Tata Consultancy Services Directors Report, TCS Reports by Directors

Tata Consultancy Services

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Directors Report Year End : Mar '15    Mar 14
To the members,
 The directors submit annual report of Tata Consultancy Services Limited
 (the Company or TCS) along with the audited financial statements
 for the financial year ended March 31, 2015. Consolidated performance
 of the Company and its subsidiaries has been referred to wherever
 1. Financial results
                                                         (Rs. crores)
                                Unconsolidated          Consolidated
                             2014-15    2013-14    2014-15    2013-14
 Revenue from operations    73,578.06   64,672.93  94,648.41  81,809.36
 Operating expenditure      52,549.86   43,139.21  70,166.70  56,656.57
 Earnings before interest, 
 tax, depreciation and
 amortisation (EBITDA)      21,028.20   21,533.72  24,481.71  25,152.79
 Other income (net)          4,466.73    3,114.71   3,229.91   1,636.74
 Finance costs                  79.57       23.41     104.19      38.52
 Depreciation and 
 amortisation expense        1,393.77    1,080.55   1,798.69   1,349.15
 Profit before exceptional 
 item and tax               24,021.59   23,544.47  25,808.74  25,401.86
 Exceptional item              528.38       -         489.75       - 
 Profit before tax (PBT)    24,549.97   23,544.47  26,298.49  25,401.86
 Tax expense                 5,293.01    5,069.55   6,238.79   6,069.99
 Profit for the year before 
 minority interest          19,256.96   18,474.92  20,059.70  19,331.87
 Minority interest              -           -         207.52     168.00
 Profit for the year (PAT)  19,256.96   18,474.92  19,852.18  19,163.87
 Adjustment for amalgamation 
 of acquired subsidiaries       71.78    2,375.22       -           -
 Balance brought forward 
 from previous year         36,420.45   24,602.85  39,504.51  29,529.97
 Amount available for 
 appropriation              55,749.19   45,452.99  59,356.69  48,693.84
 Interim dividends on 
 equity shares 
 (excluding tax)            10,772.92    2,349.87  10,772.92   2,349.87
 Proposed dividend on 
 equity shares 
 (excluding tax)             4,700.95    3,917.46   4,700.95   3,917.46
 Dividend on redeemable 
 preference shares 
 (excluding tax)                 -          28.76       -         28.76
 Tax on dividends (interim 
 and proposed)               2,591.54      788.96   2,635.69     795.68
 Write back of tax on 
 dividends of prior year       (20.97)        -       (20.97)        -
 Capital redemption reserve      -         100.00     255.57     157.12
 General reserve             1,925.69    1,847.49   1,953.64   1,883.41
 Statutory reserve               -            -        46.24      57.03
 Balance carried to 
 balance sheet              35,779.06   36,420.45  39,012.65  39,504.51
                                     (Rs. 1 crore = Rs. 10 million)
 2. Dividend
 Based on the Company''s performance, the directors are pleased to
 recommend for approval of the members a final dividend of Rs. 24 per
 share for the financial year 2014-15 taking the total dividend to Rs. 79
 per share (previous year Rs. 32 per share), including a special dividend
 of Rs. 40 per share. The final dividend on equity shares, if approved by
 the members would involve a cash outflow of Rs. 5,640.86 crores including
 dividend tax. The total dividend on equity shares including dividend
 tax for the financial year 2014-15 would aggregate Rs. 18,065.41 crores
 (including special dividend and tax thereon), resulting in a payout of
 93.81% and Rs. 8,877.98 crores (excluding special dividend and tax
 thereon), resulting in a payout of 46.10% of the unconsolidated profits
 of the Company.
 3. Transfer to reserves
 The Company proposes to transfer Rs. 1,925.69 crores to the general
 reserve out of the amount available for appropriation and an amount of
 Rs. 35,779.06 crores is proposed to be retained in the profit and loss
 4. Company''s performance
 On consolidated basis, revenue from operations for the financial year
 2014-15 at Rs. 94,648.41 crores was higher by 15.69% over last year (Rs.
 81,809.36 crores in 2013-14). Earnings before interest, tax,
 depreciation and amortisation (EBITDA) was Rs. 27,109.62 crores excluding
 a significant adjustment for one-time employee reward, registering a
 growth of 7.78% over EBITDA of Rs. 25,152.79 crores in 2013-14. The
 reported EBITDA aggregated Rs. 24,481.71 crores. Profit after tax (PAT)
 for the year was Rs. 21,911.85 crores excluding the said one-time
 adjustment for employee reward recording a growth of 14.34% over the
 PAT of Rs. 19,163.87 crores in 2013-14.  The reported PAT aggregated Rs.
 19,852.18 crores.
 On unconsolidated basis, revenue from operations for the financial year
 2014-15 at Rs. 73,578.06 crores, was higher by 13.77% over last year (Rs.
 64,672.93 crores in 2013-14). Earnings before interest, tax,
 depreciation and amortisation (EBITDA) was Rs. 23,354.62 crores excluding
 the one-time employee reward registering a growth of 8.46% over the
 EBITDA of Rs. 21,533.72 crores in 2013-14. The reported EBITDA aggregated
 Rs. 21,028.20 crores.  Profit after tax (PAT) for the year was Rs.
 21,091.43 crores excluding the said one-time adjustment stated above
 recording a growth of 14.16% over the PAT of Rs. 18,474.92 crores in
 2013-14. The reported PAT aggregated Rs. 19,256.96 crores.
 5. Human resource development
 Evolution of digital forces has transformed the way we live and work.
 TCS has built a digital and vivacious workplace which goes beyond
 constraints of time and distance. This reimagined workplace has enabled
 employees to interact and collaborate better with each other, thereby
 facilitating bonding of the global talent pool and building One TCS
 culture. ''Knome'', one of the interaction platforms, has transcended
 beyond just interaction platform to become an effective tool driving
 transparency, policy changes and even experimenting and crowd sourcing.
 It has transformed the way TCSers interact socially or professionally.
 The Company continues to grow its global scale and footprint with a
 diverse talent base of 319,656 employees representing 122
 nationalities, deployed across 55 countries. From gender diversity
 point of view, the Company is one of the largest employers of women
 with 105,481 women employees and a number of senior positions held by
 women leaders. Efficient systems, processes and continuous investments
 in technology helps the Company manage this scale and complexity of a
 large, distributed and diverse workforce.
 The Company has hired and integrated 67,123 employees across the globe
 in FY 2014-15. Through its Academic Interface Program (AIP), the
 Company continues its efforts to strengthen relationship with key
 institutes globally.
 The Company continues its focus on retention through employee
 engagement initiatives and provides a holistic environment where
 employees get opportunities to realize their potential. ''Career Hub''
 captures the career aspirations of employees and offers a framework to
 shape and propel their careers. ''Anytime and Anywhere'' learning,
 reinforced through the digital learning ecosystem, help employees to
 build their competencies across domains and technologies. Company''s
 performance driven culture helps and motivates employees to excel in
 their respective areas and progress within the organization.
 Company''s Health and Safety Policy commits to provide a healthy and
 safe work environment to all employees.  Company''s ''Fit4life''
 initiative creates a culture of fitness in the organization by helping
 to build a fraternity of health and fitness conscious employees.
 ''SafetyFirst'' initiative was launched to make Safety and Wellbeing a
 part of the Company''s culture and to change employee behaviour and
 attitude to safety. From self-defence classes to using technology to
 track vehicles transporting our employees, this initiative promotes
 several other safety campaigns across the organization to improve
 safety awareness. Each and every TCSer is urged to reflect on the need
 to ensure personal safety and security at all times and make sure
 colleagues are safe too.
 The Company also launched ''Purpose4life'' initiative to consolidate the
 employee volunteering programs for social cause under one umbrella so
 that larger programs which empower people to lead a better life could
 be taken up.
 Employee inputs from PULSE, TCS'' annual global employee satisfaction
 and engagement survey, are analyzed to gain necessary insight into the
 needs of the diverse workforce. This helps the Company to design new
 interventions and take necessary steps to enhance the engagement level.
 The Company''s progressive workforce policies and benefits, various
 employee engagement and welfare initiatives like Maitree and Employee
 Assistance Program, have addressed stress management, promoted work
 life balance and helped the Company maintain a low attrition which was
 14.9% during this year.
 6. Quality initiatives
 Sustained commitment to highest levels of quality, best-in-class
 service management, robust information security practices and mature
 business continuity processes helped the Company attain significant
 milestones during the year.
 The Company continues to maintain the enterprise-wide highest maturity
 Level 5 for CMMI-DEV (Development) version 1.3. The Company was
 re-assessed enterprise-wide at the highest maturity Level 5 for
 CMMI-SVC (Services) version 1.3.
 The Company successfully achieved the annual enterprise-wide ISO
 certification for ISO 20000:2011 (Service Management), ISO 9001:2008
 (Quality Management), ISO 27001:2013 (Security Management) and ISO
 22301:2012 (Business Continuity Management).
 The Company is enterprise-wide certified for ISO 14001:2004
 (Environmental Management) and BS OHSAS 18001:2007 (Occupational Health
 and Safety Management) which demonstrates TCS'' strong commitment to the
 environment and the occupational health and safety of its employees and
 business partners.  The Company also continues to maintain the industry
 specific quality certifications viz., AS 9100 (Aerospace Industry), ISO
 13485 (Medical Devices) and TL 9000 (Telecom Industry).
 The cornerstone of these certifications is TCS'' integrated quality
 management system (iQMS), a global process- driven and
 customer-focused system which provides ''One Global Service Standard''.
 iQMSTM is the backbone that supports TCS'' global network delivery model
 At the annual ''Knowledge Management'', India summit, hosted by the
 Confederation of Indian Industries (CII) in March 2015, the Company was
 recognized as India''s ''Most Admired Knowledge Enterprise'' (MAKE) winner
 (1st place) for a third successive year. The Company has received the
 prestigious MAKE award for the 10th time in India as well as Asia. The
 Company also received the Global Independent Operating Unit (IOU) MAKE
 award for the 5th time in a row.
 In December 2014, the Company received the ''Excellence Award'' in
 information security in the large IT Service category by the Data
 Security Council of India (DSCI).
 7. Subsidiary companies
 The Company has 60 subsidiaries as on March 31, 2015. There are no
 associate companies within the meaning of Section 2(6) of the Companies
 Act, 2013 (Act). There has been no material change in the nature of
 the business of the subsidiaries.
 Pursuant to provisions of Section 129(3) of the Act, a statement
 containing salient features of the financial statements of the
 Company''s subsidiaries in Form AOC-1 is attached to the financial
 statements of the Company.  Pursuant to the provisions of section 136
 of the Act, the financial statements of the Company, consolidated
 financial statements along with relevant documents and separate audited
 accounts in respect of subsidiaries, are available on the website of
 the Company.
 TCS Foundation was incorporated as wholly-owned subsidiary of the
 Company on March 13, 2015 under Section 8 of the Act with the sole
 objective of undertaking Corporate Social Responsibility (CSR)
 activities of the Company and its subsidiaries.
 During the year, the process of closure of following wholly-owned
 subsidiaries, which were not in operation, was completed:
 a. Tata Consultancy Services Morocco SARL AU (w.e.f. May 30, 2014)
 b. Computational Research Laboratories Inc. ( w.e.f. February 18, 2015)
 c. TCS Management Pty Ltd. (w.e.f. March 23, 2015).
 During the year, operations of following subsidiaries were reviewed and
 a restructuring process was carried out:
 a. CMC Limited
 At the respective meetings held on October 16, 2014, the Boards of the
 Company and its subsidiary CMC Limited (CMC) have approved a scheme of
 amalgamation between the Company and CMC (Scheme) proposing
 amalgamation of CMC with the Company under Sections 391 to 394 of the
 Companies Act, 1956. The appointed date for the proposed scheme is
 April 1, 2015.
 Pursuant to an Order of the High Court of Judicature at Bombay, a
 meeting of the equity shareholders of the Company has been scheduled on
 April 28, 2015, for the purpose of seeking approval of the shareholders
 for the Scheme. The shareholders of CMC have, at their meeting held on
 March 5, 2015, duly approved the Scheme.
 The Company holds 51.12% stake in CMC. CMC is engaged in procurement,
 installation, commissioning and maintenance of computer and networking
 systems, providing education and training, designing, developing and
 implementing software technologies and applications as well as
 providing professional services in India and overseas.
 The amalgamation will enable the Company to consolidate CMC''s
 operations in a single company with rationalized structure, enhanced
 reach and greater financial strength.
 As per the terms of the Scheme, shareholders of CMC will receive 79
 equity shares of Rs. 1 each of the Company for 100 equity shares of Rs. 10
 each of CMC. The swap ratio has been arrived at based on the valuation
 report prepared by B.S.R. & Associates LLP. The Scheme is subject to
 court, regulatory, shareholders and other necessary approvals. If
 approved, the paid-up share capital of the Company, will increase from
 Rs. 195.87 crores to Rs. 197.04 crores.
 b. WTI Advanced Technology Limited
 Pursuant to the Scheme of Amalgamation sanctioned by the Hon''ble High
 Court of Bombay vide its order dated March 27, 2015, WTI Advanced
 Technology Limited (WTI) was amalgamated with the Company with effect
 from appointed date, April 1, 2014. Consequently, the entire business,
 assets, liabilities, duties and obligations of WTI have been
 transferred to and vested in the Company with effect from April 1,
 WTI was engaged in information technology and information technology
 engineering services mainly comprising geographic information systems,
 computer aided design, engineering services and business associate
 services which are complementary to the business of the Company.
 c. Tata Consultancy Services Japan, Limited
 Nippon TCS Solution Center Limited, IT Frontier Corporation (ITF) and
 Tata Consultancy Services Japan Limited merged on July 1, 2014 to form
 a consolidated entity - Tata Consultancy Services Japan, Limited,
 wherein Tata Consultancy Services Asia Pacific Pte. Limited (a
 wholly-owned subsidiary of the Company) holds 51% stake and Mitsubishi
 Corporation holds the balance 49% stake. ITF, a subsidiary of
 Mitsubishi, brings its long standing relationships with Japanese
 corporations, talented workforce and competencies in industries like
 retail, distribution and trading.
 This strategic alliance with Mitsubishi has enabled the Company to
 leverage the mutual strengths in Japanese market to have scale, strong
 local presence and capability to offer full range of TCS'' global
 services to Japanese customers and accelerate growth in Japan market.
 d. Tata Consultancy Services (Africa) (Pty) Limited
 On September 16, 2014, the Company acquired additional 40% ownership
 interest in Tata Consultancy Services (Africa) (Pty) Limited (TCS
 Africa) from Tata Africa Holdings (SA) Pty Limited and thereby making
 TCS Africa a wholly owned subsidiary of the Company. TCS Africa is the
 holding company of Tata Consultancy Services (South Africa) (Pty)
 Limited, which is engaged in IT services and consulting business
 catering to the customers in South Africa region.
 8. Directors'' responsibility statement
 Pursuant to Section 134(5) of the Companies Act, 2013, the board of
 directors, to the best of their knowledge and ability, confirm that:
 i. in the preparation of the annual accounts, the applicable accounting
 standards have been followed and there are no material departures;
 ii. 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 of the
 Company for that period;
 iii. they have taken proper and sufficient care for the maintenance of
 adequate accounting records in accordance with the provisions of the
 Act for safeguarding the assets of the Company and for preventing and
 detecting fraud and other irregularities;
 iv. they have prepared the annual accounts on a going concern basis;
 v. they have laid down internal financial controls to be followed by
 the Company and such internal financial controls are adequate and
 operating effectively;
 vi. they have devised proper systems to ensure compliance with the
 provisions of all applicable laws and that such systems were adequate
 and operating effectively.
 Based on the framework of internal financial controls and compliance
 systems established and maintained by the Company, work performed by
 the internal, statutory and secretarial auditors and external
 consultants and the reviews performed by management and the relevant
 board committees, including the audit committee, the board is of the
 opinion that the Company''s internal financial controls were adequate
 and effective during the financial year 2014-15.
 9. Directors and key managerial personnel
 Mr. S. Ramadorai, Vice Chairman, stepped down from the Board of the
 Company on October 6, 2014 on attaining the age of 70 years as per the
 Company''s policy. He was associated with the Company for over four
 decades in various capacity. Under his leadership as Chief Executive
 Officer and Managing Director, TCS was transformed into a global
 software company. The Board places on record its appreciation of the
 invaluable contribution and guidance provided by him.
 Pursuant to the provisions of Section 149 of the Act, which came into
 effect from April 1, 2014, Mr. Aman Mehta, Mr. V. Thyagarajan, Prof.
 Clayton M. Christensen, Dr. Ron Sommer, Dr. Vijay Kelkar and Mr. O. P.
 Bhatt were appointed as independent directors at the annual general
 meeting of the Company held on June 27, 2014. The terms and conditions
 of appointment of independent directors are as per Schedule IV of the
 Act. They have submitted a declaration that each of them meets the
 criteria of independence as provided in Section 149(6) of the Act and
 there has been no change in the circumstances which may affect their
 status as independent director during the year.
 Mr. Cyrus Mistry retires by rotation and being eligible has offered
 himself for re-appointment.
 During the year, the non-executive directors of the Company had no
 pecuniary relationship or transactions with the Company.
 Mr. N. Chandrasekaran was appointed the Chief Executive Officer and
 Managing Director of the Company for a period of five years with effect
 from October 6, 2009. The Board of Directors at its Meeting held on
 September 3, 2014, has re-appointed him as the Chief Executive Officer
 and Managing Director of the Company for a further period of five years
 from October 6, 2014, subject to the approval of the members.
 As part of leadership development, Ms. Aarthi Subramanian was appointed
 as Additional Director with effect from March 12, 2015. The Board has
 also appointed her as Executive Director with effect from the same date
 for a period of three years. She is the Global Head of Delivery
 Excellence Group responsible for governance of service delivery,
 compliance and risk management. Ms. Aarthi Subramanian holds a B. Tech
 in Computer Science and a Masters in Engineering Management from
 University of Kansas (USA) and has over 25 years of experience across
 multiple industry solutions in different markets.
 The resolutions seeking approval of the Members for the appointment of
 Mr. N. Chandrasekaran and Ms. Aarthi Subramanian have been incorporated
 in the notice of the forthcoming annual general meeting of the Company
 along with brief details about them. The Company has received a notice
 under Section 160 of the Act along with the requisite deposit proposing
 the appointment of Ms. Aarthi Subramanian.
 Pursuant to the provisions of Section 203 of the Act, which came into
 effect from April 1, 2014, the appointments of Mr. N. Chandrasekaran,
 Chief Executive Officer and Managing Director, Mr. Rajesh Gopinathan,
 Chief Financial Officer and Mr. Suprakash Mukhopadhyay, Company
 Secretary as key managerial personnel of the Company were formalised.
 10. Number of meetings of the board
 Seven meetings of the board were held during the year. For details of
 the meetings of the board, please refer to the corporate governance
 report, which forms part of this report.
 11. Board evaluation
 The board of directors has carried out an annual evaluation of its own
 performance, Board committees and individual directors pursuant to the
 provisions of the Act and the corporate governance requirements as
 prescribed by Securities and Exchange Board of India (SEBI) under
 Clause 49 of the Listing Agreements (Clause 49).
 The performance of the Board was evaluated by the Board after seeking
 inputs from all the directors on the basis of the criteria such as the
 Board composition and structure, effectiveness of board processes,
 information and functioning, etc.
 The performance of the committees was evaluated by the board after
 seeking inputs from the committee members on the basis of the criteria
 such as the composition of committees, effectiveness of committee
 meetings, etc.
 The Board and the Nomination and Remuneration Committee (NRC)
 reviewed the performance of the individual directors on the basis of
 the criteria such as the contribution of the individual director to the
 Board and committee meetings like preparedness on the issues to be
 discussed, meaningful and constructive contribution and inputs in
 meetings, etc. In addition, the Chairman was also evaluated on the key
 aspects of his role.
 In a separate meeting of independent Directors, performance of
 non-independent directors, performance of the board as a whole and
 performance of the Chairman was evaluated, taking into account the
 views of executive directors and non-executive directors. The same was
 discussed in the board meeting that followed the meeting of the
 independent Directors, at which the performance of the Board, its
 committees and individual directors was also discussed.
 12. Policy on directors'' appointment and remuneration and other details
 The Company''s policy on directors'' appointment and remuneration and
 other matters provided in Section 178(3) of the Act has been disclosed
 in the corporate governance report, which forms part of the directors''
 13. Internal financial control systems and their adequacy
 The details in respect of internal financial control and their adequacy
 are included in the Management Discussion & Analysis, which forms part
 of this report.
 14. Audit committee
 The details pertaining to composition of audit committee are included
 in the Corporate Governance Report, which forms part of this report.
 15. Auditors
 Pursuant to the provisions of Section 139 of the Act and the rules
 framed thereunder, Deloitte Haskins & Sells LLP, (''DHS LLP''), Chartered
 Accountants, were appointed as statutory auditors of the Company from
 the conclusion of the nineteenth annual general meeting (AGM) of the
 Company held on June 27, 2014 till the conclusion of the twenty second
 AGM to be held in the year 2017, subject to ratification of their
 appointment at every AGM.
 16. Auditors'' report and secretarial auditors'' report
 The auditors'' report and secretarial auditors'' report does not contain
 any qualifications, reservations or adverse remarks. Report of the
 secretarial auditor is given as an annexure which forms part of this
 17. Risk management
 The Board of the Company has formed a risk management committee to
 frame, implement and monitor the risk management plan for the Company.
 The committee is responsible for reviewing the risk management plan and
 ensuring its effectiveness. The audit committee has additional
 oversight in the area of financial risks and controls. Major risks
 identified by the businesses and functions are systematically addressed
 through mitigating actions on a continuing basis.
 The development and implementation of risk management policy has been
 covered in the management discussion and analysis, which forms part of
 this report.
 18. Particulars of loans, guarantees and investments
 The particulars of loans, guarantees and investments have been
 disclosed in the financial statements.
 19. Transactions with related parties
 None of the transactions with related parties falls under the scope of
 Section 188(1) of the Act. Information on transactions with related
 parties pursuant to Section 134(3)(h) of the Act read with rule 8(2) of
 the Companies (Accounts) Rules, 2014 are given in Annexure I in Form
 AOC-2 and the same forms part of this report.
 20. Corporate social responsibility
 The brief outline of the Corporate Social Responsibility (CSR) Policy
 of the Company and the initiatives undertaken by the Company on CSR
 activities during the year are set out in Annexure II of this report in
 the format prescribed in the Companies (Corporate Social Responsibility
 Policy) Rules, 2014. The policy is available on the website of the
 21. Extract of annual return
 As provided under Section 92(3) of the Act, the extract of annual
 return is given in Annexure III in the prescribed Form MGT-9, which
 forms part of this report.
 22. Particulars of employees
 The information required under Section 197 of the Act read with rule
 5(1) of the Companies (Appointment and Remuneration of Managerial
 Personnel) Rules, 2014 are given below:
 c. The percentage increase in the median remuneration of employees in
 the financial year: 4.6%
 d. The number of permanent employees on the rolls of Company: 319,656
 e. The explanation on the relationship between average increase in
 remuneration and Company performance:
 On an average, employees received an annual increase of 10% in India.
 The individual increments varied from 6% to 14%, based on individual
 Employees outside India received wage increase varying from 2% to 6%.
 The increase in remuneration is in line with the market trends in the
 respective countries. In order to ensure that remuneration reflects
 Company performance, the performance pay is also linked to organization
 performance, apart from an individual''s performance.
 i. Average percentile increase already made in the salaries of
 employees other than the managerial personnel in the last financial
 year and its comparison with the percentile increase in the managerial
 remuneration and justification thereof and point out if there are any
 exceptional circumstances for increase in the managerial remuneration:
 The average annual increase was around 10%. However, during the course
 of the year, the total increase is approximately 14%, after accounting
 for promotions and other event based compensation revisions.
 Increase in the managerial remuneration for the year was 13.9%.
 k. The key parameters for any variable component of remuneration
 availed by the directors:
 The members have, at the AGM of the Company on June 27, 2014 approved
 payment of commission to the non-executive directors within the ceiling
 of 1% of the net profits of the Company as computed under the
 applicable provisions of the Act. The said commission is decided each
 year by the board of directors and distributed amongst the
 non-executive directors based on their attendance and contribution at
 the board and certain committee meetings, as well as the time spent on
 operational matters other than at meetings.
 l. The ratio of the remuneration of the highest paid director to that
 of the employees who are not directors but receive remuneration in
 excess of the highest paid director during the year:
 m. Affirmation that the remuneration is as per the remuneration policy
 of the Company:
 The Company affirms remuneration is as per the remuneration policy of
 the Company.
 n. The statement containing particulars of employees as required under
 Section 197(12) of the Act read with Rule 5(2) of the Companies
 (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is
 provided in a separate annexure forming part of this report. Further,
 the report and the accounts are being sent to the members excluding the
 aforesaid annexure. In terms of Section 136 of the Act, the said
 annexure is open for inspection at the Registered Office of the
 Company. Any shareholder interested in obtaining a copy of the same may
 write to the Company Secretary.
 23. Disclosure requirements
 As per Clause 49 of the listing agreements entered into with the stock
 exchanges, corporate governance report with auditors'' certificate
 thereon and management discussion and analysis are attached, which form
 part of this report.
 As per Clause 55 of the listing agreements entered into with the stock
 exchanges, a business responsibility report is attached and forms part
 of this annual report.
 Details of the familiarization programme of the independent directors
 are available on the website of the Company (URL:
 Policy for determining material subsidiaries of the Company is
 available on the website of the Company (URL:
 Policy on dealing with related party transactions is available on the
 website of the Company (URL:
 The Company has formulated and published a Whistle Blower Policy to
 provide Vigil Mechanism for employees including directors of the
 Company to report genuine concerns. The provisions of this policy are
 in line with the provisions of the Section 177(9) of the Act and the
 revised Clause 49 of the Listing Agreements with stock exchanges (URL:
 24. Deposits from public
 The Company has not accepted any deposits from public and as such, no
 amount on account of principal or interest on deposits from public was
 outstanding as on the date of the balance sheet.
 25. Conservation of energy, technology absorption, foreign exchange
 earnings and outgo Conservation of energy:
 TCS continues to work on reducing carbon footprint in all its areas of
 operations through initiatives like (a) green infrastructure,^) green
 IT (data centers, laptops and servers etc, (c) operational energy
 efficiency, (d) procurement of renewable energy through onsite solar
 power generating units. TCS continues to add LEED certified green
 buildings to its real estate portfolio. Green data center continues to
 be a focus area with data center power management initiative extended
 to 23 key data centers. FY15 saw operational efficiency emerging as a
 main pillar for achieving the target. TCS leveraged its IT capabilities
 with the remote energy monitoring centre (REMC) initiative, involving
 real time monitoring and controls aided by smart meters and MIS, to
 optimise the operational energy efficiency across its offices. The
 initiative covered 90 TCS offices which account for over 98% of our
 total power consumption. The estimated savings achieved in the FY15 was
 approximately 10 million units. TCS was recognised for its commitment
 to climate change management and improvement in carbon performance with
 inclusion in the Global 500 Carbon Performance Leadership Index (CPLI)
 2014 published by CDP. This is the second year in a row that TCS has
 been included in this prestigious index.
 TCS has enterprise wide certification under IS0 14001:2004
 (Environmental Management System) for its 100 offices globally.
 Data on reduction in energy consumption and consequent reduction in
 carbon footprint have been provided in the Business Responsibility
 Technology absorption, adaption and innovation:
 The Company continues to use the latest technologies for improving the
 productivity and quality of its services and products. The Company''s
 operations do not require significant import of technology.
 Research and Development (R&D): Specific areas in which R&D was carried
 out by the Company
 As the digital customer is disrupting business models in several
 industries today, TCS research and innovation teams are working with
 business units on meeting this challenge.
 Two key business units, banking & financial services and insurance &
 healthcare will have their own innovation units on the established 4E
 model. This will help the Company to scale up innovation in these
 specific domains in a structured way, supplementing innovation at the
 corporate level. The Company hopes to deploy innovation management in
 other industry units in a phased manner.
 ''Intelligent Cities'' initiative has grown this year to meet the needs
 of several global governments looking for
 intelligent infrastructures. TCS iCity Lab, in collaboration with
 Singapore Management University has achieved its major research
 objectives across the intelligent city domain, including citizen
 frameworks for ageing and chronic disease management, as well as
 personalised community healthcare services.
 To enable better user experience TCS'' ''Accessibility CoE'' released a
 set of tools based on universal design.  TCS innovation has invested in
 an application programming interfaces (APIs) initiative as APIs are
 seen as the building blocks of a digital enterprise.
 Several TCS explore projects in research areas of software,
 applications and systems progressed creating more IPR for the Company.
 In the software area, researchers are mining operational process models
 to facilitate training and transformation and also modelling human
 behaviour in the workplace. Research in the applications area deepened
 explorations in several areas including ''Enterprise Contextual
 Intelligence'', ''Digital Health'' and ''Digital Manufacturing''. The
 systems research team worked on ''Analytics as a Service'', ''Human
 Sensing'', ''Performance Prediction and Optimization'' among other things.
 Many mature projects have moved from research to business.  One example
 of close coupling of TCS research and business is: TCS Research''s
 ''Energy Carbon View Tool'' and engineering and industrial services
 unit''s ''Data Acquisition and Management System'' have together been
 implemented in more than 75 buildings to monitor and save energy.
 TCS researchers published 300  quality papers in various journals and
 conferences. 509 patents were filed this year taking the tally of filed
 patents to 2,277. Total number of granted patents is 206.
 TCS ''Co-Innovation Network'' has expanded its footprint to include
 Canada, Finland, Israel and the London Financial Technologies (FinTech)
 hubs. Many co-innovation events including a start-up boot camp for
 FinTech companies was held this year. TCS research scholar programme is
 supporting 200 PhD scholars and the programme has been extended for the
 next five years.
 TCS research has been socialized well in FY15. Our flagship event in
 North America, The ''TCS Innovation Forum 2014'', was well received with
 185 clients and partners attending, ''TCS Evangelize'' held 39 innovation
 days and workshops for customers. TCS continues to be in Forbes list of
 Top 100 innovation companies. It scored 96 percentile in innovation
 management on the Dow Jones Sustainability Index. A ''TCS Research
 Solution'' won the best demo award for mobile based blood pressure
 monitor at SenSys 2014, Memphis, USA. TCS was placed in CII''s
 Industrial Innovation Awards List for 2014.
 Looking forward, TCS R&D will deepen exploration in current areas of
 research that have yielded benefits to customers and explore new areas
 in software, applications and systems.
 Expenditure on R&D
 TCS innovation labs are located in India and other parts of the world.
 These R&D centers, as certified by Department of Scientific &
 Industrial Research (DSIR) function from Pune, Chennai, Bengaluru,
 Delhi- NCR, Hyderabad, Kolkata and Mumbai.
 26. Acknowledgement
 The directors thank the Company''s employees, customers, vendors,
 investors and academic institutions for their continuous support.
 The directors also thank the government of various countries,
 government of India, the governments of various states in India and
 concerned government departments / agencies for their co-operation.
 The directors appreciate and value the contributions made by every
 member of the TCS family.
                               On behalf of the board of directors,
 Mumbai                                               Cyrus Mistry
 April 16, 2015                                           Chairman
Source : Dion Global Solutions Limited
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