TCS engages with a broad spectrum of stakeholders, to deepen its insights into their needs and expectations, and to develop sustainable strategies for the short, medium and long term. Stakeholder engagement also helps to manage risks and opportunities in business operations. The key stakeholders identified in consultation with the company’s management are: customers, employees, shareholders, academic institutions, head-hunters, staffing firms, other suppliers, partners and collaborators, industry bodies, governments, NGOs, local communities, regulators and society at large.
Some other stakeholders that TCS closely engages with – such as industry analysts, equity analysts, and the news media –are proxies for other named stakeholders – i.e. customers, shareholders, and society at large, respectively. Stakeholder interactions might be structured (e.g. surveys, account statements) or unstructured (town halls, 1x1 meetings). Based on mutual convenience and need, the engagement maybe scheduled as needed, or pre-scheduled on a periodic basis (fortnightly/ monthly/ quarterly/ annual) or continuous (e.g. website, social media).
TCS conducts annual materiality assessments to update the list of material topics. The key elements of that assessment include:
To identify a broad funnel of issues important to each of the constituencies. The Company’s Sustainability Council uses discussions with internal and external stakeholders, as well as its own judgment, to prioritize and arrive at a list of material topics with significant economic, environmental, or social impacts on TCS’ business, reputation, and operations.
The company looks at the role of TCS in wider sustainability issues, the impact the company has through its customer engagements and its operations, and the role that the company experts play in professional associations, industry forums and other thought leadership activities to address important issues raised by stakeholders.
Read here for material responsible business conduct and sustainability issues pertaining to environmental, social and governance matters that present a risk or an opportunity to our business, and our approach to adapt or mitigate the risk :
Board effectiveness is enhanced by setting a high bar in selecting the right mix of individuals to serve on the Board, with the right qualifications, expertise and experience, who can collectively serve the best interests of all stakeholders, maintain board and management accountability and drive corporate ethics, values and sustainability. Profiles of Board members are available at https://www.tcs.com/ir-corporate-governance.
For greater diversity of opinions and perspectives within the Board, the Nomination and Remuneration Committee has fostered diversity in terms of backgrounds, areas of expertise and:
TCS’ policy on Appointment of Directors and Board Diversity can be found at https://on.tcs.com/appointment-BoD.
Board independence is ensured by having an independent majority, with 5 independent members out of 9 i.e. 55.6 percent. None of the independent directors is related to each other, or to the non-independent members. Average tenure of independent directors is 6 years.
Board effectiveness is further improved by ensuring that none of the directors holds directorships in more than seven listed entities, and none of the executive directors serves on the Boards of more than three listed entities.
TCS’ governance philosophy around minority shareholders’ interests is guided by the TCoC which emphasizes fairness and transparency to all stakeholders. Further a qualified, diverse and independent Board ensures that minority shareholders’ interests are protected.
TCS strives to reduce information asymmetry through transparency, extensive disclosures and detailed commentary of the demand environment and the state of the business, and material developments. 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.
Chairmanship of the Board is a non-executive position, and separate from that of the Chief Executive Officer and Managing Director (CEO and MD).
TCoC 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.
Over the last five decades, TCS has consistently demonstrated 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 the company values and the TCoC.
Customers are made aware of the TCoC principles in contract discussions, and through inclusion of specific clauses in proposals and contracts.
Employees also undergo mandatory training every year on Anti-bribery and ethical behaviour. They 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 senior executives directly to the Chairman of the Audit Committee under the Whistleblower Policy without fear of retaliation. Information about these channels is communicated to employees as part of the mandatory training modules.
Compliance to laws of the countries in which we operate, as well as global legislation such as Foreign Corrupt Practices Act, Bribery Act 2010 is monitored through formal compliance procedures led by the corporate compliance office. Changes to legislation are closely monitored, risks are evaluated and effectively managed across our operations.
Governance, Risk and Compliance are overseen by the Chief Compliance Officer, Chief Risk Officer and the Chief HR Officer who report to the Chief Operating Officer and Executive Director (COO and ED), and CEO and MD respectively. At the apex level, the Audit Committee headed by an Independent Director oversees compliance to the TCoC, Anti-Bribery and Anti-Corruption Policy, and Gift and Hospitality Policy and to external regulations.
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.
TCS’ approach to sustainable growth is built on the belief that it can expand its business by creating longer term value for all its stakeholders, including employees, customers, suppliers and local communities, while also valuing the environment. The various sustainability topics material to TCS are overseen by the relevant Board committees, as outlined below:
| Material Sustainability Topics |
Board Committee |
| Financial reporting, robustness of internal controls, auditor remuneration, compliance to policies around insider trading, whistle blower, ethics and Tata Code of Conduct |
Audit Committee |
| Risk management policy and plan, management of foreign exchange risks, cyber security risks, data privacy risks and intellectual property infringements risks |
Risk ManagementCommittee |
| Recommend composition of Board and its committees, appointment/re-appointment of directors and KMP, evaluation of the performance of the Board, Committees and Directors |
Nomination and Remuneration Committee |
| Health and safety at the workplace, shareholder grievances and other sustainability initiatives |
Stakeholders’Relationship Committee |
| Community initiatives and Corporate Social Responsibility compliance | Corporate Social Responsibility Committee |
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 to the directors to assess their values, competencies, and capabilities.
TCS requires its suppliers to sign the TCoC upon empanelment. That includes principles on protecting and safeguarding human rights, treating all persons with respect annity while safeguarding their rights, the abolition of forced and compulsory labor, child labor in the supply chain and strong corporate governance practices including anti-corruption and bribery and promoting fair business practices across the supply chain. TCoC also requires its suppliers to protect the environment and make conscious use of scarce natural resources in their business processes and at the same time highlighting the importance of health and safety in its workplace and expects the supplier to comply with sustainable business practices in letter and spirit in turn for its employees.
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. It works with its suppliers to ensure that they too are fully aligned with these principles.