Mar 31, 2023
Your Directors are pleased to present their 82nd Report and Audited Financial Statements of the Company for the Financial Year ended March 31, 2023.
Financial Highlights |
(H in crores) |
|
FY 2022-23 |
FY 2021-22 |
|
Total Revenue (a b c) |
5,279.77 |
5,126.05 |
Sales (a) |
5,187.86 |
5,066.46 |
Other Operating Revenue (b) |
38.33 |
33.33 |
Other Income (c) |
53.58 |
26.26 |
Profit before Tax and exceptional items and Tax |
1,420.88 |
1,409.01 |
Profit before Taxation |
1,409.67 |
1,409.01 |
Tax Expense |
362.53 |
330.69 |
Profit for the year |
1,047.14 |
1,078.32 |
Other Comprehensive Income (net of Tax)(gain) |
4.89 |
(4.67) |
Total Comprehensive Income |
1,042.26 |
1,082.99 |
Balance brought forward |
1,308.08 |
741.86 |
Profit available for appropriation |
2,350.34 |
1,824.85 |
Balance transferred to Retained Earnings from Share Options Outstanding Account |
6.93 |
- |
Appropriation : |
||
Dividend |
(1,060.74) |
(516.77) |
Dividend Distribution Tax |
- |
- |
Balance carried forward |
1,296.53 |
1,308.08 |
on and from November 16, 2022 and the second interim dividend of H 21/- per share was declared on May 12, 2023, to be paid on and from June 8, 2023. Considering the declaration of two interim dividends for the Financial Year 2022-23, the Board of Directors has not recommended a final dividend for the Financial Year 2022-23.
Transfer to Reserves
During the year, no amount was transferred to the general reserves.
Focus on Innovation and New Launches / Campaign
Your Company is focused on delivering insight-driven innovation that provides value-added new products across all price points. In the Financial Year 2022-23, the following products were launched/re-launched:
Reported Net Sales for the Financial Year 2022-23 stood at H 5,187.86 crores against H 5,066.46 crores of previous year. Net Sales increased by 2.4% in comparison to the previous year. Reported Net Profit after tax for the Financial Year 2022-23 was H 1,047.14 crores, a decrease of 2.9% over the previous year.
Despite the challenging business and economic environment, your Company continues to sustain its leadership position in both the Toothpaste and Toothbrush categories during the Financial Year 2022-23.
The Board of Directors of the Company has declared two interim dividends, aggregating to H 39/- per share, for the Financial Year 2022-23. The first interim dividend of H 18/- per share was declared on October 20, 2022 and paid
Relaunch of Colgate Strong Teeth : In 2022, Colgate Strong Teeth (CST) underwent a relaunch with a renewed focus on highlighting the importance of strong teeth as a foundation for good nutrition. The brand aimed to establish a connection between healthy teeth and better nutrient absorption through effective chewing.
The new proposition centered on promoting stronger teeth, which ensure better chewing and, in turn, leads to better nutrient absorption. This proposition was supported by a âCalcium Boostâ and âAmino Shaktiâ, which were activated across all touchpoints. This activation was designed to elevate CST to an advanced and contemporary brand.
To promote this message, the brand brought two popular celebrities, Shahid Kapoor and Rana Daggubati, who led the campaign nationwide. Notably, this was the first time that fathers led CST messaging in a campaign. The campaign included multiple films aimed at increasing awareness and consideration of the CST. These films depicted the dads reinstating the association of stronger teeth with a stronger self using varied imagery aimed at children.
Colgate Max-Fresh Charcoal : The Company introduced a novel variant belonging to its Max-Fresh product line, which incorporates a distinctive blend of bamboo charcoal, wintergreen mint, and cooling crystals. This toothpaste provides an invigorating burst of freshness that contributes to sustaining oral hygiene while also delivering an unparalleled revitalising awakening experience.
Colgate Active Salt : The Company has re-introduced Colgate Active Salt, now equipped with enhanced "Anti Germ Properties" that combat up to 99.9% of germs, effectively preventing dental problems.
Colgate PerioGard : The all new Colgate PerioGard, formulated with a potent zinc citrate composition that effectively targets anaerobic bacteria, aiding in the treatment of various gum issues, such as bleeding, inflammation and halitosis.
KEEP toothbrush:One of the Company''s latest introductions, the KEEP toothbrush, aims to assist customers in making eco-friendly decisions. The toothbrush has a reusable metal handle that can stand upright, and it comes with a replaceable soft-bristled head that has a tongue scraper. By eliminating the use of plastic in the entire handle, the toothbrush reduces plastic consumption by 80%*. KEEP the handle, replace the brush head-itâs that simple!
Advanced electric toothbrush: The smart electric toothbrush offers a personalised brushing encounter, enabling users to
choose the combination that suits them best and delivering immediate feedback to ensure proper use. It is equipped with 33 unique combinations, 4 modes, a smart pressure sensor, and a 30-second pacer to deliver a sophisticated cleaning experience. Additionally, the sleek, fashionable design and ergonomic curves of the handle facilitate a stylish and comfortable brushing experience.
Super Flexi Toothbrush : For the first time in a decade, India''s best-selling toothbrush brand underwent a massive relaunch. Featuring a contemporary appearance, the toothbrush handle is offered in four vibrant color options. The updated material includes wave trim bristles, which offer an enhanced brushing experience and, the bristles themselves are more durable.
Visible White O2 Toothbrush : A premium toothbrush with unique 360 degree wraparound spiral bristles with stain removal capabilities. The toothbrush is launched as an extension to the Visible White O2 brand regimen, known for superior technology and assured results on teeth whitening.
Baby Teether : This product is a multifunctional device that serves both as a Training Toothbrush and Teether, specifically designed to alleviate discomfort during the teething stage with its soft and delicate silicone bristles. It has undergone comprehensive safety testing and is approved for use by infants aged 0 to 12 months. The toothbrush is free of Bisphenol A (BPA) and is entirely composed of 100% food-grade silicone. The malleable handles are designed to accommodate the dimensions and grip of small hands.
Change(s) in the nature of Business
During the Financial Year under review there were no material changes with regard to the nature of business of the Company.
Details of Subsidiary, Joint Venture and Associate Company
Your Company does not have any Subsidiary or Joint Venture or Associate Company.
ESG & BUSINESS RESPONSIBILITY & SUSTAINABILITY REPORTING
As a leading oral care company in India, Colgate-Palmolive (India) Limited continues to champion optimism and amplify ESG efforts to âreimagine a healthier future for all its people and the planet.â We are steadfast in bringing to life our strategy and plans to create shared and sustainable value for all our stakeholders. We continue to remain unwavering in our commitment to responsible and shared growth as well as building a sustainable future. The Companyâs flagship programs such as âColgate Bright Smiles, Bright Futures®â, Keep India Smiling Scholarship programs and several other initiatives around Oral Health, Water Conservation, Women empowerment have been instrumental in driving social impact, preserving the environment and reaching millions
of People. We continuously rebuild and realign our practices to innovate for good as âeveryone deserves a future to smile about.â In our endeavor to inspire trust and transparency, this is the second year of publishing our Environmental, Social and Governance (ESG) Report and Business Responsibility and Sustainability Report (BRSR). The BRSR showcases our ESG progress and empowers stakeholders to make informed decisions.
Environment : Our Company is committed to ensuring that our consumers enjoy a range of advantages from using our sustainable products. Our product development process is validated by consumer feedback received through various channels on improving our processes and systems. Valuable insights received through our customer satisfaction surveys coupled with enhanced employee skill-sets fuel our product innovations. The Company has also implemented a followup monitoring mechanism to ensure corrective actions are undertaken to provide safe, sustainable and high-quality products to all our consumers.
To achieve the goal of delivering innovative and sustainable products, we are focused on the following priority areas:
⢠Usage of recycled content,
⢠Eliminate usage of plastics in packaging.
Social : Our people are our asset, and we strive to strengthen relationships with them to build a resilient, innovative and future-fit workforce. The Company breaks the mold and nurtures a work culture which bolsters creativity and encourages employee driven innovation, furthering Companyâs purpose of âreimaging a better future for the people and the planet.â Through our inclusive human resource policies and practices, we make conscious efforts to maintain a safe and a supportive work environment for our employees and the extended workforce. We inspire trust by providing our people with fair and competitive remuneration, rewards and benefits, learning opportunities, career growth, and work flexibility which help retain and attract new employees and workers with similar values.
Additionally through our Corporate Social Responsibility initiatives we endeavour to create a meaningful impact on the millions of lives we touch. Our focus areas include, Oral Health Elevation, Water Access and Augmentation, Women Empowerment and Education. Through these programs we focus on providing communities with access to safe drinking water, water for sanitation, water availability for agriculture and farm based activities, empowering women through livelihoods, financial and digital literacy and enlightening school children through oral health education and tobacco prevention sensitization, we are also impacting smiles for life for children suffering from cleft and palate deformities.
Governance : Colgate-Palmolive (India) champions the longterm value creation for all stakeholders through robust and fair governance mechanisms. Our governance structures, that are built on the pillars of integrity and transparency, ensure that ethical standards are cascaded across the business. Behaving ethically is a business imperative as we strive to meet regulatory compliances with all applicable laws while conducting business across geographies. We are guided by a highly engaged board and management that ascertains that sustainability is closely integrated with our governance mechanisms.
Our 2025 Sustainability and Social Impact Strategy guides our approach on ESG through three important pillars of S-MIL-E: Driving Social Impact, Helping Millions of Homes and Preserving our Environment. Our focus on the People to Promoting healthier lives, Contributing to the Communities where we live and work, Performance to Growing the business with innovative, more sustainable products that make the lives of consumers healthier and more enjoyable and on our Planet to conserve Earthâs finite resources, addressing climate change and maintaining the well-being of our planet for generations to come; is ever increasing and is driving all our plans and actions.
The Company has received TRUE® certification for Zero Waste (Platinum level) in 2019, for all its four manufacturing sites in India, from Green Business Certification Inc. (GBCI), the premier organization independently recognizing excellence in green business industry performance and practice globally. The GBCI administers TRUE® certification for Zero Waste, a program for businesses to assess performance in reducing waste and maximizing resource efficiency. Facilities earn TRUE® certification by achieving minimum program requirements and attaining points; the program operates on a ranking system, with âPlatinumâ being the highest certification level. We continue to maintain the certification as our Diversion Rating at more than 99% as per the requirements. The Company is the first in India to receive such certification.
Business Responsibility and Sustainability Reporting :
Pursuant to the Securities & Exchange Board of India (SEBI) vide its circular no. SEBI/HO/CFD/CMD-2/P/CIR/2021/562 dated May 10, 2021, your Company took a proactive approach in adopting Business Responsibility and Sustainability Reporting (BRSR) for the Financial Year 2021-22, a year in advance of the mandatory requirements. This report ensures that our investors have access to relevant information and disclosures with regard to our performance on Environmental, Social and Governance (ESG) parameters. Your Company believes in conducting its business activities in a responsible and sustainable manner.
This report illustrates the Companyâs efforts towards creating a long term value for all stakeholders in a responsible manner and your Company has always been steadfast in embedding ESG across the Company. To showcase our commitment towards sustainable development your Company has incorporated transparent reporting practices with regard to ESG responsibilities. The BRSR for Financial Year 2022-23 forms an integral part of this Report and is attached as Annexure 6.
Corporate Social Responsibility
The Company is committed to ensure the well-being of the community and environment in which it operates. Corporate Social Responsibility (CSR) forms an integral part of our business activities. Companyâs CSR Policy also reflects the Companyâs commitment towards society and environment. The CSR initiatives are carried out by the Company through a variety of effective programs in accordance with the requirements of Schedule VII of the Companies Act, 2013, in partnership with reputed NGOs and agencies.
The ESG and Corporate Social Responsibility Committee and the Board of Directors closely review and monitor, from time to time, the various CSR activities undertaken by the Company.
The key CSR programs undertaken by your Company during the Financial Year 2022-23 are :
1. Colgate Bright Smiles, Bright Futures®;
2. Water Augmentation for Livelihoods & Women Empowerment - with Seva Mandir
3. Water accessibility program - with Water For People India Trust
4. Keep India Smiling Foundational Scholarship & Mentorship Program - with Shikshadaan
5. Smiles For Life - Program on Cleft Surgeries & Care with MissionSmile
6. Empowering children with Computers and Language skills - With Action Aid
7. Positive Step Program - with NTP
As per the requirements of Section 135 of the Companies Act, 2013, the Company was required to spend an amount of H 25,35,12,330.44 (Rupees Twenty Five Crore Thirty Five Lakhs Twelve Thousand Three Hundred and Thirty and Forty Four Paise Only). The ESG and Corporate Social Responsibility Committee approved an amount of H 25,38,00,000 (Rupees Twenty Five Crore Thirty Eight Lakhs Only) as CSR Spend for the FY 2022-23.
However, since the Company was in the process of redesigning Colgate Bright Smiles, Bright Futures® Program and the same was re-launched in January, 2023. Considering the same, the Company could not spend the
entire CSR Funds allocated for the said project, during the Financial Year. An amount of H 5,53,19,859.36 (Rupees Five Crore Fifty Three Lakhs Nineteen Thousand Eight Hundred Fifty Nine and Thirty Six Paise Only) remaining unspent was transferred to âColgate-Palmolive (India) Limited -Corporate Social Responsibility Unspent Account (BSBF) - 2022-23â as per the statutory timelines and the same will be spent on the said project within 3 Financial Years.
A detailed description of the above programs/ activities is contained in the Annual CSR Report which forms an integral part of this Report and is annexed as Annexure 2.
The contents of the CSR Policy as well as the CSR programs undertaken by the Company are available on the Companyâs website at https://www.colgatepalmolive.co.in/community-impact
Directors Responsibility Statement
Pursuant to Section 134(5) of the Companies Act, 2013, your Companyâs Directors, based on the representations received from the Management, confirm that:
⢠in the preparation of the Annual Accounts for the Financial Year ended March 31, 2023, the applicable Accounting Standards have been followed along with proper explanation relating to material departures;
⢠they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2023 and of the profit and loss of the Company for that period;
⢠they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
⢠the Annual Accounts have been prepared on a âgoing concernâ basis;
⢠they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively; and
⢠they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
The Employee Relations in the Company continued to remain healthy, cordial and progressive in the Financial Year 2022-23.
At Colgate-Palmolive (India), we consider every employee as one of the most valuable resources contributing towards the long term success of the Company. Our employees are committed to acting with compassion, integrity, honesty and high ethics in all situations. As per the Company''s core values, all employees are treated with equality and fairness and are provided with opportunities to develop their career and meet their aspirations while working with the Company in India and, wherever possible, outside of India on assignments with group companies of Colgate-Palmolive.
Your Company also recognizes and follows âManaging with Respect Principlesâ which are applicable not only within Colgate-Palmolive but also while its employees are dealing with its customers, suppliers, vendors etc. Managing with Respect is the way Colgate-Palmolive (India) people put our values into action. It is creating an environment where people feel free to offer suggestions, contribute ideas and resources and help grow the business. Managing with Respect creates an environment where people genuinely care about each other and work well together to reach their full potential.
The detailed description of the Employee Initiatives taken by the Company are included in the Management Discussion and Analysis. Kindly refer page no. 148.
Prevention of Sexual Harassment at workplace
Your Company has zero tolerance towards any kind of harassment, including sexual harassment, or discrimination. An Internal Complaints Committee (ICC) has been constituted to investigate and resolve sexual harassment complaints. Employees are encouraged to speak up and report any such incidences to the ICC. A Policy on Prevention of Sexual Harassment is put in place, which is reviewed by the ICC at regular intervals. Any complaint made to the ICC is treated fairly and confidentially and the Company does not tolerate any kind of retaliation towards the employees who make complaints to ICC.
An online training is rolled out on the subject and it is mandatory for all the employees of the Company to complete and obtain an online certification. The said training is also mandated for the new joinees as a part of their onboarding process.
During the Financial Year 2022-23, 2 complaints were received, investigated and appropriately resolved by the ICC.
Particulars of Employees
Information as per Section 197 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided in Annexure 4 to this Report.
The statement containing the names of top ten employees in terms of remuneration drawn and the particulars of employees as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(2) of the aforementioned Rules will be made available on request sent to the dedicated email address of the Company at [email protected]
Trade Relations
Your Directors wish to record appreciation of the continued, unstinted support and cooperation from its retailers, stockists, suppliers of goods/ services, clearing and forwarding agents and all others associated with it. Your Company will continue to build and maintain a strong association with its business partners and trade associates.
Energy Conservation, Technology Absorption and Foreign Exchange
The information required under Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 with respect to conservation of energy, technology absorption and foreign exchange earnings/outgo is attached as Annexure 3 to this Report.
Corporate Governance
A separate report on Corporate Governance laying down the Company Philosophy on the Corporate Governance as well as all the disclosures as required under the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âthe SEBI Listing Regulationsâ) along with the Auditorsâ Certificate on its compliance with the corporate governance requirements under the SEBI Listing Regulations forms an integral part of this Report and is annexed as Annexure 1.
Directors and Key Managerial Personnel
Since April 1, 2022 till the date of this Report, the following changes took place in the Board of Directors and the Key Managerial Personnel (in the order of their occurrence):
⢠Resignation of Mr. Ram Raghavan (DIN : 08511606) as the Managing Director of the Company effective close of business hours on April 15, 2022 and effective that date he also ceased to be a Key Managerial Personnel of the Company.
⢠Resignation of Mr. Chandrasekar Meenakshi Sundaram (DIN : 07667965) as the Whole-time Director effective close of business hours on June 30, 2022.
⢠Appointment of Ms. Prabha Narasimhan (DIN : 08822860) as the Managing Director & Chief Executive Officer of the Company for 5 (five) consecutive years w.e.f. September 1, 2022. In line with the provisions of Section 203 of the Companies Act, 2013. Prabha is also designated as a Key Managerial Personnel effective that date.
Sr. No. |
Program/Presentation |
1. |
Update on Business operations |
2. |
Regulatory update |
3. |
ESG Framework |
4. |
ESG& BRSR |
5. |
Update on Project - Smile Store |
6. |
Red Zone Risk Matrix |
7. |
Succession Planning/Talent Retention |
8. |
Supplier Related Risk |
9. |
Update on Shareholder Matters |
10. |
Insider trading tool |
11. |
Amendments in the provisions of RPT |
12. |
ESG Update |
⢠Re-appointment of Ms. Sukanya Kripalu (DIN : 06994202) as an Additional Director designated as Non-Executive Independent Director of the Company for a second term of 5 (five) consecutive years w.e.f. June 1, 2023.
Based on the declarations provided by Ms. Kripalu, she is Independent of the Management. Considering the rich and vast experience of Ms. Sukanya Kripalu and the contributions made by her during her tenure, the Board recommends the re-appointment of Ms. Sukanya Kripalu as a Non-Executive, Independent Director.
Pursuant to the provisions of Section 152 of the Companies Act, 2013, Mr. Jacob Sebastian Madukkakuzy (DIN: 07645510), Whole-time Director & Chief Financial Officer, retires by rotation at the ensuing Annual General Meeting and being eligible, has offered himself for re-appointment. Based on the recommendation of the Nomination and Remuneration Committee, the Board recommends his re-appointment.
A detailed profile of all the Directors of your Company is available on the Company website at https://www. colgatepalmolive.co.in/who-we-are/board-of-directors.
Declaration of Independence :
The Company has received the necessary disclosures under the Companies Act, 2013 and the SEBI Listing Regulations including declarations from all Independent Directors that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and the SEBI Listing Regulations. In the opinion of the Board, the Independent Directors fulfill the conditions specified in the SEBI Listing Regulations and are independent of the management. Further, the Independent Directors possess integrity and necessary expertise and experience (including the proficiency) which bring tremendous value to the Board and to the Company.
Directors and Officers Liability Insurance Policy
The Company has a Directors and Officers Liability Insurance Policy which protects Directors and Officers of the Company for any breach of fiduciary duty.
The Company conducts familiarization programs for Independent Directors with regard to their roles, rights, responsibilities towards the Company, the business operations of the Company, etc. Detailed presentations are made to the Board and its committees from time to time.
Details of the familiarization programs extended to the Independent Directors during the Financial Year are disclosed on the Company website from time to time at http://www. colgateinvestors.co.in/policies
Gist of Familiarization programs conducted during the Financial Year 2022-23 are as follows:
The Board of Directors of your Company, from time to time, has framed and revised various Policies as per the applicable Acts, Rules and Regulations and Standards of better governance and administration of your Company. Overview of the key policies, as approved by the Board of Directors is as follows :
Nomination and Remuneration Policy: This Policy sets the objective, terms of reference, functions and scope of the Nomination and Remuneration Committee for determining qualifications, experience, independence, etc. relating to the appointment and remuneration for the Directors, Key Managerial Personnel and Senior Management employees of the Company.
Corporate Social Responsibility (âCSRâ) Policy: This Policy sets out the role of the CSR Committee of the Board of Directors, which includes identification of the areas where the CSR activities will be performed, evaluation of CSR activities, review the CSR spending vis-a-vis the activities implemented and monitoring the process of CSR projects/ programs of the Company.
Risk Management Policy: This Policy provides the framework for identification of risks of the Company, risk assessment and prioritization, loss prevention measures and other risk management measures for the Company.
Related Party Transactions Policy: This Policy regulates the entry into transactions between the Company and its related
parties and the required corporate approvals as per the laws and regulations applicable to the Company from time to time.
Policy on Determination of Materiality of Event or Information: This Policy lays down the criteria for determining the materiality of an event or information of the Company for purposes of making required disclosures to the stock exchanges pursuant to the SEBI Listing Regulations.
Records Management Policy: This Policy establishes general guidelines for retaining, preserving and archiving important documents and information.
Code of Conduct for dealing in the Companyâs Securities:
Pursuant to the SEBI (Prohibition of Insider Trading) Regulations, 2015, your Company has framed a Code of Conduct on prohibition of insider trading.
Dividend Distribution Policy: This Policy describes the circumstances under which a Member may or may not expect a dividend and the financial parameters and internal and external factors which are considered by the Board of Directors for declaration of dividend.
Policy on Retirement of Directors: This Policy lays down the age criteria for retirement of Directors on the Board of the Company. The criterion for age is desirable to allow smooth retirement for the purpose of succession planning and further to induct requisite skills and competencies on the Board of the Company with appropriate continuity.
Public Policy Advocacy: This Policy deals with laying down of standardized approach while making interactions and /or representations to the Government / Regulatory Authorities. The Company may offer opinions and recommendations to governments on particular issues to support its business goals and needs.
Board Diversity Policy: The Company recognizes the importance and benefits of having a diverse Board to enhance the quality of its performance. Diversity encompasses diversity of perspective, experience, skills, education, background, ethnicity, gender and personal attributes. This policy ensures that we have optimum composition of Board Members with diverse experience and skill sets to achieve the objectives of the organization.
The aforesaid Policies are available in the Investors Section on the website of the Company at https://www.colgateinvestors. co.in/policies.
During the Financial Year 2022-23, 6 (six) Board meetings were held on April 28, 2022; May 26, 2022; July 27, 2022; October 20, 2022; January 24, 2023; and March 24, 2023. The details of which are provided in the Corporate Governance Report that forms an integral part of the Boardâs Report.
The Board of Directors of the Company has established various Board committees to assist in discharging their duties. These include Audit Committee, Stakeholders'' Relationship Committee, ESG and Corporate Social Responsibility Committee, Risk Management Committee and Nomination and Remuneration Committee. The Board has approved the terms of reference for each of these committees. All the committees of the Board hold their meetings at regular intervals and make their recommendations to the Board from time to time as per the applicable provisions of the Companies Act, 2013 and the SEBI Listing Regulations.
The broad terms of reference of the said Committees are stated in the Corporate Governance Report that forms an integral part of the Boardâs Report.
Annual Performance Evaluation by the Board70
Pursuant to the provisions of the Companies Act, 2013 and the SEBI Listing Regulations, the Board has carried out an Annual Performance Evaluation of its own performance, as well as the performance of its Committees, its Members including Independent Directors and the Chairperson. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report that forms part of the Boardâs Report.
The Annual Performance Evaluation process has been designed in such a manner which helps to measure effectiveness of the entire Board, its Committees, Chairperson and Individual Directors. Such processes help in ensuring overall performance of the Board and demonstrates a high level of corporate governance standards. There are various key performance areas and evaluation criterias which are measured and analyzed during the process, few of them are in the table:
Sr. Particulars No. |
Key performance areas/evaluation criteria |
1. For Independent Directors |
⢠Suitable business knowledge and understanding of the industry in which the Company operates. ⢠Exercises his/her own judgement and voices opinion freely without any influence. ⢠Understands governance, regulatory, financial, fiduciary and ethical requirements of the Board/ Committee. |
2. For Executive Directors |
⢠Good understanding and knowledge of the Company and the sector it operates in and stays abreast of issues, trends, risks, opportunities and competition affecting the Company and uses this information to assess and guide the Companyâs performance. ⢠Understands duties, responsibilities, qualifications, disqualifications and liabilities as a director. ⢠Ensures best Corporate Governance practices and compliance with the applicable laws and regulations. |
3. For the Chairperson |
⢠Provides guidance to the Board on delineation of roles of the Board and Management. ⢠Provides direction to the Board on aspects that are critical/of strategic significance to the Company. ⢠Creates a cohesive environment to allow open and fair discussion. |
4. For Committees |
⢠Committee effectively performs the responsibilities as outlined in the charter and applicable laws and regulations. ⢠Committeeâs composition in terms of size, skills/expertise and experience is appropriate to perform its responsibilities. ⢠Committee meetings are conducted effectively with sufficient time spent on significant or emerging issues. |
5. For the Board |
⢠Proper mix of competencies to conduct its affairs effectively. ⢠Appropriate mix of independent and non- independent directors. ⢠Number and frequency of Board meetings is adequate to perform its duties effectively. |
The Company has an effective Vigil Mechanism system which is embedded in its Code of Conduct. The Code of Conduct of the Company serves as a guide for daily business interactions, reflecting the Companyâs standard for appropriate behavior and living corporate values. The Code of Conduct applies to all Colgate people, including Directors, Officers, and all employees of the Company. Even the Companyâs vendors and suppliers are subject to the Third Party Code of Conduct requirements and adherence to the same and it is a prerequisite for conducting business with the Company. The Code of Conduct Hotline is available on the Company website to report any concerns about unethical behavior, any actual or suspected fraud or violation of the Companyâs Code of Conduct. No adverse action will be taken against anyone for complaining about, reporting, participating or assisting in the investigation of a suspected violation of the Code
of Conduct, unless the allegation made or information provided is found to be intentionally false. The Company conducts various training and awareness sessions on Code of Conduct on a continuous basis during town halls, meetings or through creative mailers to all employees. Senior Leadership Members at various occasions emphasize the importance of adherence to the Companyâs Code of Conduct and its ethical ways of working.
The Code of Conduct can be accessed at https://www. colgatepalmolive.com/en-us/who-we-are/governance/code-of-conduct
During the Financial Year 2022-23, your Company has not accepted any Public Deposits under Chapter V of the Companies Act, 2013.
In terms of the provisions of Investor Education and Protection Fund (Accounting, Audit, Transfer and Refund) Rules, 2016, H 2.10 crores of unpaid/unclaimed dividends were transferred during the Financial Year to the Investor Education and Protection Fund (IEPF).
The due dates for transfer of unpaid dividend to IEPF for subsequent years is provided in the Corporate Governance Report annexed as Annexure 1 to this Report.
Loan, Guarantees and Investment
Particulars of loans, guarantees and investment made by the Company pursuant to Section 186 of the Companies Act, 2013 are given in Note No. 4 and 11 to the Financial Statements.
Related Party Contracts & Arrangements
All related party transactions done by the Company during the Financial Year 2022-23 were at armâs length and in the ordinary course of business. All related party transactions were reviewed and approved by the Audit Committee. During the Financial Year 2022-23, the Company has not entered into any material related party transaction as per the SEBI Listing Regulations with any of its related parties. Disclosures pursuant to the Accounting Standards on related party transactions have been made in the notes to the Financial Statements. To regulate related party transactions, the Company has also framed a Policy on Related Party Transactions and the same is available on the Companyâs website at https://www.colgateinvestors.co.in/policies
As there were no related party transactions which were not in the ordinary course of the business or not on armâs length basis and also since there was no material related party transaction as stated above, disclosure under Section 134(3)(h) of the Companies Act, 2013 in Form AOC-2 is not applicable. For more details on Related Party Transactions which are in ordinary course of business and on armâs length basis, please refer to Note No. 37 of Financial Statements.
M/s. S R B C & CO LLP, Chartered Accountants, Mumbai (ICAI Firm Registration No. 324982E/ E300003), were appointed as Statutory Auditors of the Company for a second term at the 81st Annual General Meeting (AGM) of the Company held on July 28, 2022, for a period of 5 (five) consecutive years from the conclusion of the 81st AGM till the conclusion of the 86th AGM.
The Audit report for the Financial Year 2022-23 does not contain any qualification, reservation or adverse remarks. Further, during the Financial Year 2022-23, the Statutory Auditors have not reported any instances of fraud to the
Audit Committee or Board as per Section 143(12) of the Companies Act, 2013.
Secretarial Auditor & Secretarial Audit Report
The Board had, in its meeting held on May 26, 2022 appointed M/s. S. N. Ananthasubramanian & Co., Company Secretaries in practice, (ICSI Unique Code: P1991MH040400, FCS No. 4206, COP No. 1774) to carry out the Secretarial Audit for the Financial Year 2022-23 under the provisions of Section 204 of the Companies Act, 2013. The Secretarial Audit Report in Form MR-3 is attached as Annexure 5 to this Report. The Secretarial Audit Report for the Financial Year 2022-23 does not contain any qualification, reservation or adverse remarks.
In view of the good governance practice, the Board of Directors at its Meeting held on May 12, 2023, approved the rotation of the Secretarial Auditors and appointed M/s. Dholakia & Associates LLP (ICSI Unique Code: P2014MH034700, FCS No. 10032, COP No. 12884) as the Secretarial Auditors of the Company for the Financial Year 2023-24.
Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148 of the Companies Act, 2013 are not applicable for the business activities carried out by the Company.
The Annual Return of the Company has been placed on the website of the Company and can be accessed at https://www.colgateinvestors.co.in/annual-report
Significant and Material Orders passed by the Regulators or Courts
During the Financial Year 2022-23, there were no significant or material orders passed by the Regulators or Courts or Tribunals impacting the going concern status and operations of the Company in the future.
Material changes affecting the Company
There have been no material changes and commitments affecting the financial position of the Company between the end of the Financial Year and date of this report.
Compliance with Secretarial Standards
Your Company has complied with Secretarial Standards issued by the Institute of Company Secretaries of India on Board and General Meetings.
Adequacy of Internal Financial Controls
Your Company has an adequate and talented team of internal auditors that oversees the internal financial processes, policies, and recommends robust internal financial controls from time to time. These internal financial controls help to put in place checks on the implementation of the internal financial controls, policies & procedures that are adopted by the Company for ensuring an orderly and efficient conduct of its business. These internal financial controls help in safeguarding assets, prevention & detection of frauds and/ or errors, maintaining the accuracy and completeness of the accounting & financial records. These controls help in the timely preparation of transparent, complete and accurate financial information and statements as per the accounting standards and principles laid down. The Audit Committee of your Company evaluates the internal financial controls system periodically.
The Company received the following awards and accolades during the Financial Year:
⢠FMCG ASIA AWARDS-Product launch of the Year (2022) Colgate Visible White O2 launch in India & ESG initiative of the Year.
⢠INDIASTAR 2022- The National Awards for Excellence in
⢠The Economic Times Employee Excellence Awards 2022-Recognized as one of the âExcellent Employers of Indiaâ.
⢠Best Compliance Team 2022 - At the Annual Compliance Symposium 10/10 hosted by Legasis.
⢠Jury Award for Best Tax Compliant - In the category H 500 cr to H 5000 cr turnover.
⢠Palmolive - GRAZIA MOST LOVED BRANDS 2022.
⢠The Economic Times - Best Organisations For Women 2023.
⢠ET Digiplus Awards Gold - Best use of branded content âSmile Karo Aur Shuru Ho Jaaoâ campaign 2022 & Best use of Integrated Strategy 2022.
⢠EMVIES Bronze - Best Media Buying Team of the Year âSweat Behind the Smileâ 2022.
⢠Indian Digital Awards Gold - Best use of Video âSmile Karo Aur Shuru Ho Jaaoâ campaign 2022.
⢠Indian Digital Awards Silver - Best use of Content Marketing âSmile Karo Aur Shuru Ho Jaaoâ campaign 2022.
⢠Indian Digital Awards Bronze - Best use of YouTube 2022.
⢠ICSI National Awards - Certificate of Recognition for Excellence in Corporate Governance.
Your Directors wish to convey their deepest appreciation for the unstinted dedication, professionalism, commitment and resilience displayed by the Companyâs employees at all levels and business partners, customers, vendors etc. Your Directors also wish to express their gratitude towards the Shareholders for their continued trust, support and confidence.
Mar 31, 2021
Your Directors are pleased to present their Report and Audited Accounts of the Company for the financial year ended March 31, 2021.
1. Financial Results |
('' In Crore) |
|
F.Y. 2020-21 |
F.Y. 2019-20 |
|
Total Revenue (a b c) |
4,871.56 |
4,574.33 |
Sales (Including Excise Duty) (a) |
4,810.48 |
4,487.57 |
Other Operating Revenue (b) |
30.74 |
37.52 |
Other Income (c) |
30.35 |
49.24 |
Profit before Tax and exceptional items and Tax |
1,350.21 |
1,043.36 |
Profit before Taxation |
1,350.21 |
1,043.36 |
Tax Expense |
314.83 |
226.89 |
Profit for the year |
1,035.38 |
816.47 |
Other Comprehensive Income (net of Tax)(gain) |
(3.24) |
15.53 |
Total Comprehensive Income |
1,038.62 |
800.94 |
Balance brought forward |
1,170.46 |
1,018.56 |
Profit available for appropriation |
1,038.62 |
800.94 |
Balance transferred to Retained Earnings from Share Options Outstanding Account |
1.51 |
6.74 |
Appropriation : |
||
Dividend |
(1,468.72) |
(543.97) |
Dividend Distribution Tax |
- |
(111.81) |
Balance carried forward |
741.86 |
1,170.46 |
Reported Net Sales for the financial year 2020-21 stood at '' 4,810.48 crores against '' 4,487.57 crores of previous year. Net Sales increased by 7.2% in comparison to the previous year. Reported Net Profit after tax for the financial year 2020-21 was '' 1,035.39 crores, an increase of 26.8% over the previous year.
Despite the challenging business and economic environment, your Company continues to sustain its leadership position in both the Toothpaste and Toothbrush categories during the financial year 2020-21.
Your Companyâs Board of Directors declared two interim dividends, aggregating to '' 38/- per share, for the financial year 2020-21. The first interim dividend of '' 18/- per share was declared in October 2020 and the second interim dividend of '' 20/- per share was declared in March 2021. The first interim dividend was
paid on November 18, 2020 and the second interim dividend was paid on April 16, 2021. Having declared two interim dividends, your Companyâs Board has not recommended a final dividend for the financial year 2020-21.
No amount has been transferred to the general reserves.
5. Focus on Innovation and New Launches / Campaign
Your Company is focused on delivering insight-driven innovation that provides value-added new products across all price points.
In the financial year 2020-21, the following products were launched/re-launched:
Colgate Vedshaktiâs new brand proposition: With the âMooh Swachh Toh Aap Healthyâ (Pure Mouth means
a Healthy You) media campaign, Colgate Vedshakti became the first Oral Care brand that educated consumers about the connection between Oral Health & Overall Health. Our mouth is a gateway to the body and it is imperative we keep it clean and germ free. This high decibel campaign was kickstarted with the launch of a new TVC and further amplified with multiple print & digital initiatives through the year.
The consumers resonated with the brandâs message. A testimony to this was The Economic Times Brand Equity rating the Colgate Vedshakti media campaign #6 in their list of âIndiaâs Top 100 Campaigns of 2020â across all advertised categories.
The flagship naturals brand strengthened its position as the Ayurvedic Oral Care expert with two new launches - Vedshakti Mouth Protect Spray & Vedshakti Oil Pulling.
⢠Colgate Vedshakti Mouth Protect spray: Is a
first of a kind solution powered by Ayurveda that offers instant germ kill through the convenience and simplicity of a mouth spray. When we are out of our homes, itâs not easy to keep the constantly growing mouth-germs in check. Colgate Vedshakti Mouth Protect Spray is a breakthrough innovation. It provides instant germ-killing action in the mouth, refreshes mask-breath with its minty saunf flavor and fits easily in the pocket.
⢠Colgate Vedshakti Oil pulling: Oil Pulling is an ancient oral âkriyaâ recommended in Ayurvedic scriptures as an essential part of daily morning health rituals or âdinacharyaâ. Incorporating Oil Pulling to your existing oral regimen helps remove impurities and promote Oral Health, keeping Oral diseases at bay. Combining this centuries-old practice of Oil Pulling with Colgateâs oral care expertise, we created an antioxidant rich blend of 5 oils (Sesame, Eucalyptus, Basil, Clove and Lemon) known to deep clean & detoxify the mouth every morning, giving benefits in oral health and beyond.
With the two new launches, Colgate Vedshakti became an Ayurveda Platform. A new, premium visual identity was developed which unified all the brands in the portfolio and gave a distinct signature of Ayurvedic expertise to Brand Vedshakti.
With the Vedshakti Toothpaste, Vedshakti Mouth Protect Spray & Oil Pulling, we are now providing a range of oral care solutions that helps to keep your mouth clean and detoxified to help you stay healthy.
Colgate Super Flexi Salt: Indiaâs #1 selling toothbrush brand, Super Flexi, has launched the first ever Salt toothbrush, with Salt infused slim tip bristles to provide superior cleaning. This offering comes at an attractive price point of '' 25.
Colgate Zig Zag Turmeric: Colgate Zig Zag Turmeric is Indiaâs first turmeric toothbrush. The brush has the unique offering of 100% Anti-bacterial bristles infused with turmeric, that inhibit bacterial build up on the bristle surfaces. This offering is an extension to Colgateâs range of Natural toothbrushes at '' 35.
Colgate Magik: To make brushing an exciting and interactive learning experience and to help kids develop right oral care habits, we have launched Colgate Magik, a first of its kind augmented reality toothbrush that completely transforms toothbrushing time into a fun adventure.
Toothpaste for Diabetics: Diabetes and Oral care are closely interlinked and better oral care can help in better diabetes management. Your Company has launched Colgateâs first ever Toothpaste for Diabetics. Itâs unique formula harnesses the goodness of Ayurvedic ingredients with cutting edge oral science helping people with Diabetes keep their gums healthy, thus helping them manage oral care as part of their diabetes management.
Colgate Visible White Instant: We launched Colgate Visible White Instant, a toothpaste which promises an instant teeth whitening benefit to consumers. It has a unique technology and contains optical brighteners that whiten teeth from the first brushing itself.
Colgate Zig Zag Anti Bacterial: One of Indiaâs leading toothbrush brands, âColgate Zig Zagâ is now equipped with 100% Anti-Bacterial bristles, transforming into Colgate Zig Zag Anti-Bacterial. Infused with Silver Ions, these unique bristles inhibit bacteria build up on the bristle surface. Inside the mouth, Zig Zagâs multi-angled bristles remove germs in between teeth. New Zig Zag now offers superior benefits for overall protection.
Palmolive Hand Sanitizer: Palmolive India launched itâs range of sanitizers in a record time, as an agile response during the onset of the COVID pandemic in the country. Palmolive Antibacterial Hand Sanitizer kills 99.9% of disease-causing germs instantly, without using soap or water. Its 72% alcohol based formula helps protect from illness causing germs and infection. The non-sticky, gel based formula is safe for hands and leaves them feeling soft and pampered.
Colgate Gentle Range: The New âColgate Gentleâ addresses the growing need for a brushing experience that doesnât harm soft tissues in the mouth or aggravate problems. The range has been specially curated with Dentists to deliver enhanced care for a healthy mouth and is also endorsed by IDA (Indian Dental Association).
⢠Gentle Clean for effective everyday care at an affordable entry price point of '' 30
⢠Gentle Sensitive specially designed for Sensitive teeth at '' 50
⢠Gentle GumCare designed to improve gum health in 4 weeks at '' 75
⢠Gentle Enamel designed to gently protect tooth enamel & priced at a premium of '' 120
⢠And finally the flagship bundle Gentle Ultrafoam with a patented design technology that delivers enhanced foam for a gentlest yet superior Clean.
Palmolive Hand wash 150ml Doy Packs: Palmolive Liquid Handwash variants of Sea Minerals and Orchid Milk were re-launched in an innovative 150ml doy pack with a spout in Septemberâ20. The pack provides an added convenience of use to the consumer, with the unique spout design. The pack reached a phenomenal distribution of around 198,000 stores in itâs launch month.
Palmolive Charcoal and Mint Bodywash: An
E-commerce exclusive pack, Palmolive Body Butter Charcoal & Mint Bodywash is infused with Charcoal and Mint. The natural cleansing power of charcoal removes impurities, and mint adds a long-lasting freshness. It works like a scrub for the skin and has pH balanced formula along with 0% Alcohol, Parabens, Silicones, Animal derivatives, Gluten or Bpa; making it safe for any skin type.
Palmolive Luminous Oil Enriching Bodywash: An
extension to the Luminous Range of Bodywash, Palmolive Luminous Oil Enriching Bodywash comes with a rich formula infused with 100% natural ingredients. Coconut hydrates and leaves skin feeling soft and supple, while Jojoba Oil helps in skin repair and damage control.
Colgate DentistsforMe: To stay at the forefront of oral care and to spread smile during this pandemic when dentists clinics were shut, your Company has launched Colgate DentistsforMe.in the first of its kind teledentistry platform that brings to people from all over India, access to Dentists from the comfort of their homes. You can video, audio call or chat with the 250 dentists across the country whom we have partnered with, to get help with dental issues that you or anyone in the family might face, completely free of charge!
Dental Problems, despite not being fatal, are grievously painful when they occur and on occasions when meeting a dentist physically is inconvenient. Colgate DentistsforMe.in is an easy option to consult an expert dentist in a click. DentistsforMe app is available on Google Play Store and Apple Store or you may sign up at www.dentistsforme.in
a. Your Company is an environmentally conscious Company that believes in protecting the environment and building a sustainable society. The Company is committed to doing business with integrity and respect for all people and the planet. Achieving economic, social and environmental performance in todayâs business climate requires a long term sustainability strategy that is executed with discipline year after year. Colgateâs sustainability strategy is focussed on the three areas of People, Performance and Planet.
I. People: Promoting healthier lives, Contributing to the Communities where we live and work:
⢠Your Company is committed to continuously improve employeesâ health and reduce their health risks and encouraging healthier living for employees and their families.
⢠Colgate employees have been provided with free health check.
II. Performance: Growing the business with innovative, more sustainable products that make the lives of consumers healthier and more enjoyable:
⢠Your Company endeavors to improve the sustainability profile of new products and product updates, drive sustainability with breakthrough product and process innovation, increase the recyclability of our packaging and increased recycled content, have a positive impact by expanding access to affordable health and wellness products for millions of people in underserved communities and use the power of our brands to build awareness and drive engagement in product sustainability.
III. Planet: Conserving Earthâs finite resources, addressing climate change and maintaining the well-being of our planet for generations to come:
⢠Your Company is committed to address key environmental issues such as energy use, carbon emissions, water use and waste generation as well as deforestation.
⢠Colgate has robust policies in place for sustainable use of and environmentally sound disposal of waste generated during our processes and making every drop of water count and reducing our impact on the climate and the environment. More information on conservation of energy and measures undertaken by your Company are mentioned in Annexure 3 to this report.
Your Company has received TRUE Zero Waste Platinum certification in 2019, for all its four manufacturing sites in India, from Green Business Certification Inc. (GBCI), the premier organization independently recognizing excellence in green business industry performance and practice globally. Your Company is the first in India to receive such certification. GBCI administers TRUE Zero Waste certification, a program for businesses to assess performance in reducing waste and maximizing resource efficiency. Facilities earn TRUE certification by achieving minimum program requirements and attaining points; the program operates on a ranking system, with âPlatinumâ being the highest certification level. We continue to maintain the certification as our Diversion Rating at more than 90% as per the requirements.
b. As an organization we continue to live our values and remain unwavering in our focus to improve the health and well being of our consumers. One of our topmost priorities of the Company has been the health and safety of its people. The Company, continues to ensure health and safety of its employees and other staff, took adequate pre-emptive measures on travel restriction and enhancing the hygiene & sanitization protocols across all offices and plants. We are thankful to our customers, business partners and employees for their continued support during these challenging times. Our sharp focus aimed at fulfilling demand and ensuring uninterrupted access ensured agile and innovative approaches, specifically in our Supply Chain and Distribution efforts. Our disciplined approach to managing all revenue and cost drivers, despite all the uncertainties and challenges around us on account of the pandemic, drove improvements in key financial metrics. We continue to focus our efforts on providing our consumers with a future they can smile about with their health and well-being at the core. During the financial year 2020-21 your Company has ensured to extend wholehearted support to combat the ongoing COVID-19 crises by distribution of ration kits, hygiene products, hand sanitizers, etc, across geographies in India. While Colgate has globally tied up with the World Health Organization for donation of hygiene products, we at Colgate India took a multi-fold approach to support the communities which were adversely impacted and we appreciate efforts of on the ground teams of NGO partners, support extended by Government bodies and local administration of the areas and communities we operate.
Leveraging the strength of our brand and our presence across India over the past 80 years, we have responded with agility to the
specific challenge of reaching our products to our consumers at this time. The Companyâs commitment towards its core values together with the strength of the Companyâs brands, its best-in-class distribution network and its costsaving initiatives, should position the Company well to increase stakeholder value over the long term.
Pursuant to Section 134 sub-section (3)(c) read with sub-section (5) of the Companies Act, 2013, your Companyâs Directors, based on the representations received from the Management, confirm that:
a) i n the preparation of the Annual Accounts for the financial year ended March 31, 2021, the applicable Accounting Standards have been followed and that no material departures have been made from the same;
b) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for that period;
c) to the best of their knowledge and information, they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d) they have prepared the Annual Accounts on a going concern basis;
e) they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
f) they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
A separate report on Corporate Governance along with the Auditorsâ Certificate on its compliance with the corporate governance requirements under the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âSEBI Listing Regulationsâ) is attached as Annexure 1 to this Report.
9. Corporate Social Responsibility
Your Company is engaged in a variety of corporate social activities which focus on promoting oral health education, empowering children with education, enhancing access to water and supporting livelihoods & women empowerment through water augmentation. These social initiatives reflect your Companyâs core values of caring, global teamwork and continuous improvement. These initiatives are carried out through a variety of effective programs in accordance with the requirements of Schedule VII of the Companies Act, 2013, by the Company and in partnership with reputed NGOs and agencies.
The Board of Directors and the CSR Committee closely review and monitor, from time to time, the various CSR activities undertaken by the Company.
The following are the key CSR programs undertaken by your Company during the financial year 2020-21:
i. Bright Smiles, Bright Futuresâ¢;
ii. Education programs with Seva Mandir and Action Aid and supporting Read India program of Pratham;
iii. A Positive Step program with NGO NTP for children infected & affected with HIV ;
iv. Employability linked skilling program âSakshamâ with SEEDs and Learnet skills;
v. Water program with Water for People India Trust and Water Augmentation for livelihoods and Women Empowerment with Seva Mandir;
vi. Keep India Smiling Foundational Scholarship Program with Shikshadaan; and
vii. COVID-19 relief work for communities adversely impacted through various NGO partners
A detailed description of the above programs/ activities is contained in the Annual CSR Report attached as Annexure 2 to this Report.
The contents of the CSR Policy as well as the CSR programs undertaken by the Company are available on the Companyâs website at http://www.colgate. co.in/app/Colgate/IN/Corp/ CommunityPrograms/ HomePage.cvsp
The Employee Relations in the Company continued to remain healthy, cordial and progressive in the financial year 2020-21.
At Colgate, we consider every employee as one of the most valuable resources contributing towards the
long term success of the Company. Our employees are committed to acting with compassion, integrity, honesty and high ethics in all situations. As per Colgateâs core values, all employees are treated with equality and fairness and provided with opportunities to develop their career aspirations while working with the Company in India and, where possible, outside of India on assignments with group companies of Colgate.
Your Company has zero tolerance towards any kind of harassment, including sexual harassment, or discrimination. Your Company has constituted an Internal Complaints Committee (ICC) to investigate and resolve sexual harassment complaints. Employees are encouraged to speak up and report any such incidences to the ICC. Your Company has also implemented a Policy on Prevention of Sexual Harassment which is reviewed by the ICC at regular intervals. Any complaint made to the ICC is treated fairly and confidentially.
There were no pending complaints as of the end of the financial year 2019-20. During the financial year 2020-21, five complaints were received, investigated and resolved by the ICC.
Your Company also recognizes and follows âManaging with Respect Principlesâ which are applicable not only within Colgate but also while its employees are dealing with its customers, suppliers, vendors etc. Managing with Respect is the way Colgate people put our values into action. It is creating an environment where people feel free to offer suggestions, contribute ideas and resources and help grow the business. Managing with Respect creates an environment where people genuinely care about each other and work well together to reach their full potential.
Your Directors wish to record appreciation of the continued, unstinted support and cooperation from its retailers, stockists, suppliers of goods/ services, clearing and forwarding agents and all others associated with it. Your Company will continue to build and maintain a strong association with its business partners and trade associates.
12. Energy Conservation, Technology Absorption and Foreign Exchange
The information required under Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 with respect to conservation of energy, technology absorption and foreign exchange earnings/outgo is attached as Annexure 3 to this Report.
Further, based on the recommendation of the Nomination & Remuneration Committee, the Board at its meeting held on May 17, 2021, considered and approved the re-appointment of Mr. M.S. Jacob (DIN: 07645510) as a Whole-time Director & CFO of the Company for a period of 5 (five) consecutive years with effect from October 28, 2021, subject to the approval of shareholders and any other necessary approvals as may be required.
A detailed profile of all the Directors of your Company is available on the Company website at https://www. colgatepalmolive.co.in/about/executives-and-boards/ board-of-directors
15. Familiarization Program
Your Company has been regularly familiarizing the Independent Directors on its Board with detailed presentations by its business functional heads and others on the Company operations, strategic business plans, new products and technologies. Apart from above, Independent Directors are also familiarized with various regulatory developments, changes in laws, etc. A detailed description of the familiarization programs extended to the Independent Directors during the financial year is disclosed on the Company website at http://www.colgateinvestors.co.in/policies
Gist of Familiarization programs conducted during the financial year 2020-21 are as follows:
Sr. No. |
Proqramme/Presentation |
1. |
Update on Business operations |
2. |
Strat plan |
3. |
Requiatory update and Corporate Governance |
4. |
Update on Brand protection Risk |
5. |
Presentation on compliance |
6. |
Update on eCommerce in India |
7. |
Swarna Vedshakti (SVS) platform Update |
8. |
Innovation & R&D - Update |
9. |
Business update on Western Region |
10. |
Update on Cyber Security |
Information as per Section 197 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided in Annexure 4 to this Report.
The statement containing the names of top ten employees in terms of remuneration drawn and the particulars of employees as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(2) of the aforementioned Rules will be made available on request sent to the Company on [email protected]
14. Directors and Key Managerial Personnel
During the financial year 2020-21, the following changes took place in the Board of Directors and the Key Managerial Personnel (in the order of their occurrence):
1) Appointed Mr. Sekhar Natarajan (DIN: 01031445) and Ms. Gopika Pant (DIN: 00388675) as Independent Directors of the Company for a period of 5 (five) consecutive years with effect from May 21, 2020;
2) Appointed Mr. Surender Sharma (DIN: 02731373) as Whole- time Director of the Company for a period of 5 (five) consecutive years with effect from May 21, 2020; and
3) Re-appointed Ms. Shyamala Gopinath (DIN: 02362921) as an Independent Director of the Company for a second term commencing from July 30, 2020 to May 31, 2024.
The Company has received the necessary disclosures under the Companies Act, 2013 and the SEBI Listing Regulations including declarations from all Independent Directors that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and the SEBI Listing Regulations. In the opinion of the Board, the Independent Directors fulfill the conditions specified in the SEBI Listing Regulations and are independent of the management. Further, the Independent Directors possess integrity and necessary expertise & experience (including the proficiency) which bring tremendous value to the Board and to the Company.
Pursuant to the provisions of Section 152 of the Companies Act, 2013, Mr. Chandrasekar Meenakshi Sundaram (DIN: 07667965), Whole-time Director, retires by rotation at the ensuing AGM and being eligible, has offered himself for re-appointment. The Board recommends his re-appointment.
The Board of Directors of your Company, from time to time, has framed and revised various Policies as per the applicable Acts, Rules and Regulations and Standards of better governance and administration of your Company. Some of the important Policies that are framed by your Board include the following:
i) Nomination & Remuneration Policy: This Policy sets the objective, terms of reference, functions and scope of the Nomination & Remuneration Committee for determining qualifications, experience, independence etc. relating to the appointment and remuneration for the Directors, Key Managerial Personnel and Senior Management employees of the Company.
ii) Corporate Social Responsibility (âCSRâ) Policy:
This Policy sets out the role of the CSR Committee of the Board of Directors, which includes identification of the areas where the CSR activities will be performed, evaluation of CSR activities, review the CSR spending vis-a-vis the activities implemented and monitoring the process of CSR projects/ programs of the Company.
iii) Risk Management Policy: This Policy provides the framework for identification of risks of the Company, risk assessment and prioritization, loss prevention measures and other risk management measures for the Company.
iv) Related Party Transactions Policy: This Policy regulates the entry into transactions between the Company and its related parties and the required corporate approvals as per the laws and regulations applicable to the Company from time to time.
v) Policy on Determination of Materiality of Event or Information: This Policy lays down the criteria for determining the materiality of an event or information of the Company for purposes of making required disclosures to the stock exchanges pursuant to the SEBI Listing Regulations.
vi) Records Management Policy: This Policy establishes general guidelines for retaining, preserving and archiving important documents and information.
vii) Code of Conduct for dealing in the Companyâs Securities: Pursuant to the SEBI (Prohibition of Insider Trading) Regulations, 2015, your Company has framed a Code of Conduct on prohibition of insider trading.
viii) Dividend Distribution Policy: This Policy describes the circumstances under which a Member may or may not expect a dividend and the financial parameters and internal and external factors which are considered by the Board of Directors for declaration of dividend.
ix) Policy on Retirement of Directors: This Policy lays down the age criteria for retirement of Directors on the Board of the Company. The criterion for age is desirable to allow smooth retirement for the purpose of succession planning and further to induct requisite skills and competencies on the Board of the Company with appropriate continuity.
The Statutory Policies are available in the Investors Section on the website of the Company at https:// www.co lgateinvestors.co.in/policies
During the financial year 2020-21, 5 (five) Board meetings were held. The details of the meetings are provided in the Corporate Governance Report that forms part of the Boardâs Report.
The Board of Directors of your Company has established various Board committees to assist in discharging their duties. These include the Audit Committee, the Nomination & Remuneration Committee, the Risk Management Committee, the Stakeholdersâ Relationship Committee and the Corporate Social Responsibility Committee. The Board has approved the terms of reference for each of these committees. All the committees of the Board hold their meetings at regular intervals and make their recommendations to the Board from time to time.
The broad terms of reference of the said Committees are stated in the Corporate Governance Report that forms part of the Boardâs Report.
19. Annual Performance Evaluation by the Board
Pursuant to the provisions of the Companies Act, 2013 and the SEBI Listing Regulations, the Board has carried out an Annual Performance Evaluation of its own performance, the Directors individually as well as the evaluation of the working of the Committees. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report that forms part of the Boardâs Report.
The annual performance evaluation process has been designed in such a manner which helps to measure effectiveness of the entire Board and its Committees. Such processes help in ensuring overall performance of the Board and demonstrates a high level of corporate governance standards. There are various key performance areas and evaluation criterias which are measured and analysed during the annual performance evaluation process, few of them are as follows:
Sr. No. |
Particular |
Key performance areas/evaluation criteria |
i. |
For Independent Directors |
⢠Fulfilling the criteria of Independence and is independent from the management. ⢠Devoting sufficient time and attention towards professional obligation for informed and balanced decision making. ⢠Exercises responsibilities in a bona fide manner in the interest of the Company. |
2. |
For Executive Directors |
⢠Maintains a high standard of ethical behaviour and does not have a conflict of interest with the Company. ⢠Understands duties, responsibilities, qualifications, disqualifications and liabilities as a director. ⢠Ensure best Corporate Governance practices and compliance with the applicable laws and regulations. |
3. |
For the Chairperson |
⢠Maintains a high standard of ethical behavior and provides effective leadership. ⢠Encourages active participation by all members of the Board and promotes open communication. ⢠Well prepared on the issues and provides constructive contribution and inputs in Meetings. |
4. |
For Committees |
⢠Committee effectively performs the responsibilities as outlined in the charter and applicable laws and regulations. ⢠Committeeâs composition in terms of size, skills/ expertise and experience is appropriate to perform its responsibilities. ⢠Committee meetings are conducted effectively with sufficient time spent on significant or emerging issues. |
5. |
For the Board |
⢠Composition is appropriate in terms of its diversity, balance of skills, experience and independence. ⢠Members of the Board serving as Independent Directors are sufficiently independent from the Management. ⢠Board meetings are conducted effectively, with sufficient time spent on significant or emerging issues. |
Your Company has an effective Vigil Mechanism system which is embedded in its Code of Conduct. The Code of Conduct of your Company serves as a guide for daily business interactions, reflecting your Companyâs standard for appropriate behaviour and living corporate values. The Code of Conduct applies to all Colgate people, including Directors, Officers, and all employees of the Company. Even your Companyâs vendors and suppliers are subject to the Third Party Code of Conduct requirements as adherence to the same, to the extent applicable, is a prerequisite for conducting business with your Company. The Code of Conduct Hotline is available on the Company website to report any concerns about unethical behaviour, any actual or suspected fraud or violation of the Companyâs Code of Conduct. No adverse action will be taken
against anyone for complaining about, reporting, participating or assisting in the investigation of a suspected violation of the Code of Conduct, unless the allegation made or information provided is found to be intentionally false. Your Company conducts various training and awareness sessions on Code of Conduct on a continuous basis.
Senior Leadership Members at various occasions emphasize the importance of adherence to the Companyâs Code of Conduct and its ethical ways of working.
During the financial year 2020-21, your Company has not accepted any Public Deposits under Chapter V of the Companies Act, 2013.
22. Loan, Guarantees and Investment
Particulars of loans, guarantees and investment made by the Company pursuant to Section 186 of the Companies Act, 2013 are given in the Notes to the Financial Statements.
23. Related Party Contracts & Arrangements
All related party transactions done by the Company during the financial year 2020-21 were at armâs length and in the ordinary course of business. All related party transactions were reviewed and approved by the Audit Committee. During the financial year 202021, your Company has not entered into any material related party transaction as per the SEBI Listing Regulations with any of its related parties. Disclosures pursuant to the Accounting Standards on related party transactions have been made in the notes to the Financial Statements. To regulate related party transactions, the Company has also framed a Policy on Related Party Transactions and the same is available on the Companyâs website.
The shareholders of the Company had approved a Material Related Party Transaction for payment of Royalty to Colgate Palmolive Company, USA, Promoter Company through postal ballot in the financial year 2019-20. The said approval was sought for 5 (five) years effective from July 01, 2019.
As there were no related party transactions which were not in the ordinary course of the business or not on armâs length basis and also since there was no material related party transaction as stated above, disclosure under Section 134(3)(h) in Form AOC-2 of the Companies Act, 2013 is not applicable.
M/s. S R B C & Co LLP, Chartered Accountants, Mumbai (ICAI Firm Registration No. 324982E/ E300003), were appointed as Statutory Auditors of the Company at the 76th AGM held on August 3, 2017, for a period of five consecutive years from the conclusion of the 76th AGM till the conclusion of the 81st AGM, subject to ratification by Members of the Company at every AGM to be held thereafter. Further, in view of the amended provisions of Section 139 of the Companies
Act, 2013, notified on 7th May 2018, the Members at the 77th AGM have ratified the appointment of M/s. S R B C & Co LLP, Chartered Accountants, Mumbai (ICAI Firm Registration No. 324982E/ E300003) as Statutory Auditors of the Company for their remaining tenure i.e. upto the conclusion of the 81st AGM, without requiring yearly ratification thereof.
The Audit report for the financial year 2020-21 does not contain any qualification, reservation or adverse remarks. Further, during the financial year 2020-21, the Statutory Auditors have not reported any instances of fraud to the Audit Committee or Board as per Section 143(12) of the Companies Act, 2013.
25. Secretarial Auditor & Secretarial Audit Report
The Board had appointed M/s. S.N. Anantha subramanian & Co., Company Secretaries in practice, to carry out the Secretarial Audit under the provisions of Section 204 of the Companies Act, 2013. The report of the Secretarial Auditor in Form MR-3 is attached as Annexure 5 to this Report. The Secretarial Auditorsâ Report for the financial year 2020-21 does not contain any qualification, reservation or adverse remarks.
The Annual Return of the Company has been placed on the website of the Company and can be accessed at https://www.colgateinvestors.co.in/annual-report
27. Business Responsibility Report
The Business Responsibility Report for the financial year 2020-21, as stipulated under Regulation 34 of the SEBI Listing Regulations is attached as Annexure 6 to this Report.
28. Significant and Material Orders passed by the Regulators or Courts
During the financial year 2020-21, there were no significant or material orders passed by the Regulators or Courts or Tribunals impacting the going concern status and operations of the Company in the future.
29. Material changes affecting the Company
There have been no material changes and commitments affecting the financial position of the Company between the end of the financial year and date of this report.
30. Compliance with Secretarial Standards
Your Company has complied with Secretarial Standards issued by the Institute of Company Secretaries of India on Board and General Meetings and Dividends.
31. Adequacy of Internal Financial Controls
Your Company has an adequate and talented team of internal auditors that oversees the internal financial processes, policies, and recommends robust internal financial controls from time to time. These internal financial controls help to put in place checks on the implementation of the internal financial controls, policies & procedures that are adopted by the Company for ensuring an orderly and efficient conduct of its business. These internal financial controls help in safeguarding assets, prevention &
detection of frauds and/or errors, maintaining the accuracy and completeness of the accounting & financial records. These controls help in the timely preparation of transparent, complete and accurate financial information and statements as per the laid down accounting standards and principles. The Audit Committee of your Company evaluates the internal financial controls system periodically.
Your Directors wish to convey their deepest appreciation for the unstinted dedication, professionalism, commitment and resilience displayed by the Companyâs employees at all levels and business partners, customers, vendors etc. Your Directors also wish to express their gratitude towards the Shareholders for their continued trust, support and confidence.
On behalf of the Board
R. Raghavan M.S. Jacob
Managing Director Whole-time Director
Place: Mumbai & CFO
Date: May 17, 2021 (DIN : 08511606) (DIN : 07645510)
Mar 31, 2018
To,
The Members
Colgate-Palmolive (India) Limited
The Directors are pleased to present their Report and Audited Financial Statements of the Company for the year ended March 31, 2018.
1. Financial Results (Rs. Crore)
F.Y. 2017-18 |
F.Y. 2016-17 |
||
Total Revenue (a b c) |
4,367.24 |
4,560.01 |
|
Sales (Including Excise Duty) (a) |
4,299.89 |
4,489.85 |
|
Other Operating Revenue (b) |
28.53 |
30.35 |
|
Other Income (c) |
38.82 |
39.81 |
|
Profit before Tax from ordinary activities |
994.68 |
851.43 |
|
Profit before Taxation |
983.03 |
851.43 |
|
Tax Expense |
309.66 |
274.00 |
|
Profit for the year |
673.37 |
577.43 |
|
Other Comprehensive Income (net of Tax) |
(1.08) |
5.17 |
|
Total Comprehensive Income |
674.45 |
572.26 |
|
Balance brought forward |
843.82 |
595.27 |
|
Profit available for appropriation |
674.45 |
572.26 |
|
Balance transferred to Retained Earnings from Share |
1.62 |
3.65 |
|
Options Outstanding Account |
|||
Appropriation : |
|||
Dividend |
(353.58) |
(271.99) |
|
Dividend Distribution Tax |
(71.98) |
(55.37) |
|
Balance carried forward |
1,094.33 |
843.82 |
2. Business Performance
Reported Net Sales (incl. excise duty) for the F.Y. 2017-18 stood at Rs. 4,299.89 crores against the Rs. 4,489.85 crores of previous year. Excluding the impact of implentation of GST, Net Sales increased by 5.3% in comparison to the previous year. Reported Net Profit after tax for the F.Y. 2017-18 was Rs. 673.37 crores, an increase of 17% over the previous year. Excluding the impact of tax reversals and exceptional items, Net Profit after tax for the F.Y. 2017-18 increased by 15% over the previous year.
Your Company continues to maintain its leadership position in both the Toothpaste and Toothbrush categories, with volume market shares at 53.4% and 44.8% respectively during the F.Y. 2017-18.
3. Dividend
Your Companyâs Board declared four interim dividends, aggregating to Rs. 24/- per share, for the Financial Year 2017-18. The first interim dividend of Rs. 4/- per share was declared in October 2017, the second interim dividend of Rs. 4/- per share was declared in December 2017, the third interim dividend of Rs. 5/- per share was declared in March 2018 and the fourth interim dividend of Rs. 11/- per share was declared in May 2018. The first three interim dividends were paid on November 10, 2017, December 29, 2017, April 3, 2018 respectively and the fourth interim dividend will be paid on June 15, 2018. Having declared four interim dividends, your Companyâs Board has not recommended a final dividend for the Financial Year 2017-18.
4. Colgate is # 1 âMost Trusted Brandâ in India (7th consecutive year)
Colgate has yet again emerged as the #1 âMost Trusted Brandâ in India across categories in The Economic Times Brand Equity Most Trusted Brand Survey for the year 2017. This is the 7th consecutive year that Colgate has been voted as the #1 âMost Trusted Brandâ. Colgate is the only brand to feature in the top three ranks from 2001-2017 since inception of the survey. This has been possible only due to the trust of our consumers that helps us âKeep India Smiling!â
5. Focus on Innovation and New Launches
Your Company is focused on delivering insight-driven innovation that provides value-added new products across all price points.
In F.Y. 2017-18, this innovation has led to the launch of the following products:
In the Toothpaste category:
Colgate Swarna Vedshakti: This premium toothpaste in the âNaturalsâ category was launched in select markets and is now being rolled out more broadly across the country. Colgate Swarna Vedshakti blends the goodness of Indian natural ingredients of Aloe Vera, Clove, Honey, Tulsi, Neem and Amla with Colgateâs oral care expertise, and effectively delivers holistic oral care.
Colgate MaxFresh with Cooling Crystals -New Xtra Fresh: In the freshness segment, your Company has re-launched Colgate MaxFresh with Cooling Crystals with a new formula powered with breakthrough cooling technology that provides more intense cooling and a super fresh experience.
In the Toothbrush category:
Colgate Neo: An aesthetically designed toothbrush, Colgate Neo is available in 6 exciting and differentiating handle bristle colour combinations. Its ultra soft bristles gently cleans your teeth. With 3,626 high density bristles, Colgate Neo comes in premium packaging which stands out from other toothbrushes.
6. Colgateâs âKeep India Smilingâ initiatives
Your Company is continuously striving towards instilling good oral care habits such as brushing at least twice a day, especially among the rural population of India and children who are the future of our Country. Some of the Companyâs initiatives in this regard are described below:
Pocket Dentist: Most people in rural India have never visited a dentist and have no access to reliable dental advice. As a part of our efforts to âKeep India Smilingâ, Colgate is using a mobile missed call service to provide consumers in rural India with real time access to free professional oral care advice. Pocket Dentist received multiple honours at the India Digital Media Awards (IDMA) in June 2017. It is currently live in Uttar Pradesh, and is run in partnership with Indian Dental Association (IDA). It detects multiple dialects and responds to the 30 most common oral health questions to address 91% of rural dwellersâ oral health problems in areas where over 80% of rural households may only have access to basic mobile phones. Villagers can access âPocket Dentistâ with a free of charge missed call. This program is over and above the Oral Health Month program which is Colgate Indiaâs flagship program to improve the oral health of people.
Asia Book of Records: Colgate, in partnership with IDA, Sri Ramachandra University (SRU) and Rotary International District 3232, made a proud entry in the Asia Book of Records, for âMost People Brushing their Teeth togetherâ. Aimed at educating people about oral hygiene and the right techniques for brushing, the event witnessed a total 23,615 people - including school children and adults - brushing their teeth in the right manner, at the same time and at the same venue (SRU grounds, Chennai), using Colgate Toothpaste and Colgate Toothbrushes.
7. Sustainability
Your Company is committed to doing business with integrity and respect for all people, and for the world around. Achieving economic, social and environmental performance in todayâs business climate requires a long term sustainability strategy that is executed with discipline year after year. Colgateâs sustainability strategy is focussed on the three areas of People, Performance and Planet.
I. People: Promoting healthier lives, Contributing to the Communities where we live and work:
- Your Company is committed to continuously improve employeesâ health and reduce their health risks and encouraging healthier living for employees and their families.
- Colgate employees have been provided with free health check-up facilities coupled with various âLive Betterâ initiatives for promoting healthy lifestyle.
II. Performance: Growing the business with innovative, more sustainable products that make the lives of consumers healthier and more enjoyable:
- Your Company endeavours to improve the sustainability profile of new products and product updates, drive sustainability with breakthrough product and process innovation, increase the recyclability of our packaging and increased recycled content, have a positive impact by expanding access to affordable health and wellness products for millions of people in underserved communities and use the power of our brands to build awareness and drive engagement in product sustainability.
III. Planet: Conserving Earthâs finite resources, addressing climate change and maintaining the well-being of our planet for generations to come:
- Your Company is committed to address environmental issues key to the Company such as energy use, carbon emissions, water use and waste generation as well as deforestation.
- Colgate has robust policies in place for sustainable use of and environmentally sound disposal of waste generated during our processes and making every drop of water count and reducing our impact on the climate and the environment. More information on conservation of energy and measures undertaken by your Company are mentioned in Annexure-3 to this report.
8. Responsibility Statement
Pursuant to Section 134 sub-section (3)(c) read with sub-section (5) of the Companies Act, 2013, your Companyâs Directors, based on the representations received from the Management, confirm that:
a) in the preparation of the Annual Accounts for the Financial Year ended March 31, 2018, the applicable Accounting Standards have been followed and that no material departures have been made from the same;
b) they have, in selection of the accounting policies, consulted the statutory auditors and have applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the Financial Year and of the profit of the Company for that period;
c) to the best of their knowledge and information, they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d) they have prepared the Annual Accounts on a going concern basis;
e) they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
f) they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
9. Corporate Governance
A separate report on Corporate Governance along with the Auditorsâ Certificate on its compliance with the corporate governance requirements under the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 (âSEBI Listing Regulationsâ) are attached as Annexure - 1 to this Report.
10. Corporate Social Responsibility (CSR)
Your Company is engaged in a variety of corporate social activities which focus on promoting oral health, education, skills building and enhancing access to water. These social initiatives reflect your Companyâs core values of caring, global team work and continuous improvement. These initiatives are carried out through a variety of effective programs in accordance with the requirements of Schedule VII of the Companies Act, 2013, by the Companyâs employees in partnership with reputed NGOs.
The Board of Directors and the CSR Committee closely review and monitor from time to time all the CSR activities undertaken by the Company.
The following are the key CSR Programs undertaken by your Company during the Financial Year 2017-18:
i) Bright Smiles, Bright Futuresâ¢
ii) Oral Health Month
iii) Read India program with Pratham
iv) Education & Women Empowerment program with Seva Mandir
v) A Positive Step program with NTP
vi) âSakshamâ program
vii) Water program with WFP India Trust
viii) Education Program with Action Aid
A detailed description of the above programs / activities is contained in the Annual CSR Report attached as Annexure-2 to this Report.
The contents of the CSR Policy as well as the CSR programs undertaken by the Company are available on the Companyâs website at https://www.colgatepalmolive.co.in/core-values/ community-responsibility.
11. Employee Relations
The employee relations in the Company continued to remain healthy, cordial and progressive in F.Y. 2017-18.
At Colgate, we consider every employee as one of the most valuable resources contributing towards the long term success of the Company. Our employees are committed to acting with compassion, integrity, honesty and high ethics in all situations. As per Colgateâs core values, all employees are treated with equality and fairness and provided with opportunities to develop their career aspirations while working with the Company in India and, where possible, outside of India on assignments with group companies of Colgate.
Your Company has zero tolerance towards any kind of harassment, including sexual harassment, or discrimination. Your Company has constituted an Internal Complaints Committee (ICC) to investigate and resolve sexual harassment complaints. Employees are encouraged to speak up and report any such incidences to the ICC. Your Company has also implemented a Policy on Prevention of Sexual Harassment which is reviewed by the ICC at regular intervals. Any complaint made to the ICC is treated fairly and confidentially.
There were nil pending complaints brought forward from previous F.Y. 2016-17. During the Financial Year 2017-18, no complaints were received, investigated and resolved by the ICC. There were no pending complaints at the end of the F.Y. 2017-18.
Your Company also recognizes and follows âManaging with Respect Principlesâ which are applicable not only within Colgate but also while its employees are dealing with its customers, suppliers, vendors etc. Managing with Respect is the way Colgate people put our values into action. It is creating an environment where people feel free to offer suggestions, contribute ideas and resources and help grow the business. Managing with Respect creates an environment where people genuinely care about each other and work well together to reach their full potential.
12. Trade Relations
During the year, the implementation of the Goods & Service Tax (âGSTâ) Act in India required some key transitions to the existing business systems, invoices, input tax credit requirements, compliance of GST rules etc. Your Directors wish to record their appreciation of the continued, unstinted support and cooperation, especially provided during this transition period of GST implementation by its retailers, stockists, suppliers, clearing and forwarding agents and all other business partners, which resulted into seamless business operations. Your Company will continue to build and maintain a strong bond with its business partners and trade associates.
13. Particulars of Employees
Information as per Section 197 of the Companies Act, 2013 (the âActâ) read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, forms part of this Report as Annexure-6.
The statement containing the names of top ten employees in terms of remuneration drawn and the particulars of employees as required under Section 197(12) of the Act read with Rule 5(2) of the aforementioned Rules are available for inspection at the Registered Office of the Company during business hours on any working day of the Company up to the date of 77th Annual General Meeting.
14. Energy Conservation, Technology Absorption and Foreign Exchange
The information required under Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 with respect to conservation of energy, technology absorption and foreign exchange earnings / outgo is appended hereto as Annexure-3 and it forms part of this Report.
15. Directors and Key Managerial Personnel
During the year, following changes took place in the Board of Directors and the Key Managerial Personnel (in the order of their occurrence):
i) Resignation of Mr. M. Karnataki as Associate Director - Legal & Company Secretary and Compliance Officer effective August 31, 2017, as he decided to pursue his career outside Colgate;
ii) Appointment of Mr. K. Randhir Singh as Company Secretary and Compliance Officer of the Company effective February 23, 2018;
iii) Resignation of Mr. J. K. Setna as Nonexecutive & Independent Director of the Company effective March 31, 2018, due to personal reasons.
Your Board places on record its appreciation for the outstanding contribution and guidance provided by Mr. J. K. Setna during his long tenure as an Independent Director of the Company and also for the valuable contribution of Mr. M. Karnataki during his tenure as the Associate Director -Legal & Company Secretary and Compliance Officer of the Company.
Pursuant to the provisions of Section 161(1) of the Act and the Articles of Association of the Company, the Board of Directors of your Company, based on the recommendation of the Nomination & Remuneration Committee, appointed Ms. Sukanya Kripalu as an Additional Director of the Company effective June 1, 2018 and she shall holds office up to the date of the ensuing Seventy-Seventh Annual General Meeting. The Company has received declarations from Ms. Kripalu confirming that she meets with the criteria of independence as prescribed both under Section 149(6) of the Act and under Regulation 16(1 )(b) of the SEBI Listing Regulations. Accordingly, her candidature for appointment as an Independent Director of the Company is included at Item No. 4 of the Notice of Seventy-Seventh Annual General Meeting. A notice has been received from a member proposing Ms. Kripalu as a candidate for the office of Director of the Company.
All the other Independent Directors (except Ms. Shyamala Gopinath) were appointed by the Members for a term of five consecutive years effective July 25, 2014.
Ms. Shyamala Gopinath was appointed by the Members for a term of five consecutive years effective July 30, 2015.
None of the Independent Directors are liable to retire by rotation.
The Independent Directors of your Company have given a declaration that they meet the criteria of independence as prescribed under the Companies Act, 2013 and SEBI Listing Regulations.
Mr. Issam Bachaalani, Managing Director, Mr. M. S. Jacob, Whole-time Director & CFO, Mr. Chandrasekar Meenakshi Sundaram, Whole-time Director and Mr. K. Randhir Singh, Company Secretary & Compliance Officer are the Key Managerial Personnel of the Company.
A detailed profile of all the directors of your Company is available on the website www.colgatepalmolive.co.in
16. Familiarization Program
Your Company has been regularly familiarizing the Independent Directors on its Board with detailed presentations by its business functional heads on the Company operations, strategic business plans, new products and technologies. A detailed description of the familiarization programs extended to the Independent Directors during the Financial Year are disclosed on the Company website at http://www.colgateinvestors.co.in/policies.
17. Policies
The Board of Directors of your Company from time to time has framed and approved various Policies as per the applicable Acts, Rules, Regulations and Standards for better governance and administration of your Company. Some of the important Policies that were framed by your Board include the following:
i) Nomination & Remuneration Policy: This policy sets the objective, terms of reference, functions and scope of the Nomination & Remuneration Committee for determining qualifications, experience, independence etc. relating to the appointment and remuneration for the Directors, Key Managerial Personnel and Senior Management employees of the Company.
ii) Corporate Social Responsibility (âCSRâ) Policy: This policy sets out the role of the CSR Committee of the Board of Directors, which includes identification of the areas where the CSR activities will be performed, evaluation of CSR activities, review the CSR spending vis-a-vis the activities implemented and monitoring the process of CSR projects / programs of the Company.
iii) Risk Management Policy: This policy provides the framework for identification of risks of the Company, risk assessment and prioritization, loss prevention measures and other risk management measures for the Company.
iv) Related Party Transactions Policy: This policy regulates the entry into transactions between the Company and its related parties along with the required corporate approvals as per the laws and regulations applicable to the Company from time to time.
v) Policy on Determination of Materiality of Event or Information: This Policy lays down the criteria for determining the materiality of an event or information of the Company for purposes of making required disclosures to the stock exchanges pursuant to the SEBI Listing Regulations.
vi) Records Management Policy: This policy establishes general guidelines for retaining, preserving and archiving important documents and information.
vii) Code of Conduct for dealing in the Companyâs Securities: Pursuant to the SEBI (Prohibition of Insider Trading) Regulations, 2015, your Company has framed a Code of Conduct on prohibition of insider trading.
viii) Dividend Distribution Policy: This policy describes the circumstances under which a Member may or may not expect a dividend and the financial parameters and internal and external factors which are considered by the Board of Directors for declaration of dividend.
18. Committees
The Board of Directors of your Company has established various Board Committees to assist in discharging their duties. These include the Audit Committee, the Nomination & Remuneration Committee, the Risk Management Committee, the Stakeholdersâ Relationship Committee and Corporate Social Responsibility Committee. The Board has approved the terms of reference for each of these committees. All the committees of the Board hold their meetings at regular intervals and make their recommendations to the Board from time to time.
The broad terms of reference of the said Committees are stated in the Corporate Governance Report.
19. Annual Performance Evaluation by the Board
Pursuant to the provisions of the Act and the SEBI Listing Regulations, the Board has carried out an Annual Performance Evaluation of its own performance, the Directors individually as well as the evaluation of the working of the Committees. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.
20. Vigil Mechanism
Your Company has an effective Vigil Mechanism system which is embedded in its Code of Conduct. The Code of Conduct of your Company serves as a guide for daily business interactions, reflecting your Companyâs standard for appropriate behaviour and living corporate values. The Code of Conduct applies to all Colgate people, including Directors, Officers, and all employees of the Company. Even your Company vendors and suppliers are also subject to the Third Party Code of Conduct requirements as adherence to the same, to the extent applicable, is a prerequisite for conducting business with your Company.
The Code of Conduct Hotline is available on the Companyâs website to report any concerns about unethical behaviour, any actual or suspected fraud or violation of Companyâs Code of Conduct. No adverse action will be taken against anyone for complaining about, reporting, participating or assisting in the investigation of a suspected violation of the Code of Conduct, unless the allegation made or information provided is found to be intentionally false.
21. Loan, Guarantees and Investment
Particulars of loans, guarantees and investment made by the Company pursuant to Section 186 of the Act are given in the Notes to the Financial Statements.
22. Related Party Contracts & Arrangements
All related party transactions done by the Company during the Financial Year were at armâs length and in ordinary course of business. All related party transactions were reviewed and approved by the Audit Committee. During the Financial Year 2017-18, your Company has not entered into any material related party transaction as per the SEBI Listing Regulations with any of its related parties. Disclosures pursuant to the Accounting Standards on related party transactions have been made in the notes to the Financial Statements. To regulate related party transactions, the Company has also framed a policy on related party transactions and the same is available on the Companyâs website.
As there were no related party transactions which were not in the ordinary course of the business or not on armâs length basis and also since there were no material related party transactions as stated above, disclosure under Section 134(3)(h) in Form AOC-2 of the Act is not applicable.
23. Auditors
M/s. SRBC & Co LLP, Chartered Accountants, Mumbai (ICAI Firm Registration No. 324982E/ E300003), were appointed as Statutory Auditors of the Company at the 76th Annual General Meeting held on August 3, 2017, for a period of five consecutive years from the conclusion of the 76th Annual General Meeting until the conclusion of the 81st Annual General Meeting, subject to ratification by Members of the Company at every Annual General Meeting to be held thereafter. However, in terms of the notified amended provisions of the Act regarding ratification of appointment of Statutory Auditors, your Company has placed an ordinary business item No. 3 in the Notice of the 77th Annual General Meeting for their ratification by the Members until the conclusion of the 81st Annual General Meeting without requiring yearly ratification thereof.
The Audit report for the Financial Year 2017-18 does not contain any qualification, reservation or adverse remarks.
24. Secretarial Auditor & Secretarial Audit Report
The Board had appointed M/s. S. N. Ananthasubramanian & Co., Company Secretaries in Whole-time Practice, to carry out the Secretarial Audit under the provisions of Section 204 of the Act, 2013. The report of the Secretarial Auditor in Form MR-3 is annexed to this report as Annexure-4. The Secretarial Auditorsâ Report for the Financial Year 2017-18 does not contain any qualification, reservation or adverse remarks.
25. Extract of Annual Return
Pursuant to the Section 92(3) of the Act, the extract of the annual return in Form MGT-9 is annexed to this report as Annexure-5.
26. Business Responsibility Report
The Business Responsibility Report for the Financial Year 2017-18, as stipulated under Regulation 34 of the SEBI Listing Regulations is annexed to this report as Annexure-7.
27. Significant and Material Orders passed by the Regulators or Courts
During the Financial Year 2017-18, there were no significant or material orders passed by the Regulators or Courts or Tribunals impacting the going concern status and operations of the Company in the future.
28. Compliance with Secretarial Standards
Your Company has complied with Secretarial Standards issued by the Institute of Company Secretaries of India on Board and General Meetings.
29. Adequacy of Internal Financial Controls
Your Company has an adequate and talented team of internal auditors that oversees the internal financial processes, policies, and recommends robust internal financial controls from time to time. These internal financial controls help to put in place checks on the implementation of the internal financial controls, policies & procedures that are adopted by the Company for ensuring an orderly and efficient conduct of its business. These internal financial controls help in safeguarding of assets, prevention & detection of frauds and / or errors, maintaining the accuracy and completeness of the accounting & financial records. These controls help in the timely preparation of transparent, complete and accurate financial information and statements as per the laid down accounting standards and principles. The Audit Committee of your Company evaluates the internal financial controls system periodically.
30. Acknowledgements
Your Directors wish to convey their deepest appreciation for the unstinted dedication, professionalism, commitment and resilience displayed by the Companyâs employees at all levels and business partners, customers, vendors etc. Your Directors also wish to express their gratitude towards the Shareholders for their continued trust, support and confidence.
On behalf of the Board
R. A. Shah Issam Bachaalani
Vice-Chairman Managing Director
(DIN: 00009851) (DIN: 06975320)
M. S. Jacob M. Chandrasekar
Whole-time Director & CFO Whole-time Director
(DIN:07645510) (DIN: 07667965)
Place: Mumbai
Date : May 21, 2018
Mar 31, 2017
The Directors have pleasure in presenting their Report and Audited Accounts of the Company for the year ended March 31, 2017.
1. Financial Results
(Rs. Crore)
F.Y. 2016-17 |
F.Y. 2015-16 |
||
Total Revenue (a b c) |
4,560.01 |
4,388.62 |
|
Sales (Including Excise Duty) (a) |
4,489.85 |
4,318.98 |
|
Other Operating Revenue (b) |
30.35 |
30.13 |
|
Other Income (c) |
39.81 |
39.51 |
|
Profit before Tax from ordinary activities |
851.43 |
866.63 |
|
Profit before Taxation |
851.43 |
835.28 |
|
Tax Expense |
274.00 |
254.11 |
|
Profit for the year |
577.43 |
581.17 |
|
Other Comprehensive Income (net of Tax) |
5.17 |
1.19 |
|
Total Comprehensive Income |
572.26 |
579.98 |
|
Balance brought forward |
595.27 |
340.21 |
|
Adjustment of Depreciation as per Schedule-ll of the Companies Act, 2013 |
â |
||
Profit available for appropriation |
572.26 |
579.98 |
|
Balance transferred to Retained Earnings from |
3.65 |
2.43 |
|
Share Options Outstanding Account |
|||
Appropriation : |
|||
Dividend |
(271.99) |
(271.99) |
|
Dividend Distribution Tax |
(55.37) |
(55.37) |
|
General Reserve |
- |
- |
|
Balance carried forward |
843.82 |
595.27 |
2. Business Performance
India continued to consolidate its position as the fastest growing major economy in the world with all leading indicators including GDP growth, inflation, deficits, foreign currency reserves, etc. trending in the right direction. Normal monsoons helped stimulate rural demand as well as ensured inflation was benign paving the way for interest rate cuts by the Central Bank. The recovery in demand was temporarily halted by the demonetization exercise that temporarily sucked liquidity from the system putting short term pressure on businesses due to softer demand as well as a reduction in trade pipeline. The much awaited landmark tax reform in the form of GST bill was passed by parliament paving the way for a unified market in India and it is expected to go a long way to help businesses conduct their affairs in a more efficient manner.
During the year, your Company continued its focus on innovation built on consumer insights while leveraging its strong heritage in the oral care category. Despite intense competition in the FMCG space, your Company maintained its leadership position in oral care and continued to offer customized products for each market segment. While the operations in the first half of the year saw healthy growth in sales and profitability, the second half of the year was more challenging for your Company. Demonetization affected sales adversely during the third quarter with some spillover into the fourth quarter. Your Company responded by selectively extending credit terms, advancing processing of claims and invoices as well as running additional schemes to maintain robust distribution.
In the above context, reported Net Sales for the Financial Year stood at Rs.4,489.8 crore, an increase of 4% over last year. Reported Net Profit after tax for the year was Rs.577.4 crore, a decline of 0.6% over the previous year. Reported Net Profit after tax in the previous year included net tax reversals of Rs.14.9 crore relating to favourable tax assessments. Excluding the impact of these reversals, Net Profit after tax for F.Y. 2016-17 increased by 2% over the previous year.
3. Dividend
Your Companyâs Board declared three interim dividends, aggregating to Rs.10/- per share, for the financial year 2016-17. These dividends were paid on November 23, 2016, December 27, 2016 and April 21, 2017. Having declared three interim dividends, your Companyâs Board has not recommended a final dividend for the financial year 2016-17.
4. Colgate is the #1 Most Trusted Brand in India
Colgate was once again voted as the #1 âMost Trusted Brandâ in India across categories in The Economic Timesâ Brand Equity 2016 annual survey. This is the sixth consecutive year that Colgate has been voted as the #1 âMost Trusted Brandâ. Colgate is the only brand to feature in the top three from 2001-2016 since inception of the survey.
5. Focus on Innovation and New Launches
In a highly competitive market environment, it is essential for fast moving consumer goods companies to offer quality products that delight consumers. Your Company therefore strongly believes that developing new innovative products by leveraging technology from the Parent Company is a key driver of profitable growth. Your Company is focused on developing insight-driven innovation that provides value-added new products across all price points. Beyond new products, innovation is embedded into your Companyâs culture to encourage new ideas and process improvements in every aspect of the organization.
Your Companyâs continued commitment to grow its business by creating new and technologically advanced products through innovation are demonstrated by launching the following products :
In the toothpaste category, your Company introduced innovative products like:
Colgate Cibaca Vedshakti : An excellent natural solution to take care of all your oral care needs. The new natural toothpaste has the power of six natural ingredients. Developed using Colgateâs expertise in oral care, Colgate Cibaca Vedshakti is enriched with the power of nature that helps in keeping your familyâs teeth healthy and problem-free for long.
Colgate Sensitive Clove : Our first sensitivity toothpaste with natural ingredient. Colgate Sensitive Clove, a natural product based toothpaste, provides protection against sensitivity. Formulated with Potassium Nitrate and Clove Oil, it penetrates deep into open dentin tubules to soothe sensitive areas of teeth.
Colgate Kids Toothpaste : A new range of toothpastes for kids aged 2 to 5 years, which has two delightful flavours and exciting animal cartoons.
Colgate MaxFresh Power Freeze : A new invigorating gel toothpaste infused with cooling crystals, which dissolve as you brush for a new dimension of freshness.
In the toothbrush category, your Company introduced innovative products like:
Colgate A1 Toothbrush : A new product that has been launched to address the consumer needs for dense and long lasting bristles.
Colgate Star Toothbrush : An entry toothbrush product that has been launched in select markets to drive penetration at the bottom of the pyramid, this toothbrush also comes with a tongue cleaner.
Colgate Slim Soft Advanced Toothbrush : It has dual core bristles that gently reach 7X deeper below the gum line and makes gums 300% healthier.
In the Personal Care category, your Company introduced innovative products like :
Plax Spicy Fresh : This spicy fresh mouthwash variant has an intense Spicy Fresh sensation of Eucalyptus & Clove, for lasting fresh breath without the burning feeling. This alcohol free mouthwash removes 99% of germs & helps control bad breath 24/7.
Palmolive Body Wash Menâs Range : Imported from Europe, Palmolive Men body washes are available in three exciting variants: Palmolive Men Energising-enriched with Magnesium & Citrus Oil, Palmolive Men Refreshing-enriched with Sea Minerals & Eucalyptus Oil and Palmolive Men Sensitive-enriched with Aloe Vera extract & Vitamin E, this variant nurtures your sensitive skin.
Palmolive Men Shaving Foams : The product helps soften your beard as you shave, allowing your razor to get close to your skin without causing skin irritation. Imported from Europe, and available in two exciting variants: Palmolive Men Classic and Palmolive Men Cool.
Innovations like these help your Company to maintain the position as Indiaâs Most Trusted Brand today and hopefully will for many more years.
6. Sustainability
Your Company is committed to sustainability with focused and measureable goals. Your Company values sustainability through a commitment to the quality of the environment and extends it to the long term well-being of the people and communities it serves. Through our sustainability efforts, we are helping to ensure that the business grows responsibly, while promoting the well-being of future generations.
Considering this, your Company developed a plan that guides its sustainability initiatives with key goals in the following three areas viz. People, Performance and Planet.
The broad aspects covered in these goals are as under:
I. People
Promoting healthier lives, Contributing to the Communities where we live and work.
II. Performance
Delivering Products that delight consumers and respect our Planet.
III. Planet
Making every drop of water count, reducing our impact on the climate and the environment.
Your Company believes that integrating sustainability into its everyday operations will help in making better business decisions and improve peoplesâ lives. The sustainability strategy will also continue to increase consumer loyalty, provide a competitive advantage and help to ensure long-term shareholder value. Amongst the sustainability initiatives in the area of People,
Performance and Planet, listed below are a few initiatives undertaken during the year:
Free Health check-up for all the employees;
Initiatives on clean technology, energy efficiency, renewable energy etc.
Sourcing of packaging material locally to reduce the fuel emission;
Usage of reused and recycled materials for packaging;
LEED certification for our new facilities;
Reducing consumption of water and energy per ton of product produced;
Nil material to landfill; and
Reusage of waste water from the factories.
More details on energy conservation measures undertaken by your Company are mentioned in Annexure - 3 to this report.
7. Responsibility Statement
Pursuant to Section 134(3)(c) of the Companies Act, 2013 your Companyâs Directors, based on the representations received from the Management, confirm :
a) that in the preparation of the annual accounts, the applicable accounting standards have been followed and that no material departures have been made from the same;
b) that they have, in selection of the accounting policies, consulted the statutory auditors and have applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;
c) that to the best of their knowledge and information, they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d) that they have prepared the annual accounts on a going concern basis;
e) that they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
f) that they have had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
8. Corporate Governance
A separate report on Corporate Governance along with the Auditorsâ Certificate on its compliance is attached as Annexure - 1 to this Report.
9. Corporate Social Responsibility
Your Companyâs success is linked to the Companyâs values of Caring, Global Teamwork and Continuous Improvement. Your Company cares about people: Colgate people, customers, shareholders, business partners and the community at large. Your Company works towards protecting the environment, improving and enhancing the quality of life of individuals and communities through several partnerships and associations.
Your Company and its employees are committed to bring in a positive change in the lives of many underserved communities. Your Company undertakes its Corporate Social Responsibility (CSR) activities through a variety of effective programs. Some of the key CSR activities which your Company has undertaken during the year are in the areas of Promoting preventive health care, Promoting education, Addressing inequalities and Conservation of natural resources. These activities are broadly in accordance with the Schedule VII of the Companies Act, 2013.
The Board of Directors and the CSR Committee review and monitor from time to time all the CSR activities being undertaken by the Company.
The following are the key CSR programs undertaken by your Company during the Financial Year 2016-17 :
i) Bright Smiles, Bright Futuresâ¢
ii) Oral Health Month
iii) A Positive Step
iv) Supporting Pratham
v) Supporting Seva Mandir
vi) Skill development program for rural youth
vii) Water for People
The details of the above programs/activities are elaborated in the Annual CSR Report attached as Annexure - 2 to this Report.
The contents of the CSR Policy as well as the CSR programs undertaken by the Company are available on the Companyâs website.
10. Employee Relations
The employee relations in the Company continued to be healthy, cordial and progressive.
Your Companyâs culture is one that reflects our values of caring, global teamwork and continuous improvement, as well as our unwavering commitment to integrity in everything we do. Our employees are our greatest asset, and weâre committed to maintaining an environment that celebrates their differences, values their contributions and provides opportunities for personal and professional growth. The diversity of our employees gives us an advantage over our competitors and continues to drive our success.
Your Company recognizes its responsibility and continues to strive to provide a safe working environment for its employees, free from sexual harassment and discrimination. Your Company also has a Policy on Prevention of Sexual Harassment which is reviewed by the Internal Complaints Committee (ICC) at regular intervals.
âManaging With Respectâ is the way Colgate people put your Company Values (Caring, Global Teamwork and Continuous Improvement) into action. Each and every employee is expected to work with all stakeholders (other employees, customers, consumers, suppliers, etc.) in a respectful manner. Each employee is also expected to strictly follow your Companyâs Code of Conduct and any violation is appropriately addressed. By fully including ethics and integrity in the ongoing business relationships and decision-making, your Company demonstrates a commitment to a culture that promotes the highest ethical standards. During the financial year 2016-17, four complaints were received, investigated and resolved by the ICC. There are no pending complaints at the end of the year.
11. Trade Relations
Your Directors wish to record their appreciation of the continued, unstinted support and co-operation from its retailers, stockists, suppliers of goods/ services, clearing and forwarding agents and all others associated with it. Your Company will continue to build and maintain a strong association with its business partners.
12. Particulars of Employees
Information as per Section 197 of the Companies Act, 2013 (the âActâ) read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report as Annexure - 6.
Details of employee remuneration in accordance with the Act and Rules mentioned above are available at the Registered Office of the Company during business hours on any working day of the Company up to the date of 76thAnnual General Meeting. Any shareholder interested in obtaining a copy of the said statement may write to the Secretarial Department at the Registered Office of the Company. Such details are also available on your Companyâs website.
13. Energy Conservation, Technology Absorption and Foreign Exchange
The information required under Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 with respect to conservation of energy, technology absorption and foreign exchange earnings/outgo is appended hereto as Annexure - 3 and it forms part of this Report.
14. Directors and Key Managerial Personnel
During the year, following changes took place in the Board of Directors and the Key Managerial Personnel :
i) Resignation of Mr. Niket Ghate as the Wholetime Director & Company Secretary effective December 31, 2016 as he decided to pursue his career outside Colgate;
ii) Cessation of Mr. Godfrey Nthunzi as the CFO and Whole-time Director effective October 6, 2016 and October 28, 2016 respectively consequent upon his promotion and movement to another Colgate division;
iii) Appointment of Mr. M. S. Jacob as the CFO and Whole-time Director effective October 7, 2016 and October 28, 2016 respectively;
iv) Appointment of Mr. M. Chandrasekar as a Whole-time Director effective January 2, 2017; and
v) Appointment of Mr. Makarand Karnataki as the Company Secretary & Compliance Officer effective January 2, 2017.
Your Board places on record its appreciation for the valuable contributions made by Mr. Niket Ghate and Mr. Godfrey Nthunzi during their tenure on the Board of the Company.
All the Independent Directors (except Ms. Shyamala Gopinath) were appointed by the shareholders for a term of five consecutive years effective July 25, 2014.
Ms. Shyamala Gopinath was appointed by the shareholders for a term of five consecutive years effective July 30, 2015.
None of the Independent Directors are liable to retire by rotation.
The Independent Directors of your Company have given a declaration that they meet the criteria of independence as prescribed under the Companies Act, 2013 and SEBI Listing Regulations.
Mr. Issam Bachaalani, Managing Director, Mr. M. S. Jacob, Whole-time Director & CFO and Mr. Makarand Karnataki, Company Secretary & Compliance Officer are the Key Managerial Personnel of the Company.
A detailed profile of all the directors of your Company is available on the website www.colgatepalmolive.co.in
15. Familiarization Program
Your Company, for many years now, has been familiarizing the Independent Directors on its Board with detailed presentations by its business functional heads on the Company operations, strategic business plans, new products and technologies, including significant aspects of the Industry and its future outlook. Details of familiarization programs extended to the Non-Executive & Independent Directors during the year are also disclosed on the Company website from time to time at http://www.colgate.co.in/Colgate/ IN/Corp_v2/Relatedlnformation/Familarization-Programme.pdf
16. Policies
The Board of Directors of your Company from time to time has approved and framed various Policies under The Companies Act, 2013 and its applicable Rules & Regulations for better governance and administration of your Company. Some of the important Policies that were framed by your Board include the following :
i) Nomination & Remuneration Policy :
This policy sets out the objective, terms of reference, functions and scope of the Nomination & Remuneration Committee for determining qualifications, experience, independence etc. relating to the appointment and remuneration for the directors, key managerial personnel and other employees of the Company.
ii) Corporate Social Responsibility Policy : This policy sets the scope for identification of the areas where the CSR activities will performed, evaluation of CSR activities, review the CSR spending vis-a-vis the activities implemented and monitoring the process of CSR projects / programs of the Company.
iii) Risk Management Policy : This policy provides the framework for identification of risks of the Company, risk assessment and prioritization, loss prevention measures and other risk management measures for the Company.
iv) Policy on Related Party Transactions : This policy intends to regulate the transactions between the Company and its related parties based on the laws and regulations applicable to the Company from time to time.
v) Policy on determination of Materiality of Event or information : The objective of the Policy is to determine the materiality of event or information of the Company which requires disclosure to the stock exchanges pursuant to the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
vi) Record Management Policy : This policy establishes general guidelines for retaining, preserving and, when appropriate, disposing of Records.
vii) Code of Conduct for dealing in Companyâs Securities : Pursuant to the SEBI (Prohibition of Insider Trading) Regulations, 2015, your Company has framed a Code of Conduct for the designated persons for dealing in the securities of the Company.
viii) Dividend Distribution Policy : This policy provides the circumstances under which a shareholder may or may not expect the dividend. Also, details of the financial parameters and internal and external factors which shall be considered for declaration of dividend.
17. Committees
The Board of Directors of your Company has established various committees of the Board to assist in discharging its duties. These include an Audit Committee, Nomination & Remuneration Committee, Risk Management Committee, Stakeholder Relationship Committee and Corporate Social Responsibility Committee. The Board has approved the terms of reference for each of these committees. All the Committees of the Board hold their meetings at regular intervals and make their recommendations to the Board from time to time.
The broad terms of reference of the said Committees are stated in the Corporate Governance Report.
18. Annual Performance Evaluation by the Board
Pursuant to the provisions of the Companies Act, 2013 and the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, the Board has carried out an Annual Performance Evaluation of its own performance, the Directors individually as well as the evaluation of the working of the Committees. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.
19. Vigil Mechanism
Your Company has an effective Vigil Mechanism system which is embedded in its Code of Conduct. The Code of Conduct of your Company serves as a guide for daily business interactions, reflecting your Companyâs standard for appropriate behaviour and living corporate values. The Code of Conduct applies to all Colgate people, including Directors, Officers, and all employees of the Company. Even your Company vendors and suppliers are also subject to these requirements as adherence to the Code is a prerequisite for conducting business with your Company.
The Code of Conduct Hotline is available on the Company website to report any genuine concerns about unethical behaviour, any actual or suspected fraud or violation of Companyâs Code of Conduct.
20. Loan, Guarantees and Investment
Particulars of loans, guarantees and investment made by the Company pursuant to Section 186 of the Companies Act, 2013 are given in the Notes to the Financial Accounts.
21. Related Party Contracts & Arrangements
All related party transactions done by the Company during the financial year were at armâs length and in ordinary course of business. All related party transactions were placed in the meetings of Audit Committee and the Board of Directors for their necessary review and approval. During the financial year, your Company has not entered into any material transaction as per the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 with any of its related parties which may have potential conflict with the interest of the Company at large. Disclosures pursuant to Accounting Standards on related party transactions have been made in the notes to the Financial Statements. To identify and monitor significant related party transactions, the Company has also framed a Policy on the Related Party Transactions and the same is available on the Companyâs website.
All the related party transactions entered during the year were in Ordinary Course of the Business and on Armâs Length business and hence disclosure unde section 134(3)(h) in Form AOC-2 of the Companies Act, 2013 is not applicable.
22. Auditors
M/s. Price Waterhouse (Firm Registration No. 301112E), Chartered Accountants has been the Auditors of the Company for a period more than ten years. Pursuant to Section 139 of the Companies Act, 2013, an audit firm which has completed two terms of five consecutive years cannot be re-appointed as the Auditor of the Company. Accordingly, the two terms of five consecutive years and the transitional period of three years of the present auditors expires at the conclusion of the forthcoming 76th Annual General Meeting. The Board of Directors of the Company based on the recommendation of the Audit Committee, propose the appointment of M/s. S R B C & CO LLP, Chartered Accountants, (Registration No. 324982E/E300003) as the Statutory Auditors of the Company.
The Company has received a written consent, eligibility letter and other necessary declarations and confirmations from M/s. S R B C & CO LLP. stating that they satisfy the criteria provided under Section 141 of the Companies Act, and that the appointment, if made, shall be in accordance with the applicable provisions of the Act and rules framed thereunder.
If approved by the Members, the appointment of M/s. S R B C & CO LLP, Chartered Accountants as the Statutory Auditors will be for a period of five consecutive years commencing from the conclusion of 76th Annual General Meeting till the conclusion of the 81st Annual General Meeting subject to ratification of the appointment by Members at every Annual General Meeting held after this Annual General Meeting.
The Audit report for the financial year 2016-17 does not contain any qualification, reservation or adverse remarks.
23. Secretarial Auditor & Secretarial Audit Report
The Board had appointed M/s. S.N. Ananthasubramanian & Co., Company Secretaries in Whole-time Practice, to carry out Secretarial Audit under the provisions of Section 204 of the Companies Act, 2013. The report of the Secretarial Auditor in Form MR-3 is annexed to this report as Annexure - 4. The Secretarial Auditorsâ Report for the financial year 2016-17 does not contain any qualification, reservation or adverse remarks.
24. Extract of Annual Return
Pursuant to the Section 92(3) of the Companies Act, 2013 extract of the annual return in Form MGT-9 is annexed to this report as Annexure - 5.
25. Business Responsibility Report
The Business Responsibility Report for the Financial Year 2016-17, as stipulated under Regulation 34 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 is annexed to this report as Annexure - 7.
26. Significant and Material Orders passed by the Regulators or Courts
There are no significant and material orders passed by the Regulators or Courts or Tribunals impacting the going concern status and operations of the Company in future.
27. Acknowledgements
Your Directors sincerely appreciate the high degree of professionalism, commitment and dedication displayed by employees at all levels. Your Directors also wish to place on record their gratitude towards the shareholders for their continued support and confidence.
On behalf of the Board
Issam Bachaalani R.A. Shah
Managing Director Vice-Chairman
(DIN : 06975320) (DIN : 00009851)
M.S. Jacob M. Chandrasekar
Whole-time Director & CFO Whole-time Director
(DIN :07645510) (DIN :07667965)
May 15, 2017
Mar 31, 2015
The Members
Colgate-Palmolive (India) Limited
The Directors have pleasure in presenting their Report and Audited
Accounts of the Company for the year ended March 31,2015.
Financial Results
(Rs. Crore)
F.Y. 2014-15 F.Y. 2013-14
Total Revenue (a b c) 4,015.12 3,629.13
Sales (Excluding Excise Duty) (a) 3,954.78 3,544.88
Other Operating Revenue (b) 27.17 33.93
Other Income (c) 33.17 50.32
Profit before Tax from ordinary activities 780.39 663.58
Exceptional item - 64.38
Profit before Tax
(including exceptional item) 780.39 727.96
Tax expense 221.41 188.09
Profit for the year 558.98 539.87
Balance brought forward 175.51 119.21
Adjustment of Depreciation as
per Schedule-II of
the Companies Act, 2013 (0.17) -
Profit available for appropriation 734.32 659.08
Appropriation:
Dividend 326.38 367.18
Dividend Distribution Tax 61.99 62.40
General Reserve - 53.99
Balance carried forward 345.95 175.51
734.32 659.08
Business Performance
Indian economy as measured through GDP grew by 5% in 2014 compared to
4.7% in 2013. Public sentiment significantly improved with resounding
majority of a single political party in the National elections in May
2014. Although, there was a renewed optimism in the country, it did not
translate immediately into an increase in demand. Rural consumption
slowed during the year, unexpected rains in some states further
dampened the sentiments in the rural markets.
Wholesale and Consumer price inflation moderated substantially in 2014
as compared to the previous
year. Food inflation and crude oil prices also dropped significantly in
2014. While gradual increase in economic activity is expected in 2015,
a clearer trend in rural consumption is expected only after monsoon and
a possible pick up in Government spending.
In spite of the challenges and increased competitive intensity, your
Company delivered strong results.
Your Company registered strong Sales growth of 12% to Rs. 3,954.78 Crore
from Rs. 3,544.88 Crore in the previous year. Toothpaste and Toothbrush
volumes grew at 5% and 7% respectively. This growth was
achieved at a time when the overall Toothpaste market declined by just
over 3%. Profit Before Tax (including exceptional item) during the year
was Rs. 780.39 Crore, an increase of 7% over the previous year. Profit
After Tax (including exceptional item) during the year was Rs. 558.98
Crore, an increase of 4% over the previous year.
Your Company has made very good market share progress with Toothpaste
at 57.8% and Toothbrushes at 42.1%. This is a result of ongoing
innovation supported by impeccable execution in all retail
environments. The efforts in the area of efficiency continue to pay-
off with Rs.Funding the GrowthRs. initiatives continuing to deliver
savings, allowing us to improve investment levels while also delivering
improved profitability.
Dividend
The Company has set up two state-of-the-art manufacturing facilities at
Sanand, Gujarat and Sricity, Andhra Pradesh to manufacture toothpaste
and toothbrush respectively, out of the internal accruals and strong
cash generation. Despite making such substantial investments, your
Board declared three interim dividends, each of Rs. 8/- per share,
aggregating Rs. 24/- per share for the financial year 2014-15. These
dividends were paid on October 16, 2014, December 29, 2014 and April
22, 2015. Having declared three interim dividends, your Board has not
recommended a final dividend for the financial year 2014-15.
Colgate - the #1 Brand once again in 2014
Number 1 Most Chosen Consumer Brand in India
Your CompanyRs.s brand Rs.ColgateRs. is ranked the No.1 Rs.Most Chosen
Consumer BrandRs. in India, in 2014 Brand Footprint report by consumer
knowledge and insights firm, Kantar Worldpanel. This is the third
consecutive time that the brand Rs.ColgateRs. is ranked number 1,
across the FMCG and Personal Care category. The Rs.Most Chosen Consumer
BrandRs. has been announced on the basis of certain parameters
specified by Kantar Worldpanel.
#1 Most Trusted Brand in India
Colgate was once again voted as the #1 Rs.Most Trusted BrandRs. in
India across categories in 2014. This is the fourth consecutive year
that Colgate has been voted
as the #1 Rs.Most Trusted BrandRs.. It is pertinent to note that
Colgate is the only brand to feature in the top three from 2001-2014
since inception of the survey.
Focus on Innovation and New Launches
Your Company has been continually pioneering innovation and development
in the Oral Care category with best-in-class technologies.
Your Company has been staying ahead of trends by identifying
opportunities based on insights into consumer behavior and by
leveraging the technology from the Parent Company.
Your Company has made successful innovative launches during the year,
as listed below :
In the Toothpaste category, the Company introduced innovative products
like :
- Colgate Sensitive Pro-Relief (CSPR) Enamel Repair Toothpaste - a
scientifically advanced technology that protects enamel from erosion by
repair and remineralisation. It also provides long- lasting relief from
tooth sensitivity.
- Colgate Visible White Plus Shine Toothpaste - This toothpaste is
formulated with whitening accelerators that remove and prevent surface
stains and helps in tooth whitening. In addition to this, the micro
crystals in the formulation safely polish teeth surfaces for a shinier
smile.
In the Toothbrush category, the Company introduced innovative products
like :
- Colgate SlimSoft Charcoal Toothbrush - IndiaRs.s first toothbrush
with slim tapered tip bristles technology infused with Charcoal. This
revolutionary toothbrush technology is based on the key Indian insight
of the traditional Oral Care benefits of Charcoal. The new Colgate
SlimSoft Charcoal is one such clutter breaking offering, which brings
together the traditional Oral Care benefits of Charcoal with advanced
bristle technology. It was also voted as the Product of the Year for
2015.
- Colgate ZigZag Black Toothbrush - Colgate ZigZag Black is a line
extension of one of IndiaRs.s most popular toothbrush brands Rs.Colgate
ZigZagRs.. As the market leader, your Company has introduced many
Rs.firstsRs. in the toothbrush category and Colgate ZigZag is the first
black toothbrush in the Mass Segment.
In the Mouthwash Category, your Company has launched Colgate Plax
Active Salt Mouthwash. Building on the insight of salt water gargling,
this innovative product provides dual benefit of Healthy Gums and
Long-lasting freshness to our consumers.
Your Company will continue to remain focused on driving consumer
relevant innovation in the future.
New projects
As stated in the Annual Report for the financial year 2013-14, your
Company had set up a state-of-the- art Toothpaste manufacturing
facility at Sanand in Gujarat which was commissioned in March 2014. The
said facility is now fully operational and caters to the domestic and
export markets.
Your Company has also set up a new state-of-the- art Toothbrush
manufacturing facility at Sricity in Chittoor District in Andhra
Pradesh. This facility was commissioned and fully tested in the month
of March 2015 and has commenced its commercial production in the month
of April 2015 and will have an installed capacity to produce 220
Million pieces of Toothbrushes by the end of the year.
With a commitment to grow the business, substantial investments have
been made in the above two new manufacturing facilities, which will
immensely benefit your Company in the years to come.
Expiry of Fiscal Incentives at Baddi facility
The CompanyRs.s manufacturing facility at Baddi, Himachal Pradesh was
established in April 2005 and was entitled to certain fiscal benefits
(Income Tax and Excise) for a period of 10 years pursuant to the then
Industrial Policy of the Government of Himachal Pradesh. Accordingly,
the income tax and excise benefits for the said facility expired on
March 31,2015 and on April 21, 2015 respectively. The Company,
therefore, pays applicable excise duty on production and income tax on
profits from the said facility.
Your Company continues to manufacture its Oral Care products from the
Baddi facility.
Toothpowder Manufacturing Facility at Aurangabad
As consumers shift from traditional toothpowder to toothpaste, Oral
Care market in India has changed significantly over the past few years.
This has resulted in a declining trend in toothpowder volume as the
growth is captured by toothpaste. With a view to enhance the
CompanyRs.s competitiveness and operate in a cost effective manner,
your Company offered a voluntary retirement scheme at its toothpowder
manufacturing facility at Aurangabad while ensuring that the core
values of caring for people are consistently followed. The said scheme
was accepted by all the workmen and therefore the toothpowder
manufacturing operations at the Aurangabad facility were discontinued
effective May 5, 2015.
Sustainability
Your Company is committed to sustainability with focused and
measureable goals. Your Company values sustainability through a
commitment to the quality of the environment and extends it to the
long-term well- being of the people and communities it serves.
Considering this, your Company developed a plan that guides its
sustainability initiative with key goals in the following three areas
viz. People, Performance and Planet.
The broad aspects covered in these goals are as under :
- People - Promoting healthier lives,
Contributing to the
Communities where we live
and work.
-Performance - Delivering Products that
delight consumers and
respect our Planet.
- Planet - Making every drop of water
count, Reducing our impact
on the climate and the
environment.
Your Company believes that integrating sustainability into its everyday
operations will help in making better business decisions and improve
peopleRs.s lives. The sustainability strategy will also continue to
focus on increasing consumer loyalty for our brands, provide a
competitive advantage and ensure long-term shareholder value. Listed
below are a few initiatives undertaken during the year :
- Free Health Check-up for all the employees;
- Initiatives on clean technology, energy efficiency and renewable
energy;
- Sourcing of packaging material locally to reduce fuel emission;
- Usage of reused and recycled materials for packaging;
- LEED certification for our new facilities;
- Reducing consumption of water and energy per ton of product produced;
and
- Nil material to landfill.
More details on energy conservation measures undertaken by your Company
are mentioned in an annexure to this report.
Responsibility Statement :
Pursuant to Section 134(3)(c) of the Companies Act, 2013, your
Directors, based on the representations received from the Management,
confirm :
a) that in the preparation of the annual accounts, the applicable
accounting standards have been followed and that no material departures
have been made from the same;
b) that they have, in selection of the accounting policies, consulted
the statutory auditors and have applied them consistently and made
judgments and estimates that are reasonable and prudent so as to give a
true and fair view of the state of affairs of the Company at the end of
the financial year and of the profit of the Company for that period;
c) that to the best of their knowledge and information, they have taken
proper and sufficient care for the maintenance of adequate accounting
records in accordance with the provisions of the Companies Act, 2013
for safeguarding the assets of the Company and for preventing and
detecting fraud and other irregularities;
d) that they have prepared the annual accounts on a going concern
basis;
e) that they had laid down internal financial controls to be followed
by the Company and that such internal financial controls are adequate
and were operating effectively; and
f) that they have had devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems were
adequate and operating effectively.
Corporate Governance
A separate report on Corporate Governance along with the AuditorsRs.
Certificate on its compliance is attached as Annexure - 1 to this
Report.
Corporate Social Responsibility :
Your Company and its employees share a commitment to the following
three core Corporate Values : Caring, Global Teamwork and Continuous
Improvement. These values are reflected not just in the quality of
products and the reputation of your Company, but also in our dedication
to serving the communities in which we operate.
Your Company undertakes its Corporate Social Responsibility (CSR)
activities through a variety of effective programs. Some of the key CSR
activities which your Company has undertaken during the year are in the
areas of Promoting preventive health care, Promoting education,
Conservation of natural resources, Empowerment of women and Addressing
inequalities. These activities are broadly in accordance with the
Schedule VII of the Companies Act, 2013.
The Board of Directors and the CSR Committee review and monitor from
time to time all the CSR activities being undertaken by the Company.
Following are the key CSR activities undertaken by your Company during
the Financial Year 2014-15 :
- Bright Smiles, Bright FuturesÂ
- Oral Health Month
- Rs.A Positive StepRs. - A Program in collaboration with Rs.Network
in Thane by People Living with HIVRs. a Non-Governmental Organization
(NGO), for addressing inequalities and promoting education for HIV
infected and affected children
- Supporting Rs.PrathamRs., an NGO, in the areas of providing quality
education to the underprivileged children of India
- Supporting Rs.Seva MandirRs., a nonprofit organization, in the
areas of conservation of natural resources, improving health and
education of the people.
The details of CSR activities by your Company are elaborated in the
Rs.Annual Report on CSRRs. which is attached as Annexure - 2 to this
Report.
The contents of the CSR Policy as well as the CSR activities undertaken
by the Company are available on the Company website.
Employee Relations
The employee relations in the Company continued to be healthy, cordial
and progressive.
Your Company recognizes its responsibility and continues to provide a
safe working environment for women, free from sexual harassment and
discrimination and to boost their confidence, morale and performance.
Your Company also has a Policy on Prevention of Sexual Harassment which
is reviewed by the Internal Complaints Committee at regular intervals.
"Managing With Respect" is the way Colgate People put your Company
Values (Caring, Global Teamwork and Continuous Improvement) into
action. Each and every employee is expected to work with all stake-
holders (other employees, customers, consumers, suppliers etc.) in a
respectful manner. Each employee is also expected to strictly follow
your CompanyRs.s Code of Conduct and any violation is treated with zero
tolerance. Your Company strives to set a Gold Standard in conducting
business in the most ethical and respectful manner.
Trade Relations
Your Directors wish to record appreciation of the continued, unstinted
support and co-operation from its retailers, stockists, suppliers of
goods/services, clearing and forwarding agents and all others
associated with it. Your Company will continue to build and maintain a
strong association with its business partners.
Particulars of Employees
Information as per Section 197 of the Companies Act,
2013 (the Rs.ActRs.) read with the Companies (Appointment and
Remuneration of Managerial Personnel) Rules,
2014 forms part of this Report. As per the provisions of Section 136 of
the Act, the Report and Accounts are being sent to the shareholders of
the Company and others entitled thereto, excluding the statement on
particulars of employees. Any shareholder interested in obtaining a
copy of the said statement may visit the registered office during
business hours on any working
day of the Company up to the date of 74th Annual General Meeting or
write to the Secretarial Department at the Registered Office of the
Company.
Energy Conservation, Technology Absorption and Foreign Exchange
The information required under Section 134(3)(m) of the Companies Act,
2013 read with the Companies (Accounts) Rules, 2014 with respect to
conservation of energy, technology absorption and foreign exchange
earnings/outgo is appended hereto as Annexure - 3 and it forms part of
this Report.
Directors and Key Managerial Personnel
Consequent to the elevation of the previous Managing Director, Ms.
Prabha Parameswaran as President, Africa/Eurasia Division of
Colgate-Palmolive Company, the Board of Directors at their meeting held
on August 18, 2014 appointed Mr. Issam Bachaalani as the Managing
Director of the Company for a period of five years effective October 1,
2014 subject to the approval of the Central Government and Shareholders
of the Company. The details of the appointment of Mr. Bachaalani are
elaborated in the Notice to the Annual General Meeting.
Your Board places on record its appreciation for outstanding
contributions made by Ms. Prabha Parameswaran during her tenure as the
Managing Director of the Company.
Pursuant to the provisions of Section 161(1) of the Companies Act, 2013
(the Rs.ActRs.) and the Articles of Association of the Company, the
Board of Directors of your Company, based on the recommendation of the
Nomination & Remuneration Committee, appointed Ms. Shyamala Gopinath as
an Additional Director (Non-executive & Independent) of the Company
effective May 19, 2015 and she shall hold office up to the date of the
ensuing Annual General Meeting. The Company has received declarations
from Ms. Shyamala Gopinath confirming that she meets with the criteria
of independence as prescribed both under sub-section (6) of Section 149
of the Act and under Clause 49 of the Listing Agreement with the Stock
Exchanges. Accordingly, her candidature for appointment as a
Non-executive & Independent Director of the Company is included at Item
No. 4 of the Notice to the Annual General Meeting.
Pursuant to the provisions of Section 152 of the Act and under Article
124 of the CompanyRs.s Articles of Association, Mr. Godfrey Nthunzi
retires by rotation at the ensuing 74th Annual General Meeting and,
being eligible, offers himself for re-appointment.
Pursuant to Sections 149, 150 and 152 of the Act, read with Companies
(Appointment and qualification of Directors) Rules, 2014 along with
Schedule IV of the Act (including any statutory modification(s) or
re-enactment thereof for the time being in force) and shareholdersRs.
approval in 73rd Annual General Meeting, the following Non-executive &
Independent Directors can hold office for a term of five consecutive
years on the Board of Directors of your Company :
1. Mr. R. A. Shah;
2. Mr. P. K. Ghosh;
3. Mr. J. K. Setna;
4. Mr. V. S. Mehta; and
5. Dr. (Ms.) I. Shahani.
These Non-executive & Independent Directors shall not be liable to
retire by rotation. All the above mentioned Non-executive & Independent
Directors have given the declaration of independence to the Company as
per Section 149 (6) of the Act as well as under Clause 49 of the
Listing Agreement. Mr. Issam Bachaalani, Mr. Godfrey Nthunzi and Mr.
Niket Ghate are the Key Managerial Perosonnel of the Company.
Familiarization Program
Your Company, for many years now, has been familiarizing the
Independent Directors on its Board with detailed presentations by its
business functional heads on the Company operations, strategic business
plans, new products and technologies, including significant aspects of
the Industry and its future outlook. Details of familiarization
programs extended to the Non- executive & Independent Directors during
the year are also disclosed on the Company website from time to time at
http://www.colgate.co.in/Colgate/IN/Corp_v2/
RelatedInformation/Familarization-Programme.pdf
Nomination & Remuneration Policy
The Board of Directors of your Company has, on recommendation of the
Nomination & Remuneration Committee, framed and adopted a policy for
selection and appointment of Directors, Senior Management
and their remuneration. The contents of the policy are stated in the
Corporate Governance Report.
Annual Performance Evaluation by Board
Pursuant to the provisions of the Companies Act, 2013 and Clause 49 to
the Listing Agreement, the Board has carried out an Annual Performance
Evaluation of its own performance, the Directors individually as well
as the evaluation of the working of the Committees. The manner in which
the evaluation was carried out has been explained in the Corporate
Governance Report.
Risk Management
The Board of Directors of your Company has, on recommendation of the
Risk Management Committee framed and adopted a policy on Risk
Management of the Company. The broad terms of reference of the
Committee are stated in the Corporate Governance Report.
Vigil Mechanism
Your Company has an effective Vigil Mechanism system which is embedded
in its Code of Conduct. The Code of Conduct of your Company serves as
a guide for daily business interactions, reflecting your CompanyRs.s
standard for appropriate behavior and living Corporate Values. The Code
of Conduct applies to all Colgate People, including Directors,
Officers, and all employees of the Company. Even your Company vendors
and suppliers are also subject to these requirements as adherence to
the Code is a prerequisite for conducting business with your Company.
The Code of Conduct Hotline is available on the Company website to
report any genuine concerns about unethical behavior, any actual or
suspected fraud or violation of CompanyRs.s Code of Conduct.
Loans, Guarantees and Investments
Particulars of loans, guarantees and investments made by the Company
pursuant to Section 186 of the Companies Act, 2013 are given in the
Notes to the Financial Accounts.
Related Party Contracts & Arrangements
All related party transactions done by the Company during the financial
year were at armRs.s length and in ordinary course of business. All
related party
transactions were placed in the meetings of Audit Committee and the
Board of Directors for their necessary review and approval. During the
financial year your Company has not entered into any material
transaction (as per Clause 49 of the Listing Agreement) with any of its
related parties which may have potential conflict with the interest of
the Company at large. Disclosures pursuant to Accounting Standards on
related party transactions have been made in the notes to the Financial
Statements. To identify and monitor significant related party
transactions Company has also framed a policy on the related party
transactions and the same is available on the Company website
http-.//www.colgate.co.in/Colgate/IN/Corp_v2/Investor/
CorporateGovernance/Related-Party-Transactions- Policy.pdf
Auditors
M/s. Price Waterhouse, Chartered Accountants, retire and are eligible
for re-appointment as Auditors from the conclusion of this Annual
General Meeting until the conclusion of the next Annual General
Meeting. The AduditorsRs. Report for the financial year 2014-15 does
not contain any qualification, resevation or adverse remarks.
Secretarial Auditor & Secretarial Audit Report
The Board had appointed M/s. S. N. Ananatha- subramanian & Co., Company
Secretaries in Whole- time Practice, to carry out Secretarial Audit
under the provisions of Section 204 of the Companies Act, 2013 for the
financial year 2014-15. The report of the Secretarial Auditor is
annexed to this report
as Annexure - 4. The Secretarial AduditorsRs. Report for the financial
year 2014-15 does not contain any qualification, resevation or adverse
remarks.
Extract of Annual Return
Pursuant to the Section 92(3) of the Companies Act, 2013 extract of the
annual Return is annexed to this report as Annexure - 5.
Business Responsibility Report
The Business Responsibility Report for the financial year 2014-15, as
stipulated under Clause 55 of the Listing Agreement is annexed to this
report as Annexure - 6.
Acknowledgements
Your Directors sincerely appreciate the high degree of professionalism,
commitment and dedication displayed by employees at all levels. Your
Directors also wish to place on record their gratitude to the
shareholders for their continued support and confidence.
On behalf of the Board
M. V. Deoras R. A. Shah
Chairman Vice-Chairman
(DIN : 02869422) (DIN : 00009851)
May 19, 2015
Mar 31, 2013
To, The Members of Colgate-Palmolive (India) Limited
The Directors have pleasure in presenting their Report and Audited
Accounts of the Company for the year ended March 31, 2013.
Financial Results
(Rs. Crore)
2012-13 2011-12
Total Revenue (a b c) 3,213.73 2,743.91
Sales (Excluding Excise Duty) (a) 3,084.11 2,623.85
Other Operating Revenue (b) 79.70 69.38
Other Income (c) 49.92 50.68
Profit before Taxation 663.03 588.39
Provision for Taxation 166.28 141.92
Profit after Taxation 496.75 446.47
Balance brought forward 114.68 107.99
Profit available for appropriation 611.43 554.46
Appropriation :
Dividend 380.78 339.98
Dividend Tax 61.77 55.15
General Reserve 49.67 44.65
Balance carried forward 119.21 114.68
611.43 554.46
Business Performance
Despite an inflationary environment and increasingly fierce
competition, your Company delivered very strong results. Your
Company''s business continues to grow strongly in double digits. Sales
for the year increased by 18 per cent to Rs. 3,084 crore as against Rs.
2,624 crore during the previous year. The toothpaste and toothbrush
businesses registered a very strong volume growth of 10 and 20 per cent
respectively during the year.
The profit before tax during the year was Rs. 663 crore as against Rs.
588 crore during the previous year, an increase of 13 per cent. The
profit after tax also increased, standing at Rs. 497 crore, an increase
of 11 per cent over the previous year.
Your Company continued to lay emphasis on cash generation driven by
strong business performance, focus on efficiencies, cost management and
continued efficient collection system. Your Company managed investments
prudently by deploying surplus funds after ensuring that such
investments satisfy the Company''s criteria of safety and security.
During the financial year, your Company strengthened its leadership
position in the toothpaste category to 54.6 per cent from 52.9 per cent
in the previous year. Similarly, market share in toothbrush category
was strengthened to 40.5 per cent and market share in mouthwash
category has been growing consistently.
Your Company achieved its goals by focusing on strategic initiatives
which are : engaging to build own brands, innovation for growth, being
effective and efficient and leading to win.
Dividend
The Company''s strong cash generation and positive growth momentum led
the Board of your Company to declare three interim dividends of Rs.13
per share, Rs. 6 per share and Rs. 9 per share aggregating Rs. 28 per
share for the financial year 2012-13 as against Rs. 25 per share in the
previous year. These dividends were paid on October 19, 2012, December
27, 2012 and April 19, 2013. Having declared three interim dividends,
your Board has not recommended a final dividend for the financial year
2012-13.
Colgate - the Most Trusted Brand once again in 2012
''Colgate'' has been ranked as "Most Trusted Brand" by Brand
Equity''s Annual Survey. In the year 2011 as well, Colgate was voted
as #1 Most Trusted Brand of the year. Colgate had also been rated as
India''s #1 Most Trusted Brand across all categories for four
consecutive years from 2003 to 2007. It is the only Brand to be ranked
in the top 3 from the inception of the survey in 2001.
Your Company was also ranked as the 3rd most admired Company in India
by the Global Business Magazine Fortune and Management Consultancy Hay
Group.
Sale and transfer of Company''s division viz. ''Global Shared
Services Organisation'' (GSSO)
In the year 2004, your Company with the assistance of Colgate-Palmolive
Company (CP-USA) set up a Global Shared Services Organisation (GSSO
Division) to provide IT/ITES services and assistance to some of the
subsidiaries of CP-USA including your Company. Its services primarily
revolve around, but are not limited to, the operations, maintenance and
enhancement of the SAP ERP system as well as electronic communication
systems, administrative, financial, managerial and technical matters in
the IT/ ITES segment.
Recently, CP-USA announced a four year Global Growth Efficiency Program
(GG&EP) for sustained growth. The said program''s initiatives are
expected to ensure continued growth and enhance the Colgate group''s
global leadership positions in its core businesses. The said program is
expected to achieve the objectives through :
i. Expansion of commercial hubs;
ii. Extension of Colgate Business Service Centres (CBS) and
streamlining of global functions; and
iii. Optimization of the Global Supply Chain and Facilities.
Keeping in view the aforesaid objectives, your Board felt that transfer
of GSSO division to Colgate Global Business Services Private Limited
(CGBSPL), a recently formed entity, will enable CP-India to focus on
its core business.
Your Company accordingly decided to divest its GSSO division along with
all its employees as well as assets and liabilities, as a going concern
and by way of slump sale to CGBSPL, a 100% subsidiary of the ultimate
holding company CP-USA for a lumpsum consideration of Rs. 59.89 crore.
CGBSPL will provide the best in class service to CP-USA''s
subsidiaries, including CP-India with greater efficiency.
Your Company recently obtained the approval of the shareholders by way
of Postal Ballot for sale of GSSO division.
Status of new projects
As stated in the Annual Report for the year 2011-12, to support the
growth momentum and to cater to the increasing demand of our products,
your Company is setting up a state of the art toothpaste manufacturing
facility at Sanand in Gujarat. The new factory will be the best in
class manufacturing facility which is scheduled to commence commercial
production in the current year.
Similarly, your Company is in an advanced stage of obtaining various
permissions for a new toothbrush manufacturing facility at Sricity in
Chittoor District in Andhra Pradesh. This new toothbrush manufacturing
facility is expected to commence commercial production in the year
2014.
Surrender of Lease and Sale of the factory building at Hyderabad
Pursuant to the closure of the manufacturing operations at Hyderabad
factory, your Board of Directors felt that it would be in the interest
of the Company to surrender the lease of the land and sell the factory
building to the Lessor, Swamy Sons Agencies Private Limited for a total
consideration of Rs. 1,60,00,000/- (One Crore Sixty Lacs only). The
approval of the shareholders for the aforesaid sale of factory building
was obtained by way of Postal Ballot and formalities for surrender of
lease and sale of factory building have been completed.
Sustainability
Your Company is committed to sustainability through a program that
focuses on People, Performance and Planet.
Considering this, in the year 2010, your Company developed a plan that
will guide its sustainability initiative for the next five years. The
broad aspects covered are as under :
- People - Promoting healthier lives, Contributing to the Communities
where we live and work.
- Performance - Delivering products that delight consumers and
respect our planet.
- Planet - Making every drop of water count, Reducing our impact on
climate and the environment.
Your Company believes that integrating sustainability into its everyday
operations will help in making better business decisions and improve
people''s lives. The sustainability strategy will also continue to
increase consumer loyalty, provide a competitive advantage and help
ensure long-term shareholder value.
Focus on innovation
In India today, consumer needs are fast evolving. Your Company has
been staying ahead of trends by identifying opportunities based on
insights into consumer behaviour and leveraging technology to deliver
innovative products. Our success in delivering meaningful innovation is
evident in several of our recent innovations. One out of three Indians
suffer from gum problems. To address this issue, your Company launched
Colgate Total Pro Gum Health, a technology breakthrough which reverses
gum problems in four weeks. Your Company also launched Colgate Visible
White toothpaste to create the beauty segment through this one-of-its
kind Oral Care solution that offers one shade whiter teeth in just one
week. In toothbrushes, your Company launched 3600, a battery operated
toothbrush for consumers seeking superior teeth cleaning and MaxFresh
toothbrush for those seeking freshness. In the mouthwash category, your
Company launched Colgate Plax Fresh Tea, a new flavour that builds on
the green tea trend.
As the leaders in Oral Care, your Company is making a constant effort
to cater to the Oral Care needs of different consumers by offering
products across various price points.
Innovation at your Company is not limited to new products. We are
innovating in the way we connect with shoppers in-store, engage
consumers in the digital arena, in how we go-to-market and in driving
further efficiencies in the supply chain.
Responsibility Statement
Pursuant to Section 217(2AA) of the Companies Act, 1956, the Directors,
based on the representations received from the Operating Management,
confirm:
a) that in the preparation of the annual accounts, the applicable
accounting standards have been followed and that no material departures
have been made from the same;
b) that they have, in selection of the accounting policies, consulted
the statutory auditors and have applied them consistently and made
judgments and estimates that are reasonable and prudent so as to give a
true and fair view of the state of affairs of the Company at the end of
the financial year and of the profit of the Company for that period;
c) that to the best of their knowledge and information, they have taken
proper and sufficient care for the maintenance of adequate accounting
records in accordance with the provisions of the Companies Act, 1956
for safeguarding the assets of the Company and for preventing and
detecting fraud and other irregularities; and
d) that they have prepared the annual accounts on a going concern
basis.
Corporate Social Responsibility
Your Company in partnership with the Indian Dental Association (IDA)
successfully concluded the 9th edition of a two-month long Oral Health
Month Program during the year, covering a wide spectrum of activities
designed to spread oral health awareness and good oral hygiene
practices. The mission of this Program continued to be "Mission Zero
Cavity" involving dental professionals spread across 1116 towns. The
total dentists who participated in the program were 25,000. The
two-month long oral care awareness drive covered in-clinic free dental
check-ups, school contact program, free dental check-ups in mobile
dental vans, retailers outreach program and many more such activities
to engage 3.7 million consumers.
Education has been the primary focus of your Company''s Corporate
Social Responsibility. Since 1976, your Company has been conducting a
school initiative program Colgate Bright Smiles Bright FuturesTM
wherein your Company partnered with IDA, to spread oral health
awareness among school-going children in primary schools in urban and
rural India. Till date, 107 million school children in 2,35,617 schools
in urban and rural areas have benefited from this Program. In addition,
your Company also conducts, jointly with IDA, a Teachers'' Training
Program to enable teachers to instil good Oral Care habits among
school-going children on an on-going basis.
In addition, your Company also started an employee volunteering program
called "Adopt a School", wherein the employees of the Company were
offered an opportunity to volunteer their time to spread the message of
maintaining good oral hygiene in a simple, conversational, interactive
manner to primary school children in municipal and government aided
schools. The program contributed to Colgate''s market development
efforts and business goals and reinforced Colgate''s emotional
connection with consumers. The involvement and contributions by
employees also helps Colgate give back to communities and demonstrates
Colgate''s core value of caring.
For close to a decade now, your Company partnered with the NGO,
Pratham, the largest non-governmental organisation, working to provide
quality education to the less privileged children of India. Pratham,
established in 1994, provides education to the children in the slums of
Mumbai city. Since then, the organization has grown both in scope and
geographical coverage.
Today Pratham reaches out to millions of children living both in rural
and urban areas through a range of interventions. It''s flagship
program, Read India, helps to improve the reading, writing and basic
arithmetic skills of the children in the age group of 6-14 years. Even
though India has made significant strides in improving the enrollment
levels of the children in schools, a lot still needs to be done as far
as the learning levels are concerned.
Since 2008, your Company has been supporting a program called ''A
Positive Step'' with the NGO, Network in Thane of People Living with
HIV. Through this program, your Company supports children affected and
infected by HIV with nutritional needs and school fees. The program has
infused the children with hope leading to a definitive improvement in
their academic performance and they now live with more confidence
despite their HIV condition.
Your Company will continue to take such measures to make a positive and
significant contribution to the Society.
Corporate Governance
A separate report on Corporate Governance along with the Auditors''
Certificate on its compliance is attached as Annexure 1 to this Report.
Employee Relations
The employee relations in the Company continued to be cordial except
for an unauthorised stoppage of work by one of the unions at Goa
toothpaste manufacturing facility for a period of 18 days from January
6, 2013 to January 23, 2013. However, the Management successfully
resolved the situation by following the due process and discussions
with the union and normalcy was restored in the facility. Since Company
had adequate inventory to serve the market, the impact on the
operations of the Company during the period was minimal.
A long term Memorandum of Settlement for three years and six months at
the Company''s Aurangabad toothpowder manufacturing facility was
signed on January 28, 2013. This settlement would be in force till May
31, 2015.
Information as per Section 217(2A) of the Companies Act, 1956 ("the
Act") read with the Companies (Particulars of Employees) Rules, 1975
forms part of this Report. As per the provisions of Section
219(1)(b)(iv) of the Act, the Report and Accounts are being sent to the
shareholders of the Company excluding the statement on particulars of
employees under Section 217(2A) of the Act. Any shareholder interested
in obtaining a copy of the said statement may write to the Secretarial
Department at the Registered Office of the Company.
Trade Relations
Your Directors wish to record appreciation of the continued unstinted
support and co-operation from its retailers, stockists, suppliers of
goods/services, clearing and forwarding agents and all others
associated with it. Your Company will continue to build and maintain
strong links with its business partners.
Energy, Technology Absorption and Foreign Exchange
The information required under Section 217(1) (e) of the Companies Act,
1956 read with the Companies (Disclosure of Particulars in the Report
of the Directors) Rules, 1988 with respect to conservation of energy,
technology absorption and foreign exchange earnings/ outgo is appended
hereto as Annexure 2 and it forms part of this Report.
Directors
Mr. Godfrey Nthunzi was appointed as the Whole- time Director of the
Company for five years, effective January 1, 2013, subject to the
approval of Central Government and shareholders under the provisions of
the Companies Act, 1956.
Mr. Paul Alton, Whole-time Finance Director opted for an early
retirement from the services of the Company effective December 31,
2012. The Board places on record their appreciation of the outstanding
contribution made by Mr. Paul Alton during his tenure as the Whole-time
Finance Director of the Company.
In terms of Sections 255 and 256 of the Act and under Article 124 of
the Company''s Articles of Association, Mr. J. K. Setna and Mr. V. S.
Mehta retire by rotation at the ensuing 72nd Annual General Meeting
and, being eligible, offer themselves for re-appointment.
Auditors
Messrs. Price Waterhouse, Chartered Accountants, retire and are
eligible for re-appointment as Auditors.
Cost Auditors
The Board of Directors at their Board Meeting held on March 25, 2013
appointed Messrs. N. I. Mehta & Company as the Cost Auditors for
auditing the cost accounts relating to cosmetics and toiletries for the
financial year 2013-14.
Acknowledgements
Your Directors sincerely appreciate the high degree of professionalism,
commitment and dedication displayed by employees at all levels. The
Directors also wish to place on record their gratitude to the Members
for their continued support and confidence.
On behalf of the Board
P. Parasmeswaran (Ms.) R.A. Shah
Managing Director Vice-Chairman
May 28, 2013
Mar 31, 2012
To, The Members of Colgate-Palmolive (India) Limited
The Directors have pleasure in presenting their Report and Audited
Accounts of the Company for the year ended March 31, 2012.
Financial Results
(Rs Crore)
2011-12 2010-11
Total Revenue (a b c) 2,743.91 2,327.36
Sales (Excluding Excise Duty) (a) 2,623.85 2,220.56
Other Operating Revenue (b) 69.38 65.56
Other Income (c) 50.68 41.24
Profit before Taxation 588.39 519.95
Provision for Taxation 141.92 117.37
Profit after Taxation 446.47 402.58
Balance taken over on Amalgamation of
subsidiary company - 2.59
Balance brought forward 107.99 91.95
Profit available for appropriation 554.46 497.12
Appropriation :
Dividend 339.981 299.18
Dividend Tax 55.15 49.69
General Reserve 44.65 40.26
Balance carried forward 114.68 107.99
554.46 497.12
Platinum Jubilee Year of the Company
This is a very special year as your Company completes very successful
75 years in 2012. Over these years, your Company has won the trust and
loyalty of consumers and stakeholders. Your Company is celebrating not
just the length of the journey since 1937, but also the manner in which
this length was travelled and the foundation of ethics and values on
which Company built the business over these years.
Business Performance
Your Company's strong performance continued in 2011-12, despite
difficult economic conditions coupled with fierce competition, and high
inflationary market conditions resulting in higher input cost. The
depreciation of Rupee also imposed severe challenges during the year.
Despite such challenging environment, your Company achieved a healthy
double-digit sales growth during the year 2011-12. Sales for the year
increased by 18 per cent at Rs 2,624 crore as against Rs 2,221 crore
during the previous year. The toothpaste business registered an
impressive volume growth of 14 per cent during the year.
The profit before tax for the financial year 2011-12 was Rs 588 crore as
against Rs 520 crore during the previous year. During the year, your
Company significantly increased its investment in the brand and equity
building activities by 18 per cent i.e. Rs 63 crore. Despite this
additional investment coupled with the lower deduction under the
income-tax regulations on the profits of the Baddi manufacturing
facility resulting in higher year-on-year tax payments of Rs 25 crore,
the profit after tax for the financial year 2011-12 was Rs 446 crore as
against Rs 403 crore during the previous year.
Cash generation continued to be strong arising from significant
improvements in the business performance, efficiencies and cost savings
across the organisation and a continued efficient collection system.
Your Company managed investments prudently by deployment of the surplus
funds after ensuring that such investments satisfy the Company's
criteria of safety and security.
Your Company continued to achieve excellent business results year after
year despite the testing market environment. This has been possible due
to several key initiatives which focused on consumers, dental
professionals, retail customers with a stronger focus on innovation,
greater effectiveness and efficiency everywhere, while strengthening
organisational leadership.
Dividend
The Company's strong cash generation and positive growth momentum led
your Board to declare three interim dividends of Rs 8 per share, Rs 9 per
share and Rs 8 per share aggregating Rs 25 per share for the financial
year 2011-12 as against Rs 22 per share in the previous year. These
dividends were paid on June 24, 2011, December 30, 2011 and April 17,
2012. Having declared three interim dividends, your Board has not
recommended a final dividend for the financial year 2011-12.
Most Trusted Brand
In the year 2011, the Brand Equity's Most Trusted Brand Survey ranked
your Company as the #1 Most Trusted Brand of the year. Colgate has also
been rated as India's #1 Most Trusted Brand across all categories for
four consecutive years from 2003 to 2007. It is the only brand to be
ranked in the top 3 from 2001-2011.
Voluntary Retirement Scheme for the employees at the Hyderabad Factory
In order to drive efficiency and cost effectiveness, your Company
offered Voluntary Retirement Scheme to the employees working at the
manufacturing unit at Hyderabad. All the employees working at the
factory have availed of the benefit of the said scheme and accordingly,
the manufacturing operations in the Hyderabad Factory have been
discontinued since September 29, 2011.
Such discontinuation of operations at the Hyderabad Factory will not
impact the toothpowder business as your Company has adequate capacity
to cater to the demand of the market.
New Projects
To support the growth momentum and to cater to the increasing
requirement of the products, your Company has acquired a plot of land
from Gujarat Industrial Development Corporation on long-term lease for
setting up a new Toothpaste manufacturing facility. The new
manufacturing facility is expected to be operational in the year 2013.
Your Company has also acquired in April 2012 a plot of land from Sri
City Private Limited on long-term lease for setting up a new Toothbrush
manufacturing facility in Andhra Pradesh. The new manufacturing
facility is expected to be operational in the year 2013.
Sustainability
Your Company recognizes that a broad approach to sustainability,
encompassing its long commitment to environment quality and extending
to the long-term well-being of the people and communities it serves, is
the true expression of its values. Considering this, in 2010, your
Company developed a plan that will guide its sustainability initiative
for the next five years with key goals in all three of its
sustainability focus areas: People, Performance and Planet with focused
measurable goals that align with company's business objectives. Your
Company believes that integrating sustainability into its everyday
operations will help in making better business decisions and improve
people's lives. The sustainability strategy will also continue to
increase consumer loyalty, provide a competitive advantage and help
ensure long-term shareholder value.
Focus on innovation
The Company's growth is sparked by the innovative products that it
brings to the market and also by ensuring that there is innovation at
all price points. This strategy offers consumers a choice of products
from entry level to super premium and allows them the opportunity to
trade up as disposable income level rise. During 2011-12, innovative
products like Colgate Sensitive Pro-Relief (the only product that
provides instant relief from hypersensitivity), variants of Plax Mouth
Wash with sensorial and functional benefits, were successfully launched
further enhancing the broad range of oral care benefits that Colgate
provides to the consumers. Your Company will continue to remain focused
on driving innovation in future.
Responsibility Statement
Pursuant to Section 217(2AA) of the Companies Act, 1956, the Directors,
based on the representations received from the Operating Management,
confirm:
a) that in the preparation of the annual accounts, the applicable
accounting standards have been followed and that no material departures
have been made from the same;
b) that they have, in selection of the accounting policies, consulted
the statutory auditors and have applied them consistently and made
judgements and estimates that are reasonable and prudent so as to give
a true and fair view of the state of affairs of the Company at the end
of the financial year and of the profit of the Company for that period;
c) that to the best of their knowledge and information, they have taken
proper and sufficient care for the maintenance of adequate accounting
records in accordance with the provisions of the Companies Act, 1956
for safeguarding the assets of the Company and for preventing and
detecting fraud and other irregularities; and
d) that they have prepared the annual accounts on a going concern
basis.
Corporate Social Responsibility
Your Company in partnership with the Indian Dental Association (IDA)
successfully concluded the 8th edition of a two-month long Oral Health
Month Program during the year covering a wide spectrum of activities
designed to spread oral health awareness and good oral hygiene
practices. The mission of this Program continued to be "Mission Zero
Cavity" involving dental professionals spread across 1090 towns. The
total dentists who participated in the program were 22,146. The
two-month long oral care awareness drive covered in-clinic free dental
check-ups, school contact program, free dental check-ups in mobile
dental vans, retailers outreach program and many more such activities
to engage more than 3.6 million consumers.
Education has been the primary focus of your Company's Corporate
Social Responsibility. Since 1976, your Company has been conducting a
school initiative program (now called Colgate Bright Smiles, Bright
Futures TM Program) wherein your Company partnering with IDA, to spread
oral health awareness among school-going children in urban and rural
schools. Till date, 105 million school children in 2,34,756 schools in
urban and rural areas have benefitted from this Program. In addition,
your Company also conducts, jointly with IDA, a Teachers' Training
Program to enable teachers to instill good oral care habits among
school-going children on an ongoing basis.
In addition, your Company also started an employee program called
"Adopt a School" in which the employees of the Company were offered
an opportunity to volunteer their time to spread the message of
maintaining good oral hygiene in a simple, conversational, interactive
manner to primary school children. The program contributed to
Colgate's market development efforts and business goals and
reinforced Colgate's emotional connection with consumers. It helps
give back in return to the communities, your Company does business in
and demonstrates Colgate's core value of caring.
The impact of this initiative is that over 1,00,000 children in schools
have been covered through this program where it has been conducted by
employees.
Since 2002, your Company partnered with Pratham, a non-profit
organization, to promote academic education of the less privileged
children. The grant from the Company has supported the concept of
Libraries in the "S" Ward of Mumbai where children are encouraged
to read books to enhance their knowledge and continue their academic
education. Your Company supports 65 schools in the Pratham-focused
communities in "S" Ward in Mumbai and also seeks to engage parents
in the "mother participation" program to aid the learning process
of the child.
Your Company started supporting the children affected and infected by
HIV with nutritional needs and school fees since last four years. The
program has infused the children with hope leading to a definitive
improvement in their academic performance and they now live with more
confidence despite their HIV positive condition.
Your Company will continue to take such measures to make a positive and
significant contribution to the society.
Corporate Governance
A separate report on Corporate Governance along with the Auditors'
Certificate on its compliance is attached as Annexure 1 to this Report.
Employee Relations
The employee relations in the Company continued to be positive.
Information as per Section 217(2A) of the Companies Act, 1956 ("the
Act") read with the Companies (Particulars of Employees) Rules, 1975
forms part of this Report. As per the provisions of Section
219(1)(b)(iv) of the Act, the Report and Accounts are being sent to the
shareholders of the Company excluding the statement on particulars of
employees under Section 217(2A) of the Act. Any shareholder interested
in obtaining a copy of the said statement may write to the Secretarial
Department at the Registered Office of the Company.
Trade Relations
Your Directors wish to record appreciation of the continued unstinted
support and co-operation from its retailers, stockists, suppliers of
goods/services, clearing and forwarding agents and all others
associated with it. Your Company will continue to build and maintain
strong links with its business partners.
Energy, Technology Absorption and Foreign Exchange
The information required under Section 217(1) (e) of the Companies Act,
1956 read with the Companies (Disclosure of Particulars in the Report
of the Directors) Rules, 1988 with respect to conservation of energy,
technology absorption and foreign exchange earnings/ outgo is appended
hereto as Annexure 2 and it forms part of this Report.
Directors
Ms. Prabha Parameswaran was appointed as the Managing Director of the
Company for five years from February 1, 2012 to succeed Mr. Mukul
Deoras who has been elevated as President, New Asia Division of
Colgate-Palmolive Company. The appointment of Ms. Prabha is subject to
the approval of the shareholders and the Central Government under the
provisions of the Companies Act, 1956.
The Board places on record their appreciation of the outstanding
contribution made by Mr. Mukul Deoras during his tenure as Managing
Director of the Company.
Mr. Niket Ghate was appointed as the Whole-time Director of the Company
for five years from October 1, 2011 subject to the approval of the
shareholders under the provisions of the Companies Act, 1956.
Mr. K. V. Vaidyanathan retired from the services of the Company on
November 30, 2011. He held the position of Whole-time Director of the
Company since April 1997 and during this period, he made several
significant contributions to the Company's growth and business
strategies. The Board places on record their appreciation for the
distinguished services rendered by Mr. Vaidyanathan during his tenure
with the Company.
Mr. Derrick Samuel retired from the services of the Company and hence
stepped down from the Board on January 31, 2012. The Board places on
record their appreciation of the outstanding contribution made by Mr.
Derrick Samuel during his tenure as director and Chairman of the Board.
Dr. (Ms.) Indu Shahani was appointed as an Additional Director of the
Company on January 23, 2012 and she holds office up to conclusion of
this Annual General Meeting. A notice in writing, with the requisite
deposit has been received from a member proposing Dr. (Ms.) Indu
Shahani as a candidate for the office of Director.
Under Article 124 of the Company's Articles of Association, Mr. P. K.
Ghosh and Mr. R. A. Shah retire by rotation at the 71st Annual General
Meeting and, being eligible, offer themselves for re-appointment.
Auditors
Messrs. Price Waterhouse, Chartered Accountants, retire and are
eligible for re-appointment as Auditors.
Cost Auditors
The Board of Directors at their Board Meeting held on March 23, 2011
appointed Messrs. N. I. Mehta & Company as the Cost Auditors for
auditing the cost accounts relating to cosmetics and toiletries for the
financial year 2011-12. The due date for submission of the cost audit
report was September 27, 2011 and the actual date of submission of the
report was September 26, 2011.
Acknowledgements
Your Directors sincerely appreciate the high degree of professionalism,
commitment and dedication displayed by employees at all levels. The
Directors also wish to place on record their gratitude to the Members
for their continued support and confidence.
On behalf of the Board
P. Parameswaran (Ms.) R. A. Shah
Managing Director Vice-Chairman
May 30, 2012
Mar 31, 2011
The Directors have pleasure in presenting their Report and Audited
Accounts of the Company for the year ended March 31, 2011.
Financial Results
(Rs. Crore)
2010-11 2009-10
Total Revenue 2,327.36 2,060.92
Sales (Excluding Excise Duty) 2,220.56 1,962.46
Other Income 106.80 98.46
Profit before Taxation 519.95 484.80
Provision for Taxation 117.37 61.54
Profit after Taxation 402.58 423.26
Balance taken over on Amalgamation
of subsidiary company 2.59 Ã
Balance brought forward 91.95 28.84
Profit available for appropriation 497.12 452.10
Appropriation :
Dividend 299.18 271.98
Dividend Tax 49.69 45.84
General Reserve 40.26 42.33
Balance carried forward 107.99 91.95
497.12 452.10
Business Performance
The year 2010-11 was another challenging year for the global markets.
However, the resilience shown by the Indian economy was heartening. But
the continued high level of food inflation along with the firming up of
commodity costs has led to an inflationary business environment.
Uncontrolled high inflation could dampen the growth trend in Indian
market.
In this challenging environment, your Company achieved a healthy
double-digit sales growth during the year 2010-11. Sales for the year
increased by 13 per cent at Rs. 2,221 crore as against Rs. 1,962 crore
during the previous year. The toothpaste business registered an
impressive volume growth of 13 per cent during the year.
The profit before tax for the financial year 2010-11 was Rs. 520 crore
as against Rs. 485 crore during the previous year. During the year,
your Company significantly increased its investment in the brand and
equity building
activities by 16.7 per cent i.e. Rs. 50 crore. Despite this additional
investment coupled with the lower deduction under the Income-tax
regulations on the profits of the Baddi manufacturing facility
resulting in higher year on year tax payments of Rs. 56 crore, the
profit after tax for the financial year 2010-11 was Rs. 403 crore as
against Rs. 423 crore during the previous year.
The cash generation during the year continued to be strong arising from
significant improvements in the business performance, efficiencies and
cost savings across the organisation and a continued efficient
collection system. Your Company managed investments prudently by
deployment of the surplus funds after ensuring that such investments
satisfy the Companys criteria of safety and security.
Your Company continued to achieve excellent business results year after
year despite the fierce competitive
market environment. This has been possible since your Company has the
right strategies in place which focused on consumers, dental
professionals, retail customers with a stronger focus on innovation,
greater effectiveness and efficiency everywhere, while strengthening
organisational leadership.
Winning with Consumers, Customers & Profession
To best reach todays consumers, both in and out of the store, your
Company focuses on integrated marketing communications that include a
mix of traditional and new media as well as creative promotional
activities. Your Companys shopper marketing program, which focuses on
in-store behaviour, is another way of identifying new growth
opportunities for the Company and its retail partners.
Your Company is also committed to building consumption by educating
consumers about good oral hygiene habits. Once people adopt these
habits, they stay with the same for a lifetime. Indeed the Companys
"Colgate Bright Smiles, Bright FuturesTM" oral health education program
has now reached over 95 million children since the program began.
The Management of your Company is strongly focused on aligning its
strategies and goals with those of its trade partners in order to
achieve mutual success. Small stores are just as important to your
Company as the large ones. In order to better understand the
small-store environment, the Company works closely with local
merchandisers and shop owners to offer a relevant assortment of
products and merchandising services to achieve high visibility in each
store.
The Company has developed strong relationships with dental
professionals. This strategy has contributed greatly to increasing
professional recommendations for the Companys brands. In India, 81 per
cent of professionals are now recommending Colgate ahead of any other
brand.
Focus on Innovation
The Companys growth is sparked by the innovative products that it
brings to the market and also by ensuring that there is innovation at
all price points. This strategy offers consumers a choice of products
from entry level to super premium and allows them the opportunity to
trade up as disposable income levels rise. During 2010-11, innovative
products like Colgate Plax Mouthwash and Colgate Sensitive Toothpaste
grew strongly to deliver new and improved benefits to consumers.
Organisational Leadership
Your Companys continuing success as the oral care market leader in the
country is closely linked to the personal leadership demonstrated by
its people at all levels within the organisation. The Company supports
and encourages leadership in several ways by communicating its strategy
throughout the organisation. It has strong Training & Development tools
to build personal leadership and help people carry out their
responsibilities effectively.
As your Company continues to face tough challenges, it remains
confident as it has the right strategies in place to build on the past
success. Your Company is strongly focused on delivering the value-added
products at all price points and is prepared to spend aggressively to
support its brands and fuel top-line growth.
Dividend
The Companys strong cash generation and positive growth momentum led
your Board to declare three interim dividends of Rs.10, Rs.5 and Rs.7
per share aggre- gating Rs. 22 per share for the financial year 2010-11
as against Rs. 20 per share in the previous year. These dividends were
paid on August 30 and December 24, 2010 and April 19, 2011. Having
declared three interim dividends, your Board has not recommended a
final dividend for the financial year 2010-11.
Responsibility Statement
Pursuant to Section 217(2AA) of the Companies Act, 1956, the Directors,
based on the representations received from the Operating Management,
confirm :
a) that in the preparation of the annual accounts, the applicable
accounting standards have been followed and that no material departures
have been made from the same;
b) that they have, in selection of the accounting policies, consulted
the statutory auditors and have applied them consistently and made
judgments and estimates that are reasonable and prudent so as to give a
true and fair view of the state of affairs of the Company at the end of
the financial year and of the profit of the Company for that period;
c) that to the best of their knowledge and information, they have taken
proper and sufficient care for the maintenance of adequate accounting
records in accordance with the provisions of the Companies Act, 1956
for safeguarding the assets of the
Company and for preventing and detecting fraud and other
irregularities; and
d) that they have prepared the annual accounts on a going concern
basis.
Corporate Social Responsibility
Your Company in partnership with the Indian Dental Association (IDA)
successfully concluded the 7th edition of a two-month long Oral Health
Month Program during the year covering a wide spectrum of activities
designed to spread oral health awareness and good oral hygiene
practices. The mission of this Program continued to be "Zero Tooth
Decay" involving dental professionals spread across 1000 towns. The
two-month long oral care awareness drive covered in- clinic free dental
check-ups, school contact program, free dental check-ups in mobile
dental vans, retailers outreach program and many more such activities
to engage consumers.
Education has been the primary focus of your Companys Corporate Social
Responsibility. Since 1976, your Company has been conducting a school
initiative program (now called Colgate Bright Smiles, Bright FuturesTM
Program) wherein your Company partnered with IDA, to spread oral health
awareness among school-going children in urban and rural schools. Till
date, 95 million school children in 1,94,756 schools in urban and rural
areas have benefited from this Program. In addition, your Company also
conducts in conjunction with IDA a Teachers Training Program to enable
teachers to instill good oral care habits among school-going children
on an ongoing basis. Till date, 2,46,312 teachers have undergone this
training.
Since 2002, your Company partnered with Pratham, a non-profit
organisation, to promote academic education of the less privileged
children. The grant from the Company has supported the concept of
Libraries in the "S" Ward of Mumbai where children are encouraged to
read books to enhance their knowledge and continue their academic
education. Your Company supports 65 schools in Pratham-focused
communities in "S" Ward in Mumbai and also seeks to engage parents in
the "Mother Participation" program to aid the learning process of the
child.
Your Company started supporting the children affected and infected by
HIV with nutritional needs and school fees since last three years. The
program has infused the children with hope leading to a definitive
improvement
in their academic performance and they now live with more confidence
despite their HIV positive condition.
Your Company will continue to take such measures to make a positive and
significant contribution to the society.
Guinness World RecordsTM
Your Company in association with the Indian Dental Association achieved
in November 2010 a Guinness World Record by providing dental check-ups
to 66,322 children on a single day across multiple locations involving
33 schools in five cities across India.
Your Company also achieved in January 2011 a Guinness World Record
wherein around 1,011 school children rinsed simultaneously with Colgate
Plax Mouthwash.
With these records, your Company achieved a hat-trick of Guinness World
RecordsTM in the oral care category that started of in 2007 with the
"Colgate Brush-up Challenge" where 1,77,003 students from 380 locations
in 22 cities across the country, in one day and at one time, brushed
their teeth for one minute.
Corporate Governance
A separate report on Corporate Governance along with the Auditors
Certificate on its compliance is attached as Annexure 1 to this Report.
Employee Relations
The employee relations in the Company continued to be positive. During
the year, a long-term settlement was signed with the Goa Factory Union
through a process of bilateral negotiations which would, amongst other
things, improve productivity.
Information as per Section 217(2A) of the Companies Act, 1956 ("the
Act") read with the Companies (Particulars of Employees) Rules, 1975
forms part of this Report. As per the provisions of Section 219(1)
(b)(iv) of the Act, the Report and Accounts are being sent to the
shareholders of the Company excluding the statement on particulars of
employees under Section 217(2A) of the Act. Any shareholder interested
in obtaining a copy of the said statement may write to the Secretarial
Department at the Registered Office of the Company.
Trade Relations
Your Directors wish to record appreciation of the continued unstinted
support and co-operation from
its retailers, stockists, suppliers of goods/services, clearing and
forwarding agents and all others associated with it. Your Company will
continue to build and maintain strong links with its business partners.
Energy, Technology Absorption and Foreign Exchange
The information required under Section 217(1)(e) of the Companies Act,
1956 read with the Companies (Disclosure of Particulars in the Report
of the Directors) Rules, 1988 with respect to conservation of energy,
technology absorption and foreign exchange earnings/ outgo is appended
hereto as Annexure 2 and forms part of this Report.
Directors
Effective September 1, 2010, Mr. Paul Alton was appointed as the
Whole-time Finance Director of the Company for a period of five years
subject to the approval of the shareholders and the Central Government
under the provisions of the Companies Act, 1956. The Central Government
by its letter dated January 21, 2011 has accorded an in-principle
approval subject to his appointment being approved by the shareholders
at the ensuing Annual General Meeting.
Mr. M. A. Elias stepped down from the Board effective November 30,
2010. He was appointed Whole-time Director of the Company since April
1997 and during this period, he had made several significant
contributions to the Companys growth and implementation of investment
plans and business strategies. The Board places on record their
appreciation for the distinguished
services rendered by Mr. Elias during his tenure with the Company.
Under Article 124 of the Companys Articles of Association, Mr. J. K.
Setna and Mr. V. S. Mehta retire by rotation at the 70th Annual General
Meeting and, being eligible, offer themselves for re-appointment.
Auditors
Messrs. Price Waterhouse, Chartered Accountants, retire and are
eligible for re-appointment as Auditors.
Cost Auditors
The Central Government vide its letter dated May 18, 2010 accorded its
approval to the appointment of Messrs. N. I. Mehta & Company as the
Cost Auditors for auditing the cost accounts relating to cosmetics and
toiletries for the financial year 2010-11. The due date for submission
of the cost audit report for the financial year 2009-10 was September
27, 2010 and the actual date of submission of the report was September
24, 2010.
Acknowledgements
Your Directors sincerely appreciate the high degree of professionalism,
commitment and dedication displayed by employees at all levels. The
Directors also wish to place on record their gratitude to the Members
for their continued support and confidence.
On behalf of the Board
Mukul Deoras R. A. Shah
Managing Director Vice-Chairman
May 30, 2011
Mar 31, 2010
The Directors have pleasure in presenting their Report and Audited
Accounts of the Company for the year ended March 31, 2010.
Financial Results
(Rs. Crore)
2009-10 2008-09
Total Revenue 2,060.92 1,802.57
Sales (excluding Excise Duty) 1,962.46 1,694.81
Other Income 98.46 107.76
profit before Taxation 484.80 345.31
Provision for Taxation 61.54 55.09
profit afiter Taxation 423.26 290.22
Balance brought forward 28.84 5.77
profit available for appropriation 452.10 295.99
Appropriation:
Dividend 271.98 203.99
Dividend Tax 45.84 34.14
General Reserve 42.33 29.02
Balance carried forward 91.95 28.84
452.10 295.99
Business Performance:
Your CompanyÃs strong performance continued in 2009-10 despite diffcult
economic conditions. In a year marked by volatile financial and
currency markets, your Company achieved a healthy double- digit sales
growth during the year 2009-10. Sales for the year increased by 16 per
cent at Rs.1,962 crore as against Rs.1,695 crore during the previous
year. The toothpaste business registered an impressive volume growth of
14 per cent during the year.
The profit afiter tax for the financial year 2009-10 grew by an
impressive 46 per cent to 423 crore as against Rs. 290 crore in the
previous year.
The underlying performance can be gauged from the following ratios:
2009-10 2008-09
Earnings per share (Rs.) 31.1 21.3
Dividend per share (Rs.) 20.0 15.0
Return on capital employed (%) 156.9 155.0
During the year cash generation continued to be very strong arising
from signifcant improvements in the business performance, effciencies
and cost savings across the organization and a continued effcient
collection system. Your Company managed investments prudently by
deployment of surplus funds afiter ensuring that such investments
satisfy the CompanyÃs criteria of safety and liquidity.
Your CompanyÃs market shares are improving steadily. These increases
are driven by our strong focus on understanding our consumers, working
with dental professionals and with our retail customers. Your Company
also continued to focus on driving innovation throughout all areas of
business, increasing effectiveness and effciency everywhere and
strengthening the leadership competency of the team. The sharp focus on
these four clearly defned strategic initiatives helped your Company
continue to maintain its leadership position in the oral care market.
Your Company is positioned well for the future on account of its
financial strength, market leadership position, a proven business
strategy that has helped your Company succeed in strong and weak
economic environment and most importantly a dedicated and well-trained
team of people working together to achieve the CompanyÃs business
goals.
Dividend:
The CompanyÃs strong cash generation and positive growth momentum led
your Board to declare three interim dividends of Rs.8, Rs.7 and Rs.5
per share aggregating Rs.20 per share for the financial year 2009-10 as
against Rs.15 per share in the previous year à a 33 per cent increase.
These dividends were paid on September 4 and December 28, 2009 and
April 23, 2010. Having declared three interim dividends, your Board has
not recommended a fnal dividend for the financial year 2009-10.
Responsibility Statement:
Pursuant to Section 217(2AA) of the Companies Act, 1956, the Directors,
based on the representations received from the Operating Management,
confirm:
a) that in the preparation of the annual accounts, the applicable
accounting standards have been followed and that no material departures
have been made from the same;
b) that they have, in selection of the accounting policies, consulted
the statutory auditors and have applied them consistently and made
judgements and estimates that are reasonable and prudent so as to give
a true and fair view of the state of affairs of the Company at the end
of the financial year and of the profit of the Company for that period;
c) that to the best of their knowledge and information, they have taken
proper and suffcient care for the maintenance of adequate accounting
records in accordance with the provisions of the Companies Act, 1956
for safeguarding the assets of the Company and for preventing and
detecting fraud and other irregularities; and
d) that they have prepared the annual accounts on a going concern
basis.
Subsidiary Companies:
Your Company was holding 75 per cent shareholding in Professional Oral
Care Products Private Limited at Goa (POC) engaged in the manufacture
of toothpaste. During the year, your Company acquired the remaining 25
per cent shareholding at a total consideration of Rs. 2.40 crore and
proposed amalgamation of POC with your Company. The Scheme of
Amalgamation of POC with your Company was sanctioned by the Bombay High
Court at Goa vide its order dated April 16, 2010 and accordingly, the
amalgamation of POC with your Company became fnally effective from May
1, 2010 with retrospective effect from April 1, 2009, being the
Appointed Date under the Scheme of Amalgamation.
Your Company was also holding 75 per cent of the shareholding in CC
Health Care Products Private Limited at Hyderabad (CCHL) engaged in the
manufacture of toothpowder. During the year, your Company acquired the
remaining 25 per cent shareholding at a total consideration of Rs.
69.07 Lacs and initiated steps before the Andhra Pradesh High Court for
amalgamation of CCHL with your Company effective from April 1, 2009,
being the Appointed Date under the Scheme of Amalgamation.
The amalgamation of subsidiaries is primarily designed to simplify the
corporate structure and has no material impact either in terms of
operations or in terms of capital structure of the Company.
Corporate Social Responsibility:
Your Company in partnership with the Indian Dental Association (IDA)
successfully concluded the 6th edition of a two-month long Oral Health
Month Program during the year covering a wide spectrum of activities
designed to spread oral health awareness and good oral hygiene
practices. The mission of this Program continued to be ÃZero Tooth
Decayà involving 17,500 dental professionals spread across 1000 towns.
This year the Program extended its support to NGOs like Pratham,
Akshara Foundation, Save the Children, Salaam Balak Trust among others
by conducting free dental check-ups for NGOs workers and children and
distributing free samples. In addition, free dental check-ups were
conducted for the Indian Coast Guard in Chennai.
Education has been the primary focus of your CompanyÃs Corporate Social
Responsibility. Since 1976, your Company has been conducting a school
initiative program (now called Bright Smiles Bright Futuresà Program)
wherein your Company partnered with IDA, to spread oral health
awareness among school going children in urban and rural schools. Till
date, 83 million school children in 173,000 schools in 250 towns in
urban and rural areas have benefited from this Program. In addition,
your Company also conducts in conjunction with IDA a Teachersà Training
Program to enable teachers to instill good oral care habits among
school-going children on an ongoing basis. Till date, 243,500 teachers
have undergone this training.
Since 2002, your Company partnered with Pratham, a non-profit
organization, to promote academic education of the less privileged
children. The grant from the Company has supported the concept of
Libraries in the ÃSÃ Ward of Mumbai where children are encouraged to
read books to enhance their knowledge and continue their academic
education.
Your Company started supporting the children affected and infected by
HIV with nutritional needs and school fees since last two years. The
program has infused the children with hope leading to a defnitive
improvement in their academic performance.
Your Company will continue to take such measures to make a positive and
signifcant contribution to the society.
Corporate Governance:
A separate report on Corporate Governance along with the AuditorsÃ
Certifcate on its compliance is attached as Annexure 1 to this Report.
InvestorÃs Grievance:
The legal heir of a shareholder, who died in 1988, approached the
Company for the frst time afiter 21 years in 2009 for transmission of
shares and payment of accrued dividend. The aggregate of the market
value of shares and accrued dividend is approximately Rs.20 Lacs.
However, in 2004 a request was received by the Company in the name of
the shareholder for issue of duplicate share certifcates. The Applicant
having complied with standard formalities, the Registrars of the
Company issued duplicate share certifcates as no objection was received
to a notice published in newspaper. Due intimation to the Stock
Exchange was also given before the duplicate share certifcates were
issued. The duplicate certifcates together with bonus share certifcates
were despatched to the Applicant in 2005. In view of the claim of the
legal heir, the Registrars have now fled a complaint with the police to
investigate the matter. The Registrars have assured the Company that
this incident will have no financial implication on the Company. The
Auditorsà attention have been drawn to this incident.
Employee Relations:
The employee relations in the Company continued to be positive. During
the year, a productivity-linked long-term settlement was signed with
the Aurangabad Factory Union through a process of bilateral
negotiations.
Information as per Section 217(2A) of the Companies Act, 1956 (Ãthe
ActÃ) read with the Companies (Particulars of Employees) Rules, 1975
forms part of this Report. As per the provisions of Section 219(1)
(b)(iv) of the Act, the Report and Accounts are being sent to the
shareholders of the Company excluding the statement on particulars of
employees under Section 217(2A) of the Act. Any shareholder interested
in obtaining a copy of the said statement may write to the Secretarial
Department at the Registered Offce of the Company.
Trade Relations:
Your Directors wish to record appreciation of the continued unstinted
support and co-operation from its retailers, stockists, suppliers of
goods/services, clearing and forwarding agents and all others
associated with it. Your Company will continue to build and maintain
strong links with its business partners.
Energy, Technology Absorption and Foreign Exchange:
The information required under Section 217(1)(e) of the Companies Act,
1956 read with the Companies (Disclosure of Particulars in the Report
of the Directors) Rules, 1988 with respect to conservation of energy,
technology absorption and foreign exchange earnings/ outgo is appended
hereto as Annexure 2 and forms part of this Report.
Directors:
Effective February 1, 2010, Mr. Mukul Deoras was appointed as the
Managing Director of the Company to succeed Mr. Roger Calmeyer, who
stepped down as the Managing of Director of the Company effective
January 31, 2010 to retire from the services of the Corporation. The
appointment of Mr. Deoras is subject to the approval of the
shareholders and the Central Government under the provisions of the
Companies Act, 1956.
The Board places on record their appreciation for the distinguished
services rendered by Mr. Calmeyer during his tenure with the Company.
Effective April 1, 2010, Mr. Derrick Samuel has been appointed as
Director and Chairman of the Board to succeed Mr. Justin Skala, who has
stepped down to head the Latin America Division of the Corporation.
The Board, while welcoming Mr. Samuel, places on record their
appreciation for the distinguished services rendered by Mr. Skala
during his tenure with the Company.
Under Article 124 of the CompanyÃs Articles of Association, Mr. P.K.
Ghosh and Mr. M.A. Elais retire by rotation at the 69th Annual General
Meeting and, being eligible, offer themselves for re-appointment.
Auditors:
Messrs Price Waterhouse, Chartered Accountants, retire and are eligible
for re-appointment as Auditors.
Acknowledgements:
Your Directors sincerely appreciate the high degree of professionalism,
commitment and dedication displayed by employees at all levels. The
Directors also wish to place on record their gratitude to the Members
for their continued support and confdence.
On behalf of the Board
Mukul Deoras R.A. Shah
Managing Director Vice-Chairman
May 27, 2010