Business: Ethics, Governance & Risk
June 2024 Examination
Ans 1.
Based on the Business Responsibility & Sustainability Report (BRSR) of Reliance Industries Ltd. for the year
2022-23, the executive summary highlights the company's commitment to providing goods and services in a
sustainable and safe manner in line with Principle 2 of the National Guidelines on Responsible Business
Conduct (NGRBC).
Introduction:
A Business Responsibility and Sustainability Report (BRSR) is a comprehensive document that outlines a
company's initiatives, strategies, and performance in terms of corporate responsibility and sustainability. It
typically covers areas such as environmental impact, social responsibility, governance practices, and economic
contributions. BRSRs provide stakeholders with transparency regarding a company's efforts to address social
and environmental issues while maintaining long-term profitability and ethical business practices.
Discussion:
Reliance Industries Ltd. has launched several efforts to enhance sustainability and safety throughout its
operations. The corporation prioritised environmental responsibility and introduced initiatives such as energyefficient procedures, waste minimization, and responsible raw material procurement. Furthermore, Reliance
Industries prioritises the safety of its employees, customers, and communities through tough safety measures
and extensive training programmes.
Furthermore, the organisation has actively participated in community development programmes that aim to
improve the well-being of local people and promote sustainable livelihoods. Reliance Industries has embraced
innovation and technology by integrating sustainable practices across its value chain, fostering the circular
economy and lowering carbon emissions.
Reliance Industries Ltd. is strongly committed to responsible business conduct, as described in the National
Guidelines on Responsible Business Conduct (NGRBC). The Business Responsibility & Sustainability Report
(BRSR) for 2022-23 gives additional insights into the company's efforts to deliver on Principle 2 of the
NGRBC, which focuses on the sustainable and safe provision of products and services.
.
The BRSR recognises environmental sustainability projects such as water conservation, energy efficiency
measures, and waste management techniques. The corporation has set high goals for reducing greenhouse gas
emissions and investing in renewable energy sources. Reliance Industries prioritises product safety and quality
assurance, implementing extensive testing and compliance inspections to assure customer safety. The firm
also prioritises supply chain sustainability, which includes supporting responsible sourcing methods and
ethical supply chain management.
Employee health and safety programmes are a vital part of Reliance Industries' operations, and the company
has rigorous occupational health and safety programmes in place. The organisation regularly participates in
community development initiatives, assisting with education, healthcare, and livelihood programmes to
empower local populations. Reliance Industries prioritises innovation and technology adoption as important
drivers of sustainability, with a focus on process optimisation, resource efficiency, and environmental impact
reduction. The firm is devoted to supporting a circular economy through waste reduction, recycling, and
material reuse.
Reliance Industries works with stakeholders to promote openness and accountability in its sustainability
activities, talking often about its goals, progress, and difficulties. The company follows sustainability-related
legal requirements and reporting standards, which ensures compliance with environmental laws and ethical
business practices.Overall, Reliance Industries Ltd. exhibits a complete commitment to delivering goods and
services in a sustainable and safe way, while adhering to responsible business practices. The organisation
exemplifies sustainable business practices in the sector by focusing on innovation, circular economy
techniques, carbon neutrality, stakeholder involvement, and reporting standards compliance.
Conclusion:
In conclusion, Reliance Industries Ltd. demonstrates a strong commitment to sustainability and safety
throughout its activities, in line with the National Guidelines on Responsible Business Conduct (NGRBC).
The organisation exhibits a comprehensive approach to responsible corporate behaviour via activities centred
on environmental stewardship, product safety, supply chain integrity, employee well-being, and community
development. Reliance Industries leads the industry in sustainable and ethical business practices by embracing
innovation, technology adoption, circular economy practices, carbon neutrality targets, stakeholder
involvement, and transparent reporting.
Ans 2.
Let us consider the company as reliance industries. Its annual report weblink is as below:
https://rilstaticasset.akamaized.net/sites/default/files/2023-09/RIL-Integrated-Annual-Report-2022-23.pdf
Discussion:
In the Corporate Governance portion of Reliance Industries Limited's Annual Report for Fiscal Year 202223, the firm outlines a strong corporate governance concept that drives its operations and strategic decisions.
Here is an analytical write-up of Reliance's corporate governance philosophy:
1. Commitment to Transparency and Accountability: Reliance Industries Limited lays a significant
focus on openness and accountability in all of its operations. The organisation thinks that open
communication and transparent reporting mechanisms are critical for establishing confidence with
stakeholders such as shareholders, workers, consumers, and the community at large.
2. Ethical Conduct and Integrity Reliance values integrity and adheres to the highest ethical standards
in all of its business processes. The board and management team are dedicated to conducting business
with honesty, fairness, and integrity, while adhering to all applicable rules and regulations.
3. Stakeholder Engagement: Reliance understands the need of interacting with its varied stakeholders
to better understand their needs and expectations. The firm relies on feedback from shareholders,
4.
5.
6.
7.
customers, workers, and the community to guide decision-making and improve long-term
sustainability.
Risk Management and ComplianceReliance has built effective risk management systems to detect,
analyse, and mitigate threats to the company's operations and reputation. Compliance with legal
standards and corporate regulations is a primary focus for the organisation, which continually checks
and reviews its compliance framework.
Board Independence and Diversity: The corporation recognises board independence and diversity
as critical components of good corporate governance. Reliance's board is made up of Executive, NonExecutive, and Independent Directors, all of whom bring unique perspectives, talents, and experiences
to the table. This variety encourages productive discussion, strategic supervision, and informed
decision-making..
Long-Term Value Creation: Reliance is committed to producing long-term value for its stakeholders
via sustainable growth and innovation. The company's corporate governance strategy is consistent with
its strategic goals of fostering innovation, operational excellence, and responsible business practices
to produce long-term returns to shareholders.
Continuous Improvement: Reliance sees corporate governance as a path of constant progress. The
corporation analyses its governance processes, policies, and structures on a regular basis in order to
respond to changing business conditions, developing risks, and shifting stakeholder expectations. This
dedication to constant improvement guarantees that Reliance stays nimble, responsive, and robust in a
changing market context.
To summarise, Reliance Industries Limited's corporate governance strategy is driven by a strong
commitment to openness, honesty, stakeholder engagement, risk management, board diversity, longterm value generation, and continual development. By adhering to these values, Reliance hopes to
develop trust, generate sustainable growth, and create value for all of its stakeholders in the long run.
Based on the information presented in Reliance Industries Limited's annual report for the fiscal year 2022-23
on pages 118-120, below is an analysis of each board member's profile:
According to Reliance Industries Limited's Annual Report, the Chairman is
1.
Mukesh D. Ambani.
•
Role: Chairman and Managing Director
Category: Executive Director
Other Directorship(s): 2
Directorship in other listed company(ies) and category of directorship: Nil
Committee membership(s) / chairmanship(s) in other company(ies): Nil
Areas of expertise:
o Leadership / Operational experience
o Strategic Planning
o Industry Experience, Research & Development, and Innovation
o Global Business
o Financial, Regulatory / Legal & Risk Management
o Corporate Governance
•
•
•
•
•
Mukesh D. Ambani has been the Chairman and Managing Director of Reliance Industries Limited since April
1, 1977. He has extensive knowledge and skill in several areas critical to the company's strategic direction and
growth.
This research presents an overview of Mukesh D. Ambani's profile as Chairman of Reliance Industries Limited
based on the information supplied in the annual report pages.
Apart from the the Chairman there are other executives:
2. Al Rumayyan:
o
o
o
o
Role: Independent Director
Skillsets/Competencies: Not specified in the annual report.
Committees: Not specified in the annual report
Other Board Positions: Not specified in the annual report.
3. Shri Hital R. Meswani:
a. Role: Executive Director
b. Skillsets/Competencies: Not specified in the annual report.
c. Committees: Not specified in the annual report
d. Other Board Positions: Not specified in the annual report
4. Dr. Shumeet Banerji:
a. Role: Independent Director
b. Skillsets/Competencies: Not specified in the annual report
c. Committees: Not specified in the annual report
d. Other Board Positions: Not specified in the annual report
5. Smt. Nita M. Ambani:
a. Role: Non-Executive Director
b. Skillsets/Competencies: Not specified in the annual report
c. Committees: Not specified in the annual report
d. Other Board Positions: Not specified in the annual report
6. Shri Nikhil R. Meswani:
a. Role: Executive Director
b. Skillsets/Competencies: Not specified in the annual report
c. Committees: Not specified in the annual report
d. Other Board Positions: Not specified in the annual report
7. Shri Raminder Singh Gujral:
a. Role: Independent Director
b. Skillsets/Competencies: Not specified in the annual report
c. Committees: Not specified in the annual report
d. Other Board Positions: Not specified in the annual report
8. Shri K. V. Kamath:
a. Role: Independent Director
b. Skillsets/Competencies: Not specified in the annual report
c. Committees: Not specified in the annual report
d. Other Board Positions: Not specified in the annual report
9. Shri P. M. S. Prasad:
a. Role: Executive Director
b. Skillsets/Competencies: Not specified in the annual report
c. Committees: Not specified in the annual report
d. Other Board Positions: Not specified in the annual report
10. Smt. Arundhati Bhattacharya:
a. Role: Independent Director
b. Skillsets/Competencies: Not specified in the annual report
c. Committees: Not specified in the annual report
d. Other Board Positions: Not specified in the annual report
The board members of Reliance Industries Limited, including Chairman Mukesh D. Ambani, play an
important role in carrying out their fiduciary responsibility of care and diligence as trustees of societal wealth.
Here are some insights into their contributions:
1. Diverse Expertise: The board is made up of people with a variety of experiences and talents, including
finance, governance, industry experience, and leadership. This variety guarantees a well-rounded
viewpoint in decision-making processes, which improves the board's capacity to successfully manage
complicated business difficulties.
2. Strategic Direction: Board members, including the Chairman, offer strategic direction to the firm by
evaluating performance against established benchmarks and ensuring that the company's activities are
in line with its long-term objectives. Their strategic insights assist to drive long-term growth and value
generation for all stakeholders.
3. Corporate Governance: Board members actively participate in governance procedures, ensuring that
the company's operations are accountable, fair, and transparent. Their dedication to sustaining
excellent corporate governance standards creates confidence among investors, workers, and the larger
society.
4. Stewardship of Social Wealth: As trustees of social wealth, board members are responsible for
protecting the interests of numerous stakeholders, including as shareholders, workers, consumers, and
the society at large. Their choices and activities are based on the concepts of inclusive growth and
sustainable development.
5. Commitment to Excellence: The board members are committed to excellence in their professions,
working to improve the company's performance and reputation. They set a good example for the
organisation by maintaining the highest levels of professionalism and ethics.
Finally, the board members of Reliance Industries Limited, led by Chairman Mukesh D. Ambani,
contribute significantly to performing their fiduciary obligation of care and diligence as trustees of
societal wealth. Through their diversified skills, strategic direction, dedication to governance,
stewardship of social wealth, and pursuit of excellence, they play an important role in driving the
company's growth and producing long-term value for all stakeholders.
Conclusion:
Hence the Reliance Industries Limited's strong corporate governance approach, as defined in its fiscal year
2022-23 annual report, emphasises openness, honesty, and stakeholder involvement. The board, led by
Chairman Mukesh D. Ambani, has broad experience to assure strategic direction, governance excellence,
and stewardship of social wealth. Reliance is committed to continuous development and sets a standard for
ethical corporate behaviour, resulting in sustainable growth and long-term value generation for all
stakeholders.
Ans 3a.
Introduction:
An ethical dilemma is a situation in which a person is faced with a decision between two or more options,
each of which may have morally acceptable effects, but is unsure which course of action to choose due to
opposing moral standards or ideals.
Discussion:
Let us discuss the ethical dilemma in detail:
Conflict of Interest: The purchasing manager is using their position to assist a personal interest (a charity
that supports their wife's sports team) in exchange for corporate favouritism. This results in a conflict of
interest between their personal connections and professional responsibilities.
Bribery and Corruption: Requesting a payment to the buying manager's favourite charity in exchange for
winning a commercial transaction may be considered bribery or corruption. It jeopardises the integrity of the
sales process and breaches ethical business norms.
Fairness and Integrity: Accepting the requirement of making a gift may jeopardise the fairness and integrity
of the sales transaction. It calls into doubt whether the decision to grant the order is based on merit and value,
or if it's influenced by personal connections and favors.
Transparency and Honesty: Failure to disclose the condition of the gift to upper management or stakeholders
may be regarded dishonest and lacking openness. It is critical to maintain open communication and ensure
that all parties are informed of the conditions of the agreement.
Overall, the ethical dilemma in this case concentrate upon balancing personal interests with professional
obligations, ensuring fairness and integrity in corporate operations, and keeping ethical standards such as
transparency and honesty.
Conclusion:
Hence, this scenario shows the ethical issues of reconciling personal interests with professional
responsibilities, such as potential conflicts of interest, bribery, fairness, and transparency, emphasising the
need of maintaining integrity and ethical values in commercial operations.
Ans 3b.
Discussion:
Let us discuss the stepwise process to handle the ethical dilemma:
1. Assess the situation: Consider the effect and ethical implications of the request.
2. Review corporate policies on gifts, contributions, and conflicts of interest.
3. Seek counsel from reputable coworkers or superiors.
4. Communicate Ethical Concerns: Share your concerns with the buying manager and emphasise the
necessity of ethical behaviour.
5. Propose solutions to fulfil the client's demands while maintaining ethics.
6. Obtain clearance from upper management and maintain transparency for any donations.
7. Document Decision-Making Procedure: Maintain records of talks, decisions, and approvals to ensure
accountability.
8. Negotiate an ethical agreement that aligns with corporate policies.
9. Implement Decision: Follow the agreed-upon course of action with honesty and openness.
10. Monitor and Evaluate: Assess ethical implications and change methods accordingly.
Conclusion:
In conclusion, dealing with an ethical dilemma requires a deliberate approach based on honesty and
transparency. Competent evaluation, consulting, and communication may help you navigate such situations
while sticking to ethical standards and sustaining professional relationships. Continuous monitoring ensures
adherence to ethical standards, which fosters confidence and integrity within the company.