and LATAM. It was ranked the #1 Top Employer in the US, UK, Finland, Switzerland, Singapore, Philippines, Malaysia, Hong Kong, Ecuador, Chile and Australia in the country-wise rankings. Integrated Annual Report 2020-21 Management Discussion and Analysis | 114 # FY 2021 PERFORMANCE OVERVIEW: # INTELLECTUAL CAPITAL The company's Chief Technology Officer oversees a three-horizon portfolio of investments spanning current innovation, mid-term and long-term research: This is a milestone year for TCS Research and Innovation (R&I). TCS' first research lab was established forty years ago at the Tata Research, Design and Development Centre (TRDDC) in Pune. TCS Research marked its 40th year by adopting a new brand identity with the tagline `Inventing for Impact'. TCS R&I made a significant contribution towards mitigating the effect of the pandemic across areas such as drug candidate molecule discovery, COVID data management, diagnostic kits and epidemiological study. Sustained investments over the years have resulted in a significant scaling up of TCS' R&I footprint over the last four decades. Today, TCS has research labs and innovation centers around the world, some deeply embedded within business units, some in collaboration with academia, as part of Pace Ports, as well as dedicated Agile Innovation Centers for customers. The company has over 6,000 inventors and innovators working on advancing scientific knowledge and solving real-world problems. # TCS Portfolio of Investments for Innovations |Horizon|Horizon 03|Horizon 02|Horizon 01| |---|---|---|---| |Disruptive Innovations|Platform Innovations|Derivative Innovations|Futuristic investments in new areas such as DNA computing, AI for protein design, cognitive robotics, meta materials, quantum computing and sensing, and digital twins for biology.| |Mid-term investments in cloud-based platforms for orchestration of network technologies, robot communications and logistics, and XR-based avatars.|Investments in labs across key business units to deliver innovative solutions to solve current customer problems. Several of TCS' IP-based products released new features: ignio™ released features related to cognitive procurement, digital workspace and assurance, enabling customers to leverage the power of AI in business and IT functions.|Investments in labs across key business units to deliver innovative solutions to solve current customer problems. Several of TCS' IP-based products released new features: ignio™ released features related to cognitive procurement, digital workspace and assurance, enabling customers to leverage the power of AI in business and IT functions.|Investments in labs across key business units to deliver innovative solutions to solve current customer problems. Several of TCS' IP-based products released new features: ignio™ released features related to cognitive procurement, digital workspace and assurance, enabling customers to leverage the power of AI in business and IT functions.| TCS MasterCraft™ launched new features for application development, modernization and enterprise data transformation; strengthened its go-to-market strategy with Cloud Service Providers (hyperscalers). Jile™ MarketPlace was launched to facilitate integration to various commercial and open-source tools in agile project management. Integrated Annual Report 2020-21 Management Discussion and Analysis | 115 TCS R&I is building a rich pipeline of IP based assets consisting of patents, products and platforms. To enable business alignment and to de-risk emerging technology use, TCS' New Products and Services Development framework monitors the pipeline of evolving, future-focused offerings. This has resulted in a further expansion of the IP portfolio across a range of technologies and industry domain processes. As of March 31, 2021, the company has filed for 5,879 patents and has been granted 1,850 patents. TCS researchers presented over 240 papers at premier research conferences and notable journals this year. |
# SUBJECT CLUSTER |Data Science|Edge Analytics|Seismic Event Forecasting|Attribution Modeling|System Performance Modeling|Adaptive Machine Learning| | | | | | |---|---|---|---|---|---|---|---|---|---|---| |Intelligent Powerplant|Agriculture Digital Farming|Livestock Digital Farming|Intelligent Pharma Manufacturing|Connected Health System|Ports Terminal Planning| | | | | | |Enterprise Personalization|Digital Inclusivity|Collaborative Interfaces|Intelligent Virtual Assistant|Special Purpose Hardware|Smart Waste Management|Logistic Management| | | | | |Autonomous Vehicle|Deep Learning|Computer Vision|Robotic Process Automation|IT Operation Automation|Predictive IT Operation|ML Augmented Data Centre|Natural Language Processing| | | | |Internet of Things|Access, Trustworthy Security|IoT Security|Multimedia Security|Authenticate & Authorize|Threat Modeling|Privacy by Design|Data Management|Incident Management|Cybersecurity in Gaming|Quantum Cryptography| |Artificial Intelligence / Machine Learning|Reliable & Safe Light Detection and Ranging|Drone Technology|Information Technology|Meta Materials|Sensor Informatics|Cognitive Robotics|Embedded System Analytics|Unobstructive Sensing| | | |Sensing Technology|5G Technology & Application|Blockchain Technology & Application|Software Services|Software Engineering|Hybrid Cloud Storage Management|Microservice Modernization|Quantum Computing Architecture|Validation & Verification| | | # TCS' Patent Wall: Breakup by Themes Integrated Annual Report 2020-21 Management Discussion and Analysis | 116 # Broad-basing Innovation # Innovation Ecosystem TCS runs ideathons and hackathons almost every week to build an innovation culture within the organization and offer employees opportunities to innovate within and outside their current assignments. These crowdsource innovative ideas from within TCS and have been very popular with customers. Several customers have run challenges and have been impressed by the number of novel solutions or ideas TCSers have come up with. Every key business unit has its own innovation program, led by a unit-level CTO. These units leverage their deep domain expertise, customer-specific contextual knowledge and the research outcomes in emerging technologies from Corporate R&I as well as the TCS Co-Innovation Network to come up with innovative solutions for customers in their respective segments. Examples include: # TCS DynaPORT™ This solution from the Travel, Transportation and Hospitality unit is for seaports and terminal operators. This one-stop digital terminal operating system (TOS) streamlines order-to-invoice processes and supports multi-modal and multi-purpose requirements. It currently powers over 80 terminals across the globe. # TCS Omnistore™ With TCS OmniStore, retailers can orchestrate unified omnichannel customer journeys, build new services and apps quickly without worrying about channel constraints, and ensure their stores are 'always on' to drive unique, interconnected micro-experiences. # TCS Consent Management Solution This helps organizations automate compliance towards latest privacy regulations while reducing associated costs. It offers a range of capabilities such as consent collection and enforcement, data subject rights, data masking and data discovery. # Customer Engagement TCS Research and Innovation connects with customers and partners through several channels. TCS Innovation Forum 2020, its flagship event, was reimagined in a format that was optimal for digital channels. Over 3,700 clients and partners attended the series across editions, totaling 4x attendance over the physical event in 2019. A number of Innovation Days, Round Tables and seminars were held for customers around the world. # Social Good A number of assistive technologies have emerged from TCS R&I, including Assisto (Speech aid for Cerebral Palsy); VHAB (Immersive Physio); Verbose (Speech-to-text); School at Home assistance for disabled; Emotrain (Training for Autistic) and Home Bound (COVID related remote medical assistance). These were especially useful during the pandemic, where much of the training and support for children with special needs had to be virtual. TCS' Access Infinity platform that has been powering the Sugamya Pustakalaya portal, won the Zero Project Award this year. Launched by Daisy Forum of India (DFI), a not-for-profit organization with a network of over 100 organisations working for the welfare of the visually impaired, the portal has 674,795 books available for download for the print-disabled community. # Socially responsible initiatives launched include # TCS Suite of Products and Platforms - TCS Sustainathon, in its first edition for Singapore, focused on reducing food wastage. - TCS and the Malaysian petroleum major PETRONAS launched a Social Enterprise Education Lab (SEEd.Lab), an end-to-end incubation program for a group of young Malaysian to-be-entrepreneurs and to create employment opportunities for others. - TCS and Auckland Business School Launched an APAC-focused Digital Sustainability Index. The new index will track the adoption and leverage of digital technologies by enterprises for their growth and transformation, and for discharging their social and environmental responsibilities, to create longer term value for all stakeholders. # Highlights: - Digital Glass room: Virtual learning platform, made available to educational institutions across the country shut down by lockdown, free of cost. Garnered registrations from 37,000 institutions. - Remote internships for students across trending domains guided by industry mentors, helped 2.6k college students. - Assessment: 273 million+ candidates assessed till date; 10.5 million+ answer books evaluated, 900,000 registrations for TCS NQT in FY 2021. |
Remote assessments served 28 million+ candidates. Socially distanced assessments for in-center exams across 700+ cities through zero-touch biometric, crowd management, process digitization, which lead to 20 million+ youth securing their future in academic admission/job recruitment. - Learning: 12 million+ learners on the platform, 71,000 courses available, 490,000+ communities. - Process Management: 700+ SMB clients, 145+ education ERP clients. - 300+ new wins in India and 7 in International market. - Strategic partnerships in India with bodies like National Skill Development Corporates (NSDC) and the state governments of Kerala and Telangana towards skills development. # Banking: Serves more than 25% of the world population. Two of the world's largest core banking implementations run on TCS BaNCS, processing 1 billion accounts. # Capital Markets: Performs clearing and settlement in over 20 markets worldwide. Records 10 million trades per day (peak), represents $40 trillion worth of AUC across 100 countries. # Insurance: Administers over 20 million life, annuity and pension policies; 135 million property and casualty policies. # Global Securities: It offers ready market connectivity to 45+ local markets for settlements, with 8 of the top custodians running on the solution. # Other investments in sustainability initiatives: Digital farming, the energy value chain, and water and power savings, continue. # TCS Research Scholar Program: The TCS Research Scholar Program is in its 10th year and has supported 350 scholars from 41 premier institutes till date. TCS' researchers mentor young social entrepreneurs solving socially relevant problems at the TCS Foundation's Digital Impact Square (DISQ), Nashik. DISQ entrepreneurs came up with innovative solutions for coping with the pandemic. # Integrated Annual Report 2020-21 # Management Discussion and Analysis * 14,000+ active users till date * Plug and play SaaS based business platform to digitally transform business, network and revenue management domains of subscription-based businesses * World leading cognitive automation software for IT and business operations. FY 2021 highlights: - 50+ new wins; 180% YoY growth in channel partners - Manages over 1.5 million technology resources autonomously - 84 patents filed to date; 30 granted - Prevented revenue leakage of over $100 million and has delivered cost savings of over $25 million for customers globally in FY 2021. - Serving 33+ clients, across Communications, Utilities, Manufacturing and Personal Care; Serving 22 million+ subscribers, handling 145,000+ devices and processing 1.2 billion+ events. - 13 new wins and go-lives in FY 2021 - AI-powered retail optimization suite that enables retailers to improve sales and margins with integrated merchandising and supply chain decisions. - 1 new win and 2 go-lives in FY 2021 - AI-powered future commerce platform that enables unified customer journeys by seamlessly catering to new channels and brand expansions. - 1 new win and 4 go-lives in FY 2021 - Comprehensive suite for digital transformation of drug development and clinical trials - Executed 500 trials on ADD - Customers: 9 out of the top 10 pharma companies - Key implementations: Redesigned operational analytics for top 3 pharma, implemented advanced submission planning for a pharma major's regulatory submission; rolled out cognitive automation of pharmacovigilance for 62 studies; 12k+ shipments completed; 10k+ kits dispensed; 90%+ adherence rate on Decentralized Trials solution; implemented eConsent for 11 studies - Set up COVID study on ADD in less than 10 days for a leading Asia-based pharma major - AI powered system of actionable intelligence - powered by an enterprise digital twin (customer, product, process) to help business leaders simulate and optimise enterprise decisions, predict and proactively manage outcomes - 7 new wins and 3 go-lives in FY 2021 - Digital platform to optimally automate and manage IT processes - FY 2021 Highlights: 25 new wins, 96 billion+ records processed for data privacy, 5 billion+ records processed for data quality, 57+ million lines of code (mloc) analyzed, 5+ mloc generated - SaaS-based, scalable Agile DevOps platform to accelerate software development and delivery and integrate DevOps tools # Building a Culture of Innovation that welcomes new ideas from across the organization, resulting in an industry-leading portfolio of intellectual property. # Awards and Accolades for Intellectual Capital - Intelligent smart contract development toolkits, Integration solutions and 'Designed for DLT' business solutions that provides foundational technology, tools and business components for creating distributed ledger solutions across varied industries. - Built on the core principles of Coexistence, Integration and Interoperability, Quartz enables existing systems to coexist and integrate with blockchain platforms and other messaging networks. - 10 new wins and 2 go-lives in FY 2021. |
- Highly Commended in the category Best Enterprise AI Solution at The AIconics Awards, TCS Optumera™, an AI-powered retail optimization suite, helps retailers make data-driven decisions around right-sizing store space, shopper-centric omni-channel assortments, dynamic pricing strategies and compliance. It also won the 2021 Data Breakthrough Award in the category Data Solution of the Year - Retail for empowering retailers to execute integrated strategic decisions. - Digitate, a software venture of TCS, was ranked #37 among the Top 100 Software Companies of 2020 by The Software Report, recognized for the rapid growth and market leadership of its ignio suite within five years of launch. - Named the POS Technology of the Year at the Retail Systems Awards 2020, TCS OmniStore™, a flagship product of the TCS Algo Retail™ suite, was recognized for its open architecture and fluid technology stack that allows enterprises to quickly build new journeys, services, and apps without worrying about channel constraints; all this with the flexibility of reusing existing investments. File: AR_TCS_2020_2021.md - Won the 2021 CIO 100 Award for its Intelligent Urban Exchange (IUX) for Workplace Resilience software. - Won the 2021 IoT Breakthrough Award in the category Enterprise IoT Management Innovation for its Intelligent Urban Exchange (IUX) for Workplace Resilience software. - Honored with the CIO Choice 2021 award in the category Digital Transformation Enabler for its investments in research and innovation, strong domain knowledge across industries, rigor in service delivery, and comprehensive portfolio of services and platform solutions including IT and advisory services, and digital workplace. - TCS Connected Clinical Trials solution, part of TCS ADD platform, won the 2020 Citeline Award in the category 'Best Patient-facing Technology Initiative' for providing a positive experience to patients in clinical trials and driving efficiency. - Conferred the CIO100 Special Award for Business Transformers, IDG India's annual award program. # FY 2021 PERFORMANCE OVERVIEW: # RELATIONSHIP CAPITAL # Customers Customer-centricity is at the core of TCS' business model, organization structure and investment decisions. The philosophy has been to delight them by delivering superior outcomes, and build strong, enduring relationships. Additionally, the company seeks to expand and deepen customer engagements by continually looking for new areas in the customer's business where the company can add value, proactively invest in building newer capabilities, and launch new services and solutions to participate in those opportunities. TCS was ranked #1 in Customer Satisfaction across Europe for the eighth consecutive year in a large, independent survey of 1700 CxOs of top IT spending organizations by Whitelane Research. Additionally, in the individual country rankings, TCS was ranked #1 by customers in UK, France, Germany, Austria, Switzerland, Netherlands, Belgium, Luxembourg and the Nordics. # Client Metrics | |FY 2017|FY 2021| |---|---|---| |$100 million+ clients|101|84| |$50 million+ clients|48|35| TCS' Sustainable Supply Chain policy and Green Procurement policy outline its commitment to making its supply chain more responsible and sustainable. In FY 2021, the company integrated sustainability, safety and environmental requirements in its online vendor management system across the various stages of vendor lifecycle - selection, review and renewal. Supplier engagement includes defining product specifications on safety/environment, vendor compliance review, outlining mandatory policy and process requirements, desktop assessments, audits and performance review on these criteria. TCS' responsible sourcing program encourages its suppliers to go beyond 100% regulatory compliance, and strive for better sustainability performance. # Investors TCS is seen as a benchmark in transparency and disclosures, publicly communicating its longer-term strategy, qualitative aspects of the demand outlook, risks and opportunities. The company has a robust investor outreach program through which it engages with a broad range of investors domestically and overseas. These efforts towards removing information asymmetries and helping investors arrive at a fair valuation of the company's stock have resulted in TCS topping various regional investor polls conducted by publications such as Institutional Investor, FinanceAsia and AsiaMoney. In FY 2021, TCS was quick to embrace virtual meetings for its investor outreach, including meetings, virtual NDRs and conferences. TCS was also the first corporate in India to hold a virtual Annual General Meeting last year. 21 308-1 Integrated Annual Report 2020-21 Management Discussion and Analysis | 121 # Brand Building # Breaking out The following table provides the number of investor and analyst interactions by category in FY 2021: |Particulars|Q1|Q2|Q3|Q4|FY 2021| |---|---|---|---|---|---| |Meetings and Calls|59|29|38|95|221| |Conferences|47|207|111|62|427| |Sell Side Analysts|8|8|27|5|48| |Total|114|244|176|162|696| Quarterly, half-yearly, and annual results are intimated to the stock exchanges, published in leading Indian newspapers, emailed to analysts and investors who subscribe to the service, and posted on the website. |
Half-yearly results are mailed to shareholders, along with a message from the MD on the Company's performance. The quarterly earnings release is accompanied by a press conference, which is streamed live on www.tcs.com, and an earnings call that is webcast on the website. Material developments during the quarter that might impact revenue or earnings are intimated to the stock exchanges and through the website. Quarterly results, regulatory filings, transcripts of earnings call, Investor Relations presentations and schedules of analyst and investor interactions are available at https://www.tcs.com/investor-relations. # Full Pivot to Digital Key highlights of the year are: - Leading the narrative with thought leadership - New Beginning, Vision 25X25, Secure Borderless Workspaces™, Business 4.0™ - Launched the 'Transforming India' campaign - Integrated campaign across digital and television with 1,700 spots; reached 1.6 million high affinity TV audiences; 111 million impressions garnered across digital platforms; over 1 million website clicks generated - Global Media Engagement - Leading the conversation during the pandemic, positioning TCS as a thought leader in technology transformation. This resulted in a greater share of voice with over 50,000 mentions and 4,000 unique stories. - Social Media success - The company used social media channels effectively to amplify its narratives. Its stakeholder engagement resulted in garnering over 5 million followers on LinkedIn, and 100 million organic impressions. - Digitally enabled customer engagement - Full deployment of digital marketing for sales enablement, including 500+ campaigns in account-based marketing and 50,000 customer touch points - Enabled global marathons go virtual - Virtual running apps, digital and physical running experiences created # Driving Associate Engagement and Connect Launched the #OneTCS platform: A medium to drive employee engagement, connection and motivation. An enterprise-wide, arts-driven talent hunt was launched; interviews and online interaction with celebrity sportspersons, lifestyle. # gurus to keep the #OneTCS platform vibrant for employees. There were 6.5 million unique engagements on this platform. - Townhalls, events, consistent multi-channel communication: These included celebrating milestones such as achieving the goal of Enterprise Agile by 2020, and 10,000 Contextual Masters - Pandemic communication with clarity to inform and connect: Welfare programs, COVID-19 response initiatives, structured employee well-being program via TCS Cares Details of TCS' new brand articulation and purpose can be found here: https://www.tcs.com/buildingonbelief. Refer to the Panel Discussion on Building on Belief (Page 24), featuring N G Subramaniam, Chief Operating Officer, K Ananth Krishnan, Chief Technology Officer and Krishnan Ramanujam, President - Business and Technology Services # Brand Value TCS' reputation for customer-centricity, domain depth and execution excellence have made it the preferred growth and transformation partner to leading corporations across the world. It is also recognized as a top employer brand across the major markets it operates in, including North America, Europe, UK, India, Latin America and Australia, among others. - Unique usage of external channels to drive employee engagement # Brand launch TCS adopted a new brand statement, Building on Belief, to convey how its partnership with customers goes beyond technology deployment. It helps them make a meaningful difference, translating their aspiration into reality. The new statement conveys how TCS builds on their ambition and optimism to transform their business for the better, the impact of which is felt by their customers and the communities they serve. It also reflects TCS' own belief that it, along with its customers, can harness collective knowledge to innovate in ways that result in better futures for individuals, communities and the planet. # TCS Brand Value Building on Belief TCS is among the Top 3 Brands in IT Services and its brand value grew by $1.4 billion in FY 2021 |GLOBAL TOP EMPLOYER|SUPERBRAND IN US|# FASTEST GROWING BRAND| |---|---|---| |ACROSS MAJOR MARKETS (6TH CONSECUTIVE YEAR)|FOR ITS STRENGTH OF BUSINESS REPUTATION & COMMUNITY IMPACT| | winner of 2020 Gartner Communications Award for Excellence in Building a Corporate Brand Integrated Annual Report 2020-21 Management Discussion and Analysis | 123 # Its purpose-driven community outreach and corporate social responsibility company's high standing in the investor community is evidenced by the top ranking it has been consistently receiving in surveys across Asia. The cumulative effect of all the goodwill and recognition from these different stakeholders, and concerted efforts by the company's marketing organization have helped put TCS among the Top 3 brands in IT Services by brand value. # Awards and Accolades for Relationship Capital initiatives across the world have earned it local recognition and goodwill. |
The Partners - Won the 2020 SAP® Pinnacle Award in the category Integrated Delivery Partner of the Year, in recognition of its outstanding contributions as an SAP partner, dedication to teamwork, innovative approach and capacity to challenge what is possible, in helping customers achieve their goals. - According to Brand Finance, TCS' brand value grew by $1.4 billion in FY 2021, the highest absolute growth among the 25 companies assessed, that too in a challenging year when the brand value of IT services companies collectively dropped by 3 percent. Further, at 10 percent growth over the prior year, TCS has outperformed its other two peers among the Top 3 brands in IT services. - Named the Global System Integrator of the Year 2020 by HPE in recognition of its outstanding performance, commitment to customer excellence, focus on growth, innovation, and professional achievements. - Won 2020 Pega Partner Award for Excellence in Growth and Delivery for leveraging Pega technologies to drive successful digital transformation programs for joint clients in the insurance, manufacturing and telecommunications industries. - Awarded the 2020 Canada IMPACT Award for Datacenter Migration by Microsoft Corporation for driving strong business outcomes for its customers, including enhanced security, increased agility, more resiliency, strong TCO transformational wins. - Recognized by Amazon Web Services (AWS) as the 2020 AWS Migration Success Partner of the Year in India, for TCS' commitment to excellence in helping customers successfully migrate and manage their core applications on the cloud. - Recognized as a Solution Plus Partner by Intel's Winners' Circle Program, for contributions to the acceleration of #5G and virtual network transformation. |FY|2010|2013|2014|2015|2016|2017|2018|2019|2020|2021| |---|---|---|---|---|---|---|---|---|---|---| |Brand Valuation|$12.8|$8.7|$9.1|$10.4|$13.5|$14.9| | | | | Source: Brand Finance Integrated Annual Report 2020-21 Management Discussion and Analysis | 124 # Awards and Recognition - Won the 2020 Salesforce Partner Innovation Award in the Media Industry category for helping Equifax UK deliver enhanced customer experiences. # Brand - Ranked among the Top 3 brands in IT services by Brand Finance; TCS clocked the highest absolute brand value growth in the sector in 2020 and was named the fastest growing brand in the industry over the last decade (2010-2020). - Named a Superbrand in the US and in the UK, on the strength of its brand reputation, business performance, industry-leading job creation, scale of employee training and development, and commitment to corporate social responsibility initiatives. - Ranked among the Top 100 US brands, across all industries, by Brand Finance for the sixth year in a row. TCS was ranked #59, up two places from last year. - Listed among the Top 10 in five categories - Customer Favourite, Best AR Team, Biggest Improver, Analyst Advocacy Award and Overall Champion, in a survey covering over 300 analysts globally, by The Analyst Observatory at the University of Edinburgh Business School. Notably, this is an unaided measure of analyst mindshare of the larger universe of software vendors, technology providers, hyperscalers, telecom companies and system integrators. - Won the 2020 Gartner Communications Award in the category 'Excellence in Building a Corporate Brand' for its multi-phased communication strategy, centered around its Business 4.0™ thought-leadership framework. - TCS Transforming India campaign has won the Best Integrated Campaign Award - Gold at the Exchange4Media - India PR and Corporate Communications Conference 2020. - Won 2 Stevies at the 2020 American Business Awards®, for the 2019 TCS New York City Marathon app. TCS received a Gold Stevie® in the category Mobile Marketing Campaign of the Year and a Silver Stevie in the category Best User Experience. - Ranked at second place for the Analyst Relations Team of The Year award by the Institute of Industry Analyst Relations, based on their poll of over 100 top industry analysts. Integrated Annual Report 2020-21 Management Discussion and Analysis | 125 # FY 2021 PERFORMANCE OVERVIEW: MANUFACTURED CAPITAL With SBWS, TCS enabled most of its workforce to be fully productive while working remotely. Throughout FY 2021, less than 4% of the workforce worked out of its facilities, mostly confined to very sensitive projects and activities such as R&D which necessarily require specialized equipment and controlled environments. To create a safe workplace for them, TCS deployed its IUX for Workplace Resilience solution which combines risk analytics with key business relaunch functions, including workforce safety, regulatory compliance, operational resilience, and customer engagement. Its business command dashboard enables site administrators to monitor the daily risk profile and risk prediction for over 180,000 TCSers in India on a rolling seven, 14- and 21-day basis, easing workforce deployment planning. |
Based on the daily risk scores, site administrators could decide which of the employees could be safely allowed to return to work, if required. Additionally, to ease the pressure on strained local medical infrastructure and help TCSers and their families safely quarantine themselves in the event of testing positive to the virus, TCS built 11 Covid Health Centers across various cities at its campuses, with a cumulative capacity of 240 beds. # Top: Open Agile collaborative workspaces to support all stages of the innovation lifecycle # Bottom: Covid Health centres created at TCS' campuses in 11 cities Looking ahead, TCS' Vision 25x25 envisages a very different role for the office, to serve as physical hubs for collaboration, innovation and team building, while routine work can get done from anywhere. Towards this, the company has already built Incubation Development Centers at some of its locations, which will be further refined to align with business requirements. These locations are going to be Open Agile Collaborative Workspaces with Software Defined Network rolled out in a phased manner. This will give the teams mobility, flexibility and seamless collaboration environments for their business functions. TCS is also planning to consolidate old leased, non-agile and smaller vintage facilities to new owned campuses, optimizing its operational expenses. Integrated Annual Report 2020-21 Management Discussion and Analysis | 126 # FY 2021 PERFORMANCE OVERVIEW: FINANCIAL CAPITAL The discussions in this section relate to the consolidated, Rupee-denominated financial results pertaining to the year that ended March 31, 2021. The financial statements of Tata Consultancy Services Limited and its subsidiaries (collectively referred to as 'TCS' or 'the Company') are prepared in accordance with the Indian Accounting Standards (referred to as 'Ind AS') prescribed under section 133 of the Companies Act, 2013, read with the Companies (Indian Accounting Standards) Rules, as amended from time to time. Significant accounting policies used in the preparation of the financial statements are disclosed in the notes to the consolidated financial statements. # Overview of the consolidated financial results of the Company: | |FY 2021 Adjusted*| |FY 2021 Reported| |FY 2020| |---|---|---|---|---|---| |Revenue|% of Revenue|% Growth|Revenue|% of Revenue|% of Revenue| |Revenue from operations|164,177|100.0|164,177|100.0|156,949| |Earnings before interest, tax, depreciation and amortization (EBIDTA) (before other income)|46,546|28.4|45,328|27.6|42,109| |Profit Before Tax (PBT)|44,978|27.4|43,760|26.7|42,248| |Profit after tax attributable to shareholders of the Company|33,388|20.3|32,430|19.8|32,340| |Earnings per share (in `)|89.27| |86.71| |86.19| * Excluding provision towards legal claim # Analysis of revenue growth On a reported basis, TCS' revenue grew 4.6% in FY 2021, compared to 7.2% in the prior year, due to the sharp revenue reduction in the first quarter across industry segments from the pandemic impact. # Average currency exchange rates during FY 2021 for the three major currencies: |Currency|Weightage (%)|FY 2021 (`)|FY 2020 (`)|% Change YoY| |---|---|---|---|---| |USD|52.0|74.06|71.23|4.0| |GBP|13.5|97.32|90.15|8.0| |EUR|12.0|86.69| |9.8| Movements in currency exchange rates through the year resulted in a positive impact of 5.4% on the reported revenue. The constant currency revenue growth for the year, which is the reported revenue growth stripped of the currency impact, was (0.8)%. # Growth attributable to | |FY 2021 (%)|FY 2020 (%)| |---|---|---| |Business growth|(0.8)|7.1| |Impact of Exchange rate|5.4|0.1| |Total Growth|4.6|7.2| # Segmental Performance The revenue break-up by Industry Vertical and Geography is provided below: | |India|Others| |---|---|---| |Banking, Financial Services and Insurance|40.0%|51.3%| |Manufacturing|9.7%|18.2%| |Communication, Media and Technology|16.5%|5.1%| |Retail and Consumer Business|15.6%| | |Others| |11.7%| # Revenue by Industry Vertical # Revenue by Geography Integrated Annual Report 2020-21 Management Discussion and Analysis | 128 # Segment revenues, year on year growth, a brief commentary and segment margins are provided below: |Industry Vertical|Segment Revenue|YoY Revenue Growth|Commentary|Segment Margin| |---|---|---|---|---| |Banking, Financial Services and Insurance|65,634 (61,095)|7.4%|* Key investment themes included customer experience transformation; future readiness through core transformation including platform simplification and modernization and cloud adoption; optimization of back office operations. * Other key areas of spend included adoption of payments, robo-advisory systems and crypto-custody solutions. * Market reform such as CAT, LIBOR Transition, SFTR, BREXIT also drove significant spend especially around the use of predictive analytics, AI, NLP and automation.|28.5% (27.7%)| |Communication, Media and Technology|27,077 (25,978)|4.2%|* Parts of the Media sub-vertical, related to live sports, events, entertainment and radio were affected by the pandemic. * Key investment themes included 5G and fiber rollout, network virtualization, operating model transformation, product and platform engineering, business simplification, data and analytics and cloud enablement. * M&A and business separation activities was another key driver of spend.|29.6% (29.7%)| |Retail and Consumer Business|25,589 (26,280)|(2.6%)|* Retail and CPG - Discretionary retail and some parts of CPG were impacted by the pandemic. |
Spending was driven by transformation in Demand Planning, Forecasting and Replenishment to ensure continuous availability of high demand essential items; unified customer experience across channels, contactless pick-up / payment, curbside pickups etc; D2C and e-commerce initiatives in CPG. * Travel, Transportation & Hospitality - The sector was badly impacted by pandemic restrictions. Key investment themes include contactless operations and self-service, operating model changes, and simplification.|27.9% (26.1%)| Integrated Annual Report 2020-21 Management Discussion and Analysis | 129 # Industry Vertical |Segment|Revenue FY 2021 (FY 2020)|YoY Growth %|Commentary|Segment Margin FY 2021 (FY 2020)| |---|---|---|---|---| |Manufacturing|15,950 crore (16,468)|(3.1)|* Large parts of the manufacturing sector were impacted badly by the plant closures and supply chain disruptions. This resulted in postponements in capex and discretionary programs. * Key spending themes included IT infrastructure and movement to the cloud, Plant safety and industrial applications such as remote asset management, IT security, Supply chain resilience, in-vehicle software, connected products. * In the Utilities sub-vertical, key areas of spend included geospatial systems, customer service, and operational resilience and optimization.|28.1% (27.0)| |Others|29,927 crore (27,128)|10.3|* Growth in the Life Sciences segment was led by pandemic related initiatives such as adverse event processing for the vaccine, M&A synergies through IT integration, digital marketing and analytics, IT operating model transformation, cloud enablement, workplace modernization and cybersecurity. * Key areas of spend across other verticals included M&A, cloud adoption, cyber security, operations optimization and vendor consolidation.|27.5% (22.6)| Integrated Annual Report 2020-21 Management Discussion and Analysis | 130 # Business Outlook Increased activity around mergers, acquisitions and divestitures are expected to drive more opportunities around integration and transitional services. Other industry-specific themes such as regulatory compliance in the banking and financial services domains, supply chain transformation in manufacturing, and connected vehicles in the auto sector are also expected to drive growth. The COVID-19 pandemic continues to challenge businesses in every possible way and has amplified existing risks. Operating in an uncertain and ever-changing environment, TCS' global operations bring in considerable complexities and its robust enterprise risk management framework aids in ensuring the strategic objectives are achieved. This framework is supported by processes for risk identification, risk assessment, risk response planning and actions, risk monitoring and overall risk governance. The digital platform for integrated risk management provides an enterprise-wide view of risks covering strategic, operational, compliance, financial and catastrophic risks, providing a holistic approach towards informed decision making. TCS anticipates increased investments by customers in growth and transformation initiatives that deepen customer engagement, enable competitive differentiation, improve supply chain resilience and drive revenue growth. Common investment themes that are expected to accelerate across all industry verticals in FY 2022 are: - Data-driven customer journey transformations spanning front-, middle- and back-office processes and systems to enable enhanced and personalized customer experiences; - Digital enablers for direct distribution and end-customer engagement; - Seamless, personalized omnichannel experiences in consumer-facing industries; - Product and business model innovations; - Adoption of open APIs to enable purpose-driven ecosystems. The need for optimization and for freeing up resources for high priority transformation initiatives is also expected to result in more outsourcing engagements and vendor consolidation, helping drive market share gains. Global economic growth is projected to grow at 6 percent in 2021 after an estimated contraction of 3.3 percent in 2020. While there is still uncertainty on the path of the health crisis, with likelihood of third or fourth waves, and the emergence of new strains of the virus, overall business outlook across industries appears to be positive in all of TCS' major markets. This is expected to result in an expansion in enterprise spending on IT services globally, following a decline in 2020. TCS anticipates increased spending on business operations transformation using TCS Cognix™; legacy system transformation including application architecture and data modernization; cloud adoption; intelligent automation; cyber-security; IT operating model transformation using a Machine First approach for leaner and more agile operations; and digital workplace transformation for enhanced user experience and superior collaboration. Risks are assessed and managed at various levels with a top-down and bottom-up approach covering the enterprise, the business units, the geographies, the functions, the customer relationships and projects. |
23 World Economic Outlook, April 2021, International Monetary Fund Integrated Annual Report 2020-21 Management Discussion and Analysis | 131 # Key Risks, Anticipated Impact on the Company and Mitigation Strategies |Key Risks|Impact on the Company| |---|---| |Disruption and Uncertainty in Business due to the COVID-19 pandemic|Customers: The COVID-19 pandemic extending into the second year has resulted in changes in consumer behaviors, impacting demand in various industries, hurting small businesses and necessitating large fiscal interventions. Tapering off of these interventions, or the emergence of new variants which trigger new lockdowns and other restrictions could disrupt the return to normalcy and impact customers' short-term priorities, growth plans and discretionary budgets. It could also result in restructuring of some contracts, deferment, cancellation of some planned engagements besides other tactical steps such as vendor rationalization, or insourcing of work to captives, impacting the company's revenue growth. Mobility: Due to new strains of COVID-19 and increasing trend in infection cases globally, business disruptions due to intermittent lockdowns, international travel restrictions are likely, impacting the mobility of the company's workforce required to travel for work purposes, which in turn may impact service delivery and revenues. Workforce: The continuing pandemic may affect not only the health of affected employees, but also their emotional and mental wellbeing, due to physical isolation for a long period. If large numbers of employees are affected, it could result in business disruption and necessitate higher spends for ensuring business resiliency. There could be hesitation to come back to office in the near future from employees who have been working remotely from their hometowns. This may impact employee morale and satisfaction leading to the risk of higher attrition.| # Mitigation - COVID-19 Emergency Response Apex committee at Enterprise level to drive a holistic action plan and coordinate global efforts, based on frequent risk assessments. - Secure Borderless WorkSpaces (SBWSTM) infrastructure enabling associates to work from home and ensure business continuity. Digital communication channels and collaboration platforms set up for them to stay connected with colleagues and customers. - Regular communication with customers about measures taken to maintain business services and reporting of their operations status. - Pursuing new and re-purposed offerings and solutions during and post the COVID-19 disruption. - Regular coordination with key suppliers for expeditious provisioning of assets critical for business services. - 24*7 dedicated helpline for associates to address COVID-19 related help, queries and for emotional support. Regular webinars, interactive sessions, counseling services (TCS Cares), medical hotline to doctors and fitness sessions for associates. Isolation Centers setup in 11 TCS Offices. - Periodic advisories to associates towards ensuring health and safety. - SOP for operating TCS Offices including implementing Safe Operating Zones for associates required to work from office, thermal screening, self-declaration, frequent sanitization of premises, social distancing layout etc. AI-based Workplace resilience tool implemented in Delivery Centers to aid in risk profiling and contact tracing. - Rigorous review and execution of Business Continuity and Crisis Management capability which is benchmarked with ISO 22301 certification. File: AR_TCS_2020_2021.md - Remote working practices for managers and employees integrated into the Location Independent Agile delivery method, to ensure effectiveness and productivity. Integrated Annual Report 2020-21 Management Discussion and Analysis | 132 # Key Risks # Impact on the Company However, the company's relative competitiveness is expected to increase because of its traditional value focus and its strong track record in helping customers improve the efficiency and resilience of their business and IT operations through digital transformation initiatives and the Machine First Delivery ModelTM. # Volatile global political and economic scenario The Company derives a material portion of its revenues from customers' discretionary spending which is linked to their business outlook. Political disruptions or volatile economic conditions due to geo-political tensions, trade wars, and uncertainty regarding post-Brexit impacts on different business sectors may adversely affect that outlook resulting in reduced spending which could restrict revenue growth opportunities. # Restrictions on global mobility, location strategies Distributed software development models require the free movement of people across countries and any restrictions in key markets pose a threat to the global mobility of skilled professionals. Restrictions on mobility due to the pandemic, or due to legislations which limit the availability of work visas or which apply onerous eligibility criteria or costs could lead to project delays and increased costs. # Mitigation - Regular connect with Government and Health service providers to facilitate planning for logistics and arrangements for vaccination of employees as required. - Encouraging associates to get vaccinated, including facilitation and reimbursement. |
- Monitoring changes in regulations related to the impact due to pandemic and align internal policies accordingly. - Broad-based business mix, well diversified across geographies and industry verticals. - Offerings and value propositions targeting all stakeholders (in addition to the CIO) in the customer organization, covering discretionary as well as non-discretionary spends, and relevant at every point in the business cycle. - Participating in the customer's growth and transformation initiatives through services and offerings including advisory services, migration and modernization of applications and workplace transformation using location independent agile, deep contextual knowledge and data-driven analytics and dashboards. - Proactively investing in infrastructure and resourcing to satisfy anticipated customer demand for flexible products-and-platforms based solution offerings and subscription-based services to gain market share and new clients and markets. - More long-term contracting models. - Leveraging business ecosystem through collaboration with partners, startups and alliances to participate in transformation initiatives of customers. - Ongoing monitoring of the global environment, working with advisors, partners and governments. - Material reduction in dependency on work visas through increased hiring of local talent including freshers, use of contractors, local mobility and training in all major markets. - Leveraging the SBWSTM model to source talent from anywhere and deliver from anywhere. Use of Location Independent Agile to promote systematic collaboration and reduce the need for co-location. Integrated Annual Report 2020-21 Management Discussion and Analysis | 133 # Key Risks # Impact on the Company - Active engagement in Science, Technology, Engineering and Math (STEM) initiatives designed to structurally increase the availability of engineering talent in major markets. - Greater brand visibility through event sponsorships, community outreach, showcasing of investments, innovation capabilities and employment generation. - Increased outreach to government stakeholders, trade bodies, think tanks and research institutes. # Business model challenges Rapidly evolving technologies are changing technology consumption patterns, creating new classes of buyers within the enterprise, giving rise to entirely new business models and therefore new kinds of competitors. The COVID-19 pandemic has resulted in a major acceleration of technology investments by customers to make themselves future-proof and also to power the revival of their business. This investment shift is targeted to deliver superior customer experience or improve their employee engagement or improve their operational resilience. There is a major shift towards public cloud adoption and cloud-based transformation initiatives as well as digitalization of legacy applications. This is resulting in increased demands on the Company's agility to keep pace with the rapidly changing customer expectations. Failure to cope may result in loss of market share and impact business growth. There is also increased focus on vendor consolidation and corporate restructuring and mergers and acquisitions in some customer industries. # Mitigation - Investments in building scale and differentiated capabilities on emerging technologies through large scale reskilling, external hiring, research and innovation, solution development and IP asset creation leveraging deep contextual knowledge across customer specific domain, technologies and processes. - Establishment of focused business service units providing end-to-end transformational and operational solutions on leading cloud technology platforms spanning advisory, migration and modernization and support of applications. - Staying relevant to customers by constantly launching new service practices and technology solutions including a new AI-Powered business command solution to help firms assess risk profiles and protect employees returning to offices and modernizing existing offerings and solutions. - Developing capabilities in organization divestiture and integration planning to cater to Merger and Acquisition induced demand for advisory and business consolidation related services. - Thought leadership by propagating the Business 4.0 framework leveraging the Machine First Delivery Model (MFDM™). Developing industry-specific best practices and AI-led Products to enable customers derive greater business value and discover opportunities to transform and grow their businesses. - Implementing Location Independent Agile methods to mitigate location constraints and pricing and margin pressures. - Constant scouring of the technology landscape through alliance partnerships, and strong connections in academia and the start-up ecosystem to spot new trends and technologies and launch offerings around them. # Key Risks |Impact on the Company|Mitigation| |---|---| |Litigation risks Given the scale and geographic spread of the Company's operations, litigation risks can arise from commercial disputes, perceived violation of intellectual property rights and employment related matters. Its rising profile and scale also make TCS a target to litigations without any legal merit. This risk is inherent to doing business across the various countries and commensurate with risk faced by other players similarly placed in the industry. In addition to incurring legal costs and distracting management, litigations garner negative media attention and pose reputation risk. |
Adverse rulings can result in substantive damages.|* Strengthening internal processes and controls to adequately ensure compliance with contractual obligations, information security and protection of intellectual property. * Improved governance and controls over immigration process / increasing localization and sensitization of business managers. * Potential disputes are promptly brought to the attention of management and dealt with appropriately. * Team of in-house counsels, backed by tie-ups with a network of highly reputed global law firms in all the major markets. * Robust mechanism to track and respond to notices as well as defend the Company's position in all claims and litigation.| |Currency volatility Volatility in currency exchange movements results in transaction and translation exposure. TCS' functional currency is the Indian Rupee. Appreciation of the Rupee against any major currency could impact the reported revenue in Rupee terms, the profitability and also result in collection losses.|* Following a currency hedging policy that is aligned with market best practices, to limit impact of exchange volatility on receivables, forecasted revenue and other current assets and liabilities. * Hedging strategies are decided and monitored by the Risk Management Committee of the Board convened on a regular basis.| |Breach of data protection laws Data Privacy and protection of personal data is an area of increasing concern globally. Legislations like GDPR in Europe carry severe consequences for non-compliance or breach. Many other countries have enacted or are enacting their Data Privacy regulations to ensure protection of personal data. Violation of data protection laws or security breaches can result in substantive liabilities, fines or penalties and reputational impact.|* Global privacy policy in place covering all applicable geographies and areas of operations, which sets out the privacy principles within TCS. * Global privacy policy in place to oversee and deploy data privacy obligations and support initiatives across the enterprise. DPOs (Data Protection Officers) have been appointed for TCS entities as required by local privacy regulations. Privacy leads have been appointed in all units. * Embedding privacy by design and privacy by default principles in development of new or changed internal processes or services or products. Robust and continued governance of personal data. * Data protection controls and robust risk response mechanisms to cater to protection of personal data in the TCS ecosystem as well as protection of such data in Client-managed networks in Global Delivery Centers.| Integrated Annual Report 2020-21 Management Discussion and Analysis | 135 # Key Risks |Impact on the Company|Mitigation| |---|---| |Cyber Attacks Risks of cyber-attacks are forever a threat on account of the fast-evolving nature of the threat. There is also an increased risk due to various pandemic themed cyber threats. In addition to impact on business operations, a security breach could result in reputational damage, penalties and legal and financial liabilities.|* Investments in automated prevention and detection solutions, including Perimeter security controls with advanced tools, enhanced internal vulnerability detection, data leak prevention tools, defined and tested incident management and recovery process in compliance with ISO 27001 standard. * Deployment of a security governance tool on all devices used by employees while working remotely, to monitor the work and ensure compliance to company security policies and contractual obligations. * Compliance to security controls for cloud services as per ISO 27017:2015 / 27018:2014 standard. * Continued reinforcement of stringent security policies and procedures including enhanced security measures and awareness building to combat pandemic-themed threats like phishing, soliciting for fraudulent causes or charities, suspicious pleas and communication through social media, text or calls. * Collaboration with Computer Emergency Response Team (CERT) and other private Cyber Intelligence agencies, and enhanced awareness of emerging cyber threats.| # Key Risks # Impact on the Company * Enterprise-wide training and awareness programs on Information Security including the extensively used enterprise-wide communication and collaboration platforms accessed through mobile or desktop channels. * Strict access controls including dynamic passwords for secure access to enterprise applications and special handling of privileged administrator accounts. Rigorous access management on all Cloud deployments. * Encryption of data, data back-up and recovery mechanisms for ensuring business continuity. * Ability to isolate TCS enterprise network from client network and defined escalation mechanisms to handle security incidents in client environment. * Periodic rigorous testing to validate effectiveness of controls through Vulnerability Assessment and Penetration Testing. * Internal and external audits and forensics. |
# Non-compliance to complex and changing global regulations As a global organization, the Company has to comply with a complex regulatory landscape across multiple jurisdictions, covering areas such as Employment and Labour, Immigration, Taxation, Foreign Exchange and Export Control, Environment, Health and Safety, Anti-Bribery and Anti-Corruption, Data Privacy and so on. The laws and regulations are continuously evolving, increasing in number and complexity. This has resulted in greater compliance risk and cost for the Company. The fast pace of changes in the regulatory environment, including those due to the pandemic, also requires quick understanding of their implications and adaptation in business operations. Failure to comply could result in penalties, reputational damage and criminal prosecution. # Mitigation * Deployment of a comprehensive global compliance management framework that enables tracking of changes to applicable laws and regulations across various jurisdictions and functional areas and managing compliance obligations. This includes those laws and provisions specially enacted directly to cater to the pandemic impacts. * Periodic regulatory compliance certification, which is fully digitized enables self-governance and covers compliance across all the locations of the Company. * Adequate and effective internal controls to comply with regulations and to keep a check on unlawful and fraudulent activities. * Awareness through web-based compliance training courses for all staff and regular notifications/alerts on regulatory changes communicated to stakeholders. * Strong governance at executive and board level through compliance committees. # Key Risks # Intellectual Property (IP) infringement and leakage Risk of infringement of third-party IPs by TCS may lead to potential liabilities, increased litigation and impact reputation. Inadequate protection of TCS' IP may lead to loss of IP leading to potential loss of ownership rights, revenue and value. # Mitigation - Established an industry leading IP management framework (IP 4.0) and accordingly have institutionalized frameworks, processes and procedures that address the risk of infringement of third-party IP while ensuring safeguarding of TCS' own IP assets. This strong focus on IP-led growth driven based on the 3P (Patents, Products and Platforms) strategy is contributing significantly towards thinning the competition for TCS. - Established a centralized IP and Software Product Engineering group that strives to build an IP thinking culture and hence covering the IP related awareness aspects effectively. - Well-defined (software) asset lifecycle governance framework that incorporates policy guidance and risk mitigation guidelines on IP, Legal, software product engineering and business-related risks. - IP Governance program that ensures that there is right access and right use of TCS IP, customer IP, partner IP, and third-party IP in service and partner engagements. - Some of the other key controls include: Employee confidentiality agreement, training and awareness for IP protection and prevention of IP contamination and infringement. Digitized system to enable strict controls around movement of people and information across TCS' product teams and customer account teams. - Technology inventions celebrated in TCS by running special programs such as "Invent and Inspire" wherein top inventors and their invention stories are recognized for their success and impact on business. # Key Risks # Sustainability Risks # Impact on the Company Growing scientific evidence indicates that extreme weather conditions like intense winter storms (recent event in Texas for example), rainfall, cyclones, droughts, are attributable to climate change. As a result of changing weather and seasonal patterns, there are also increasing cases of seasonal diseases, epidemics and pandemics besides threat to human safety and business disruption. As TCS has operations globally with employees distributed across numerous locations due to remote working, these sustainability related risks, if not managed properly, have the potential to impact delivery operations and safety of TCS stakeholders resulting in business disruption. # Mitigation - An environmentally sustainable approach adopted by creating green policies, processes, frameworks and infrastructure. All TCS Centers globally continue to be certified under the ISO14001:2015 Environment Management Standard. - Designed and planned all delivery centers infrastructure to have minimum impact upon occurrence of any extreme weather events. Business Continuity plans tested periodically to ensure effectiveness in the event of disaster. Mass communication infrastructure to reach targeted set employees used effectively multiple times last year due to pandemic and extreme weather conditions. - Focus on Carbon footprint reduction, through energy efficiency, use of renewable energy, water management through rainwater harvesting, recycling and waste management. - Centralised IoT based Remote Energy Management System across TCS campuses, Roof Top Solar Power Plants in campuses. - Driving supply chain sustainability through responsible sourcing. - Year-round associate engagement on environmental awareness and sensitizing them towards nature and conservation of resources. |
# Market dimension and opportunity: As TCS' customers respond to climate change actions, the company is seeing a transition in the customer's business models, thus creating new markets and new opportunities, creating new business avenues for TCS to partner with them in their climate change mitigation journey by leveraging its core competencies. - Consumer behaviors are shaping how products and services are delivered and consumed. Low carbon strategies by consumers and hence increasing demand for more sustainable products and services, present an opportunity for the company. - TCS key solution areas revolve around designing sustainability strategy, sustainability innovation, sustainable consumer analytics and sustainable dashboards. Various TCS products and solutions facilitate alignment to the UN Sustainable Development Goals. TCS works closely with its customers in coming up with innovative solutions leveraging AI, ML, NLP, Cloud and DLT to manage the range of risks and opportunities climate change brings along. # Internal Financial Control Systems and their Adequacy TCS has aligned its current systems of internal financial control with the requirement of Companies Act 2013, on the lines of the globally accepted risk-based framework issued by the Committee of Sponsoring Organizations (COSO) of the Treadway Commission. The Internal Control - Integrated Framework (the 2013 framework) is intended to increase transparency and accountability in an organization's process of designing and implementing a system of internal control. The framework requires a company to identify and analyze risks and manage appropriate responses. The Company has successfully laid down the framework and ensured its effectiveness. TCS' internal controls are commensurate with its size and the nature of its operations. These have been designed to provide reasonable assurance with regard to recording and providing reliable financial and operational information, complying with applicable statutes, safeguarding assets from unauthorized use, executing transactions with proper authorization and ensuring compliance with corporate policies. TCS has a well-defined delegation of power with authority limits for approving contracts as well as expenditure. Processes for formulating and reviewing annual and long-term business plans have been laid down. TCS also undergoes periodic audit by specialized third party consultants and professionals for business specific compliances such as quality management, service management, information security, etc. The audit committee reviews reports submitted by the management and audit reports submitted by internal auditors and statutory auditors. Suggestions for improvement are considered and the audit committee follows up on corrective action. The audit committee also meets TCS' statutory auditors to ascertain, inter alia, their views on the adequacy of internal control systems and keeps the board of directors informed of its major observations periodically. TCS management has assessed the effectiveness of the Company's internal control over financial reporting (as defined in Clause 17 of SEBI Regulations 2015) as of March 31, 2021. BSR & Co. LLP, the statutory auditors of TCS have audited the financial statements included in this integrated annual report and have issued an attestation report on the company's internal control over financial reporting (as defined in section 143 of Companies Act 2013). Based on its evaluation (as defined in section 177 of Companies Act 2013 and Clause 18 of SEBI Regulations 2015), TCS' audit committee has concluded that, as of March 31, 2021, the company's internal financial controls were adequate and operating effectively. TCS has appointed Ernst & Young LLP to oversee and carry out internal audit of its activities. The audit is based on an internal audit plan, which is reviewed each year in consultation with the statutory auditors and approved by the audit committee. In line with international practice, the conduct of internal audit is oriented towards the review of internal controls and risks in the Company's operations such as software delivery, accounting and finance, procurement, employee engagement, travel, insurance, IT processes, including most of the subsidiaries and foreign branches. # Performance Trend - 10 years # Amounts in ` Crore |Ind AS|FY 2021*|FY 2021|FY 2020|FY 2019|FY 2018|FY 2017|FY 2016|FY 2015#|FY 2015|FY 2014|FY 2013|FY 2012| |---|---|---|---|---|---|---|---|---|---|---|---|---| |Total revenue from operations|164,177|164,177|156,949|146,463|123,104|117,966|108,646|94,648|94,648|81,809|62,989|48,894| |Americas|84,278|84,278|82,000|77,562|66,145|66,091|60,011|51,053|51,053|45,259|35,247|27,570| |Europe|52,346|52,346|48,037|43,456|34,155|30,038|29,092|26,730|26,730|23,433|16,813|12,382| |India|8,449|8,449|8,964|8,393|7,921|7,415|6,729|6,108|6,108|5,488|4,890|4,202| |Others|19,104|19,104|17,948|17,052|14,883|14,422|12,814|10,757|10,757|7,629|6,039|4,740| |Employee cost|91,814|91,814|85,952|78,246|66,396|61,621|55,348|48,296|50,924|40,486|31,922|24,683| |Other operating cost|25,817|27,035|28,888|28,711|24,192|24,034|22,621|19,242|19,242|16,170|13,027|9,776| |Total cost (excluding interest & depreciation)|117,631|118,849|114,840|106,957|90,588|85,655|77,969|67,538|70,166|56,656|44,949|34,459| |EBITDA (before other income)|46,546|45,328|42,109|39,506|32,516|32,311|30,677|27,110|24,482|25,153|18,040|14,435| |Profit before tax|44,978|43,760|42,248|41,563|34,092|34,513|31,840|28,437|25,809|25,402|18,090|13,923| |Profit after tax attributable to shareholders of the Company|33,388|32,430|32,340|31,472|25,826|26,289|24,270|21,912|19,852|19,164|13,917|10,413| |Equity share capital|370|370|375|375|191|197|197|196|196|196|196|196| |Reserves and surplus|87,014|86,063|83,751|89,071|84,937|86,017|70,875|52,499|50,439|48,999|38,350|29,284| |Gross block of property, plant and equipment|28,658|28,658|26,444|24,522|22,720|20,891|19,308|16,624|16,624|13,162|10,996|8,844| |Total investments|29,373|29,373|26,356|29,330|36,008|41,980|22,822|1,662|1,662|3,434|1,897|1,350| |Net current assets|66,076|65,125|63,177|70,047|63,396|65,804|47,644|30,726|28,495|27,227|19,734|12,673| |EPS - as reported|89.27|86.71|86.19|83.05|134.19|133.41|123.18|111.87|101.35|97.67|70.99|53.07| |EPS - adjusted for Bonus Issue|89.27|86.71|86.19|83.05|67.10|66.71|61.59|55.94|50.68|48.84|35.50|26.54| |Headcount (including subsidiaries) as on March 31st|488,649|488,649|448,464|424,285|394,998|387,223|353,843|319,656|319,656|300,464|276,196|238,583| Note: The company transitioned into Ind AS from April 1, 2015. *Excluding provision towards legal claim. # Excluding the impact of one-time employee reward. |
Integrated Annual Report 2020-21 Management Discussion and Analysis | 141 # Overview of Funds Invested Funds invested exclude earmarked balances with banks and equity shares measured at fair value through other comprehensive income. ( Crore) | |FY 2021|FY 2020|FY 2021|FY 2020|FY 2021|FY 2020| |---|---|---|---|---|---|---| |Investments in mutual funds, Government securities and others|29,160|26,140|175|174|29,335|26,314| |Deposits with banks|3,848|1,210|719|348|4,567|1,558| |Inter-corporate deposits|11,229|8,171|27|27|11,256|8,198| |Cash and bank balances|5,272|8,241|-|-|5,272|8,241| |Total|49,509|43,762|921|549|50,430|44,311| Total invested funds include 1,306 crore and 1,195 crore for FY 2021 and FY 2020, respectively, pertaining to trusts and TCS Foundation held for specified purposes. Integrated Annual Report 2020-21 Management Discussion and Analysis | 142 # Ratio Analysis - 10 years |Ratio Analysis|Ind AS|Units|FY 2021*|FY 2021|FY 2020|FY 2019|FY 2018|FY 2017|FY 2016|FY 2015#|FY 2015|FY 2014|FY 2013|FY 2012| |---|---|---|---|---|---|---|---|---|---|---|---|---|---|---| |Ratios - Financial Performance| | | | | | | | | | | | | | | |Employee Cost / Total Revenue|%|55.9|55.9|54.8|53.4|53.9|52.2|50.9|51.0|53.8|49.5|50.7|50.5| | |Other Operating Cost / Total Revenue|%|15.7|16.5|18.4|19.6|19.7|20.4|20.9|20.4|20.3|19.8|20.7|20.0| | |Total Cost / Total Revenue|%|71.6|72.4|73.2|73.0|73.6|72.6|71.8|71.4|74.1|69.3|71.4|70.5| | |EBITDA (Before Other Income) / Total Revenue|%|28.4|27.6|26.8|27.0|26.4|27.4|28.2|28.6|25.9|30.7|28.6|29.5| | |Profit Before Tax / Total Revenue|%|27.4|26.7|26.9|28.4|27.7|29.3|29.3|30.0|27.3|31.1|28.7|28.5| | |Tax / Total Revenue|%|7.0|6.8|6.2|6.8|6.7|6.9|6.9|7.2|6.6|7.4|6.4|7.0| | |Effective Tax Rate - Tax / PBT|%|25.5|25.6|23.2|24.1|24.1|23.6|23.6|23.5|23.7|23.9|22.2|24.4| | |Profit After Tax / Total Revenue|%|20.3|19.8|20.6|21.5|21.0|22.3|22.3|23.2|21.0|23.4|22.1|21.3| | |Ratios - Growth| | | | | | | | | | | | | | | |Total Revenue|%|4.6|4.6|7.2|19.0|4.4|8.6|14.8|15.7|15.7|29.9|28.8|31.0| | |EBITDA (Before Other Income)|%|10.5|7.6|6.6|21.5|0.6|5.3|25.3|7.8|(2.7)|39.4|25.0|29.1| | |Profit After Tax|%|3.2|0.3|2.8|21.9|(1.8)|8.3|22.3|14.3|3.6|37.7|33.6|14.8| | |Ratios - Balance Sheet| | | | | | | | | | | | | | | |Debt-Equity Ratio|Times|-|-|-|-|0.0|0.0|0.0|0.0|0.0|0.0|0.0|0.0| | |Current Ratio|Times|3.0|2.9|3.3|4.2|4.6|5.5|4.1|3.9|2.4|2.7|2.7|2.2| | Note: The company transitioned into Ind AS from April 1, 2015. *Excluding provision towards legal claim. # Excluding the impact of one-time employee reward. Integrated Annual Report 2020-21 Management Discussion and Analysis | 143 # Ratio Analysis |Units|FY 2021*|FY 2021|FY 2020|FY 2019|FY 2018|FY 2017|FY 2016|FY 2015#|FY 2015|FY 2014|FY 2013|FY 2012| |---|---|---|---|---|---|---|---|---|---|---|---|---| |Days Sales Outstanding (DSO) in ` terms|67|67|71|68|74|70|81|79|79|81|82|86| |Days Sales Outstanding (DSO) in $ terms|68|68|67|69|74|73|80|78|78|82|82|81| |Invested Funds / Capital Employed|52.6|53.1|47.7|55.2|55.6|55.8|45.8|42.3|43.9|44.0|37.2|35.6| |Capital Expenditure / Total Revenue|1.9|1.9|2.0|1.5|1.5|1.7|1.8|3.1|3.1|3.8|4.2|4.1| |Operating Cash Flow / Total Revenue|23.6|23.6|20.6|19.5|20.4|21.4|17.6|20.5|20.5|18.0|18.4|14.3| |Free Cash Flow / Operating Cash Flow Ratio|91.9|91.9|90.5|92.5|92.8|92.3|89.7|84.8|84.8|78.9|77.3|71.5| |Depreciation of Property, Plant and Equipment (PPE) / Average Gross Block of PPE|8.7|8.7|8.6|8.5|9.1|9.5|10.0|11.7|11.7|10.6|10.2|10.7| |EPS - adjusted for Bonus|89.27|86.71|86.19|83.05|67.10|66.71|61.59|55.94|50.68|48.84|35.50|26.54| |Price Earning Ratio, end of year|35.6|36.6|21.2|24.1|21.2|18.2|20.4|22.8|25.1|21.8|22.1|22.0| |Dividend Per Share|38.00|38.00|73.00|30.00|50.00|47.00|43.50|79.00|79.00|32.00|22.00|25.00| |Dividend Per Share - adjusted for Bonus|38.00|38.00|73.00|30.00|25.00|23.50|21.75|39.50|39.50|16.00|11.00|12.50| |Market Capitalisation / Total Revenue|7.2|7.2|4.4|5.1|4.4|4.1|4.6|5.3|5.3|5.1|4.9|4.7| Note: The company transitioned into Ind AS from April 1, 2015. *Excluding provision towards legal claim. # Excluding the impact of one-time employee reward. Integrated Annual Report 2020-21 Management Discussion and Analysis | 144 # FY 2021 PERFORMANCE OVERVIEW: # SOCIAL CAPITAL # A Purpose-Driven Approach TCS has continued to empower communities globally through its strategic programs - by prioritizing education, skilling, employment and entrepreneurship with a focus to bridge the opportunity gap. TCS has also invested in basic health and wellness, water sanitation and hygiene, conservation and disaster relief efforts to support the most pressing needs of communities across the globe. TCS' growing, highly skilled and diverse workforce serves as champions to build organic connects with the community while accelerating social impact. This novel approach ensures that the company invests in large-scale yet sustainable initiatives that create generational improvements. TCS' Corporate Social Responsibility (CSR)24 commitment stems from the Company's core values and the Tata Group's ethos of improving the quality of life of local communities, while contributing to economic and social development. TCS' core belief of building greater futures for people and communities through innovation and collective knowledge is based on the values of fairness, equity and respect for human rights and guides how the Company conducts its business, treats its employees and supports local communities25. The company's vision is to empower communities by connecting people to opportunities in the digital economy and its mission is to build inclusive, equitable and sustainable pathways for all - especially youth, women and marginalized communities. In FY 2021, TCS' global community initiatives reached more than 1.8 million beneficiaries. An understanding of access darkness during the pandemic prompted bridgital and other innovative solutions and a recalibration of TCS programmes. The company has leveraged this opportunity to reimagine its programs through a digital-first approach and, in conjunction with its efforts to close the digital gap, to be able to reach people when and where they needed it most. Opportunities for employees to volunteer time include skills-based volunteering, pro bono support to community-based organization and social cause leadership. In FY 2021, more than 69,000 employees volunteered over 787,000 hours to support these initiatives. TCS has leveraged its intellectual, technology expertise, and financial and human capital to create exponential impact across the globe. |
The company's engagement strategy utilizes its contextual knowledge and the knowledge from a diverse network of experts to develop innovative solutions to unique problems within the community. Its deep understanding of technology and its application helps to create a strong foundation for execution at scale. File: AR_TCS_2020_2021.md 24 103-2, 103-3 25 TCS has been a signatory to the UN Global Compact (UNGC) since 2006 and is aligned with its ten principles. The Company supports the principles contained in the Universal Declaration of Human Rights, the ILO Declaration on Fundamental Principles and Rights at Work, and the United Nations Guiding Principles on Business and Human Rights. Management Discussion and Analysis | 145 # Community Initiatives # THOUGHT LEADERSHIP, RESEARCH AND INSIGHTS # Pro-Bono Technology Support to Social Organisations # EDUCATION # Digital Empowers # Women's Business # Adult Literacy Collaborative program (ALP) # Ignite My Future in School (IMFIS) # BASIC HEALTH AND WELLNESS # Cancer Institute, Chennai # Medical Center (TMC) # SKILLING # GoIT # EMPLOYMENT # Youth Employment Program # Operation Smile # ENTREPRENEURSHIP # Tata Trusts Migrant Resource Centers # WATER SANITATION AND HYGIENE # Digital Impact # Jal Jeevan Mission India has ~258 million adult illiterates. Despite years of investments, illiteracy continues to persist as a core impediment stopping individuals from becoming productive and responsible members of their communities and contributing to the national economy. Over the last two decades, TCS' Adult Literacy program has not only helped create basic literacy for groups that are otherwise left behind, but has also empowered its female beneficiaries to become income generators and change agents within their own communities. Literacy empowerment has resulted in social and economic inclusion, as well as access to government benefits, insurance schemes, financial stability and, in some cases, financial independence. 26 413-1 Integrated Annual Report 2020-21 Management Discussion and Analysis | 146 # TCS' proprietary Computer Based Functional Literacy (CBFL) solution has never been more important than in today's globally connected, knowledge-based economy. It is increasingly critical for students to master algorithmic thinking, problem-solving, collaboration and creativity, among several other skills that will set them up for success in this new world of work. 20 states and 162 districts in India and in Burkina Faso, Western Africa. This year, TCS invested in efforts to broaden its scope to include financial and digital literacy modules, so that the program is elevated to integrate a path to enhanced livelihoods while creating relevance for its learners in the new digital world. Downstream impact created by the program, till date, includes: - 81% of learners encouraged their own children, especially girls, to go to school. - 75% reported that their self-esteem had increased as a result of being literate. - 67% reported that they were now more participative in family decisions. 8,180 learners gained literacy skills this year. Till date the program has reached learners across. # Asha Devi's Story Like any other piece of drawstring, the measuring tape in Asha Devi's tailoring shop in a nondescript village of central India, hung uselessly for years. Despite her competence with the sewing machine, till the age of 45, Asha could never establish herself as a 'Tailor Master'. She could neither read nor write, and therefore she could not take down measurements to sew. Asha Devi enrolled herself in the Adult Literacy Program (ALP) and over three months, achieved functional literacy. She now understands digits, expertly takes measurements and writes them down. Literacy brought out the natural entrepreneur in her. Asha has now started a tailoring school at her house where she offers a two-month crash course. The school gives her an assured income, in addition to the monthly turnover in her tailoring shop. "Now I'm not dependent on anyone. At the bank, I can do my own transactions. Earlier, I would have to take my daughter's help to fill out the forms and could only use my thumb print," she says. Computational thinking (CT) has emerged as a key skill-set empowering students with the strategies they need to thrive in any job or industry. Ignite My Future in School (IMFIS) has integrated CT skills within classrooms in 350 districts across US and in India, LATAM and UK. Integrated Annual Report 2020-21 Management Discussion and Analysis | 147 While integrating a core yet novel skill set within K-12 students and 20,000 educators in the U.S. classrooms, multi-layer engagement is critical. |
The program has integrated within its model support to key stakeholders within the learning ecosystem which includes students, parents, teachers and administrators and adopted an inclusive approach within its design so that no student gets left behind. As educators grappled with virtual learning during the pandemic, IMFIS offered year-round support through its Learning Leader Ambassador Program working with 190 educators from schools across North America, UK and LATAM in addition to sharing distance learning activities that teachers of any subject, grade, or student population could immediately put into action. In today's Business 4.0™ world, where digital technologies are rapidly reshaping the ways in which enterprises do business, integrating new skill sets within a student's learning experience can play an extremely important role in democratizing access to opportunities. An integral element of the program is the Ignite Innovation Student Challenge, which encourages students to use computational thinking to create digital solutions that solve problems within their community and improve the world. The program has created innovation champions like Ryan H who was recognized as an "Orange County Hero" by the American Red Cross and received a grant from the Office of Naval Research to bring his low-cost wildfire detection idea to life - a much needed solution in a year that has seen multiple fires within the region. In addition, Gitanjali R, winner of the 2019 challenge under the Health Pillar was named Time magazine's first ever 'Kid of the Year'. This has been the unique outcome of goIT, TCS' student focused digital innovation program, which has introduced learners across the globe to STEM, computer science, design thinking and innovation. Students who have experienced goIT are empowered to create technology enabled human-centred solutions to problems within their ecosystems such as Local, an app to provide low-income families with fresh, locally sourced produce or Big Otry Fever, a platform to mitigate online bullying and negative commentary. In FY 2021, IMFIS empowered more than 600,000 students and educators. This year, the program was also launched in India, Wales, Mexico and Canada. The program surpassed its goal to reach 1 million. Diego Vela is a middle school teacher at Colegio Ingles Americano in Monterrey, Mexico. In his STEM lab and computer studies classes, he incorporates Ignite My Future's transdisciplinary lessons to empower his students to solve real world problems. He says, "The power of computational thinking lies in the fact that once you show students how to apply it to solve problems, they will naturally begin to apply those strategies from that moment forward. They will forever receive the benefits of using computational thinking to find solutions." Diego is also a Learning Leader Ambassador who has shared his love of computational thinking and IMFIS resources with teachers in his school and at global events. Through the program's global collaboration, he has connected his classes with other students from around the world to work together to solve global problems using computational thinking. "We all speak one language," says Deigo. "It is the language of education." Integrated Annual Report 2020-21 Management Discussion and Analysis | 148 # The goIT Monthly goIT helps students think, problem solve and design. - 80% of students showed higher order design thinking skills. - 55% wanted to continue using technology to create solutions for the community. Challenge provides a recurring opportunity for classrooms to directly engage with the UN Sustainable Development Goals (SDGs) and the much-needed virtual engagement for students who are remotely learning. It engages experts from across business and policy to set challenges on issues impacting communities to spur digital innovation, creativity and generation of new ideas. This year, students across North America, UK and Australia worked on novel solutions to address sustainability challenges impacting communities everywhere. It was Jennifer Smith's, EVP and CIO Zions Bancorporation, challenge on reducing inequalities (SDG goal 10) that spurred Nadine and Ivy from Canada to create winning solutions to address gender and ethnic inequalities. Nadine's solution Female Force specifically targets gender inequality by creating a safe space for women to share their experiences and ideate on solutions. Nadine says, "With Female Force I want to create a supportive virtual village in which women can empower each other." In FY 2021, the program reached more than 54,000 beneficiaries and expanded to 33 countries. Impact created by the program, till date, includes: - 70% of students showed an increase in empathy. |
Over the decade to 2030, India will need to create at least 90 million new jobs to absorb the 60 million new workers who will enter the workforce. In a similar vein, Latin America experiences the world's highest skills shortage in the formal economy, with four in ten organizations finding it difficult to get workers with the necessary skills. As a result of the pandemic, digital fluency and a mastery of technology has become the default especially when ensuring access to future opportunities. Despite this, there still exists an acute lack of access to and understanding of digital technologies. Even today, youth from ethnic, socio-economic, and otherwise marginalized communities have limited or no access to develop market relevant skills that can set them up for success. Last year TCS Singapore partnered with the Singaporean government to help graduates upskill and secure jobs during COVID last year, along with its usual hiring. In FY 2021, TCS Singapore announced plans to launch a Digital Acceleration program. Integrated Annual Report 2020-21 Management Discussion and Analysis | 149 # Integrated Annual Report 2020-21 # Management Discussion and Analysis Centre (DAC), supported by the Singapore Economic Development Board (EDB), to support Singapore's businesses in their recovery and future-readiness. As part of this initiative, TCS' will provide up to 100 traineeship opportunities for local polytechnic and university graduates through Workforce Singapore's SGUnited Traineeships Programme. This programme consists of foundational, specialized, and hands-on training courses for intensive skill building through various formats including webinars, assessments, and hackathons. TCS' Youth Employment programs, in India and LATAM, have supported skills development for undergraduate students and have provided a platform for first time employment in the private sector for many. These trainings have not only increased self-esteem, status and confidence but have also led to enhanced mobility, financial independence and generational growth. Overall, engineering students experience business communication, general aptitude and technical skills over 196 hours while non-engineering students train in math, analytics, English and technology over 100 hours. Armed with cross-functional skills, these youth are then connected to employment opportunities across multiple sectors. Over last year, TCS realised that in rural colleges where computer and internet access were limited, it was critical to evolve its program model so that students using smartphones with low bandwidth or even regular phones were able to connect to mentors and coaching sessions. The digital pivot meant mentors and TCS volunteers from every part of the country, even other parts of the world, could join in. The initial challenge of mobility became an opportunity to tap into a larger pool of volunteers, youth and mentors increasing one-on-one engagement and learning effectiveness. # Entrepreneurship In FY 2021, more than 15,000 students were trained in India and LATAM, and more than 800 students gained employment in sectors such as IT, BPS, retail, banking and several others. The impact created by the program, till date, includes: - 1.5x enhancement in income in comparison to male employee in a rural area. - 81% indicated that better jobs led to a change of role as earning member. - 74% indicated an enhancement of status in the family and community. During the last three semesters of his graduate program at the Government Engineering College of Kushalnagar, Rakshith joined the TCS Youth Employment Program for rural undergraduates, which he describes as a remarkable transformational journey. Prior to this experience, his family's sole source of sustenance was their paddy field. After his training, Rakshith was recruited by a leading IT consulting company. Two years into employment, Rakshith has not only supported the needs of his family adequately but added to their savings, enabling them to purchase a coffee estate near their village. At work, Rakshith has devoted himself to ensuring the same opportunities are made available to many others. Today, outside his working hours, he conducts at 10 aptitude sessions in every quarter with at least 40-60 students across 14 colleges attending each session. "The program inspired me develop skills that helped me become a high skilled professional. It also played a significant role in making me more confident in my communications skills. I believe this program is a necessity for all rural students who are aspiring to achieve their goals with limited available resources." says Rakshith. |
# Digital Infrastructure and Rural Entrepreneurship The community in Ekta village of Bharatpur district in the central Indian state of Rajasthan today lauds the grit, toil and determination with which Laxmi steered her family - from economic distress to stability - as she took on the role of an entrepreneur and a digital service provider. Digital infrastructure, knowledge and resources in financial transactions, tele-health and tele-law, as well as access to government schemes like Ayushman Golden Cards and farmer support are, as a result, more easily accessible. BridgeIT, is a youth entrepreneurship program that has played a pivotal role in enhancing access to new opportunities. The program enables economic growth to be more inclusive allowing rural entrepreneurship to become key enablers in overcoming discrimination and raising the standards of living of those in rural areas. Bapi from Odisha started his entrepreneurial journey in August 2020. In less than a year's time, Bapi's monthly income reached ₹130,000. Honappa from Karnataka has experienced a similar trajectory earning ₹146,000 last month after only 11 months of being an entrepreneur. Another critical outcome has been the upward social mobility and respect for these entrepreneurs within their communities. For example, Zohming from Mizoram was elected as the Vice President of his village council after supporting multiple families through his services. At 18, Laxmi joined the BridgeIT program, training to use a computer while enhancing her communication and business skills. In parallel, she made time to complete her graduation. After she acquired digital skills, Laxmi was provided two laptops to start her own business. "I opened a shop at home offering services like e-Mitra, on-line form filling for issuing fresh ration cards, Aadhar cards, voter ID cards, pension withdrawal and anything else that needed to be enabled digitally," recalls Laxmi. As of date, the program has 437 active digital entrepreneurs, providing digital services to an average of 200,000 beneficiaries every quarter. Till date, this robust network of entrepreneurs has supported rural populations across 30 districts and 10 states in India. Impact created by the program, till date, includes: - 2x earnings for men in comparison to others self-employed in rural areas. - ₹4 crore aggregate earnings of entrepreneurs. - 95% indicated increased income and improved standard of living. - 92% women indicated higher self-esteem at home. Laxmi visited each of the 5,000 households in her village to market her services. As the business flourished, her monthly income grew to ₹60,000. Today, Laxmi is a leading supporter at the local self-help group and has supported the community with their online documentation, so that they, in turn, can access the COVID-19 subsidies and relief schemes. # PITCH FOR # A TCS Foundation Initiative, Digital Impact Square Digital Impact Square (DISQ), an open social innovation center, has leveraged digital technologies to become an enabler for growth and transformation. The intervention has addressed challenges in health and hygiene, food security, housing and transportation, water, citizen empowerment and education among several other critical areas. # PURPOSE Digital Empowers The purpose of Digital Empowers is to raise awareness on digital technologies and social issues, explore the art of what's possible, and foster cross sector partnerships. The program has primarily focused on convening four key expert groups from technology, business, non-profit, and public policy - to ideate, collaborate and create solutions for social impact leveraging emerging technologies. Overall, the program has supported 11 solutions in reaching self-sufficiency. Since inception in 2018, Digital Empowers has engaged with more than 2,500 experts from UK, Europe, US and Canada to expand the knowledge base, explore new solutions and collaborate to address the most pressing community issues - all of which have cross sections across the world. # Thought Leadership, Research and Insights In addition to leveraging emerging technologies to transform customers' businesses, TCS is also using them to transform society. TCS leverages its intellectual capital to create innovative solutions to societal challenges and the company does this by applying its contextual knowledge while engaging a high-profile and diverse network of leaders to harness expertise and amplify impact. In collaboration with the World Economic Forum, TCS released Closing the Skills Gap: Key Insights and Success Metrics summarizing a 3-year collaboration that generated business commitments to skill 17.3 million people and includes case studies and lessons learned from 33 companies and 44 programs. |
# Integrated Annual Report 2020-21 Management Discussion and Analysis | 152 # Basic Health and Wellness TCS has consistently leveraged its technology capabilities to execute large scale community impact programs enabling greater access to high quality healthcare facilities. TCS's Digital Nerve Centre is a unique and innovative care delivery model designed to connect, communicate, coordinate and deliver care by leveraging people, infrastructure and a robust digital platform. The primary healthcare transformations at Kolar has integrated all levels of public health facilities - from Sub centre, Primary Health Centre level to District Hospital level on a single platform to provide the right care through the right healthcare center. To enhance operational efficiency, enhancements were made to the management system supporting laboratory services, billing and finance. All these enhancements ensure that patients not only benefit from modern affordable cancer therapy but also from the cost-effective models of care. TCS also supported Tata Trusts in their interventions for migrant populations in Uttar Pradesh and Karnataka, India through a holistic Beneficiary Management System (BMS) and a grievance management system. A mobile application for field mobilizers helped capture details and create sensitizations about Apna Seva Kendras and government schemes and benefits. For Operation Smile, an organisation that has enabled thousands of safe surgeries for those born with cleft lip and cleft palate, TCS built a comprehensive Patient Management System to streamline a patient's journey. The Tertiary Health Care Transformation at the Tata Medical Center (TMC) in Kolkata provided 100% coverage of patients via virtual engagements, including those that did not show and were not reachable. Patient care services implemented this year improved patient satisfaction and reduced anxiety. Through this year, the program has successfully piloted and demonstrated benefits from 'IoT based smart rural water management' in 7 villages across 4 States. The project has also aided the government and technical taskforces in developing adequate standards, governance frameworks and rollout guidelines. # Pro-Bono Technology Support to Social Organisations TCS' pro-bono technology support interventions continue to help community-based organizations across the globe. In FY 2021, the company supported social organizations like the Women's Business Collaborative focused on leveraging the power of collaboration to accelerate change for gender inclusion and Chief Executives for Corporate Purpose (CECP), a CEO-led coalition to create social impact in North America with services valued over $2 million. # Water Sanitation and Hygiene Jal Jeevan Mission, a project by the ministry of Jal Shakti, Government of India has been supported by the Tata Group with TCS providing key expertise in applying a 'Bridgital model' for monitoring rural water service delivery as well as enhanced stakeholder engagement via digitally enabled workflows. To date, interventions have led to the... Integrated Annual Report 2020-21 Management Discussion and Analysis | 153 # Stakeholder Capitalism and a Purpose Driven Approach Stakeholder capitalism and a purpose driven approach is becoming critical for companies as consumers and the society at large is expecting more from businesses. It is, therefore, important for companies to communicate more long-term, forward-looking information to key stakeholders. TCS' technology enabled solution for Chief Executives for Corporate Purpose (CECP) has digitally enabled long-term planning for more than 250 of its member companies. The solution has supported over 30 CEOs on their journey to refocus investor expectations towards the long term and corporate sustainability. "Through their pro bono services, TCS gave us, as a non-profit, access to expert developers who helped us design and implement a first-class platform. TCS worked hands-on as an extension of our team and fully embedded themselves in the development process from start to end as true thought partners." # Community Investments In Australia, TCS provided pro bono technology empowerment to Australia and New Zealand based Meals on Wheels, Royal Hospital for Women, Food Ladder, Charitable Recycling Australia and Biocovid valued at A$1 million so they could continue to support people who depended on their services even during in the pandemic. TCS community investments have been actualized, in a large part, by its large employee base who generously volunteer their time, skills and expertise as last-mile connectors. TCS' Employee Volunteer Program channeled the unique skillset of its employees and their ability to address some of the most pressing issues in countries where they live and work. In FY 2021, more than 69,000 employees volunteered over 787,000 hours to support these initiatives, contributing to Sustainable Development Goals 3, 4, 5, 8, 10, and 13. # Youth Employment Program Through the Youth Employment Program, volunteers in India delivered sessions for youth in Sweden, Germany, US and Australia. |
Through TCS' collaboration with Katalyst, 33 volunteers mentored 53 girls from marginalized communities in India providing them the exposure to a new set of experiences and perspectives. Integrated Annual Report 2020-21 Management Discussion and Analysis | 154 # A Sakira Banu, IT Analyst Through Lab on Bike, implemented in association with Agastya International Foundation, providing kits for communities affected by typhoon Ulysses and by raising funds. # Empowering Communities to Adapt and be Resilient to COVID19 At the Oragadam Thiruvidanthai village in Tamil Nadu, access to water was a massive issue, with only one borewell for 46 families. The greatest impact was on women and their sanitation and hygiene. Sakira Banu, through her volunteering effort, was instrumental in constructing a motor-based borewell to create access to water for 160 people. Sarika also supported efforts to construct borewells in Sembakkam and Paloor Villages. At the Hanumanthapuram Government School in Tamil Nadu, students had to bring water from their own homes rationing consumption to ensure they had access to clean drinking water through the school day. Leveraging her experience of constructing sustainable borewells, Sakira liaised with the Block Development Officer, obtained the necessary approvals, and the school got a 425 ft borewell and long-term access to water, leading to better sanitation and hygiene for the entire school. Over 2,800 people from rural communities in Karnataka and Puducherry were supported by TCS volunteers. Students were provided access to computer, internet, multimedia learning while employment-related mentorship was provided to the youth. Adults in the villages benefited from the healthcare advice and awareness programs. TCS responded to this global community challenge with great agility, creating essential interventions including those that supported health and well-being, facilitated adaptation of education systems to virtual and remote learning and leveraged a purpose-driven approach to utilizing its technology and human capital to create solutions that address immediate needs of the local communities. The pandemic pushed medical professionals into the front lines of the crisis. As a result, there was an increased need to develop and deliver resources that support physicians, nurses, care team members. TCSers in China helped set up a computer lab to facilitate remote education in a distant school in Gansu province. Employees who, typically, volunteered in person, spent time via video conferencing several times a week to teach students STEM subjects. TCSers in the US and Canada supported military veterans and youth from underserved communities through mock interviews and virtual career coaching, while those in India volunteered time to lead technical trainings through its youth employment programs. File: AR_TCS_2020_2021.md TCS contributed ₹250 crore to the PM Cares Fund to support vulnerable and marginalized populations in India. Employees also supported disaster relief efforts to help those affected by typhoon Rolly and Ulysses by providing resources. and their families. TCS provided more than 100,000 health and well-being as health professional worked around the clock. TCS iON CoronaWarriors, an online learning program, was specifically created for paramedical and professional healthcare workers on the fundamentals of infection prevention and control of COVID-19. This 6-hour course was designed and curated by healthcare experts at TCS and Harvard University to provide essential support during the peak of the pandemic. 2.5 million meals were distributed to 250,000 doctors and medical professionals in partnership with Indian Hotels Company Ltd. This helped ensure support to Cancer Institute, Chennai for at-risk populations such as those with cancer. # TCS' Leaders with Purpose TCS' Leaders with Purpose program provides professional development through hands-on civic leadership training to select champions committed to leveraging their skills to change the world. The 80-member cohort of 2021 is currently undergoing expert mentoring sessions and social projects to build socially conscious leaders within the company's workforce. For many years, Anita served as a CSR Champion, helping organize and promote volunteer opportunities among associates in her account. In 2019, she enrolled for the program, motivated by a desire to help train and inspire the next generation of volunteers to spread the sense of purposefulness across the workforce. Through training in community engagement, Anita gained greater insight into the objectives and opportunities to scale impact through corporate social initiatives. After graduating from the program in the summer of 2020, Anita remains a true social leader and she is now leading a team of TCS associates in a pro bono effort benefitting an international disaster relief agency. She also serves on TCS' inaugural Go Red Advisory Committee to raise funds and awareness in the fight against heart disease, the global #1 cause of death. |
Ensured the activation of contact-less patient care coordination services for over 21,000 patients. Virtual consultation services implemented at the hospital proved to be immensely beneficial while the integration of a COVID assessment helped with early assessment and the delivery of appropriate care. At Tata Medical Center Kolkata, ClinicographTM services enabled location independent access to review and analyze patient data to provide care during lockdowns. The pandemic had the deepest impact on those who are most vulnerable, including people living in poverty, older people, those with disabilities, youth and minorities. TCS' support in providing food, pantry boxes and healthcare products for vulnerable communities in the U.S., Mexico and Chile ensured access to basic sustenance. At this time, it was also important that verified information is made available for those in rural and disconnected areas. TCS created content in 10 Indian languages focusing on physical and emotional well-being as well as guides to access government relief measures and other entitlements that were crucial to ensuring wellness of 450,000 people in India during the lockdowns. # Lending a Helping Hand TCS family of more than 488,000 global employees shared TCS' commitment to support those that needed it the most - and TCS, in turn, supported Integrated Annual Report 2020-21 Management Discussion and Analysis | 156 All it takes is one person to make a difference. Jigar Chadva, a delivery manager and a community champion, realized that he alone could be the start of a movement that would provide support and relief for so many impacted by the pandemic. He, along with members of his team, took the lead to organize several activities in Bangalore to provide relief to marginalized sections and those below the poverty line, who are most impacted by the lockdown. Understanding the need for swift action, Jigar worked, for over 2 months, to collect and distribute 450 food packets from central government authorized kitchens for people in and around Whitefield area of Bangalore city. Twenty families also received groceries and supplies worth `10,000. Organizations such as Chaitanya Kuteer, SOS Children's village and Vonisha Foundation received a total of 1,000 masks while non-profit Chaitanya Kuteer was also supported with grocery stock of 2 months for the wellbeing of the children who were under its care. For his efforts, Jigar was recognized as a CORONA warrior - a special badge issued by the Government of India for those who had selflessly volunteered time in support of communities and to help others receive immediate relief. "Thanks to you and your team of warriors for this generous gesture towards community well-being. Since these areas are home to people who earn less than `30 a day, these masks are the much needed and timely protection against any new wave of the pandemic." - SOS Children's Villages of India, Bangalore Technology and innovation are the core strengths of TCS, and the company leveraged its expertise to overcome the challenges communities were facing during the pandemic. Resilience of social organizations was key if continuity to essential services had to be maintained. TCS delivered enhancements to its Beneficiary Management System (BMS), developed pro-bono for Tata Trust's migrant support interventions. Enhancements included features such as SMS and e-mail configurations key during the pandemic to create large scale connects for a population group that was most impacted by the disconnect. TCS associates volunteered time to create awareness e-communication materials in multiple easily accessible formats and translated these into four languages. As a result, over 18,000 beneficiaries in India had access to WHO guidelines on actions to adopt to ensure their safety during the pandemic. Also, see the story of how TCS developed a standalone system to help the State of Connecticut disburse pandemic unemployment benefits. # Bridging education gaps Unemployment assistance to gig workers and other independent contractors on Page 29 in this Report. While virtual learning facilitated continued support for their educational needs, a 5-day self-paced digital certification program, Career Edge, was also specially designed and offered at no cost to university students and working professionals to enhance their digital skills during lockdowns. Virtual learning became an essential service during the pandemic. Across the globe, there were over a billion students putting their varying degrees of digital skills to the test in an effort to keep themselves safe yet connected. At the same time, access to at-work skills remained a distant possibility for marginalized youth. |
Acknowledging this critical gap, TCS created support systems for learners of all ages, educators, and parents to make a seamless transition to remote and online learning. A digital pivot for TCS' strategic programs, Ignite My Future in School, goIT, and Youth Employment, ensured that learning continued even if it could not take place in person. TCS Cares and TCS Yoga, designed to engage the company's global workforce, were also integrated into the program design of its employment programs in India to ensure much-needed support to students in managing the negative impacts on their overall well-being during the pandemic. TCS' proprietary iON Digital Glass Room was opened up for any educational institution across the globe to utilize free of cost for the entire academic year. Over 23,000 institutions leveraged the platform to support their educational needs. # Extending TCS' reach One of the biggest challenges that impacted rural India during the pandemic was the lack of connectivity. The digital divide created an unprecedented lack of access to basic services rendering several marginalized groups at risk. Digital entrepreneurs of TCS' flagship BridgeIT program became the "bridge" to connect communities to critical services that had all gone virtual. New services within the CSC platform, such as tele-law and tele-health, were delivered via these entrepreneurs. They also provided access to emergency ambulance services and food for those below the poverty line in rural regions and distributed health materials, over 6,000 masks, food, and protective equipment to over 200,000 households. From April to August, the months of highest impact, these services supported more than 157,000 people across India. Rodney Crouse, a middle school teacher in North Carolina and TCS' Ignite My Future in School Learning Leader, realized quickly this year that computational thinking strategies will help his students remain engaged during distance learning. By integrating the simple strategies that he learned from the program, Rodney has found that students who were struggling to stay engaged were now taking an initiative. Today, Rodney collaborates with educators from Mexico, Canada, and the U.S. to help his students solve the global problem of Food Deserts. "My kids are living in a food desert, so they are learning about where they live and how to solve a problem that affects their community. This project is relevant to all of their lives." # Awards and Accolades for Social Capital - Awarded the 2020 CSR China Education Award - Named as one of America's Most Community-Minded Information Technology Companies for the fourth consecutive year, and as Technology Sector Leader for the third year, in the Civic 50 by Points of Light, the world's largest organization dedicated to volunteer service. - Awarded by SHRM India for Excellence in Community Impact at the HR Excellence Awards 2020. - Received an APEX award from Global Compact Network Singapore for Sustainable Solutions in recognition of TCS' Care Seniors Program in Singapore. - Recognized among Asia's Best Companies 2020 for Best Environmental Stewardship and Most Committed to Social Causes by FinanceAsia. - Named the 2020 Corporate Citizen of the Year by Economic Times for demonstrating a deep commitment to society. - Recognized for its work with Million Women Mentors at the 17th Annual Innovations in Diversity & Inclusion Awards. - Won the 2020 Stevie Gold Award for Best CSR Strategy in Canada. TCS also leveraged its partner network to provide access to masks, food, and protective equipment to over 180,000 households in Raichur, Karnataka. TCS' Youth Employment Program, additionally, expanded its reach during the pandemic to support training for marginalized populations in states such as Arunachal Pradesh, Himachal Pradesh, Haryana and Ladakh. The company's work with social entrepreneurs who have scaled the solutions incubated by the Digital Impact Square, a TCS Foundation Initiative, served more than 3.8 Million people in India. Solutions like a vehicle e-pass system allowed essential and authorized services to work smoothly during the lockdown and MahaKavach, helped health authorities in tracking quarantined patients in Maharashtra, India in turn supporting the management of the spread of the disease in critical states. # Business Responsibility Report This section is as per Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 # Section A: General information about the company 1. Corporate Identity Number (CIN) of the Company: L22210MH1995PLC084781 2. Name of the Company: Tata Consultancy Services Limited Registered address: 9th Floor, Nirmal Building, Nariman Point, Mumbai - 400 021, India 3. Website: www.tcs.com 4. E-mail id: [email protected] 5. Financial Year reported: April 1, 2020 to March 31, 2021 6. |
Sector(s) that the Company is engaged in (industrial activity code-wise): ITC CODE: 85249009 Product Description: Computer Software 7. Total number of locations where business activity is undertaken by the Company: 1. Number of International Locations (Provide details of major 5): |Region|# of Delivery Centers| |---|---| |UK and Ireland|20| |North America|19| |Latin America|19| |Asia Pacific|10| |Europe|7| |MEA|1| 2. Number of National Locations: 107 8. Markets served by the Company - Local/State/National/International: North America, Latin America, United Kingdom and Ireland, Continental Europe, Asia Pacific, Middle East and Africa, and India. 9. List three key products/services that the Company manufactures/provides (as in balance sheet): Consulting and Service Integration, Digital Transformation Services and Cognitive Business Operations. Integrated Annual Report 2020-21 Management Discussion and Analysis | 160 # Section B: Financial details of the company 1. Paid up Capital (INR): 370 crores 2. Total Turnover (INR): 164,177 crores 3. Total profit after taxes (INR): 32,430 crores 4. Total Spending on Corporate Social Responsibility (CSR) as percentage of profit after tax (%): 2.03% of average net profit for previous three years in respect of standalone TCS (India Initiatives only) 5. List of activities in which expenditure in 4 above has been incurred: |Category (CSR in India only)|₹ crore| |---|---| |Disaster Relief - COVID 19|273| |Education, Skilling, Employment, Entrepreneurship|28| |Health, Wellness and Water, Sanitation and Hygiene (WASH)|22| |Heritage|1| |Contribution to Foundations/Trusts|350| |Total|674| Including overseas spend, the Company's total spending on Corporate Social Responsibility is ₹ 737 crore # Section C: Other details 1. Does the Company have any Subsidiary Company/ Companies? Yes 2. Do the Subsidiary Company/ Companies participate in the BR Initiatives of the parent company? If yes, then indicate the number of such subsidiary company(s): Yes, 49 subsidiaries participated 3. Do any other entity/entities (e.g. suppliers, distributors etc.) that the Company does business with, participate in the BR initiatives of the Company? If yes, then indicate the percentage of such entity/entities? [Less than 30%, 30-60%, More than 60%] No. # Section D: BR information 1. Details of Director/Directors responsible for BR Management Discussion and Analysis | 161 # 2. Principle wise (as per NVGs) BR Policy/policies The National Voluntary Guidelines on Social, Environmental and Economic Responsibilities of Business (NVGs) released by the Ministry of Corporate Affairs has adopted nine areas of Business Responsibility. These briefly are as follows: - P1 Business should conduct and govern themselves with Ethics, Transparency and Accountability - P2 Businesses should provide goods and services that are safe and contribute to sustainability throughout their life cycle - P3 Businesses should promote the wellbeing of all employees - P4 Businesses should respect the interests of, and be responsive towards all stakeholders, especially those who are disadvantaged, vulnerable and marginalized - P5 Businesses should respect and promote human rights - P6 Business should respect, protect, and make efforts to restore the environment - P7 Businesses, when engaged in influencing public and regulatory policy, should do so in a responsible manner - P8 Businesses should support inclusive growth and equitable development - P9 Businesses should engage with and provide value to their customers and consumers in a responsible manner |S. N.|Questions| |---|---| |1|Do you have a policy / policies for....| |2|Has the policy being formulated in consultation with the relevant stakeholders?| |3|Does the policy conform to any national / international standards?| |4|Has the policy been approved by the Board? If yes, has it been signed by MD/owner/ CEO/appropriate Board Director?| |5|Does the company have a specified committee of the Board/ Director/ Official to oversee the implementation of the policy? Indicate the link for the policy to be viewed online?| |6|Has the policy been formally communicated to all relevant internal and external stakeholders?| |7|Does the company have in-house structure to implement the policy/ policies?| |P1|P2|P3|P4|P5|P6|P7|P8|P9| |---|---|---|---|---|---|---|---|---| |Y|Y|Y|Y|Y|Y|Y|Y|Y| |Y|Y|Y|Y|Y|Y|Y|Y|Y| |Y|Y|Y|Y|Y|Y|Y|Y|Y| |Y|Y|Y|Y|Y|Y|Y|Y|Y| |Y*|Y*|Y*|Y**|Y*|Y***|Y*|Y*|Y*| |Y|Y|Y|Y|Y|Y|Y|Y|Y| |Y|Y|Y|Y|Y|Y|Y|Y|Y| Integrated Annual Report 2020-21 Management Discussion and Analysis | 162 |S. N.|Questions|P1|P2|P3|P4|P5|P6|P7|P8|P9| |---|---|---|---|---|---|---|---|---|---|---| |8|Does the Company have a grievance redressal mechanism related to the policy/policies to address stakeholders' grievances related to the policy/ policies?|Y|Y|Y|Y|Y|Y|Y|Y|Y| |9|Has the company carried out independent audit/ evaluation of the working of this policy by an internal or external agency?|Y|N|Y|N|N|Y|N|N|Y| * TATA Code of Conduct (https://on.tcs.com/Tata-Code-Of-Conduct) ** CSR Policy (https://on.tcs.com/Global-CSR-Policy) *** Environment Policy (https://on.tcs.com/Environmental-Policy) # 3. Governance related to BR (a) Indicate the frequency with which the Board of Directors, Committee of the Board or CEO to assess the BR performance of the Company. Within 3 months, 3-6 months, Annually, More than 1 year: 7 Board Meetings were held during the year. |
(b) Does the Company publish a BR or a Sustainability Report? What is the hyperlink for viewing this report? How frequently it is published? Yes, the Company publishes a Sustainability Report every year as part of the Integrated Annual Report. The hyperlink is: https://on.tcs.com/Annual-Report-2021 # Section E: Principle wise performance # Principle 1 1. Does the policy relating to ethics, bribery and corruption cover only the company? No. Does it extend to the Group/Joint Ventures/Suppliers/Contractors/ NGOs/ Others? Yes. 2. How many stakeholder complaints have been received in the past financial year and what percentage was satisfactorily resolved by the management? If so, provide details thereof, in about 50 words or so: In FY 2021, 184 concerns from various stakeholders were received via various channels. Of these, 167 (91%) were satisfactorily resolved as on March 31, 2021, and the remaining concerns are a work in progress to be resolved following due processes. Integrated Annual Report 2020-21 Management Discussion and Analysis | 163 # Principle 2 1. List up to 3 of your products or services whose design has incorporated social or environmental concerns, risks and/or opportunities: 1. TCS Evirozone™ is a suite of products designed with environmental sustainability as a central focus for the Consumer and Packaged Goods industry. This includes: - TCS EnvirozoneTM O-Zone for Responsible Sourcing. O-Zone brings a holistic view to manage supply chain sustainability risks by tracking and mitigating water stress, food toxicity, climate and social risks from a complex network of suppliers upstream. - TCS EnvirozoneTM iCloseLoop - This is a Recycling Marketplace that helps in achieving a unified view of the journey towards sustainable packaging and a circular economy. It serves as an input to strategic decisions on product packaging and extended producer responsibility. - TCS EnvirozoneTM Net-Zero - Net-Zero is a Carbon Management Solution that enables accounting and management of value chain emissions for better visibility on climate risk. It also enables stakeholders' engagement for shared ownership of carbon mitigation programs. 2. Digital Farming Initiative (DFI): TCS' Digital Farming Initiative is a platform that personalizes data support to the level of each farmer and field. It hopes to transform the complete supply chain of the agri eco-system through the application of innovative protocol-centric, data-driven, "Sky-Earth" convergence technologies, thereby improve farmer livelihoods. It also works through creation of rural nuclei of growth called PRIDEs (Progressive Rural Integrated Digital Enterprises). 3. Virtual HABilitation (VHAB) - TCS' VHAB aims at providing a full-fledged application platform for children having difficulties in limb, muscular movements and general behavioral traits. A cost efficient solution built on gesture reality, leap motion and virtual reality platforms that builds a personalized suite of exercises for various kinds of movements for hands, legs and palms, that are fun, interactive and ensure development. 2. For each such product, provide the following details in respect of resource used (Energy, Water, Raw material etc.) per unit of product (optional) 1. Reduction during sourcing/production/ distribution achieved since the previous year throughout the value chain? - EnvirozoneTM : This is a digital product, therefore not applicable. - Digital Farming Initiative: Not Applicable - Virtual HABilitation (VHAB) - Not Applicable 2. Reduction during usage by consumers (energy, water) has been achieved since the previous year: - EnvirozoneTM : The products listed above are TCS' new digital offerings that enable better environmental, social and governance (ESG) performance for the Company's customers. These solutions have proven ability to better manage ESG risk and accelerate its customers' sustainability journeys towards responsible sourcing, net-zero carbon, circular economy, and brand neutrality. Each customer's journey has been different; but ESG performance has improved in each case. - Digital Farming Initiative The following improvements have been achieved with respect to environmental impact: - Reduction in chemicals usage (20 kgs/hectare): 50,400 tons Integrated Annual Report 2020-21 Management Discussion and Analysis | 164 # Reduction methane and CO2 emissions: 7,500 tons/year # Reduction in water usage: 2.4 million litres/season # Reduction in electricity usage: 1 million units/year # Virtual HABilitation (VHAB) - Not Applicable # 3. Does the company have procedures in place for sustainable sourcing (including transportation)? (a) If yes, what percentage of your inputs was sourced sustainably? Also, provide details thereof, in about 50 words or so. TCS' suppliers sign the Supplier Code of Conduct and the Tata Code of Conduct. The Company's policy on supply chain sustainability can be found here: Sustainable Supply Chain Policy # 4. |
Has the company taken any steps to procure goods and services from local & small producers, including communities surrounding their place of work? Yes (a) If yes, what steps have been taken to improve their capacity and capability of local and small vendors? While the criteria for selection of goods and services is quality, reliability and price, TCS gives preference to small organisations, particularly promoted by entrepreneurs from socially backward communities. TCS has conducted a value stream mapping of their manufacturing lines, identified opportunities for process and productivity improvements and facilitated capacity planning. TCS has also supported suppliers to meet their raw material / hardware purchasing needs from Tier II suppliers. This has helped the suppliers to improve their own capacity. TCS has played a key role in enhancing Small and Medium Enterprises' manufacturing capability by identifying gaps in the process as compared to customer processes and supporting the SME by training and handholding to overcome those gaps. One example of supporting these key activities is by helping the supplier create a specific FAI (First Article Inspection) process so that components can be developed and inspected in record time and shipped to customer. Beyond the company's own procurement system, TCS is increasing the capacity of Self Help Groups and entrepreneurs through its BridgeIT and Adult Literacy programs and community investments. # 5. Does the company have a mechanism to recycle products and waste? If yes what is the percentage of recycling of products and waste (separately as 10%). Also, provide details thereof, in about 50 words or so: Yes. For more details please refer to FY 2021 Performance Overview: Natural Capital which forms part of this Integrated Annual Report # Principle 3 # 1. Please indicate the Total number of employees: 488,649 as on March 31, 2021 # 2. Please indicate the Total number of employees hired on temporary/ contractual/ casual basis: 18,259 as on March 31, 2021 # 3. Please indicate the Number of permanent women employees: 178,357 as on March 31, 2021 # 4. Please indicate the Number of permanent employees with disabilities: 825 as on March 31, 2021 Management Discussion and Analysis | 165 # 5. Do you have an employee association that is recognized by management? Yes # 6. What percentage of your permanent employees are members of this recognized employee association? 0.03% (For India) # 7. Please indicate the Number of complaints relating to child labour, forced labour, involuntary labour, sexual harassment in the last financial year and pending, as on the end of the financial year: The Company has adopted a policy on prevention, prohibition and redressal of sexual harassment at the workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (India) and the Rules thereunder. During FY 2021, the Company has received 27 complaints of sexual harassment, out of which 19 complaints have been resolved with appropriate action taken and 8 complaints remain pending as on March 31, 2021. Internal review is under progress for the pending complaints, following due process. There have been no complaints in other areas. # 8. What percentage of your under mentioned employees were given safety & skill upgradation training in the last year? |(a) Permanent Employees|99.7%| |---|---| |(b) Permanent Women Employees|99.7%| |(c) Casual/Temporary/Contractual Employees|78.3%| |(d) Employees with Disabilities|99.4%| # Principle 4 # 1. Has the company mapped its internal and external stakeholders? Yes # 2. Out of the above, has the company identified the disadvantaged, vulnerable & marginalized stakeholders? Yes # 3. Are there any special initiatives taken by the company to engage with the disadvantaged, vulnerable and marginalized stakeholders? If so, provide details thereof, in about 50 words or so: Yes. Please refer to the section on FY 2021 Performance Overview: Social Capital in this Integrated Annual Report for details on the Company's Adult Literacy Program, Bridge IT, Youth Employment programs among others. # Principle 5 # 1. Does the policy of the company on human rights cover only the company or extend to the Group/Joint Ventures/ Suppliers/Contractors/NGOs/Others? The principles stated in the Company's code and policies which include respect for human rights and dignity of all stakeholders, extend to the group, joint ventures, suppliers and all those who work with TCS. File: AR_TCS_2020_2021.md # 2. How many stakeholder complaints have been received in the past financial year and what percent was satisfactorily resolved by the management? No material concern related to violation of fundamental human rights of individuals was received during the financial year. |
Integrated Annual Report 2020-21 Management Discussion and Analysis | 166 # Principle 6 1. Does the policy related to Principle 6 cover only the company or extends to the Group/Joint Ventures/Suppliers/Contractors/NGOs/others. The policy is applicable to TCS, its subsidiaries and vendors. 2. Does the company have strategies/ initiatives to address global environmental issues such as climate change, global warming, etc? Y/N. If yes, please give hyperlink for webpage etc: Yes. Please refer to the section on FY 2021 Performance Overview: Natural Capital in this Integrated Annual Report and https://www.tcs.com/sustainability-strategy. TCS' Environmental Policy is available on https://on.tcs.com/Environmental-Policy. 3. Does the company identify and assess potential environmental risks? Yes. 4. Does the company have any project related to Clean Development Mechanism? If so, provide details thereof, in about 50 words or so. Also, if Yes, whether any environmental compliance report is filed? Not Applicable. 5. Has the company undertaken any other initiatives on - clean technology, energy efficiency, renewable energy, etc. Y/N. If yes, please give hyperlink for web page etc. Yes. Please refer to the section on FY 2021 Performance Overview: Natural Capital in this Integrated Annual Report. 6. Are the Emissions/Waste generated by the company within the permissible limits given by CPCB/SPCB for the financial year being reported? Yes. 7. Number of show cause/ legal notices received from CPCB/SPCB which are pending (i.e. not resolved to satisfaction) as on end of Financial Year. None. # Principle 7 1. Is your company a member of any trade and chamber or association? If Yes, Name only those major ones that your business deals with: Yes. National Association of Software and Services Companies (NASSCOM), Confederation of Indian Industries (CII), Federation of India Chambers of Commerce and Industry (FICCI), US India Business Council (USIBC), US Chamber of Commerce and Confederation of British Industry (CBI). 2. Have you advocated/lobbied through above associations for the advancement or improvement of public good? Yes/ No; if yes specify the broad areas (drop box: Governance and Administration, Economic Reforms, Inclusive Development Policies, Energy security, Water, Food Security, Sustainable Business Principles, Others): Yes. TCS participated in consultations on governance and administration, sustainable business principles, inclusive development policies (with a focus on skill building and literacy), economic reforms and tax and other legislations. TCS uses the Tata Code of Conduct as a guide for its actions in influencing public and regulatory policy. # Principle 8 1. Does the company have specified programmes/initiatives/ projects in pursuit of the policy related to Principle 8? If yes details thereof? Yes. Please refer to the preceding section on FY 2021 Performance Overview: Social Capital in this Integrated Annual Report. 2. Are the programmes/projects undertaken through in-house team/own foundation/external NGO/government structures/any other organization? TCS uses all of these modes. Integrated Annual Report 2020-21 Management Discussion and Analysis | 167 # 3. Have you done any impact assessment of your initiative? TCS has been conducting internal impact assessments to monitor and evaluate its strategic CSR programs. The Company takes cognizance of sub-rule (3) of rule 8 of the Companies CSR Policy Rules 2014 and has initiated steps to conduct impact assessment of CSR projects through an independent agency. There are no projects undertaken or completed after 22nd January 2021, for which the impact assessment report is applicable in FY 2021. # 4. What is your company's direct contribution to community development projects- Amount in INR and the details of the projects undertaken? ₹737 crore, including overseas spend. For more details, please refer to Annexure II of Directors' Report in this Integrated Annual Report. # 5. Have you taken steps to ensure that this community development initiative is successfully adopted by the community? Please explain in 50 words, or so. Yes. The CSR initiatives of the Company are executed by a skilled team who ensure impact-focused implementation, monitoring, and reporting. Successful adoption of programs is evidenced by the following impact achieved, till date, in its strategic programs: - 23,800 rural youth employed through Youth Employment Program # Principle 9 # 1. What percentage of customer complaints/consumer cases are pending as on the end of financial year. 5.8% complaints are pending resolution as on March 31, 2021. # 2. Does the company display product information on the product label, over and above what is mandated as per local laws? Yes/No/N.A./Remarks (additional information): Not Applicable # 3. Is there any case filed by any stakeholder against the company regarding unfair trade practices, irresponsible advertising and/or anticompetitive behaviour during the last five years and pending as on end of financial year? |
If so, provide details thereof, in about 50 words or so: No # 4. Did your company carry out any consumer survey/ consumer satisfaction trends? Yes - 325,000 villagers supported with digital services by 466 BridgeIT entrepreneurs - 1.07 million individuals, including over 70,000 prison inmates, made literate through the Adult Literacy Program Please refer to the section on FY 2021 Performance Overview: Social Capital in this Integrated Annual Report for further details. Integrated Annual Report 2020-21 Management Discussion and Analysis | 168 # FY 2021 PERFORMANCE OVERVIEW # NATURAL CAPITAL TCS' approach to sustainable growth is built on the belief that it can strengthen its business while also valuing the environment and its ecosystem. TCS is in a unique position to combine its heritage of purpose along with digital leadership and innovation to drive its own journey to more sustainable outcomes, as well as partner with customers, civil society and governments to lead and shape solutions towards the achievement of the UN Sustainable Development Goals. The Company has set a new carbon reduction target. It commits to reduce absolute Scope 1 + Scope 2 greenhouse gas emissions by 70% by 2025 over a 2016 base year. It aspires to achieve net-zero emissions by 2030. Key strategies include energy efficiency across operations, expanded use of renewable energy sources, working with supply chain partners to reduce value chain emissions and optimizing business air travel and employee commutes. TCS' leadership commitment builds on the significant progress it has already made in reducing its environmental footprint. It is driven by the belief that business success and sustainability-driven decisions are one and the same thing for a future-fit business, and banks on the passion of its employees, shareholders, suppliers, and customers to support its progress on this journey. # Key Areas of Focus - Accelerating TCS' journey towards net zero: Having achieved the previous target of halving the specific carbon footprint by 202027 (versus baseline year FY 2008) ahead of schedule, through digital technology was launched at TCS' first Sustainathon in Singapore in 2020. The challenge focused on solutions for food waste management which amplified the critical role that sustainability and success of the UN SDGs play in the creation of a better future. - Partnering with customers for more sustainable outcomes: Beyond its own footprint, TCS is actively engaged with customers and partners to help shape and deliver their journey to more sustainable and future-fit businesses. It sees greater potential in enabling efficiencies and climate action through its digital solutions for customers, higher than what it can accomplish within its own organizational boundaries. TCS offers digital solutions that use cutting edge technologies for intelligent energy management that reduces energy consumption, evaluation of portfolio climate risks for decision making, GreenIT, logistics route optimization, scope 1, 2 & 3 carbon emission foot printing and enabling blockchain-based Renewable Energy Certificate marketplaces. In addition, it plans to partner with customers strategically to deliver carbon neutral operations together. - Influencing and enabling future generations: TCS is one of the largest creators of skilled jobs globally. It encourages students to build the skills and confidence to pursue STEM education and careers and become tomorrow's technology and business leaders. It is committed to imparting digital skills and capabilities to at least 5 million youths by 2025. Another initiative to inspire and empower young minds to solve real-world environmental problems. 27 In the past years, TCS has successfully reduced its specific energy consumption in kWh/FTE by over 60% in FY 2020 over the baseline year FY 2008, and brought down its specific carbon footprint from Scope 1 and Scope 2 from 3 tCO2/FTE in FY 2008 to 1.15 tCO2e/FTE in FY 2020, a reduction of 61.6%. Integrated Annual Report 2020-21 Management Discussion and Analysis | 169 # Empowering employees to lead the change: TCS is certified under the ISO 14001:2015 Environmental Management System (EMS) standard, across 120 locations globally. The management system has integrated environmental (including climate change) risks and opportunities with TCS' business strategy. The company measures, manages and reports on energy, carbon, water and waste - the most material environmental aspects of its operations. Low quantities of food waste were generated as canteens and food services were operating at a bare minimum. Air travel and employee commutes were extremely limited and hence the carbon footprint associated with them also reduced significantly. # Managing the Carbon Footprint TCS has embraced the precautionary principle and recognized carbon footprint mitigation and energy optimization as a high priority area. |
With an operational footprint that consists largely of campuses of office blocks for the delivery organization, and sales offices, direct emissions from operations - also referred to as Scope 1 emissions - are a very small part of the company's carbon footprint, amounting to just 8% of the overall carbon footprint. The rest is made up of indirect emissions, referred to as Scope 2 emissions, associated with purchased electricity. # Impact of SWBS™ The company's environmental footprint was significantly reduced in FY 2021 due to the large-scale switch to remote working, enabled by the Secure Borderless Workspaces operating model. With over 96% of employees working from home throughout the year, resource consumption, emissions and wastes were significantly lower across all the parameters. However, despite the low occupancy rates of 3-4%, utilities across facilities had to be run at base load to ensure the overall health of the facility and systems. Due to the pandemic, all energy utilities had to be operated at base load for cooling and lighting systems, data centers and server rooms, to optimize the energy use. The absolute energy consumption is down by 46.6% YoY and absolute carbon footprint reduced to the tune of 40% to 50% despite the low physical occupancy. # Key Focus Areas - Energy management: Energy efficiency through green infrastructure and operational efficiency - Carbon footprint reduction: Maximizing energy efficiency and use of renewable energy - Water management: Efficient use, recycling and rainwater harvesting - Waste management: Reduction, Reuse and Recycling 28 103-2, 103-3 29 102-11; Earliest reference on Page 5, TCS Corporate Sustainability Report 2006-07 30 302-1, In FY 2021, TCS consumed 292 GWh of electricity of which 15.6% was from renewable sources, ~1% from onsite utilities and the remaining was purchased electricity. Total direct energy used was 0.04 Million GJ and total direct plus indirect energy used was 1.04 million GJ. The total electricity consumed, as well as direct energy usage, has gone down, due to lockdowns. # Integrated Annual Report 2020-21 # Management Discussion and Analysis (Scope 1 + Scope 2) is down by 48.8% YoY. TCS' more rooftop solar, taking the total on-site rooftop solar capacity across its campuses to 8.1 MWp. The estimated specific greenhouse gas emission (Scope 1 + Scope 2) was 0.54 tCO2e/ FTE/Annum in the current reporting year, a reduction of 53% Y-O-Y. The specific carbon footprint data is presented for the sake of continuity and is not comparable with the prior years. # The Path to Energy Efficiency This increased the solar electricity generation capacity to 11 million units within campuses. The total renewable energy quantum including on-site rooftop and third-party power purchase agreements is about 45.5 million units in FY 2021, which is about 15.6% of the total energy mix. On-site rooftop solar contributed about 2.5% of the total electricity mix. In FY 2021, solar photo voltaic cells technology was upgraded from polycrystalline solar panels to monocrystalline PERC technology panels. This helped to improve the project capacity and power generation by 13% and 17% respectively in the same given rooftop space. An elevated solar installation was successfully piloted around the lake area at Synergy park campus in Hyderabad to utilize the cooling effect of water on solar panels. The Remote Energy Management System has helped reduce the specific energy consumption year on year. This reduction has been despite the growth in employees, commissioning of new facilities and ramping up within existing facilities. Over 60% of the total office space currently occupied by TCS in India is designed as per the Leadership in Energy and Environmental Design (LEED) green building standards. In FY 2021, the company added additional green buildings to the company's real estate portfolio, installing rooftop solar power plants across campuses, optimizing IT system power usage, and upgrading legacy equipment with state-of-the-art technology. As the established standard operating procedures were recalibrated on the basis of the base load for cooling and lighting systems, data centers and server rooms, to optimize energy use; the investments made in the IoT based energy management platform and the energy operations command center paid good dividends. The cognitive AI / ML based algorithms came into play and were able to quickly define a 'new normal' consumption profile based on the significantly reduced activities. Data center power management initiatives helped achieve the target power utilization efficiency (PUE) of 1.65 at 21 Data Centers and reduce weighted average PUE of 23 Data Centers to 1.66 this year from 2.54 in 2014. |
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