Analysis of HUL &

ITC’s CSR
Commitments from
2015 to 2021
Prepared for: Prof. Ashish Aggarwal, SMCSR Term Project

Prepared by: Group-5 (Abhijeet Kohat, Mohd Waheed, Parthib Choudhury, Shikhar
Yadav, Vikas Kumar, Yash Sharma)
Agenda

Stakeholder Engagement Mechanisms

CSR Committee Structure

CSR Policy

CSR Strategy

CSR Spending

Impact Analysis
HUL uses a multi-stakeholder model in order to conduct their business sustainably

Digital platforms like People Data Centre and Consumer Household customer
Customers Cleanipedia and BeBeutiful Carelines surveys

Programs like Employee Annual employee feedback

Employee Care to Connect pulse-check surveys survey: UniVoice

Donations to disaster and calamity Consumer behavioral Environmental conservation and

Community relief change drives livelihood generation acts
Similar to HUL, stakeholder engagement and their enhancement is at the heart of ITC’s business model

Digital market In-person direct Personalized lifestyle Customer satisfaction

Customers surveys connect/visits privilege programs surveys

Individual performance Employee engagement Proactive grievance Trade union

Employee tracking and mentoring surveys redressal mechanisms meetings

Community Community needs Forming community Greenfield/expansion Periodic evaluation of

assessment institutions project public hearings social investments
Agenda

Stakeholder Engagement Mechanisms

CSR Committee Structure

CSR Policy

CSR Strategy

CSR Spending

Impact Analysis
HUL’s CSR Committee has 7 members, with a mix of independent and executive directors; The committee
meets bi-annually and is headed by an Independent Director

Independent Director
as Chairperson
Mr. O.P. Bhatt

3 Executive Directors 3 Independent Directors

- Mr. Sanjiv Mehta, CEO & MD - Mr. Sanjiv Misra

- Mr. Ritesh Tiwari, CFO & ED - Ms. Kalpana Morparia
- Mr. Srinivas Pathak, Deputy CFO - Mr. Leo Puri

Committee’s Formulate the CSR Recommend to board the Recommend amount of Review HUL’s
policy to CSR projects to be expenditure for CSR performance on CSR
Objectives the board undertaken projects projects

Half-yearly meetings 100% meeting attendance in FY21

ITC’s CSR & Sustainability Committee also has 7 members, but the Committee is headed by an Executive
Director and meets more frequently, on a quarterly basis

Executive Director as
Chairperson
Mr. Sanjiv Puri, Chairman & MD

1 Non-Executive
1 Secretary 4 Independent Directors
Director

- Mr. David Robert Simpson - Mr. R K Singhi, Executive VP & CS - Ms. Nirupama Rao
- Ms. Meera Shankar
- Mr. Hemant Bhargava
- Mr. Ajit Kumar Seth

Committee’s Formulate the CSR Present the Annual CSR Recommend amount of
policy to Action Plan to expenditure for CSR
Objectives the board the board projects

Quarterly meetings 100% meeting attendance in FY21

Agenda

Stakeholder Engagement Mechanisms

CSR Committee Structure

CSR Policy

CSR Strategy

CSR Spending

Impact Analysis
How frequently is the CSR Policy updated?

“
The Committee decides on Policy updates at an annual basis.
”

- Kanika Pal, South Asia Head, Community Investments &

Sustainability Program @ Unilever

“
We don’t have a fixed frequency as such. The CSR Committee can meet as and when required to make
changes to the policy.
”

- Aswathaman Vijayan, Manager, Sustainability @ ITC

How are the Schedule VII themes on which CSR projects will be executed are selected?

“
Our Schedule VII focus has been the same since the CSR law came into being. Given our area of work, we
believe we can make better positive impact on health, environmental sustainability, and the women.
”
- Kanika Pal, South Asia Head, Community Investments &
Sustainability Program @ Unilever

“
Given our scale of operations, we aim to make impact across all Schedule VII listed activities. But majority
of our budget is dedicated towards improving health and quality of life of the communities associated to
our operations.
”
- Aswathaman Vijayan, Manager, Sustainability @ ITC
HUL and ITC have similar focus areas for CSR; That said, ITC additionally focuses on protecting national
heritage, art and culture

Promote healthcare, including preventive

Promote health, hygiene and nutrition
healthcare

Environmental sustainability & water Creating sustainable livelihoods and

conservation alleviating poverty

Rural development, skill development,

Focus areas Building capabilities for tomorrow
entrepreneurship development & education

Provide relief and assistance to victims of

Disaster response
disasters and calamities

Protect national heritage, art & culture, and

Additional
preserving & promoting music and sports
To ensure adequate implementation of the CSR Policy, HUL follows a 3-Tier governance mechanism which
involves the Board, the CSR Committee and the Leadership Team

Board of Directors

Board monitors and reviews the performance and impact of the CSR programs, gives feedback and guidance, and ensures that disbursed CSR funds are
aligned with the HUL's CSR Policy

The Chief Financial Officer (CFO) certifies that the CSR funds so disbursed have been utilized for the purposes and in the manner approved by the Board
HUL's CSR Governance

CSR Committee

CSR Committee provides oversight and guidance on CSR performance and monitors compliance with the CSR Policy, commitments and the applicable
CSR provisions and if required make necessary recommendations to the Board, from time to time

Leadership Team

Leadership Team works with the Management Committee and meets periodically to discuss the progress of CSR initiatives including implementation,
funding etc. of the projects
Different from HUL, ITC follows a “step-by-step” approach to ensure good governance of their CSR Policy

• The CSR and Sustainability Committee will review, monitor and provide strategic direction to the Company's CSR and sustainability practices
Step-1

• The CSR and Sustainability Committee will place for the approval of the Board of Directors of the Company an annual CSR Action Plan
Step-2

• The Corporate Management Committee (CMC) will ensure that ITC's CSR Programs address major development challenges and are aligned
ITC's CSR Governance

with the priorities of the Government

Step-3

• The Management Committee of the Social Investment Programme (MC-SIP) formed by the CMC implements and monitors the approves CSR
Programs within the specified budgets and timeframes
Step-4

• MC-SIP will provide a report back to the CMC on the progress of the CSR Programs at quarterly intervals or at other frequency
Step-5

• CMC will provide a report back to the CSR and Sustainability Committee on the progress of implementation of the approved CSR Programs
once in 6 months. The CSR Committee will review the report & apprise the Board
Step-6
Agenda

Stakeholder Engagement Mechanisms

CSR Committee Structure

CSR Policy

CSR Strategy

CSR Spending

Impact Analysis
How is it decided if the project will be done internally vs through an agency?

“
Most of our projects are directly implemented, because there are legal nuances when it comes to tying up
with an agency, there are multiple statuary conditions the agency must meet before we can onboard them.
”
- Kanika Pal, South Asia Head, Community Investments &
Sustainability Program @ Unilever

“
If we can execute the projects ourselves, we try to do so. We only collaborate with external partners when
we believe they will add more value to the project than us.
”

- Aswathaman Vijayan, Manager, Sustainability @ ITC

How are the CSR projects chosen?

“
We have an internal framework for assessing the feasibility and benefits of the CSR projects. We typically
see how many people does the project impact, can we do it for a sustained duration, and how easy is it to
exit the project in case we have achieved the objective or want to focus on something more pressing.
”
- Kanika Pal, South Asia Head, Community Investments &
Sustainability Program @ Unilever

“
We choose CSR projects based on comprehensive need assessment surveys. We conduct this survey once a
year to understand what do our stakeholders think about key intervention areas. We have a Corporate
Management Committee (CMC) which helps us identify what are the current challenges in the country, and
what are the government guidelines & priorities.
”
- Aswathaman Vijayan, Manager, Sustainability @ ITC
In the last 7 years, HUL undertook 26 CSR projects; Of these, 70% were implemented directly by HUL, and
75% of the CSR budget was spent on these projects
Directly Running for Amount Spent
# Project Theme
implemented (# of years) (INR Crores)

1 Project Shakti Yes Rural women empowerment 7 329.9

2 Swachh Aadat Swachh Bharat (SASB) Yes Health & hygiene 6 170.0

3 Asha Daan Yes Health & hygiene 7 28.2

4 Sanjivani Yes Health & hygiene 7 4.8

Decreasing order of amount spent

5 Ankur Yes Education 7 2.1

6 Good Life Club Scholarship Yes Education 1 5.0

7 Plastic Waste Management Yes Environment Sustainability 1 3.7

8 Fair & Lovely Foundation Yes Education 1 3.0

9 Environment & SC Sustainability Yes Environment Sustainability 1 2.6

10 Project Sunlight Yes Community development 1 1.1

11 Development & Public Area Maintenance Yes Community development 1 0.9

12 Road Beautification Yes Community development 1 0.6

13 COVID-19 Relief Work Yes Relief Work 2 61.7

In the last 7 years, HUL undertook 26 CSR projects; Of these, 70% were implemented directly by HUL, and
75% of the CSR budget was spent on these projects
Directly Running for Amount Spent
# Project Theme
implemented (# of years) (INR Crores)

14 Contribution to tech business incubators Yes Donation 1 0.2

15 Contribution to medical institutions Yes Donation 1 3.5

16 Fani Cyclone Relief Yes Relief Work 1 2.5

17 CM Relief Fund Yes Relief Work 1 1.0

Decreasing order of amount spent

18 Relief Funds / Save the children - Donation Yes Relief Work 1 0.3

19 Water Conservation Projects No Environment Sustainability 7 145.7

20 Project Prabhat No Community development 7 37.1

21 Solidaridad - Sustainability [Tea Procurement] No Environment Sustainability 3 3.8

22 Domex toilet academy No Health & hygiene 2 3.4

23 Promoting Nutrition & Hygiene No Health & hygiene 1 7.7

24 Suvidha Sanitation Facility No Health & hygiene 1 4.1

25 Safe drinking water No Health & hygiene 1 2.0

26 Handwashing behaviour change programme No Community development 1 0.6

We created our own classification and noticed that of these 26 HUL projects, 7 could be categorized as
“Long-Term”, while 6 as “Funding Heavy”

Long-Term
Water
Project Shakti SASB Asha Daan Sanjivani Ankur Prabhat
(Running for 5+ years)
Conservation

Funding Heavy Water COVID-19

Project Shakti SASB Asha Daan Prabhat
Conservation Relief Work
(Spend of INR 20+ Cr)

Other key highlights

HUL had a major strategy shift in 2016, when it reduced the number of projects from 15 to 8
Other big change was during COVID, when it increased its projects

30% of HUL’s CSR project (8 out of 26) for the FY 2015-21 period were executed by external agencies

One of the external agency was Hindustan Unilever Foundation (HUF)

HUL takes up one of the 8 project, namely the "Water Conservation Projects" which itself has 18+ sub-projects

Projects undertaken with the help of external NGOs (not including HUF) received just 7% of total budget
Surprisingly, till FY-2020, ITC did not clearly differentiate in its annual reports, between the projects which
were implemented directly vs via external agencies

There is one common statement written in the report against nearly

It was only in the FY-2021 report, that ITC clearly indicated a
every CSR project: “Implemented through implementing agencies,
Yes/No regarding Direct implementation of its CSR projects
government, and direct”

Possible reason might be that in FY-2021 reports, project wise CSR

Due to this reason, an analysis of ITC’s CSR projects could not be
expenditure had to be reported in new format, with the Registration
conducted by us for the FY-2015 to FY-2021 duration from the
Number of the implementing agency required to be directly
direct vs implementing agencies categorization perspective, like
reported against every project not implemented directly by the
we did for HUL
company
Agenda

Stakeholder Engagement Mechanisms

CSR Committee Structure

CSR Policy

CSR Strategy

CSR Spending

Impact Analysis
Upon comparing the CSR spendings with PAT & PBT for the 2015-2021 period, we noticed that both, HUL
and ITC, have been calculating their CSR obligations on PAT instead of PBT

Money saved by
CSR Spending
not calculating
for 2015-2021
CSR obligation on
Period
PBT
2015 2016 2017 2018 2019 2020 2021

CSR Obligation (In INR Crore) 79.9 91.9 101.7 112.2 124.2 142.2 161.7
INR 826.0 INR 252.4
Crore % of PBT* 1.5% 1.6% 1.6% 1.7% 1.7% 1.7% 1.7% Crore
% of PAT* 2.0% 2.3% 2.4% 2.4% 2.4% 2.4% 2.3%

2015 2016 2017 2018 2019 2020 2021

CSR Obligation (In INR Crore) 248.9 277.4 275.3 290.5 306.6 326.2 352.8
INR 1913.3 INR 145.4
Crore % of PBT* 2.0% 2.0% 1.9% 1.9% 1.8% 1.8% 1.9% Crore
% of PAT* 2.9% 3.0% 2.8% 2.8% 2.7% 2.5% 2.6%

*: % was calculated on the average PBT and PAT of the last 3 years
“Health & Hygiene” being the common focus area in last 7 years, “Rural women empowerment” has been
HUL’s focus, while “Environmental Sustainability” has been ITC’s focus

Accumulated CSR Spending

for 2015-2021 Period 826.0 Crores 1913.3 Crores

Rural women empowerment 40% Health & hygiene 30%

Environmental sustainability 20%

Health & hygiene 27%
Education 16%

Environment Sustainability 19%

Community development 15%

Relief Work 8% Rural women empowerment 7%

Relief work 7%
Community development 5%

Donation 3%
Education 1%
National heritage 2%

Donation 0% Sports 0%

0% % of CSR Spending 50% 0% % of CSR Spending 50%

During this period, both companies have spent their CSR budget across 20+ projects respectively, across
multiple themes and geographies PAN India

Accumulated CSR Spending

for 2015-2021 Period 826.0 Crores 1913.3 Crores

Project Shakti Swacch Aadat Swacch Bharat Health & sanitation, drinking water, eradication Education, vocational training, livelihood
of poverty promotion

(17%)

(20%) Women empowerment Investment in

academia
Water Conservation Project (3%)
(7%)
(29%) Disaster relief
Agri development
Soil & moisture conservation, social forestry,
wasteland development, solid waste management

(6%)
(18%) National
(40%) heritage
COVID-19 Relief Work
Project Prabhat Asha Daan (8%) (13%) (3%)
Sanjeevani Others
Others
(5%) (4%) (21%)
(2%) (3%) (2%)
Over the years, HUL’s CSR spend on “Rural women empowerment” has reduced; Spending on “Health &
Hygiene” and “Donation” peaked for both companies in 2020-21, due to COVID

Accumulated CSR Spending

for 2015-2021 Period 826.0 Crores 1913.3 Crores

60% 60%

Rural women
empowerment

Health & hygiene

Environment Sus-
tainability

Relief Work

Community
development

Education

Donation

National Heritage 0% 0%
2015 2016 2017 2018 2019 2020 2021 2015 2016 2017 2018 2020 2019 2021
Agenda

Stakeholder Engagement Mechanisms

CSR Committee Structure

CSR Policy

CSR Strategy

CSR Spending

Impact Analysis
How do you calculate the social impact of various CSR projects?

“
We create annual action plans for our CSR engagements. We conduct periodic review for the project
implementations through physical site-visits, or by collecting videos and pictures from the sites.
”
- Kanika Pal, South Asia Head, Community Investments &
Sustainability Program @ Unilever

“
We have to give a status update of the CSR projects to the board in every 6 months. And, we also have a
different Committee which is responsible for monitoring the performance and impact of different
programs. The “Management Committee of the Social Investment Programme” publishes quarterly impact
assessment reports.
”
- Aswathaman Vijayan, Manager, Sustainability @ ITC
HUL CSR activities are predominantly aligned towards improving living conditions, through direct
intervention, of affected people

HUL’s Social Impact

Objective Initiatives UoM 2016-17 2017-18 2018-19

Asha Daan: Taking care of infants, destitute men and women

- Nos. 400 400 400
and HIV-positive patients

Sanjivani: Providing free mobile medical facility in the interior

- Nos. 2.7 Lacs 2.9 Lacs 3.3 Lacs
villages of Assam

Water conservation
liters 100 Billion 200 Billion 300 Billion
Projects

Hindustan Unilever Foundation (HUF): Creation of

Employment Nos. 1 Lac 3.5 Lacs 6 Lacs
cumulative water potential

Biomass production Tons 10 Lacs 24 Lacs 37 Lacs

Project Shakti: Financially empower rural women and create

Women empowerment Nos. 70,000 70,000 72,000
livelihood opportunities for them

GHG emission reduction % 37% 44% 56%

Environment & Sustainability: Reducing the environmental
footprint in areas of greenhouse gases, water and waste across
manufacturing locations with a 2008 baseline
Waste reduction % 43% 57% 88%
While ITC CSR activities are predominantly aligned towards improving the ecology and positively impacting
the society

ITC’s Social Impact

Objective Initiatives UoM 2016-17 2017-18 2018-19

Social Forestry Acres 50,298 49,761 38,916

De-risk poor rural households by diversifying farm portfolios
through the promotion of tree-based farming
Agro Forestry Acres 22,835 26,328 21,553

Integrate diverse elements of the rural portfolio of initiatives into

Area under crop development Acres 45,969 1,43,580 1,50,835
a Climate Smart Village approach

Watershed area Acres 1,27,005 1,45,455 1,36,190

Structures Nos. 1,490 1,534 2,101

Ensure water security for all stakeholders through watershed
development & managed aquifer recharge
Storage potential Lac CuM 32.2 35.7 34.1

Biodiversity conservation Acres 1,250 1,803 2,060

Actively promote non-farm livelihood opportunities to diversify

Women covered cumulatively Nos. 44,239 52,871 54,731
income portfolios of poor households
Thank you!