Business ethics and corporate governance are two significant factors that impact a company and how it operates.

Business ethics represent the values, principles or characteristics a company follows when conducting business in the economy. Corporate governance is the internal framework a company designs and implements to govern and protect those invested into the company. The relationship between business ethics and corporate governance comes from an organizations owner or executive managers, who create the governance and decide which ethical principles employees will follow. Business ethics typically follow a normative theory. This theory states that individuals and firms will follow ethical principles that are commonly found in society, hence the term normative, or standard, ethics. Three normative ethic theories include stockholder,stakeholder and social contract theories. The stockholder ethical theory states that a company should create a relationship between business ethics and corporate governance that focuses on stockholders. Managers will employ strategies and activities that advance or increase the investments of share holders. Under the stakeholder theory of ethics, business ethics and corporate governance focuses on anyone who has a stake in the business. Although wide ranging, this connection between business ethics and corporate governance is often stronger, as recent changes to corporate governance include now any individual who is affected by the company. This connection ensures that everyone receives equal or fair treatment when dealing with the business. For example, customers who purchase a faulty product may receive a replacement at no charge and a few extra benefits. This promotes business ethics throughout the organization. A third and final ethical theory is the social contract theory. This theory focuses on companies that improve the overall welfare of society. Shareholders may be less willing to invest money into a company that follows this ethical theory, as shareholders may lose money to causes or other benefits that are outside of the companys normal operating context. To make investors fully aware of the companys social contract theory of ethics, business owners, executives and board members will often include this information in the corporate governance. Another relationship between business ethics and corporate governance is a companys mission statement. The mission statement clearly outlines a companys planned standard of excellence for operating in the business environment. This mission statement can focus more on a social aspect of the operations rather than a profit motive to repay shareholders. In these types of companies, shareholders will invest in the company because they believe in the company and desire to see the company succeed in its social mission.

CSR AT INFOSYS
Infosys has pledged to make a difference to society by actively participating in community development. Our 'social contract' inspires more than 100,000 employees to contribute to community welfare, environment sustainability and digital literacy. In 2009-10, Infosys organized several programs, enabling employees to give back to society: Volunteering A sabbatical policy encourages Infoscions to work for designated Indian Non-Governmental Organizations (NGOs) on community projects. Employees are paid an allowance by the company for up to a year. Infoscions actively support the mid-day meal program of the Akshaya Patra Foundation. It is the worlds largest NGO school meal program blending nutrition with education for more than one million children in rural areas across seven states in India, daily. Emergency aid In 2009, floods in Andhra Pradesh and Karnataka caused widespread destruction of life and property. The Infosys Foundation and Infoscions donated 30 crore towards rehabilitation and reconstruction of homes. In 2010, Infosys Australia organized a fund-raiser to support Red Cross disaster relief efforts in the wake of earthquakes in Haiti and Chile. Infosys USA worked with Red Cross to provide Haitians with food and medical care. Digital empowerment Infosys initiates children into Information Technology at a young age through the SPARK program. In 2009-10, Infoscions touched the lives of more than 70,000 students across India by undertaking IT training and mentoring teachers of government-aided schools in rural areas. Shaping policies Members of the board of directors of Infosys serve on global councils and contribute to policy making in corporate governance, education, healthcare, diversity, and the environment. Infosys is partnering with state utilities in India to introduce 'voluntary green tariff', enabling consumers to offset the cost of renewable energy. We hosted the Climate Roadmap Sub-National Workshop at Mysore, a platform to share best practices in environment sustainability. Promoting education and research Infosys is working with more than 400 engineering colleges in India to enhance their curriculum and enrich the talent pool through the Campus Connect Foundation researchers. program. The Infosys Science promotes research in pure and applied sciences with an annual prize of 50 lakh for Indian

Infosys is focused on Green IT to improve the quality of life, protect the environment and transform business. From an enterprise cloud to smart grids within our campuses, we have piloted several green applications locally: InGreen Energy Management Our application evaluates energy consumption patterns to identify opportunities for energy optimization. Automated data gathering and intuitive data visualization enable tracking and reporting of energy related data at consolidated and granular levels. Smart workplaces Intelligent cubicle design techniques and sensors provide volumetric lighting by detecting movement of employees and assessing body temperature to calibrate the intensity of light. Carbon footprint calculator Our patent-pending, desktop personal carbon calculator measures an individual's carbon footprint and reports the carbon credits required to offset it. A sustainability portal guides employees on how to reduce their ecological impact. Responsible computing Terminator, our desktop application prompts employees to switch off their Personal Computers (PCs) towards the end of the day. PCs shut down automatically after a pre-defined idle period. Car pooling Our online tool facilitates group travel among employees. The tool is being shared with companies in the vicinity across our Development Centers in India. Infosys is set to become carbon-neutral by 2012. Our global customers partner with us to transform into low-carbon businesses. We reduce their carbon footprint by innovating across their product lifecycle. We have developed green IT solutions for companies across industries: Automotive: We redesigned the sub-frame assembly and reused components to enhance the fuel efficiency of semi-trailers at an automotive major. Manufacturing: We helped a global aluminum manufacturer save US$ 1 million per furnace annually by automating and integrating melt furnace operations using Wireless Sensor Networks (WSN) technology to reduce energy consumption. Telecom: We improved scheduling and utilization of the field workforce at a leading telecom company in the Asia-Pacific region. It minimized operational costs and reduced truck rolls to customer premises by 50%, significantly reducing their carbon footprint. Insurance: Our workflow-based document management system transformed underwriting into an automated business process for an insurance company. It realized annual savings of US$ 300,000 in office supplies and record storage, while drastically reducing consumption of paper. Resources: Our integrated ERP solution automated the business processes of a South-East Asian forest resource and wood products company. It enhanced the reforesting program, optimized transportation across processing facilities and distribution networks, and reduced carbon emissions

CSR AT ITC
e-Choupal

The Big Picture: ITC's Agri Business Division, one of India's largest exporters of agricultural commodities, has conceived e-Choupal as a more efficient supply chain aimed at delivering value to its customers around the world on a sustainable basis. The e-Choupal model has been specifically designed to tackle the challenges posed by the unique features of Indian agriculture, characterised by fragmented farms, weak infrastructure and the involvement of numerous intermediaries, among others. The Value Chain - Farm to Factory Gate:

'e-Choupal' also unshackles the potential of Indian farmer who has been trapped in a vicious cycle of low risk taking ability > low investment > low productivity > weak market orientation > low value addition > low margin > low risk taking ability. This made him and Indian agribusiness sector globally uncompetitive, despite rich & abundant natural resources. Such a market-led business model can enhance the competitiveness of Indian agriculture and trigger a virtuous cycle of higher productivity, higher incomes, enlarged capacity for farmer risk management, larger investments and higher quality and productivity. Further, a growth in rural incomes will also unleash the latent demand for industrial goods so necessary for the continued growth of the Indian economy. This will create another virtuous cycle propelling the economy into a higher growth trajectory. The Model in Action: Appreciating the imperative of intermediaries in the Indian context, 'e-Choupal' leverages Information Technology to virtually cluster all the value chain participants, delivering the same benefits as vertical integration does in mature agricultural economies like the USA. 'e-Choupal' makes use of the physical transmission capabilities of current intermediaries aggregation, logistics, counter-party risk and bridge financing -while disintermediating them from the chain of information flow and market signals.

With a judicious blend of click & mortar capabilities, village internet kiosks managed by farmers - called sanchalaks - themselves, enable the agricultural community access ready information in their local language on the weather & market prices, disseminate knowledge on scientific farm practices & risk management, facilitate the sale of farm inputs (now with embedded knowledge) and purchase farm produce from the farmers' doorsteps (decision making is now information-based). Real-time information and customised knowledge provided by 'e-Choupal' enhance the ability of farmers to take decisions and align their farm output with market demand and

secure quality & productivity. The aggregation of the demand for farm inputs from individual farmers gives them access to high quality inputs from established and reputed manufacturers at fair prices. As a direct marketing channel, virtually linked to the 'mandi' system for price discovery, 'e-Choupal' eliminates wasteful intermediation and multiple handling. Thereby it significantly reduces transaction costs. 'e-Choupal' ensures world-class quality in delivering all these goods & services through several product / service specific partnerships with the leaders in the respective fields, in addition to ITC's own expertise. While the farmers benefit through enhanced farm productivity and higher farm gate prices, ITC benefits from the lower net cost of procurement (despite offering better prices to the farmer) having eliminated costs in the supply chain that do not add value.

The Status of Execution:

Launched in June 2000, 'e-Choupal', has already become the largest initiative among all Internet-based interventions in rural India. 'eChoupal' services today reach out to over 4 million farmers growing a range of crops soyabean, coffee, wheat, rice, pulses, shrimp - in over 40,000 villages through 6500 kiosks across ten states (Madhya Pradesh, Haryana, Uttarakhand, Karnataka, Andhra Pradesh, Uttar Pradesh, Rajasthan, Maharashtra, Kerela and Tamil Nadu). The problems encountered while setting up and managing these 'e-Choupals' are primarily of infrastructural inadequacies, including power supply, telecom connectivity and bandwidth, apart from the challenge of imparting skills to the first time internet users in remote and inaccessible areas of rural India.

Several alternative and innovative solutions - some of them expensive - are being deployed to overcome these challenges e.g. Power back-up through batteries charged by Solar panels, upgrading BSNL exchanges with RNS kits, installation of VSAT equipment, Mobile Choupals, local caching of static content on website to stream in the dynamic content more efficiently, 24x7 helpdesk etc. Going forward, the roadmap includes plans to integrate bulk storage, handling & transportation facilities to improve logistics efficiencies. As India's 'kissan' Company, ITC has taken care to involve farmers in the designing and management of the entire 'e-Choupal' initiative. The active participation of farmers in this rural initiative has created a sense of ownership in the project among the farmers. They see the 'e-Choupal' as the new age cooperative for all practical purposes. This enthusiastic response from farmers has encouraged ITC to plan for the extension of the 'e-Choupal' initiative to altogether 15 states across India over the next few years. On the anvil are plans to channelise other services related to micro-credit, health and education through the same 'e-Choupal' infrastructure. Another path-breaking initiative - the 'Choupal Pradarshan Khet', brings the benefits of agricultural best practices to small and marginal farmers. Backed by intensive research and knowledge, this initiative provides Agri-extension services which are qualitatively superior and involves pro-active handholding of farmers to ensure productivity gains. The services are customised to meet local conditions, ensure timely availability of farm inputs including credit, and provide a cluster of farmer schools for capturing indigenous knowledge. This

initiative, which has covered over 70,000 hectares, has a multiplier impact and reaches out to over 1.6 million farmers.

CSR AT TATA
A 100 years ago, Tata Steel first marked its imprint on a small, insignificant place called Sakchi, which later transformed into Jamshedpur, the birthplace of Indian steel. Today, Tata Steel is a beacon to the corporate world, in its endeavours to enrich the lives of the people and communities it touches. The companys corporate social responsibility (CSR) strategy was inspired by Jamsetji Tatas conviction that, In a free enterprise, the community is not just another stakeholder, but is, in fact, the very purpose of its existence. Tata Steels approach to its business has evolved from this concept and the wealth it has created is continuously returned to the people through its community initiatives. The mandate given to the Tata Steel CSR team was to work for the welfare of the socially and economically disadvantaged communities living in and around its areas of operation, including the mines and collieries serving the plant. Over the years, its initiatives have encompassed provision of healthcare services, drinking water, rain water harvesting, tribal development, relief and rehabilitation endeavours, income and employment generation, womens health and education, awareness programmes on the ill-effects of drugs, alcohol and HIV/AIDS, and patronage to sports and cultural activities. The CSR programme is managed by three organisations Tata Steel Rural Development Society (TSRDS), Tata Steel Family Initiatives Foundation (TSFIF) and the Tribal Culture Society (TCS). Of these, TSRDS assumes (and uses) the lions share of Tata Steels services and resources, because of the sheer range and volume of its activities. TSRDS also serves as an implementing agency for other international organisations engaged in socio-economic development and empowerment initiatives. The two other organisations are newer and more focused in their specific areas. The Tata Steel CSR policy encompasses initiatives to conserve, sustain and renew the environment, to encourage sustainable socio-economic development of the community and to improve the quality of life of the people living in the areas in which it operates. In all their programmes, the organisations seek to engage the ultimate beneficiaries of an initiative right from the conceptualisation and planning stage to the implementation, with the company playing the role of

a catalyst eliciting positive change. The attempt is to get the people to act out of their own convictions, and support them in their efforts to build a better future. Says AN Singh, deputy managing director (corporate services), Tata Steel, Community development must have a beneficial impact on the lives of the people, and should be sustainable. For this to happen, people need to accept ownership of a project. The understanding of the word empowerment comes from enabling people to stand on their own feet, and a step forward in this direction is to get those people to replicate it for the good of the next community. To ensure this, Tata Steel follows a participative model for its CSR initiatives, offering resources in the form of expertise, guidance and direction. The community plays a significant role, right from the prioritisation of its needs to the planning and the execution of the project. Once people begin to accept ownership of a project, they become more enthusiastic about what will work, and aware of what will not. This commitment to the project means they are far more likely to derive benefits from it, and look after it in the future. This model has been very successful. In fact, just as Tata Steel has become a benchmark in the industry for its business practices, its CSR programme too has been hailed as a benchmark. It has also been acknowledged as a best practice leader in the area of corporate social responsibility since 1993. Singh says, We have a 100-year-old legacy of working with the community. We have the experience of working in different areas, different situations, and using different approaches to achieve our objectives. This has given us the opportunity to fine-tune our processes and brought us where we are today. Other corporates, public sector undertakings and NGOs often come to us to study our processes. We are very happy to share our learnings and to learn from others, because we believe that if you network, you go a mile longer, and have greater reach. Tata Steel doesnt shy away from collaborating with the government either. Singh avers, If we have a better delivery mechanism than the government, and they have more funds than us, we should work together. The greatest strength of the companys CSR activity is that it is looked upon as a business process, like any other, not post-profit philanthropy. There is an annual business plan, with mid-, short- and long-term plans specified, thereby encouraging the company to think in terms of sustainability. Singh says, When we spend money, we either create an asset in terms of a building, pump, school, house and so on, or we improve the quality of life through programmes on adult literacy, TB treatment, empowering women, etc. If money spent does not create an asset or an improvement in the lives of the people, then the money is wasted. It is this commitment that has gained Tata Steel the unstinting support and

admiration of the grateful people of Jharkhand and Orissa. The company has received numerous awards in recognition of its CSR endeavours, including The Energy and Resources Institute Award, recognising its corporate leadership for good corporate citizenship and sustainable initiatives. It is also the only Indian company to have pledged to translate the Global Compact principles on human rights, labour and environment into practice, and has been conferred with the Global Business Coalition Award for Business Excellence in the Community for HIV/AIDS. Singh now has plans to take community development initiatives even further. Going forward, he says, I see an enlargement of our community development processes. I see them getting bigger, more accentuated and focused. As we do well, wed like to do even more for the community. The team is now working on expanding its activities in Chhatisgarh, where Tata Steel is putting up a greenfield site. Through its work in CSR and sheer perseverance, the Tata Steel team has proved its fidelity to the Tata Groups enduring commitment to Improving the quality of life of the communities we serve. Tata Steel Rural Development Society Tata Steel Rural Development Society (TSRDS), established in 1979, has faithfully executed its mandate of enriching the quality of life of the communities in which Tata Steel operates. Over the years, it has worked in areas such as food, water and health and ensured empowerment to people whose lot has been otherwise abject and pitiable. Today those people aspire and have access to things they scarcely dreamed of some decades ago. The society has a special focus on income generation, health and hygiene and empowerment. It has established a network of health stations and trained staff who act as providers of basic healthcare. TSRDS has offices in West Bokaro, Noamundi, Jamadoba, Gopalpur and Sukinda, besides Jamshedpur. TSRDSs efforts have led to the economic development of an area once classified as backward. Starting with 32 villages, it now covers over 700 villages in its programmes, including those surrounding Sukinda, Bamnipal and Gopalpur. Its projects have included the developing of water sources, training farmers on improved agricultural practices, promoting rural enterprise, infrastructure development to boost the village economy, encouraging animal husbandry, promoting art, culture, sports and games. Some projects have also been in the area of sanitation, water conservation, tube well installation and the enhancement of livelihood. The infrastructure it has developed includes schools and hostels, community sheds, rehabilitation hutments, link roads, culverts, etc, the absence of which pose a serious hindrance to rural development.

The society also conducts health awareness programmes and health camps to promote awareness on health issues, especially on the preventive and curative aspects. TSRDS has also made arrangements for the Lifeline Express to visit villages under its care. This is a unique hospital on wheels, equipped with a modern operating theatre that provides diagnostic, medical and surgical intervention to people living in remote areas. No effort has been spared in involving the government and other NGOs in the task of improving rural conditions. TSRDS was well aware that in the struggle to achieve rural development, it needed to work hand in hand with others with similar goals. Many such partnerships have raised the standard of living of the people of Jharkhand and Orissa. More importantly, they have brought to the fore specific types of skills and expertise to cater to specific needs, making projects more effective. Also, being a part of Tata Steel has enabled it to access and utilise the tremendous resources of the company and the Group. TSRDSs commitment and dedication have inspired and directed numerous people to play a more proactive role in their spheres of existence. The thrust has always been on participative leadership as a successful model of rural development. Groups such as Salahakar Samiti, Pani Panchayat, Community Health Guide, Save the Forest Group and Mahila Samiti have helped the organisation to garner support in all its endeavours. The idea was to encourage the ultimate beneficiaries to play a more active role in the projects so as to make it more self-sustaining. To ensure this, TSRDS conducts periodic leadership camps, where youngsters are encouraged to develop their talents in the service of their own people. The greatest achievement of TSRDS has been its ability to empower people, give them a glimpse of latent capabilities, and drive them to use their talents for the good of the community. Pleased with its commitment, the government has granted the status of a mother NGO to this society. The Tribal Culture Society The Tribal Culture Society (TCS) of Tata Steel has done outstanding work for the tribals of Jamshedpur and the surrounding areas in Jharkhand. The society evolved from a pure company department for Adivasi affairs in 1974, to a Tribal and Harijan Welfare Cell in 1984. In 1993, it assumed its present form as a non-profit organisation, equipped with the expertise and financial resources to make a difference in the lives of marginalised tribal communities. The intention was extremely laudable since developmental concerns often have a way of neglecting indigenous people. TCS was set up to ensure that the voice of the tribal community did not go unheeded. Empowerment of the marginalised community was TCSs primary aim.

The society focuses on three important issues: education, improvement of livelihood opportunities and the preservation of the ethnic identity of the tribal community. At its basic level, education requires the creation of functional literacy within the community. Shakshar Samaj uses the software developed by Tata Consultancy Services to teach people to read and write. RK Singh, honorary joint secretary, TCS, says, We have shifted from using only computers to using flip charts and alphabet charts. Currently learners are taught how to write in the Devanagari script. Plans are on to teach them the local language, Santhali. Programmes like the Jyoti fellowship and other coaching programmes have served to create a positive impact on the lives of youngsters. SC/ST candidates appearing for the Trade Apprentice entrance exams are made to undergo a six-month residential training programme to increase their capabilities. Similar coaching classes are held for those wanting to appear for the civil services exam. Aspirants are also given training to become motor drivers, fitters and mechanics, pathologists and community health providers, etc. Project Sahyog helped youth to gain a better understanding of themselves, develop leadership skills, and inculcate a feeling of fellowship. Beyond this, TCS decided to work on building the capacities of adolescents. This gave rise to DISHA Development Initiative on Supporting Healthy Adolescents, a programme seeking to delay the age of marriage, and provide access to information and better health services. SPARSH Strategies for Promotion of Adolescent Reproductive and Sexual Health provides information on issues related to adolescence and seeks to improve the status of the girl child in the community. All these steps have served to integrate tribal youth into the mainstream. TCS also nurtures the talent of youth chosen for their sporting abilities. They are given training and financial support to participate in meets around the country. They then secure an entry into the athletic, archery or football academies established by Tata Steel. TCS takes its goal of livelihood generation very seriously. The idea, says Singh, is not so much to guarantee livelihood as to improve their employability. Self-help groups enable TCS to fulfil dreams of running microenterprises. The society arranges for bead and jute handicraft making, paper making, candle making, stone carving classes, etc. TCS also supports numerous local clubs and promotes tribal customs and traditions in an attempt to help tribal children understand their heritage. This programme includes a tribal appreciation programme to promote indigenous value systems.

A heritage hall has been created in Jamshedpur to showcase the rapidly dying culture and lifestyle of the four major and six minor tribes in Jharkhand. TCS has a library of books, which are available to students conducting research on tribal issues. TCS has also made arrangements for a number of mobile clinics to treat diseases like tuberculosis, diarrhoea, leprosy, cleft lip and other general ailments. It also looks into immunisation of babies and creates awareness on subjects like contraception, breast feeding, etc. Through these and other measures, TCS has demonstrated that it has the will and the desire to give a helping hand to the less privileged sections of society. Family Initiatives Foundation Tata Steels Family Welfare Programme began in the 1950s. Since March 2000, the activities are being carried out under the Tata Steel Family Initiatives Foundation. It provides maternal and child health and family planning services. It also works on adolescent reproductive and sexual health issues and has a care and support programme for HIV/AIDS. TSFIF believes that investing in a health system is the key to improve the quality of life of people and is continuously striving for it, explains TSFIF head Shakti Sharma. The foundation operates in Jharkhand, Orissa and Chhatisgarh. TSFIF has six main focus areas: Maternal and Child Health: TSFIF addresses family planning concerns through the use of communication media. This programme has successfully destroyed prejudices created by myths and traditional beliefs. TSFIF focuses on reproductive health services and creates awareness on spacing methods and family planning options. Adolescent Reproductive and Sexual Health: TSFIF has four projects o Youth Access to Reproductive Health Services in India (YARS) provides high quality, comprehensive reproductive health services to youth and adolescents and helps them to practice healthy sexual behaviour. o Strategies to Improve Adolescent Reproductive Health and Rights through Advocacy and Services (SAHAS) seeks to improve the sexual and reproductive health and well-being of adolescents. o Apni Baatein is a school-based teen health programme that emphasises value-based education. There was a need for school students to have a platform where they could share their concern about values and reproductive health. The project was born from this need, says TSFIF manager Dilith Castleton. The topics include effective communication skills, dealing with emotions and peer pressure, understanding ones body, HIV/AIDS and personality development. o RISHTA is an adolescent health project, in collaboration with the Tata Steel Rural Development Society and the David and Lucile Packard Foundation.

AIDS awareness: Understanding the threat of HIV/AIDS, TSFIF realised the importance of integrating HIV/AIDS programmes with RCH services. Screening tests for pregnant mothers were introduced along with counselling and treatment for those infected. Drinking water and sanitation: Nearly 2,000 tube wells have been constructed for a population of 3 lakh. At least 2,000 toilets are constructed annually. Eye care and cleft lip: More than 1,500 eye-related and 500 cleft lip and palate correction services are provided annually. Lifeline Express: This hospital on wheels has helped over 50,000 patients in Jharkhand, Orissa and Chhatisgarh.

TSFIF also looks at livelihood concerns of the community through: Watershed management: It trains villagers on water use, crop diversification, multicropping, hybrid farming, maintenance of assets, etc. Land and water management: It teaches villagers to adopt improved agricultural techniques. Enterprise promotion: It trains villagers on financial management, entrepreneurship, etc through activities such as goat rearing, poultry, banana cultivation, etc. The organisation has worked hard to enhance the quality of life of the people in and around Jamshedpur. It truly believes in what JRD Tata once said: The wealth gathered by Jamsetji Tata and his sons in half a century of industrial pioneering formed but a minute fraction of the amount by which they enriched the nation. The whole of that wealth is held in trust for the people and used exclusively for their benefit. The cycle is thus complete; what came from the people has gone back to the people many times over.