Corporate Social Responsibility Of FMCG Leading Corporate Houses- ITC & HUL

Contents1. ITC1.1 Introduction1.2 ITC Sustainable Business Development Initiatives1.3 Corporate Governance Policy of ITC1.4 ITC CSR Activities1.5 CSR Theories Applicable to ITC1.6 ITC Alignment to Business Responsibility Principles(NVG)1.7 Shortcomings in ITC CSR Practices and Suggestions for Improvements2. HUL2.1 Project shakti 2.2 Strategic sourcing of tomatoes2.3 Stakeholders of hul2.4 Reducing sachet waste through pyrolysis2.5 Lifebuoy promoting health and hygiene through handwashing2.6 Domex toilet academy 2.7 Project prabhat 2.8 Non strategic initiatives2.9 Corporate governance2.10 Principles of nvg applicable to hul3. Conclusion

ITCINTRODUCTION ITC was incorporated on August 24, 1910 under the name Imperial Tobacco Company of India Limited. ITC Limited is an Indian conglomerate headquartered in Kolkata, West Bengal.Its diversified business includes five segments: Fast Moving Consumer Goods (FMCG), Hotels, Paperboards & Packaging, Agri Business & Information Technology. ITC is one of India's foremost private sector companies with a market capitalisation of US $ 45 billion and a turnover of US $ 7 billion. ITC is rated among the World's Best Big Companies, Asia's 'Fab 50' and the World's Most Reputable Companies by Forbes magazine and among India's Most Valuable Companies by Business Today.

ITC SUSTAINABLE BUSINESS INITIATIVES Business cannot succeed in societies that fail. Businesses must play a more meaningful, involved and active role in the creation of a more sustainable and inclusive future. ITC is pursuing innovative business strategies that synergize the creation of sustainable livelihoods and the preservation of natural capital with the building of shareholder value. This Triple Bottom Line strategy of building economic, social and environmental capital involves: Embedding Sustainability in Business Investing in Social Development Adopting a Low Carbon Growth Path and a Cleaner Environment Approach

Sustainability Policies of ITC

Life Cycle InitiativesITC endeavours to embed the principles of sustainability, as far as practicable, into the various stages of product or service life-cycle including procurement of raw material / service, manufacturing of product or delivery of service, transportation of raw materials and finished goods, and disposal by consumers.

Stakeholder EngagementITC believes that it is necessary to represent to and engage with authorities on matters concerning the various sectors in which it operates. ITC's engagement with the relevant authorities is guided by the values of commitment, integrity, transparency and the need to balance interests of diverse stakeholders.

Responsible AdvocacyITC is committed to providing products and services that offer best-in-class quality and user experience. With a continually growing portfolio of businesses that use agri / farm products, ITC endeavors to use sustainably sourced ingredients in products and internationally accepted standards of manufacturing in relevant businesses.

Product ResponsibilityITC is committed to providing products and services that offer best-in-class quality and user experience. With a continually growing portfolio of businesses that use agri / farm products, ITC endeavors to use sustainably sourced ingredients in products and internationally accepted standards of manufacturing in relevant businesses.

Responsible SourcingITC endeavors to integrate sustainability in the procurement process for its products and services across its diversified business portfolio.

Freedom of associationITC believes all employees are important stakeholders in the enterprise and it is imperative to build a culture of mutual trust and respect, interdependence and meaningful engagement. This approach helps in building, strengthening and sustaining harmonious employee relations across the organization.

Diversity and equal opportunityITC believes that diversity at the workplace creates an environment conducive to engagement, alignment, innovation and high performance. This is achieved by a policy that ensures diversity and non-discrimination across the Company.

Child Labor and forced LaborITC believes in a "No Child Labor and No Forced Labor" policy.

Human rights consideration of stakeholders beyond the WorkplaceITC provides products and services of superior quality and value by sourcing its technologies, equipment, inputs and finished goods from reputed international and Indian manufacturers and suppliers. ITC expects its business partners to establish a human rights compliant business environment at their workplace. ITC believes that its vendors and suppliers must establish processes for mapping/monitoring progress on human rights performance.

Environment, Health & SafetyITC is committed to conducting its operations with due regard for the environment and providing a safe and healthy workplace for its employees.

CORPORATE GOVERNANCE POLICY OF ITC ITC's Corporate Governance initiative is based on two core principles. These are: Management must have the executive freedom to drive the enterprise forward without undue restraints exercised within a framework of effective accountability. ITC believes that any meaningful policy on Corporate Governance must provide empowerment to the executive management of the Company, and simultaneously create a mechanism of checks and balances which is used with care and responsibility to meet stakeholder aspirations and societal expectations. The cornerstone of ITC Governance policy is trusteeship, transparency, empowerment and accountability, control and ethical corporate citizenship. The practice of Corporate Governance in ITC is at three interlinked levels: Strategic supervision by the Board of Directors

Strategic management by the Corporate Management Committee

Executive management by the Divisional / Strategic Business Unit (SBU) Chief Executive assisted by the respective Divisional / SBU Management Committee

Board of Directors: Executive Chairman of ITC shall operate as the Chief Executive for ITC as a whole Directors shall be appointed / re-appointed for a period of three to five years, and in the case of Executive Directors up to the date of their retirement, whichever is earlier. The Board shall determine from time to time the retirement age for both Executive and Non-Executive Directors. The Board shall specify the maximum number of company Directorships which can be held by members of the ITC Board. The Board shall meet at least six times a year and meetings will be held once in two months. The annual calendar of meetings shall be agreed upon at the beginning of each year. The quorum for meetings shall be one third of members and decisions shall be taken by simple majority, unless statutorily required otherwise. Minutes shall be circulated within 15 working days of the meeting and confirmed at the next meeting Composition of the DMC shall be determined by the Line Director with the approval of the CMC.

The Board shall have the following Committees whose terms of reference shall be determined by the Board from time to time:

CommitteeMembersChairman

Audit Committee Non-Executive Directors of the Company, as may be decided by the Board. The Director responsible for the Finance function, Head of Internal Audit and representative of Statutory Auditors shall be Invitees with the Company Secretary as the Secretary. One of the Independent Directors

Compensation Committee Non-Executive Directors of the Company, as may be decided by the Board. One of the Independent Directors

Nominations Committee The Executive Chairman and Non-Executive Directors of the Company, as may be decided by the Board. Executive Chairman.

Investor Services Committee Directors of the Company, as may be decided by the Board, with the Company Secretary as the Secretary. One of the Non- Executive Directors

Sustainability Committee The Executive Chairman and Non-Executive Directors of the Company, with the Company Secretary as the Secretary. Executive Chairman.

ITCS CSR ACTIVITIES In pursuance of the Companys policy on Corporate Social Responsibility (ITCs CSR Policy detailed in the Policies & Guidelines section of this Report), ITC has crafted innovative business models that create larger and enduring value by not only generating new sources of competitive advantage for its businesses, but also in the process augmenting natural capital and sustainable livelihoods for the nation. The various CSR initiatives include: 1. Consumption of Energy ITCs water conservation, watershed development and rainwater harvesting projects not only improve the sustainability of their agri-related businesses, but also create sustainable livelihoods for a large number of marginal farmers. Establishment of green buildings is one of the relevant responses to the environmental challenges. ITCs Hotels Business reaffirmed this commitment by formally adopting the Responsible Luxury credo which is exemplified by the ITC Grand Chola, which is Worlds Largest LEED Platinum rated Green Hotel. 2. Minimizing Carbon Intensity and Adopting a Low Carbon Growth Path ITC continues to enlarge its positive carbon footprint through enhanced energy conservation, use of renewable energy sources and the expansion of carbon sequestration through large-scale Social and Farm Forestry Programmes. 3. Consumption of Energy Intergovernmental Panel on Climate Change In 2012-13, ITC Units consumed 21,347 Terra Joules (TJ) of energy. Despite significant grow slight increase of 1.0% in the total energy consumption as compared to previous year (21,130 TJ in 2011-12).This is directly attributable to the energy conservation projects implemented across the ITC Units and better capacity utilization. 4. Progress In Reduction of Specific Energy Consumption In ITCs Businesses A focused approach on energy conservation through rigorous third party audits and implementation of the recommendations and better capacity utilization resulted in substantial reduction in specific energy consumption.ITCs Paperboards and Specialty Papers Business has been rated the most energy efficient in the Indian Paper and Paperboards sector, according to the Centre for Science and Environment, New Delhi, (Challenge of the New Balance, CSE, 2010). 5. Water Conservation Conducting water audits, benchmarking and implementation of best practices to achieve the lowest possible specific freshwater intake. 6. Zero Effluent Discharge Treating and progressing towards achieving recycling of all waste water within premises. 7. Water Positive FootprintThey have enhanced water footprint through rainwater harvesting. All ITC Units are required to ensure that wastes are segregated at source in accordance with Company-defined guidelines. This ensures maximum reuse/recycling of waste. For example, it is ensured that paper waste is not contaminated with wet waste, which would render it unrecoverable. 8. Towards 100% Recycling Each category of waste is individually addressed and tracked to ensure that it can be reused, if possible, and if not, recycled. This ensures that almost no waste from their businesses lands up in municipal or private landfills. 9. CSR at marketplace

Enlarging ITCs Carbon Positive Footprint ITCs Social and Farm Forestry Initiatives have added more than 17,000 hectares of plantations during 2012-13. Total plantations, as on March 31, 2013, stand at over 1, 42,000 hectares.

Resource Conservation Reduce waste generation through constant monitoring of specific waste generation data at all ITC Units. CSR AT COMMUNITY 1. ITC e-ChoupalRecognizing the various challenges faced by the farmer and leveraging ITCs consumer facing businesses, ITC e-Choupal was designed to provide a 360-degree intervention to trigger a virtuous cycle of higher farm productivity, higher income, enlarged capacity for farmer risk management, and thereby larger investments to enable higher quality and productivity. This initiative has benefitted over 4 million farmers in 40,000 villages.2. Social Investments Programme CoverageThese projects are spread across 10 states covering 60 districts. The interventions reach out to more than 6 lakh households in more than 6,500 villages. Of the total projects currently being implemented, 76% are targeted at the Companys rural stakeholder households, while the balance 24% addresses stakeholders residing around their factories.3. Animal HusbandryThe programme for genetic improvement of cattle through artificial insemination to produce high-yielding crossbred progenies has been given special emphasis because it reaches out to the most impoverished and has the potential to enable them live with social and economic dignity. Ten new Cattle Development Centres (CDCs) were established during the year, taking the total to 303 centres covering nearly 5,000 villages that facilitated 2.75 lakh artificial inseminations during the year. 4. Project Gomukh- Integrated Dairy Management Programme The overarching objective of the project is to increase milk productivity and improve the quality of milk, thereby increasing farm incomes significantly.

5. The Social Forestry Programme ITC promotes pulpwood plantations in Andhra Pradesh and energy security in Karnataka which cumulatively covers a total of 33,448 hectares in 1,717 villages, impacting nearly 40,000 poor households. 6. Building Skills and Social Infrastructure around their Factories For the households around their units, these projects aim at creating sustainable livelihoods through community development.

CSR THEORIES APPLICABLE TO ITC Maximization of shareholder value ITC believes that its aspiration to create enduring value for the nation provides the motive force to sustain growing shareholder value.

Cause-related marketingEvery Classmate notebook carries ITC's Corporate Social Responsibility message on its back. For every four Classmate Notebooks purchased, ITC contributes 1 to its social development initiative that supports, among other projects, primary education. Corporate constitutionalism Social responsibilities of businesses arise from the amount of social power that they have. They are undertaking various environmental and social activities on a large scale.

Corporate (or business) citizenshipThe firm is understood as being like a citizen with certain involvement in the community. As a corporate citizen with enduring relationships in rural India, ITC has a history of collaboration with communities and government institutions to enhance farm productivity and the rural resource base. With initiatives like e-choupal ITC is transforming the way farmers do business, and the way rural markets work. Stakeholder management ITC considers all its employees and the community as its stakeholder. Through various skill development and social infrastructure development around their plant, it balances the interests of the stakeholders of the firm.

Universal rights ITC takes care of the human rights, labor rights of all its employees. The common good Various of ITCs CSR initiatives are oriented towards the common good of society. ITC ALIGNMENT TO BUSINESS RESPONSIBILITY REPORT PRINCIPLES (NVG) ITC links Sustainability Report 2014 to Business Responsibility Report Principles to assess compliance with Environmental, Social and Governance (ESG) norms. PrincipleBusiness Responsibility Report Principles toassess compliance with ESG normsCoverage in Section of Sustainability Report 2014

1 Businesses should conduct and govern themselves with Ethics, Transparency and Accountability Governance Structure

2 Businesses should provide goods and services that are safe and contribute to sustainability throughout their life cycle Energy Air Emissions Water Management Resource Conservation

3 Businesses should promote the wellbeing of all employees Labour Practices and Decent Work Occupational Health and Safety Human Rights Significant Investments

4 Businesses should respect the interests of, and be responsive towards all stakeholders, especially those who are disadvantaged, vulnerable and marginalized Economic Performance Stakeholder Engagement Labour Practices and Decent Work Human Rights Significant Investments Social Investments - Mission Sunehra Kal

5 Businesses should respect and promote human rights Human Rights Significant Investments

6 Business should respect, protect, and make efforts to restore the environment Raw Materials Biodiversity Social Investments - Mission Sunehra Kal

7 Businesses, when engaged in influencing public and regulatory policy, should do so in a responsible manner Responsible Policy Advocacy Stakeholder Engagement Memberships and Affiliations

8 Businesses should support inclusive growth and equitable development Economic Performance Social Investments - Mission Sunehra Kal

9 Businesses should engage with and provide value to their customers and consumers in a responsible manner Stakeholder Engagement Product Responsibility

SHORTCOMINGS IN ITC CSR PRACTICES AND SUGGESTIONS FOR IMPROVEMENTS Although e-choupal helps eliminate the middleman and therefore allows farmers to get a better price form what they grow, it does nothing to solve the more fundamental problem of the inherent inefficiencies created by so many tiny farms. E-Choupal relies on infrastructure, which is often lacking in rural communities. Electricity and telecommunication services can sometimes be less than 100% reliable in some of the places where E-choupal has been implemented For few of the Indicators under Specific standard disclosure under G4 GRI ITS has not disclosed any information citing the reason that there is no frame work in place to access such indicators. For such indicators they could take initiative and develop their own framework for reporting.

HUL

Strategic Initiatives1. Project Shakti Doing well by doing goodHUL created a unique micro-entrepreneurship model with the aim of integrating business interests with societal need.

About Project ShaktiA rural woman from poor economic background (in some cases member from a Self Help Group) is selected as a Shakti entrepreneur, commonly referred as 'Shakti Amma'. She receives stocks from HULs rural distributor. After being trained by the company, the Shakti entrepreneur then sells those goods directly to consumers and retailers in the village. This project was extended in 2010 for marginalised men, typically the husbands and brothers of Shakti Amma, the male members of Shakti Amma family, who distribute HUL products on bicycles to nearby villages.

Project Shakti Model1. 2. 3.Training selling , commercial knowledge and book-keeping

Recruits women/men identified from the village

HUL executive meet Panchayat/ self-help group in an uncovered village

4. 5. 6.The products are then sold door-to-door

On Average, Shakti Amma makes a 10% margin on the products she sells

A Shakti Amma is asked to put Rs. 20,000 as investment which is used to buy products for selling

Project Shakti started

With 17 women in one state in 2001

Provides livelihood opportunities

Over 65,000 Shakti Ammas distribute our HUL products in more than 165,000 villages and reach over 4 million rural households. Over 50,000 Shaktimaans. Each Shaktimaan covers around 3 villages in his own villages vicinity

Incentive for Shakti Ammas

Shakti Ammas are earning more than Rs. 1,000 a month. Door to door selling (11% margin on sales) Sell from own home (11% margin on sales) Retailers (3% margin) The company provides training in selling , commercial knowledge and book-keeping The Shakti Ammas can choose to set up their own business or become project Shakti distributors by investing Rs. 10,000 15,000 in stock at the outset by micro-finance banks facilitated by HUL. The company sells the products at additional discounts to the Shakti Entrepreneurs (SEs) thus enabling them to raise incomes of their families. The initiative almost doubles the average household income of a SE.Target

As per Unilever Sustainable Living Plan, Unilever will increase the number of Shakti entrepreneurs that it recruits, trains and employs from 45,000 in 2010 to 75,000 in 2015 globally.HUL distributes Tata Teleservices using Shakti amma distribution channel In 2011, HUL entered into an agreement with Tata Teleservices to distribute their products in rural markets, leveraging our existing networks. They are now distributing telecom products for Tata Teleservices in 95,000 telecom outlets through a network of over 700 rural distributors.

Associated MDG goals 1. Goal (1) Eradicate Extreme poverty and hunger2. Goal (3) Promote gender equality and empower women3. Goal(5) Improve maternal health4. Goal(7) Ensure environmental sustainability5. Goal(8) Develop a global partnership for development

All good so far, but still scope for improvement.1. Shakti Ammas are indirect employees of HUL. Empowering them alone is not sufficient. Ensuring that their financial position be secured, is important too. This can be achieved by helping them insure against home loan, child education loan by sharing the cost of premium charged by the insurance company.

Course of Action:-Almost one-third of Rs.20,000 that HUL keeps as an investment from each Shakti amma, be kept aside against a SIP or mutual fund and premiums for loan be recovered from there.

Strategic Sourcing of TomatoesIt is a sustainable sourcing initiative to source tomatoes used in Kissan Ketchup in India from farmers under Unilever Sustainable Living Plan launched in November 2010. HUL entered into a Public-Private partnership with Maharashtra Government for sustainable sourcing of tomatoes.About Strategic SourcingAs part of this initiative, HUL provides farmers with a buy-back guarantee for their produce as part of the sourcing arrangement. HUL also offers global and local knowledge and expertise in sustainable agriculture practices in tomato cultivation; this includes the latest agricultural techniques, irrigation practices and selection of the right type of seeds.Public-private partnership

The public-private partnership is for one year with effect from April 1, 2012 to March 31, 2013

Scale of Strategic Sourcing of tomatoes

Farmers cultivate two seasons of crops on an area of 800 hectares in Nasik, Ahmednagar and Pune (an overall radius of 100 km around Nasik). Till 2013, over 1600 farmers have registered for this project to grow tomatoes on over2000acres of land. This Supply Integration initiative undertook for Sustainable tomato sourcing through 1,100 smallholder farmers, 1500 acres, 28,000 metric tonnes of tomatoes In 2013, 80% of tomatoes used in Kissan ketchup in India were from Sustainable Sources.

Ensuring Quality of tomato sourced

There are two main routes to ensure raw materials count as sustainably sourced, either by working towards one of the Unilever recognised certification standards or through self-assessment using the Unilever Sustainable Agriculture Code.

The Business Model

Varun Agro, food processing company in partnership with HUL

Varun Agro collects produce from farmers following harvest

Farmers

Guidelines to farmers on good agricultural practices

HUL uses the processed tomato pulp

Win-win situation for HUL and farmers.

Increase in tomato production & productivity for farmers Strengthening of tomato supply chain Assured supply of tomato to the company.

Tripple Bottom Line

MDG goals targeted 1. Goal (1) Eradicate Extreme poverty and hunger2. Goal (3) Promote gender equality and empower women3. Goal(7) Ensure environmental sustainability4. Goal(8) Develop a global partnership for developmentTarget

HUL aims to source 100% of its tomatoes from sustainable sources by 2015. Unilever is committed to sourcing sustainably all its agricultural raw materials by 2020.

Stakeholders Of HUL

DormantDiscretionaryDemandingDominantDangerousDependentDefinitive

Government InvestorsEmployeesIndustry Shareholders,

Regulatory AgenciesNGOsLocal Residents Customers

Communities,Contractors

Suppliers

Distributors

REDUCING SACHET WASTE THROUGH PYROLYSIS

Over 40 billion sachets go out of Unilever every year. Thousands of tons of products are sold in single-use sachets in developing markets. This makes brands affordable to people with low incomes. However, low recycling value and the lack of disposal facilities means sachets can end up as litter or landfill.

REDUCING THE ENVIRONMENT IMPACT OF SACHETS

HULs approach is to: Implement design improvements to create sachets that use less material or material with less environmental impact support litter awareness programmes Work with others to explore economic models which create incentives for collection and reuse of our packaging.

HOW PYROLYSIS WORKS

Pyrolysis offers a closed loop system which involves catalytic depolymerisation of plastics into fuel. The fuel can be used in the factories as furnace oil. Its factory in Puducherry has successfully used the fuel to power its boiler to check feasibility of this approach.

CHALLENGES FACED

The costs associated with the collection of sachets remain prohibitive due to the almost non-existent value of the sachet itself.

One of the biggest barriers to turning pyrolysis into a business opportunity for reprocesses is taking collection of sachet waste to scale. HUL has engaged NGOs in India to assist us and we plan to test different approaches.

CREATING VALUE FROM WASTE IN INDONESIA Unilever Indonesia has initiated a Community Waste Bank Programme. This aims to empower communities to take their own action to manage their waste whilst receiving economic benefits. Unilever Indonesia assists communities in developing a system where they can collect inorganic waste and sell it based on its value. The money received is saved at a bank and can be cashed in over time In 2013, there were 712 community waste bank initiatives, with around 36,000 members.

After opening in 2012, Sobirins waste bank in Gunung Samarinda collects over 2-3 tons of non-organic solid waste each month. Each household manages to save about 50,000 rupiah (about $5) a month through this waste bank.

PERFORMANCE HULs goal is to develop and implement a sustainable business model for handling our sachet waste streams by 2015.

ASSOCIATED MDGs

To ensure environmentalsustainability To combatHIV/AIDS,malaria, and other diseases To develop a global partnership for development To eradicateextreme poverty and hunger TRIPLE BOTTOM LINE ASSOCIATED WITH THE ABOVE INITIATIVE

LIFEBUOY PROMOTING HEALTH AND HYGIENE THROUGH HANDWASHING

More than 600,000 children in India do not reach the age of five due to diarrhoea and pneumonia. Hand washing with soap can prevent over a third of those deaths. Lifebuoy soap has embarked on a noble mission to change the hygiene behaviour of 1 billion consumers by 2015 across Asia, Africa and Latin America by promoting the benefits of hand washing with soap at key times.

FIVE LEVERS FOR CHANGE METHODOLOGYLifebuoy has used Unilevers Five Levers for Change methodology to develop a series of interventions to ensure that people not only understand why washing hands with soap is important, but also practice the new habit over a period of time and get rewarded for sticking with it.These five levers are:

Visibly clean is not necessarily clean: (Lever 1: make it understood) Mother & child interaction: (Lever 2: make it easy) Pledging: (Lever 3: make it desirable) Positive reinforcement: (Lever 4: make it rewarding) 21 days practice: (Lever 5: make it a habit)THE RIPPLE EFFECTPast studies show that if one can reach one child through a school programme, that child will go home and influence the behaviour of his or her whole family.RURAL AND URBAN OUTREACH PROGRAMMESIn 2013, HUL touched 10.8 million people through our Lifebuoy hand washing programme. It has reached out to 58 million people since 2010 in both rural and urban India.HELP A CHILD REACH 5 In 2013, HUL launched the Help a Child Reach 5 campaign with a pilot project in Thesgora village in Madhya Pradesh in India which has the largest incidence of diarrhoea in the country. A study by Nielsen has shown a reduction of diarrhoea in Thesgora from 36% to 5% aided by a significant adoption of hand washing habit among mothers and children at key occasions during the day.BIHAR HAND WASHING PROJECT: In 2013 HUL also launched a pilot hand washing project in two districts of Bihar state -- Begusarai and Khagaria. It has reached nearly one million people through the initiative during the year. The ambition on this project is to impact the hand washing behaviour of 45 million people in rural Bihar in India over the next five years.URBAN SCHOOL CONTACT PROGRAMME: In urban India, Lifebuoy has been running a direct school contact programme for the last three years. It teaches children in urban schools the benefit of washing hands on five critical occasions every day. In 2013, we reached out to six million people through this programme.GLOBAL HANDWASHING DAY The year 2013 marked the sixth year of Global Hand washing Day (GHD) which is celebrated every year on October 15. On GHD in 2013, 1800 HUL employees volunteered to spread the awareness on hand washing in 150 schools in 35 cities reaching over 50,000 children across India.

ASSOCIATED MDGs To combatHIV/AIDS,malaria, and other diseases To reducechild mortality To develop a global partnership for developmentTRIPLE BOTTOM LINE ASSOCIATED WITH THE ABOVE INITIATIVE

DOMEXTOILET ACADEMY (DTA) Improving hygiene and sanitation: Lack of access to hygienic sanitation: One of the key cause of diarrhoea amongst children in India 620 million defecate in open 60% of these are Indians By WHO and UNI3CEF DTA was in November 2013 with the aim of building 24,000 toilets by 2015 in the areas where people defecate in the open and dont have access to improved sanitation facilities. Spreading awareness Why is it important? Around 6, 00,000 children do not reach the age of 5 because of diarrhoea and pneumonia lack of proper sanitation being one of the reasons. They want to spread awareness with the help of local entrepreneurs by asking them to build and sell toilets this stimulates the growth of the local entrepreneur, people getting job, the increase in Domex sales and leads to improve sanitation facilities resulting better hygienic condition for the people living in that area. The academy provides training to the local entrepreneurs and masons to supply the toilet, hence, assuring personal monitoring in the entire process. About DTA: Reached 850 people in 2013. Its based on community partnership model to make it scalable and self sustainable. Partnered with eKutir rural management services private limited. Currently trained 40 local entrepreneurs who are working as per the plan. DTA provides seed capital and also provides the initial operational cost for the execution of this project. The outreach: With the help of local Self Help Groups(SHGs) i.e. 12000 women SHGs, in Vidharbha, they target to spread information regarding importance of hygienic sanitation to women and children and they provide facility of micro loans via micro finance institutions to buy the toilets from the local entrepreneurs. It has taken help from an NGO named Nageshwara Charitable Trust. First ever academy to sponsor for world toilet day in partnership with World Toilet Organization(WTO). Impact: In 2013, Junapani, a village in Wardha district in Maharashtra was made open defecation free. Today, there are around 80 toilets as a result of the efforts of DTA. The programme was expanded to cover 300 villages in Odisha and 40 villages in Maharahtra. 103 toilets have been built in Orissa and Maharashtra. Currently under execution in Chhindwara. How was the consumer made to contribute (indirectly)? There was an online campaign carried out by HUL regarding the awareness of hygiene sanitation. HUL would give 5 Rs for every click on the link and casting a vote, showing support for campaign. For every bottle of Domex purchased HUL gave 5% of the revenues to DTA. The MDG goals which we can associate with this project : Goal 3: Empowering women. Goal 4: Reduce under five mortality Goal 6: Combat diseases Diarrhoea and pneumonia in this case In accordance with Narendra Modis Swachch Bharat call. The integrative aspect of DTA is that the society is getting benefited and the instrumental aspect is the increase in sales of Domex The business model: Provide them with the necessary financial facility if necessary

Provide fundamental training to local entrepreneurs according to the plan.

Increase the sale of Domex in rural area

Project Prabhat: Launched in December 2013 in order to contribute to the development of the local communities around the manufacturing units of HUL. Its aim is to reach larger communities around the unit and hence have a synergy between the units and the external environment. This helps in increasing the brand visibility and creating a goodwill for Unilever. It focuses on health and hygiene, livelihoods and water conservation initiatives which are fully aligned to the USPL guidelines. In December 2013 the lifebuoy school of 5 was run in Silvassa. With respect to the water conservation initiative under prabhat, Hindustan Unilever Fund (HUF), a wholly of HUL is contributing towards the water agenda that would support in harnessing opportunities to improve the water security (availability, storage and usage) of the region. In the selected communities, HUF works with NGOs as local implementing partners. The locations covered in Phase 1 include Silvassa, Khamgaon, Orai and Etah. The initiatives planned are drip irrigation, building check dams etc. The livelihood program emphasizes on to empower youth by enhancing their business skills and hence provide them with a better livelihood. HUL has collaborated with LabourNet for the implementation of the same. The location covered in phase one are Haridwar, Pondicherry,Silvassa, Khamgao, Goa and Nasik. Some other programs covered are beauty and hair care, work place skills, tailoring, spoken english, retail sales, hospitality and BPO.

Triple bottom line associated with both the initiatives:

Both the initiative taken by HUL are in accordance with the integrative and the ethical theories of corporate social responsibility.

NON STRATEGIC INITIATIVESREDUCING GREENHOUSE GASES From manufacturing

CO2 emission per tonne of production reduced by 27% in 2013 compared to the 2008 baseline. Achieved through several environment friendly initiatives at our manufacturing sites such as replacing fossil fuels with biomass fuel for boilers, solar lights and water heaters, installing hot air generators and thermic fluid heaters at our sites. Increased the share of renewable energy by 2% over 2012 and 8.5% over 2008. The share of renewable energy in our total energy consumption in our manufacturing is 21%.

From transport and travel

CO2 emission from your Companys logistics network has reduced by 430bps (from 78.4 kg CO2 per tonne to 74.1 kg CO2 per tonne) in 2013. In 2013, the Company maximised the direct dispatches of our products in key categories to 70% and improved truck utilisation from 89% to 91% through usage of right truck type. The Company also shifted incremental 3000 tonnes of load from road to rail mode of transport resulting in reduction of carbon footprint generated through warehousing and transportation.

From refrigeration Made ice cream business environment friendly by purchasing more climate friendly freezers. There are currently 33,750 freezers with HC ( Hydrocarbon) technology in the fleet in India.

REDUCING WATER FOOTPRINT From manufacturing process

The Company reduced water usage per tonne in our manufacturing operations by 37% compared to the 2008 baseline. Initiatives - recycling treated effluent water for gardening, installing reverse osmosis technology at various utilities, collecting and recycling of rain water, arresting major leakage and loss of water at the manufacturing sites led to this reduction. In 2013, of total 38 sites, 33 sites became zero-discharge sites, an addition of 3 sites compared to that of last year. Six more sites implemented rainwater harvesting taking the total to 28 sites, creating a potential of 371,000 kilo litres water per annum. Rainwater harvesting and use of RO for recycling effluent water has helped your Companys sites to reduce fresh water abstraction by over 86,000 kilo litres. Amli and Doom factories adopted the rainwater harvesting and recycling model.In Goa, rainwater on the terrace area of the factory is collected and recycled for use.

Corporate Governance:

Chairman: Harish Manwani MD and CEO: Sanjeev Mehta CFO: P.B.Balaji Executive director: Pradeep Banerjee Independent director: S.Ramadaroi, O.P.Bhatt, Sanjeev Mishra

Corporate information: Registered office and research centre Executive director, legal & Corporate Affairs and Company Secretary Statutory Auditors Solicitors Registration and share transfer agents Subsidiary agents

The National Voluntary Guidelines provides the following nine principles.Principle 1: Ethics, Transparency and Accountability [P1]Principle 6: Environment [P6]

Principle 2: Products Lifecycle Sustainability [P2]Principle 7: Policy Advocacy [P7]

Principle 3: Employees Well-being [P3]Principle 8: Inclusive Growth [P8]

Principle 4: Stakeholder Engagement [P4]Principle 9: Customer Value [P9]

Principle 5: Human Rights [P5]

Conclusion

We can see it from two perspective:

Strategic: the activities carried out under these initiatives will definitely benefit the company but ample care should be taken care that during the execution of these activities, should an individual be harmed and so should the environment.

Non- strategic: these are the kind of activities which may or may not benefit the companies i.e. they are generally classified as philanthropic. Care should be taken that once started, these activities should be carried on with the same intent with which it had begun and it should nowhere be neglected deeming it as unimportant or less important. It should be given equal priority like the other activities.