Infosys Technologies Ltd.

BUSINESS ETHICS
 Contents

Introduction & History

Organizational Structure

CSR Initiative

Corporate Governance

Lesson Learnt

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 Introduction
 Involvement in software development services, targeted
towards the distribution, banking, telecommunication &
manufacturing sectors worldwide.

 India‟s Largest IT company.

 Headquarter is in Bangalore.

 114,822 employees (including subsidiaries).

 Offices in 33 countries and development centres in India, China,

UK, Australia, Canada and Japan.

 Corporate R&D wing called Software Engineering and

Technology Labs (SETLabs).

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 History & Background
 INFOSYS was promoted by Mr. S. Gopalakrishnan, Mr. K.
Dinesh, Nandan M Nilekani, Mr. S.D. Shibulal, Mr. N.R. Narayana
Murthy & Mr. N S Raghavan.

 July 2nd 1981, the company was incorporated as Infosys

Consultants Private Limited at Pune.

 June 2nd 1992, the company was converted into a Public Limited
Company under the name - Infosys Technologies Ltd.

 Since listing on the BSE (till 2000), Infosys' sales and earnings
compounded at more than 70% a year.

 Grown from a capital of US$ 250, to a US$ 5.38 billion company

& market capitalization of approx. US$ 38 billion.
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 Awards & Milestones
 Infosys was the only Indian company to win the Global MAKE
(Most Admired Knowledge Enterprises) award for the years
2003, 2004 and 2005.

 Inducted into the Global Hall of Fame for the same.

 Silver Shield from the Institute of Chartered Accountants of

India for the Best-Presented-Accounts.

 A Certificate of Merit, was received from the Ministry of

Commerce in 1998, Government of India, for meritorious
performance in the field of exports during 1995-96.

 In 2003, ICRA, gave CGR1 rating, making it the first company in

the country to get the highest rating for corporate governance.
 Awards & Milestones
 Ranked among the best in investor relations in the APAC region

 Listed on Forbes Asian Fabulous 50.

 Ranked as the most admired company in India according to the

Wall Street Journal survey.

 Ranked as the best company to work for in India by Business

Today‟s ninth survey of „Best Companies to Work For‟.

 Golden Peacock National Training Award for the year 2009.

 CRISIL has assigned CRISIL GVC Level 1 rating to Infosys.

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 Organizational Structure
 Adopted a free form organization devoid of hierarchies.

 Every one shares the same designation i.e., Associates.

 It is an organization with value based hierarchy rather than title

based.

Organizational Chart:
 infosys-technologies (1).pdf

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 CSR Initiatives
 Areas of Execution:

Healthcare, Social rehabilitation & rural upliftment, Learning &

education and Art & Culture

 In 1996, created the “Infosys Foundation” operating in the areas

of health care, rural uplift, education, arts and culture.

 In 1997, started the "Catch them Young Programme", to expose

the urban youth to the world of Information Technology by

 conducting summer vacation programme.

 In 2008, along with National Institute of Advanced Studies

created „Infosys Mathematics Prize‟ for excellence in
Mathematics research.
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 CSR Initiatives
Healthcare
 Infosys have constructed hospital wards, donated hi-tech
equipment, organized health camps, distributed medicines to
economically-weaker sections in remote areas.

Example:
 The annex to a cancer hospital in Kancheepuram, Tamil Nadu
was added
 A hospital was built for tribal's at H.D. Kote, Mysore.
 In Bellary, a hospital constructed to treat patients with brain
fever.
 The Foundation air-conditioned the burns ward of the Victoria
Hospital, Bangalore

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 CSR Initiatives
Social Rehabilitation & Rural Upliftment
 Relief work after natural disasters
 Organized an annual mela that empowers destitute women or
built orphanages that give children a better life

Example:
 Donation towards the mid-day meal program of the Akshaya
Patra Foundation, Bangalore
 Worked in the tsunami-affected areas of Tamil Nadu and the
Andaman Islands, earthquake-affected areas of Kutch, cyclone-
devastated areas of Orissa
 The Foundation worked with the Red Cross Society to supply
aid equipment to the physically

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 CSR Initiatives
Learning & Education

 Offers an edge to deprived and rural students

 Set up more than 10,150 libraries in rural government schools.

 14 government schools reconstructed in slum areas of

Hyderabad

 1,000 teachers trained

 Works with Prerna, an NGO in Raichur and Bangalore, and

Vidya Poshak in Dharwad, to distribute scholarships to poor
students

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 CSR Initiatives
Art & Culture

 Preserving our rich heritage and honoring our artisans

 organize cultural programs to promote artists in rural areas

 Help under-privileged artists from different walks of writers,

painters, poets or musicians who don't have access to contacts

 Sponsored art exhibitions and performing arts programs in

Dharwad and Bangalore in Karnataka

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 CSR Initiatives
Infosys Development Centers
Chennai Development Center
 Helping the visually challenged
 Facilities for rural schools

Hyderabad Development Center

 PC donation drive
 Day of Change

Mysore Development Center

 Notebook distribution
 School for dropouts
 Language and computer education
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 CSR Initiatives
Infosys Development Centers
Bangalore Development Center
 Rakum School for the visually challenged
 Notebook distribution

Bhubaneswar Development Center

 Prepares students for a career in the Business Process
Outsourcing industry

Chandigarh Development Center

 Behavior and social skills development
 Medical camp and cleanliness drive

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 CSR towards Employees
 Employed people represent various different variety of
nationalities, cultures, genders & gender identities, employment
histories, and levels of physical ability.

 Employees' focus on commonalities they share and leverage.

 Infosys Women Inclusivity Network (IWIN).

 Spark Guru, an initiative to awareness among school teachers

in rural areas about social issues.

 Helen Keller award, best employer from National Centre for

Promotion of Employment for Disabled People (NCPEDP).

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 Consumer Responsibility
 Regular R&D for innovation of product

 Feedback from consumers

 Provide 24 hours customer care services.

 Provide sufficient information about the product and services

 Honest for their customers

 Hear and redress the genuine grievances of the customers

 Provide products of proven quality

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 Corporate Governance
“The primary purpose of corporate leadership is to create wealth legally and
ethically. This translates to bringing a high level of satisfaction to five
constituencies –
customers,
employees,
investors,
vendors and
the society-at-large.
The raison d'être of every corporate body is to ensure predictability,
sustainability and profitability of revenues year after year.”

N. R. Narayana Murthy
Chairman of the Board and Chief Mentor

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 Corporate Governance
What is Corporate Governance?

 The primary purpose of corporate leadership is to create wealth

legally and ethically.

 This translates to bringing a high level of satisfaction to five

constituencies -- customers, employees, investors, vendors and
the society-at-large.

 The raison d'être of every corporate body is to ensure

predictability, sustainability and profitability of revenues year
after year.

N. R. Narayana Murthy
Chairman of the Board and Chief Mentor
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 Corporate Governance Philosophy
 Satisfy the spirit of the law and not just the letter of the law.
Corporate governance standards should go beyond the law.

 Be transparent and maintain a high degree of disclosure levels.

When in doubt, disclose.

 Communicate externally, in a truthful manner, about how the

Company is run internally.

 Comply with the laws in all the countries in which we operate.

 Have a simple and transparent corporate structure driven solely

by business needs.

 Management is the trustee of the shareholders' capital and not

the owner.
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Corporate Governance Constituents
The Board of Directors
 Pivotal role
 Accountable to stakeholders
 Directs management

The Shareholders & Stakeholders

 To participate in appointment of directors
 To hold the BoD accountable for governance through proper
disclosures

The Management
 To act on the direction of the BoD
 To provide requisite information to the BoD for decision
making
 To implement and monitor control systems

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 Components of Disclosure
Disclosures Disclosures
by whom for whom

Public Listed Cos. Shareholders

Intermediaries Investors
Stock Exchanges MARKET Intermediaries
Mutual Funds Regulator
Analysts & advisors Government
Other stake -
holders

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 Disclosure based Regulation

 Initial Disclosures
 Continuous disclosures
 Corporate Governance
 Financial disclosures
 Risk based disclosures for intermediaries
 Disclosures for stock exchanges

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 Corporate Governance Philosophy

INFOSYS Model - Contents

 General standards of conduct

 Management of conflicts of interest
 Prohibition of exploitation of corporate opportunities
 Protection of company‟s confidential information
 Obligations under securities laws
 Use of assets
 An entire section on responsibilities to customers and
stakeholders.

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 Corporate Governance Score
( CGS)
Corporate Governance Score ( CGS)

Composite Score

 Ownership Structure and external Influence 9.0 (max. 10)

 Shareholder rights and stakeholder relations 8.3 (max. 10)

 Transparency, disclosure & Audit 9.2 (max. 10)

 Board structure and effectiveness 8.9 (max. 10)

- Standard and Poor CGS

Rating

 CRISIL has been consistently assigning us the „CRISIL GVC Level 1‟ rating

 ICRA assigned „CGR 1‟ rating to our corporate governance practices.

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 Ownership Structure
Transparency of Ownership
Infosys is a widely held company with a transparent shareholding structure.
The company discloses shareholdings by type and percentage.

Key Analytical Issues Assessment

Full disclosure of shareholding structure in public reports in Positive

terms of identifying major and majority beneficial shareholders
/control right holders.
Where applicable, indirect holdings have been enumerated and Positive
explained

Ownership Concentration and Influence

Key Analytical Issues Assessment

There is a strict separation of management control and Positive

ownership control among the founder/managers.
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Shareholding Pattern

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 Shareholder's Rights
Shareholder Meeting & Voting Procedures

Key Analytical Issues Assessment

The company informs shareholders of upcoming meetings sufficiently Positive

in advance (at least 21days notice) to consider and execute their
votes.
Information sent to shareholders on the agenda for the meeting is Positive
generally comprehensive and posts agendas and details of
shareholder meetings on its website
The company has introduced a “non-mandatory” postal ballot, which Positive
allows shareholders who cannot attend meetings to express a view on
resolutions, though these ballots cannot be counted
under law.
Other methods of voting by proxy, such as electronic voting, are not Negative
allowed by law.

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 Stakeholder Relations
Stakeholder Relations

Relations with stakeholders appears to be moderately strong.

Key Analytical Issues Assessment

The company makes pro-active disclosures about its relations Positive

with various stakeholders, including employees and the local
community.
There do not appear to be any problematic relationships Positive
between the company and its stakeholders.

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 Transparency, Disclosure & Audit
Content of Public Disclosure

Key Analytical Issues Assessment

Financial statements are produced and audited according to Indian Positive

Accounting Standards as well as US GAAP. Abbreviated financial
statements and notes are also produced in substantial compliance
with the GAAP of Australia, Canada, France, Germany, Japan and the
United Kingdom
Company financial statements are comprehensive and contain more Positive
than the relevant and expected information of a US-listed company
There is strong disclosure of minority interests, internal and related Positive
party transactions. Financial reporting is assessed as very strong.

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 Transparency, Disclosure & Audit
Timing and Access to Public Disclosure
Key Analytical Issues Assessment

Public reports are always filed on time and information is sent to Positive
shareholders in a timely manner.
Infosys makes substantial effort to ensure that reports and Positive
announcements reach a significant number of shareholders and
investment professionals. These include live tele- and webcasts of
presentations, press conferences, and analyst calls.

Audit Process

Key Analytical Issues Assessment

The auditor is experienced and reputable, and has relevant industry Positive
experience
The audit committee consisting entirely of independent outside Positive
directors selects the auditor.

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 Board Structure
Board Structure & Independence
Key Analytical Issues Assessment

A majority of the directors are non-executive and all are Positive

judged as independent
There are Audit, Remuneration and Nomination Committees, Positive
all of which are highly independent

Full Board and Major Board Committees Executive Non-executive

Full Board 7 8
Audit Committee 0 6
Compensation Committee 0 4
Nomination Committee 0 5

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Directors‟ Shareholding

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 Learnings from INFOSYS
 Strategizing success and organizing human resources

 Fostering Innovation

 Focusing on Shareholders and building trust

 Cultivating a work force

 Upholding investor interest

 Respecting the law and adhering to values

 Creating Goodwill

 Going Global

 Excelling and Improving

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 Learnings from INFOSYS

 It is possible for professionals to stay back in India and create

wealth and leverage assets and equity legally and ethically.

 To put the interest of public or the greater community ahead of

the interests of a smaller group or community.

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 Infosys

AWARDS 2010

2007
1. Most Admired Indian
Company
2. Best Companies for
2009
1. Fintech 100 leaders
2. Top 10 companies
for leaders
3. IT Vendor of the
Year 1. Most admired knowledge
2008 enterprise
2. Partner Solution offering of the
year
3. Asian fabulous 50
1. Best Outsourcing Partner
2. Asia Business Continuity
Award
3. Global Six Sigma Award

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