Reliance Industries ,CAST STUDY  solution

Read the following cases carefully and answer the questions given at the end of each.

(a)    Reliance Industries and Corporate Governance Reliance is one of the pioneers in the country in implementing the best international practices of Corporate Governance.

The board of Directors at Reliance periodically reviews its composition for ensuring a strong element of independence and commitment. The Directors are elected by the shareholders. However the board plays an important role in the selection of candidates for shareholders' approval.

Roles and esponsibilities of Board and Management

The board's roles and responsibilities include establishing an effective mechanism for overseeing the affairs, keeping in view the company's size, complexity, geographical operations and corporate tradition and culture. The Reliance's framework is designed to:

• • Enable the Board to provide strategic guidance for the management.
• • Define the respective roles and responsibilities of senior executives to ensure accountability; and
• • Ensure a balance of authority such that no single individual has unfettered powers. To ensure the truthful and factual presentation of it's financial position. The Company has put in place a strong internal audit process. The board has also constituted an audit committee, which is responsible to the external reporting, performance and objectivity of the internal audit function and independence of the external auditors. To ensure long-term shareholder value creation and to promote shareholder participation in corporate affairs, Reliance has established and maintained communication strategies, including a policy for clarity in notices of meetings. Reliance also maintain its corporate website for convenient access by the shareholders to all the information about the company. The company has adopted a remuneration policy that attracts and maintains talented and motivated executives so as to encourage enhanced performance of the company. The remuneration policy envisages a clear relationship between performance and remuneration, including the link between remuneration paid and the overall corporate performance.

Questions :

1. Discuss the link between Board of Directors and Corporate Governance practices in Reliance.

 2. What type of Remuneration Policy is followed at Reliance for rewarding Employee Performance ? (b)CSR at Bank of India

 At Bank of India, corporate social responsibility is basically the care and concern for the deprived in particular and the community at large. Social responsibility is a function of the banking industry where by the Bank focuses on those below poverty line and the communities that qualify for schematic lending under the various government sponsored programs. The focus ison ensuring that they become self-sufficient and can achieve the desired goals to improve their living standards. The Bank has a policy of recruiting the blind and disabled and also has a committee to monitor and prevent any sexual harassment at the work place. Employees always volunteer to support NGOs in noble causes such as Eye donations/Blood donation camps.. The top management not only involves in such a cause but also actively supports it. Well known NGOs who have been on the scene for quite a number of years and doing services to the community over the years are supported in their cause. The programs are monitored by the zonal offices spread over 43 zones that ensure the end of the funds donated to the NGOs. The relationship with some of the NGOs is on a continuous basis like that with the cancer foundation. The Bank is truly a bank of India, as the name idicates, with over 2600 branches and 43 zonal offices and has a good representation both in metro, urban and rural India. It is, therefore, natural that CSR should spread across state borders and is not limited to where the Bank is headquartered. Business ethics and governance are separate issues. The money contributed towards CSR activities are monitored by the concerned zonal offices and the NGOs are asked to submit receipts and photographs justifying end use of funds. Employees have always contributed whenever there has been a major disaster by donating a day's wages, which along with the Bank's contribution , collectively works out to a few million rupees. Their employees are involved in a systematic monitoring of the activities for which the funds have been donated. The objective is to ensure that there is total involvement of both the management and the employees while the mission would be to succeed in making life better for poorest of the poor and the downtrodden. As a part of its centenary celebrations, the Bank of India has adopted 101 villages. Employees too are very considerate when it comes to serving a social cause and the Officers' association and the Unions have always been organising blood donation drives, adoption of village and free cancer detection of camp.

 Questions :

1. Discuss the rationale behind the implementation of Corporate Social Responsibility at Bank of India.

 2. What activities have been undertaken at Bank of India as a part of Banks Social Responsibility ?

MS-611 : RURAL MARKETING

Hero Motocorp steps up rural touch-points

It is Dussehra and Diwali time and over 500 rural sales executives of Hero dealers are now busy meeting the sarpanch, the headmaster and the anganwadi workers in villages all over the country. They are also visiting potential customers at their homes, inviting them to drop in at the company's dealerships which might be located a few kms away.

Says senior vice president (marketing and sales), Hero. "We are confident of surpassing last years's sales of two -wheelers during Dussehra and Diwali by a long shot". The company is ready to roll out its on-ground activation for the rural customers and has doubled its touch-points in rural areas from 2,000 in 2006 to nearly 4,000. The on-ground activation is actually the last leg of Hero's rural marketing efforts. The first leg is its Usage & Attitude studies, which are conducted by the company's in-house research team once in every two years. The study captures every aspect of the potential customers' lives. It tracks aspects like the level of awareness of brand Hero, the current modes of transportation, what is the expectation of the customer from motorcycles etc. The company is also doing Rural Footprint studies on a quarterly basis. "Under this, we chart the events that will take place in villages. The core idea is to take the brand to the customer when he is in a happy mood. And these happy times are linked to good harvests, festivals and marriages when there is cash in hand," says the senior vice president. Thirdly, to ensure that the village customer doesn't postpone buying a two wheeler just because there's no cash in hand, Hero has entered into numerous vehicle finance tie-ups with NBFCs , cooperative banks and regional rural banks. The other cornerstone of Hero's success is its media campaign and the choice of media vehicles. The company banks on good old Doordarshan for this. "DD's reach in the rural areas is a good enough bet to reach the target customer. We invest heavily in cricket on DD, " says the senior vice president. The DD campaign seeks to build an ongoing relationship with millions of households in rural India. The company had decided to seize the latent potential of this market by launching some of its entry-level products which are tailored to suit the needs of the rural consumer like adjustable suspension, strong headlights and good ground clearance. Reasons that are good enough for rural sales contributing 45 percent to the company's overall annual sales.

Questions

(a) Analyze the rural marketing strategy of Hero Motocorp.

 (b) Examine the challenges faced by Hero in the rural markets.

(c) What is the potential for two wheelers in Indian rural market ?