BUSINESS ETHICS

ASSIGNMENT
(A REPORT ON NTPC LTD.)

Done by,
Hrishikesh M
PGDM-B Batch
1st Year
CONTENTS:-
1) Introduction
2) Mission, Vision & Values
3) Ethical Code of Conduct
4) CSR
5) Corporate Governance
6) Ethical Dilemma
1) Introduction about NTPC Ltd.:-

Formerly known as National Thermal Power Corporation Limited, NTPC Limited is a legal
entity in India. It engaged in electricity production and alliance activities. It is a legal entity
established under the Companies Act of 1956 and is under the jurisdiction of the Ministry of
Power of the Government of India. The company is headquartered in New Delhi. The core
function of NTPC is to produce and distribute electricity to the State Electricity Commission
of India. The organization also undertakes consulting and turnkey project contracts, including
engineering, project management, construction management, and power plant operations and
management.

The agency is also involved in oil and gas exploration and coal mining activities. It is the
most important electricity service in India, with a generation capacity of 62,086 MW.
Although the company has approx. 16% of the country's production capacity contributes
more than 25% of total energy generation, thanks to its focus on operating its power plants
with a higher level of efficiency (approximately 80.2% compared to the PLF rate 64.5%
national). NTPC currently produces 25 billion units of electricity per month. 4,444 NTPC
currently operates 55 power plants (24 coal projects, 7 gas/liquid fuel combined cycle
projects, 2 hydropower projects, 1 wind power project and 11 solar power projects). In
addition, there are 9 coal stations and 1 gas station, which are owned by joint ventures or
subsidiaries.

Founded by the Government of India in 1975, it currently holds 54.74% of the shares on June
30, 2016 (2004, 2010, 2013, 2014, 2016 and (After the sale of shares in 2017)

In May 2010, NTPC was awarded the Maharatna status from the Government of India, one
of the only four companies that were granted this status. It ranked 400th in the 2016 Forbes
Global 2000.

NTPC is India's largest energy company with an installed capacity of 66,900MW (including
JV) and plans to become a 130 GW company by 2032. Founded in 1975, NTPC aims to be
the largest and best energy company in the world.

NTPC has a comprehensive rehabilitation and resettlement policy, as well as a corporate

social responsibility policy that is well integrated into its core energy project development
and power generation business. The company is committed to producing reliable energy at
competitive prices in a sustainable manner, optimizing the use of multiple energy sources
through innovative green technologies, thereby forcing NTPC to contribute to the country's
economic development and society.
Future Goals:
The company has a long-term plan for the enterprise to have 128,000 MW by 2032. NTPC
Limited is expanding to meet the country's power requirements. The 12th plan aims to add
14,058 MW (already 4,170 MW in 2012-13, 1835 MW14 in 2013, 1290 MW in 20 1415, and
1,150 MW from April 2015 to 30 November 2015) Added.
As of November 30, 2015, the company is building 23004 MW. NTPC is diversifying its
capacity composition with a focus on renewable energy. As of November 30, 2015, NTPC's
solar power capacity is 110 MW 250 MW under construction, 1260 MW during bidding. The
company plans to add 10,000 MW of solar PV capacity over the next five years. On July 18,
2015, NTPC declared the commercialization of the first hydroelectric power plant at
Attention Cordam in Himachal Pradesh. The company has a long-term plan to reduce its
fossil fuel capacity mix to 56% by 2032.
NTPC is also planning to expand globally. The public sector company has signed an
agreement with the Government of Sri Lanka with the Ceylon Electricity Board to establish a
500 MW (2x250) coal-based thermal power plant in the island nation. We have also signed
an MOU with Kyushu Electric Power Co. Inc. of Japan to conclude an information exchange
partnership with experts in various business fields. The company is also in the process of
completing an MOU with Nigeria to establish a power plant that opposes the long-term base
LNG allocation of India's NTPC plant.
2) Mission, Vision& Values:-
Mission: The mission of
NTPC Ltd. is
"To provide reliable power and related solutions in an economical, efficient and
environmentally friendly way driven by innovation and agility".
Vision:
NTPC's Vision
Is 'The World's Leading Power Company Energizes Growth in India'.
Values:
NTPC Ltd. Core Values are:
ICOMIT
I-Honesty
C-Customer Focus
O-Organizational Pride
M-Mutual Respect and Trust
I-Innovation and Learning
T-Comprehensive Quality and Safety
3) Ethical Code of Conduct:-
Consistency, transparency, and trust form part of the core belief of all the activities of NTPC
LIMITED ("NTPC") (the "Company"), which is the foundation of growth and development.
Establish separate legal and ethical standards of conduct in connection with Article 49 of the
Frequently Amended Corporate Governance Listing Agreement, which applies to all Board
members and all senior management. Is obligatory. Company employee. Therefore, to meet
this requirement, this Code of Conduct was enacted by the Board of Directors. This Code
broadly sets out the general principles that Board members and management should follow as
guidelines for making ethical decisions.
• This Code of Conduct is referred to as the “Code of Conduct for Board Members and
Senior Executives” of NTPC LIMITED (“NTPC” or “Company” and this Code of Conduct is
referred to as this “Code”). Increase. ..
• This Code is in line with the company's vision and values to achieve its mission and goals,
to control the company's operations, and to enhance ethical and transparent processing.
• The Company retains current conduct, disciplinary and appeal provisions (“CDA
Provisions”), which discipline the behaviour of all regular employees of the company,
including former directors. Industrial Employment (Constant Orders) Act, 1946.
• Codes for board members and senior management are currently developed in accordance
with Amended Clause 49 of the listing agreement that the company has entered into with the
stock exchange. Rice field. Companies are listed in the Transactions and Companies Act,
2013 clauses.
• The purpose of this Code is to strengthen the integrity, ethics and transparency of corporate
governance and to strengthen the trust and confidence in the management of the company. By
shareholders and other stakeholders.
• This Code provides that a company's board of directors and senior management must
comply with and within the framework of its law.
• This Code came into effect on December 23, 2014.
Enforcement of the Code of Conduct:
a) The Company Secretary shall be the Compliance Officer for the purposes of this Code.
b) Each board member and senior official is responsible for full compliance with this Code.
c) The Compliance Officer shall notify the Board of Directors of the company if there is a
violation of this Code.
d) The Company shall ensure confidentiality and protection of any person who in good faith
reports a violation or alleged violation of the law or this Code or any other Company policy,
or is assisting in an investigation or process. Regarding such violations. Consequences of
non-compliance with this Code of Conduct.
1) If a non-executive director violates this Code, the Board shall consider the same for
appropriate action as necessary.
2) If a full-time director or senior management violates this Code of Conduct, it will be
processed in accordance with the company's CDA rules.

Key Requirements:
i. Board members and management should act within the powers granted and, in the
best interests of the company, comply with the following:
ii. We act with the utmost care, skill and diligence in relation to all transactions of the
company.
iii. Act in good faith as much as possible and adopt the highest standards for personal
and professional integrity, fairness, honesty, honesty and ethical behaviour, relying on
the independence of judgment and ensuring that it is not damaged. Will fulfil the
obligations of the person.
iv. Approved by the Audit Committee and / or the Board of Directors and, if necessary,
by a special resolution of a special stakeholder transaction meeting
v. We are not involved in any external business or other interests, performing positions
or duties that harm the interests of the company or adversely affect the performance of
the company's business.
vi. If you are a member of the Commission, unless you fully disclose your written
opportunity to the Board, you will have the opportunity to discover using your
company's property, information or status, or for your own personal benefit. Do not
use. Senior management and the Board / CMD refuse to pursue such an opportunity
for the company, and he makes such an opportunity available.
vii. Do not do immoral acts.
viii. Follow the risk management framework / policies established by your company.
ix. You need to ensure a workplace free of discrimination and harassment based on race,
colour, religion, caste, age, gender, nationality, origin, disability, military service, or
other prejudices. Shall not use IT system of the Company for purposes that may be
regarded as derogatory, defamatory or obscene or otherwise considered irresponsible
and/or compromise the protection and security of IT systems;
 x. In the performance of the company's duties, it must be held accountable to its
stakeholders: shareholders, debtors, creditors, contractors, suppliers, customers,
governments, etc.
xi. You may not (directly or indirectly) donate Company funds, credit, property or services to
any political party.
xii. We will fulfil our responsibilities in a sincere way for the benefit of the company, and act
objectively and constructively while performing our duties.
xiii. Any external consideration that can impede the exercise of objective and independent
judgment in the most important interests of the enterprise as a whole, while agreeing to or
disagreeing with the collective judgment of the Board in the decision making of the Board. I
can't do that either.
xiv. Do not abuse your position for the purpose of directly or indirectly gaining personal gain
or benefit due to damage to the company or shareholders or due to a relationship.
xv. It is there to implement the best corporate governance and needs to support the company.
xvi. You need to act and keep this in mind, based on your company's vision, mission and
values.
Subject:
This Code applies to:
a) All full-time directors, including the company's president and managing director.
b) All non-executive directors, including outside directors, unless specifically exempted
from the provisions of this Code.
c) All senior management positions.
4) CSR:-
NTPC Ltd.’s CSR goals are as follows:
• Providing beneficial business and environmental value to businesses and large ecosystems.
• Check for minimal waste and ensure sustainable power development throughout
operations.
• Effectively donate for the development of society.
• Guide departments in the areas of resettlement, rehabilitation and environmental protection,
including effective reuse and energy conservation practices.
At the heart of the company's philosophy, CSR has been an important part of NTPC's
development and the lives of millions of Indians. NTPC's mission statement embodies a spirit
of compassion and sharing. They firmly believe that the communities around our project and
the communities driven out by it are key partners / stakeholders in India's growth story.

As good neighbours, they have built strong partnerships with them through many well-
planned community development intervention programs. NTPC is also a member of India's
Global Compact Network, confirming that it participates in various CSR activities based on
the 10 principles of the Global Compact, and sharing experiences with the world through the
publicly announced "Communication on Progress". Increase. The CSR addresses a variety of
issues, including basic infrastructure development, education, community health and hygiene,
capacity building and sexual capacity building.

Active participation and ownership of these efforts by the community is key to the smooth
and secure implementation of these plans. The Project is customized to the requirements of
the specific area, and the village development advisory board guides through a wide range of
demand assessment surveys and consultations through participation in various forums such as
rehabilitation and peripheral development advisory boards. Will be done.
Basic Principles:
 Prioritize regions and lagging regions and strive to improve the standard of living of
society as a whole.
 Socially vulnerable groups, especially marginalized groups such as women, girls,
people with disabilities and the elderly, promote inclusive growth by focusing on the
needs of the privileged, marginalized and vulnerable classes.
 Contribute to clean and sustainable development by protecting the environment (air,
soil, and water), conserving natural resources, supporting biodiversity conservation,
and maintaining renewable energy to do.
 Integrate CSR and sustainability efforts with the mechanisms of National
Development Plan adopted by NTPC.

Selection criteria for CSR activities:

NTPC shall conduct CSR activities that meet any of the following.
1. Activities specified through regular needs assessment surveys and/or input from a variety
of stakeholders, including public representatives of the community and public representatives
of the Panchayat District Administration. Organizations such as the Village Development
Advisory Committee (VDAC) and other participating forums/exchanges with senior
management.
2. The specified activities must correspond to the list of activities specified in Schedule VII of
the Companies Act 2013 and the rules created there under.
3. Other activities for the benefit of society as a whole.
Monitoring and evaluation:
1. Monitoring and review, at the station and enterprise level. The station level is supposed to
do a local review, propagate the MIS and generate an exception report. Review of enterprise-
wide CSR and budget utilization should be done at the corporate level.
2. The effectiveness of the CSR program is assessed through internal and external
assessments.
3. Progress is measured based on the results of a need assessment / criteria survey
(performed before the start of the project).
4. An internal audit is conducted to confirm the efficiency of the implementation.
5. Social Impact Assessment (SIE) is done through a trusted external body to measure the
impact of CSR initiatives.
Delivery mechanism:
• Office or group of station / office through a trusted implementation agency.
• Partnerships with other institutions such as reputable NGOs / institutions (recommended
criteria).
• The "NTPC Foundation", a charitable trust aimed at serving and empowering disabled
people and the estranged class of society, the "NTPC Foundation" is a charitable trust
established by NTPC and is a socio-economic concern.
• EVOICE (Volunteer Organization of Employees for Community Participation Initiatives)
NTPC with employees under the banner "Volunteer Organization of Employees for
Community Participation Initiatives (EVOICE)" Family volunteers are recommended.
5) Corporate Governance:-
Corporate Governance is a number of policies and business process that is driven by
conscience, openness, honesty, professionalism and responsibility to improve the richness of
the organization that produces capacity. It is a journey to create a sustainable value for all
stakeholders through a robust and transparent management board mechanism in society.
NTPC's corporate governance philosophy comes from our belief that corporate governance
structures are an integral part of improving efficiency and growth and increasing investor
confidence. The philosophy of corporate governance is scripted as follows:
"A company as a great corporate citizen is a long-term success by building the trust of
various stakeholders by devoting itself to sound corporate practices based on conscience,
openness, fairness, expertise and responsibility." The Company believes in sustainable
corporate growth through its organization to various stakeholders with a sound financial
system, the best leadership reflected in improving market reputation and efficiency.
We believe we must go beyond complying with regulatory frameworks. Our corporate
structure, business, operations and public practices are closely aligned with the philosophy of
corporate governance. Transparency, responsibility, impartiality and intensive
communication with stakeholders are essential to our functioning. We consider system-
centric performance and performance-oriented systems. We place the highest priority on
these systems to protect the interests of all shareholders, especially minority shareholders.
We strive to harmonize growth and efficiency with governance and ethics. Based on our
mission statement, our board of directors develops strategies and policies focused on
optimizing value for a variety of stakeholders, including consumers, shareholders and society
in general. In addition to complying with the listing agreement clauses, we also follow the
guidelines for corporate governance issued by Government of India.
Our Board of Directors Drives Us Based on Diverse Expertise:
Currently, the NTPC Board of Directors consists of six full-time functional directors and a
managing director who also serves as the company's president. Our functional directors are
experienced experts in their respective functional fields. Provides managerial guidance on
operational issues, best practices in hiring management of the system, and monitoring
compliance with various legal and other requirements.
The company has nine independent directors and two jointly appointed directors. The outside
directors of the corporate board of directors are appointed by the Government of India
through a sophisticated selection process, such as using the Government of India's
"Navigation Panel" to welcome experts and experts in related fields. We believe that outside
directors will bring the wealth of experience, knowledge and practice that comes from other
companies to absorb the best practices that continue in the industry.
A clear definition of the role and responsibilities of the board leading to decentralized
decision-making:
Our framework allows the board to provide strategic guidance to the company for effective
oversight of management. Was designed to the roles and responsibilities of board members
and senior management are clearly defined to facilitate the responsibilities of the company
and shareholders. This balances authority and prevents individuals from having free power.
Delegation of Decision Making to Multiple Panels of the Board :
We have various committees on the board level to focus attention before raising important
issues to the board. Some of these committees have voluntarily set up listing contracts, even
though there are no legal requirements. Here, there is a "project committee" that reviews and
decides on investment proposals before the approval of the board, a "contract committee" that
processes contracts up to the limit set by the board, and "contract committee" for various
reviews. Business Administration Committee is included. An "Investment / Donation
Subcommittee" on issues related to the internal control system and its compliance and
placement of surplus funds, donations / donations for national, public or philanthropic
purposes. The other committees of the board are the Audit Committee, the Shareholder /
Investor Grievance Committee and the Post-Distribution Activities Committee of the
Company's Securities.
The Audit Committee was established on NTPC in 1995, long before it became legally
necessary under the Companies Act in 2000. The Audit Committee protects the integrity of
the company by ensuring that the company's true and realistic financial position is submitted
to the Board of Directors. Management
Established a code of conduct to facilitate ethically responsible decision making. There are
two codes of conduct for board members and those for senior management. It aims to align
the company's vision and values and to manage the company's operations in an ethical and
transparent manner in order to achieve its mission and goals. The Code of Conduct also
includes issues related to insider trading in Company Security.
Established System of Responsibility Assessment for Board Performance:
The performance of the Board of Directors and directors is assessed by the Ministry of
Electricity, the administrative province of the company. To evaluate the company's
performance, the government has established a system of goal setting agreed upon between
the company and the government through a memorandum of understanding (MOU). The
MOU system pre-defines evaluation criteria for parameters such as financial performance,
productivity, talent development activities, project execution, and operational performance
for objective evaluation of central public sector enterprises (CPSE). The Board is also
assessed through a two-level performance appraisal system. The first is assessed at the level
of the president and managing director, the second at the local level. Performance
announcements from all directors are reviewed by the Chairman and Managing Director and
forwarded to the Ministry of Education for evaluation.
Adopting a Timely and Balanced Disclosure Policy:
We believe in full disclosure to investors of all material matters about our company.
Announcements about the company are regularly made available on our website or to
regulators in a transparent and balanced manner on a detailed basis of fact. Beyond the
regulation, we believe to our shareholders that the NTPC has more than 7.53 lakhs as of
31.3.14. These approximately 99% are private shareholders, appointing share transfer agents
to serve these shareholders, and establishing an investment services division in the company
to adequately and timely rectify the complaints of these small shareholders.
We are continuing our efforts to expand the place of payment of dividends through electronic
payment systems (ECS), etc. Our directors are in constant dialogue with institutional
investors and explain the company's strategies and plans. In these exchanges, investors
express different views on the company's sectors and businesses, and management responds
to their concerns and explains the actions the company has taken. Also hosts the annual
Investor and Analysts Meeting and the entire Board meets with analysts and the investment
community to address any questions or concerns about the company.
Risk Management Framework:
NTPC has implemented a sophisticated enterprise risk management framework with BSE /
NSE for listing contract compliance. The
Function Responsible Level “Risk Management Committee (RMC)” has assumed
responsibility for identifying plans and strategies for mitigating risk in the short and long
term. The
RMC meets quarterly to discuss strategies. Risks are regularly monitored for key
performance indicator reports. RMC results are submitted as board information.
Customer Relationship Management Our approach to Customer relationship management is
an essential enterprise-wide business strategy we are actively practicing to systematically
create and maintain profitable long-term customer relationships. As a result, NTPC is highly
regarded among customers for its professionalism. Under the Customer Relationship
Management (CRM) program, the company began serving customers in selected sectors such
as operational remuneration, R&D, finance, and IT with the clear objective of growth across
the power sector.
Undivided Promise to Society / Society's First Promise:
NTPC has been a committed and socially responsible corporate citizen since its inception.
The company is establishing and employing a Dynamic Corporate Social Responsibility
Community Development (CSRCD) policy to engage in CSR activities in areas adjacent to
power plants. There is the 'NTPC Foundation' established to address niche areas of social
development at the national level through strategic interventions.
6) Ethical Dilemma:-
Unstable Boiler:
Unchahar's Tragedy Is Unacceptable Shows Loose Safety Protocols Boiler explosion at
Unchahar's NTPC power plant, Rae Bareli stresses the importance of procedures and
investigation of hazardous industrial behaviour. It resulted in severe bruises and wounds to
dozens of employees who sacrificed at least 32 lives.
Highly compressed boilers are dangerous appliances and are strictly monitored by
appropriate laws. Indeed, the necessary purpose of the Indian Boiler Act of 1923 is to ensure
the safety of life and the protection of resources by approving systematic standards regarding
the characterization and maintenance of these units.
It is evident from the disaster in the public sector facilities that the fact that the government of
Uttar Pradesh is not sufficient to achieve this goal. Very clearly, the boiler is configured to
implement a warning as soon as dangerous pressure occurs, be automated from a risk
perspective and operate security equipment, so accidents can be completely avoided. It's
done.
Withstand years of analysis to see if all these features are working properly. At the Unchahar
plant, waste gas outlets due to ash, which is rare in fairly new boilers, have been interrupted
and the quality of the equipment and fuel used needs to be investigated. Ideally, these aspects
should be investigated by an independent body without NTPC.
Industrialized management has unfortunately come to be seen as a barricade that gets in the
way of doing business easily in India. This is the result of mistakes and cheating, and the
government's regular response has been to ease emergency safety checks. The facility's own
approval and the approval of the moderators are supported by bureaucrats in the case of
boilers. Shortly after taking office, Prime Minister Narendra Modi likened the maintenance of
a boiler to that of a secretly owned car. There the owners are aware of the need for the safety
of their activities, so they have to trust that they will do their best. But the two cannot be
compared. The Unchahar accident shows that it is in the interest of everyone who will have a
clear regulatory structure for unsafe industrial activity.
The safety and interests of workers and society as a whole cannot be negotiated.
Understanding regulatory weaknesses requires a rigorous approach to accident reporting as
part of the process. Data from the National Crime Records Bureau provide a vision of
disasters caused by industrial boilers and gas cylinders (61 deaths in 2015), and the increase
in the number of disasters that occurred in the previous year is a safety protocol. Indicates
that the obligation needs to be applied. The loss suffered by a worker's family due to an
accident that could be prevented cannot only be compensated financially. It must be the
responsibility of the centre to ensure that measures to facilitate the business lead to under-
regulation and endanger life. Administrative rehabilitation can eliminate inspector Raj, fraud
and achieve clear regulation while maintaining corporate security.

NTPC: New challenges for India's largest electricity producer

• A long-term decline in utilization levels may be a large income risk and ongoing systems on
suboptimal levels would affect returns
. • Although prices are steadily discussed at 2.50 per unit in renewable energies, the average
rate has risen at NTPC $ 3, 18 FY16 to $ 3.38 in FY19

While the availability of fuel for NTPC Ltd normalizes, a new challenge is caused: the
question.
The generation of thermal power plants stored by the central electricity authority decreased
for the second consecutive month in May. The average use of April-May, as represented by
the plant load factor (PLF), dropped 78.7% to 73% per year. In May, it was even 71.4%
lower.
If the card has also become smaller in recent years as a result of inconspicuous demand in
recent years, as a result of inconspicuous demand. But the drop seems to be recently
accelerated. The 720 base point decrease in NTPC`s coal PLF to 71% in the summit summer
in May, which has set the highest energy / top requirement, is quite surprising. The difference
between the entire thermal PLF-PLF and the NTPC coal in a record booth of 8% (in the past
(in the past) of 1518%) said analysts at SBICAP Securities Ltd in a note.
The use decrease coincides with a pick-up in the hydropower generation and in renewable
energy. In view of the status of renewable energy dimensions, power distribution companies
(discoms) would reduce thermal upholstery. Other factors also work, especially at the front
costs.
Although Renewable Energy Rates have fallen steadily to ₹ 2.50 per unit, the average rate at
NTPC from ₹ 3.18 in FY16 has risen to $ 3.38 in FY19. The collective bargaining rise at the
company cannot be very large and the renewable rates gap cannot be great, but for Cash
strapped big buyers, such as capital defence of the state, the savings are considerable.
The decline in use, despite more fuel availability, shows the discretion of the power supply
through state aid programs.
According to an analyst, some of NTPC boys construction plants have significantly higher
variable costs, which rates of more than $ per unit. As the states occur in the form of
hydropower, renewable or even stain force, they are generally returned from costly power
chase agreements.
Of course, with a regulated business model, in which minimum efficiencies are insured,
NTPC is isolated from changes in the socket. In addition, improved fuel availability and
inventories help to recover the fixed costs. The slow scale-up can also be in the total
operating levels in the total level of use.
Even then, a long-term decline on the level may be a major risk of income and the power
plants return to the suboptimal level. "The long-term pressure on the coal plant factors is a
concern because it has the efficiency parameters, among other things," The analysts were
added SBI CAP securities.