ITC operates in a diversified, ever-changing, highly competitive global landscape. This necessitates the development of a strong, customer responsive worldclass enterprise premised on a commitment to employee well-being that goes beyond just conforming with relevant local laws to incorporating the best of global standards.

ITC is committed to conducting business in accordance with the highest ethical standards. It expects its employees and business partners to subscribe and adhere to this philosophy, which honours all pertinent laws and upholds the spirit of human rights as enshrined in existing international standards.

Objectives

The Company's primary objectives in this area for the next five years are to ensure that:

• All ITC's operational Units are and will continue to remain fully compliant with the Company's Policies, premised on a zero tolerance guiding principle towards violations in this regard.
• All investment decisions will integrate Human Rights and Decent Labour Practices considerations into the decision-making process.
• All ITC's Business partners and supply chain members will follow and adhere to the Human Rights Policies that the Company upholds.

Accordingly, the Company has put in place Board approved Policies covering crucial aspects of employee engagement and human rights.

Implementation

All ITC Units have instituted appropriate systems and processes to ensure compliance with these Policies and with statutory provisions, including processes to redress grievances. The implementation of these Policies is ensured by Divisional/ Strategic Business Unit Chief Executives, through members of the respective Management Committees. Compliance is regularly monitored and evaluated by the Sustainability Compliance Review Committee (SCRC). The report of the SCRC is reviewed by the Corporate Management Committee every quarter.

Outcomes

ITC's commitment to its employees and their well-being is reflected in its compliance with all its stated Policies, as demonstrated by the performance data presented in this section.

At ITC, we firmly believe that it is our people who strengthen the Organisation and make it exceptional, both in driving world-class performance and in nurturing and enhancing its reputational capital. We operate in a diversified, global and highly competitive landscape where success demands that we proactively pursue higher levels of commitment to human rights and world-class talent management systems and processes. ITC has not only survived for over a century, but has created a unique identity based on the culture of excellence founded on values that are imbibed and visibly demonstrated. Over the years, ITC has created a remarkable Organisation by nurturing a talent pool that is highly motivated, trained and ably supported by various initiatives and a purposive agenda.

We continue to be customer-focused, competition-differentiated, performance-driven and future-capable through a mandate of distributed leadership and differentiated people policies and initiatives. Our commitment to this mandate is demonstrated by our compliance to the processes and rigour of implementation.

ITC's talent management strategy is premised on creating business relevant capabilities to facilitate speedy response to future opportunities. The first is to energise the Organisation for change by building capability in its people through information, knowledge and skills. The second is to guide continuous learning and performance improvement in all functions and businesses. ITC is committed to an integrated and customised talent management approach spanning recruitment, continuous engagement, capability building, leadership development, employee well-being and total rewards. By offering diverse experiences and challenges in various business contexts, ITC has an unparalleled advantage in people practices.

In FY 2016-17, ITC employed 32,337 full-time employees out of which 2329 employees in the Leaf Tobacco Business were engaged on a seasonal basis due to the nature of the business. In addition, 21,841 employees were engaged from service providers in this period.

ITC's talent brand of 'Building Winning Businesses. Building Business Leaders. Creating Value for India' is embodied in our talent management initiatives. Business leadership development is considered integral to talent management. ITC's 'strategy of organisation' - creating multiple drivers of growth through a diverse portfolio of businesses each with its own independent leadership team - serves as an excellent platform to build distributed business leadership. Our Talent Management strategy is focused on building a high quality 'future-ready' pool of managers, specialists and business leaders. Our talent brand exemplifies our commitment to developing managers with functional expertise, leadership capability and a desire to contribute to a larger purpose. As a result of our unique employee centric policies, ITC featured in top 25 places to work in a survey conducted by the leading magazine, Business Today in 2016-17. ITC also ranked among the top 10 companies that MBA students in India want to work with, according to an employer branding survey conducted by Universum Global. The latest Randstand Employer Branding Research 2017 survey recognised ITC as the most attractive employer in FMCG sector. During the year under report, ITC has made significant investments in enhancing the Organisation's recruitment and selection skills and performance management processes, which will positively impact its talent management agenda of building business leaders.

Attrition

The overall attrition (voluntary separation, retirement, termination and abandonment of services) across management and non-management employees for 2016-17 was 18.6%. The attrition for management level employees was 16% whereas the attrition for non-management employees was 19.6%. The gender-wise attrition was at 16.6% and 33.9% for male and female employees respectively. Our efforts are aligned to mitigate attrition in the Organisation by instituting contemporary policies and benchmarking to market best practices. This has led to significant investments towards development and growth of employees, with a market driven and competitive remuneration approach and a renewed focus on performance management.

Learning & Development

In FY 2016-17 we continued to enhance our learning and development processes to create empowered experiences at the workplace. Through concentrated efforts towards enabling capability and talent development, ITC focused on career conversations, skill building and leadership development. Multiple forums for learning include classroom training, e-learning, on-the-job training, inclusion in taskforces and projects, mentoring and deploying organisation-wide IT platforms to enable sharing of best practices. All learning and development initiatives undertaken are aligned to our Vision, Mission, Strategic Agenda and our three horizon growth strategy.

In FY 2016-17, 1,21,653 person days of formal training was undertaken for employees organisation-wide. Customised training curricula were developed for employees across each skill set to build capabilities, thus facilitating them with the necessary skills to succeed. Gurukul, ITC's state-of-theart technical training facility located in Ranjangaon is a significant milestone in its skilling journey for manufacturing set ups and is the first integrated facility catering to its FMCG businesses. Gurukul was conferred the 'Best Corporate University Award', instituted by Leapvault in partnership with the Tata Institute of Social Sciences.

Employee Well-being

Employee Well-being is a core component of our organisational philosophy and we make consistent efforts to ensure that all aspects of an employee's life - physical, mental, emotional and spiritual are positively influenced. Our approach focuses on creating a work environment that enables winning performance with a caring and compassionate work ethos. Full-time Employees of ITC receive benefits such as periodic preventive health check-ups, medical assistance (including hospitalisation), group accident insurance, annual leave along with leave encashment, maternity leave for women employees and retirement benefits, among others. In addition, most Units have a wellness centre and a resident doctor. Out of the 60 women employees who availed maternity leave benefit in FY 2016-17, 46 have rejoined work within the year, resulting in a return to work rate of 76.7%. Various proactive measures were undertaken such as periodic health/medical camps, awareness programmes on a healthy lifestyle, yoga workshops and the development of wellness plans at business unit locations.

Employees also have the opportunity to volunteer for various social programmes through ITC's CSR initiatives. ITC Hotels offers its employees a confidential counselling service to seek professional help in a safe and secure environment in dealing with issues such as developing coping skills to meet life challenges, making important decisions or exploring new avenues for change and growth. Sports and recreational activities for employees and their families are organised periodically. ITC's Agri Business Division - ILTD encourages employees to take individualised health objectives based on BMI and strength and endurance tests. Our TM&D organisation conducts 'Parenting Workshops' so as to address essential needs around child care, nurturing and development. ITC offers best-in-class accommodation, club membership, guest houses, transit flats and holiday home facilities to its employees and their families across locations. Committed to building awareness on occupational diseases, ITC maintains good ergonomics and safety at the workplace.

Employee Voice and Engagement

To capture 'employee voice', a critical component in ensuring employee wellbeing, Units conduct periodic employee engagement surveys wherein employees share their views about the workplace. Results of our employee engagement survey, 'iEngage', conducted in 2016 revealed that 93% of ITC employees were proud to work for ITC - a score which is among the highest globally. The response rate for the organisation wide survey was at a healthy 96% with 100% completion of survey questionnaire by all participants. Improvement areas in managerial capabilities and performance barriers were pursued with focus on building interventions to support and enhance these aspects. Positive organisation-wide changes were accelerated with ownership and action from top management and business leadership.

Guided by fundamental principles of human rights, ITC is committed to protection, respect and elevation of human rights in the Organisation. Our commitment to human rights is long standing and it reflects in our Code of Conduct and is a cornerstone of our corporate policies. During 2016-17, nearly 1650 crores out of total capex cash flow of 3095 crores was incurred on machinery and technology, sourced from reputed global suppliers/vendors. Approximately 883 crores were invested on new factories, hotels and modernisations. All large contracts in ITC, for the construction of hotels, factories and significant upgrades, have incorporated environment, health, safety and human rights clauses covering decent place of work and beyond compliance labour practices. All large projects were managed and supervised by ITC managers, who also ensured compliance to relevant laws. Systems have been established to ensure compliance of our Policies and Standards, through rigorous audits by Corporate Internal Audit.

As a large multi-business enterprise, ITC recognises the responsibility in proactively encouraging high standards of human rights across its supply chain too. As a first step in raising awareness, the ITC Code of Conduct for Vendors and Service Providers is shared with supply chain partners and accepted by identified service providers. A step wise iterative approach is envisaged to establish adherence to Policy on Human Rights, Labour Practices and Decent Work Environment for service providers. During 2016-17, there were 1556 service providers of which 1405 operated within the Company's premises and 151 worked off-site. 100% of service contracts with these service providers include clauses in line with ITC Human Rights Policies and EHS guidelines.

Prohibition of Child Labour and Forced Labour

It is ensured that no person below the age of eighteen years is employed in the workplace and forced labour is prohibited in all Units. The Company does not engage vendors and suppliers who resort to using child and/or forced labour.

Inclusive Workplace

Our policies and work environment are supportive to differently abled employees with focus on creating awareness and opportunities. ITC Hotels Division has been proactively creating awareness on the opportunities for employing differently abled employees among its potential employees. In this endeavour, ITC now employs 78 differently abled persons across business, and continues to guide industry action in creating inclusive workplaces.

Freedom of Association

At ITC, the rights of freedom of association and collective bargaining are recognised and respected. In FY 2016-17, ITC entered into collective bargaining settlements with around 10,809 employees in India.

Diversity and Equal Opportunity

With a diverse and agile workforce across the geographies in India, we are strongly committed to diversity and equality to ensure opportunities based on merit and ability. Our policies ensure a work environment that is free from any form of discrimination in terms of compensation, training and employee benefits, based on caste, religion, disability, gender, sexual orientation, race, colour, ancestry, marital status or affiliation with a political, religious or union organisation or majority/minority group. ITC has put in place suitable processes and mechanisms to ensure issues such as sexual harassment, if any, are effectively addressed. All employees undergo sensitisation training and internal redressal committees are set up across businesses to handle issues.

Grievance Redressal

ITC Units have appropriate systems and processes in place to ensure compliance with these policies and with statutory provisions, including processes to redress grievances. The implementation of these policies are ensured by Divisional Chief Executives, through members of the respective Management Committees. The Company has established suitable processes and mechanisms to ensure that grievances are effectively addressed. The Grievance Redressal Procedure is intended to facilitate open and structured discussions on grievances related to labour practices and human rights to ensure that these are dealt with in a fair and just manner. In FY 2016-17, 445 grievances were received from employees on matters pertaining to policy, welfare and administration and 383 of them have been since resolved.