HINDUSTAN UNILEVER LIMITED

SUBJECT : AUDITING AND CORPORATE GOVERNANCE

COURSE : BCOM (HONS), 6^TH SEMESTER

SUBMITTED TO : MS. ALKA MA’AM

SUBMITTED BY : NIKITA GUPTA , 19/93132 AND

: BHUVESH GOLCHHA, 19/93203

HUL AT A GLANCE

“India’s largest fast moving consumer goods Company, we are driven by our purpose to make sustainable living commonplace.”

85+ years of heritage in the Indian market

Headquarters in Mumbai, Maharashtra

Incorporated in 1933

1,500 suppliers helping to achieve success in the market

₹ 45,311 crore turnover in the financial year 2020-2021

21,000 employees

4500 Distributors helping them to achieve success

50+ brands that are household names

8 million stores sell their products

No. 1 employer in the FMCG industry for 12 years in a row

WIDE RANGE

FOUR BROAD DIVISIONS

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Others

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Products other than Home Care, Beauty & Personal care, Foods and Refreshment.

Our Largest Categories:

Exports and Imports

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(constitutes a little part of portfolio)

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“I believe that nothing can be greater than a business, however small it may be, that is governed by conscience; and that nothing can be meaner or more petty than a business, however large, governed without honesty and without brotherhood.”

– William Hesketh Lever

(39%)

(32%)

(27%)

(39%)

WHAT IS CORPORATE GOVERNANCE ??

Corporate Governance is the system of rules, practices and processes by which a firm is directed and controlled. Corporate governance essentially involves balancing the interests of a company's many stakeholders, such as shareholders, senior management executives, customers, suppliers, financiers, the government, and the community.

PRINCIPLES

Transparency

Independence�

Accountability�

Responsibility�

Fairness�

Discipline�

Social responsibility

LEADERSHIP

AUDIT COMMITTEE

The audit committee performs the following functions-

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• reviewing the functioning of the Code of the Company and Whistle-Blowing Mechanism
• overseeing the Company’s financial reporting process
• reviewing, approving or subsequently modifying any Related Party Transactions
• recommending the appointment, remuneration and terms of appointment of Statutory Auditors of the Company
• reviewing and monitoring the auditor’s independence and performance and effectiveness of audit process;
• assessing management letters/letters of internal control weaknesses issued by the Statutory Auditors
• reviewing the adequacy of internal audit function
• evaluating internal financial controls, internal and risk management systems

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INTERNAL CONTROLS AND RISK MANAGEMENT

• The Company has an independent Internal Audit Department primarily assisted by outsourced

audit teams for Internal Audit and Corporate Risk assessment and mitigation.

• The conduct of Internal Audit is oriented towards the review of internal controls and risks in the

Company’s operations.

• Business Risk Assessment is an ongoing process to track the evolution of risks and delivery of mitigating action plans.
• The Company’s internal financial controls framework is based on the ‘three lines of defense model
• The Management, Statutory and Internal Auditors undertake rigorous testing of the control environment of the Company

NOMINATION AND REMUNERATION COMMITTEE

The Nomination and Remuneration Committee is responsible for evaluating the balance of skills, experience,

independence, diversity and knowledge on the Board and for drawing up selection criteria, ongoing succession

planning and appointment procedures for both internal and external appointments.

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The role of Nomination and Remuneration Committee, includes:

• the criteria for appointment, qualification of Directors
• Review, determine and Recommend to the Board about all elements of remuneration package
• Formulate criteria and carry out evaluation

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STAKEHOLDER RELATIONSHIP COMMITTEE

The role of Stakeholders’ Relationship Committee includes resolving the grievances of shareholders, ensuring expeditious share transfer process in line with the proceedings of the Share Transfer Committee, evaluating performance and service standards of the Registrar and Share Transfer Agent of the Company.

The Committee shall take steps to develop an understanding of the views of shareholders about the Company, either through direct face-to-face contact, analysts’ briefings or survey of shareholders.

Details of Shareholders’/Investors’ Complaints-

During the financial year ended 31st March, 2021, 124 complaints were received from the shareholders. All complaints have been redressed to the satisfaction of the shareholders.

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• The company has adopted a code of conduct for the members of the board and members of the management committee of the company.
• The code also restricts the directors from accepting any gifts or incentives in their capacity as director.
• To comply with all applicable rules, regulations and laws.
• Refrain from using company’s position or property for personal gain
• To act in good faith, responsibly with due care, competence, without allowing their

independent judgement to be subordinated.

• Not to use confidential information acquired in the course of their service as directors for

their personal advantage.

CODE OF CONDUCT

CORPORATE SOCIAL RESPONSIBILITY

The role of CSR Committee includes formulating and recommending to the Board the CSR Policy and activities to be undertaken by the Company, recommending the amount of expenditure to be incurred on CSR activities of the Company, reviewing the performance of Company in the areas of CSR.

INITIATIVES

Water

Conservation

Projects

Project

Shakti

Swachh

Aadat

Swacch

Bharat

Prabhat

Promoting

Nutrition

And

Hygiene

Sanjeevani

PM

Relief

Fund

Disaster

Management

Covid-19

Relief

Fund

Promoting

Research & development, education

Plastic

Waste

Management

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CORPORATE POLICIES

• Code of Business Principles
• Whistle–Blower Policy
• Policy on dealing with Related Parties
• Policy on Material Subsidiary
• Policy on avoiding Conflict of Interest
• Policy on Dividend Distribution
• Share Dealing Code
• Reward Policy

FINANCIAL HIGHLIGHTS FROM LAST 10 YEARS

2010-11

2021-22

(Tentative)

DISCLOSURES

Disclosure mentioned on website:

1. Details of business of the company
2. Terms and conditions of appointment of independent directors
3. Composition of various committees of board of directors
4. Policy for determination of materiality of events;
5. Code of conduct for board of directors and senior management personnel
6. Details of establishment of vigil mechanism/ whistle–blower policy
7. Details of familiarisation programmes imparted to independent directors
8. Policy on dealing with related party transactions;

Disclosure of pending cases/instances of non-compliance