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Hero MotoCorp

2/22/2016

REPORT

Hero MotoCorp

Author: Sagar Khandelwal | MISB Bocconi India

Hero MotoCorp

Board of Directors

Mr. Pawan Munjal


Chairman,
Managing Director & CEO

Mr. Munjal is the Chairman, Managing Director & CEO of the Company. He is responsible for growth
and strategic planning for the entire Group. A graduate in Mechanical Engineering, Mr. Munjal has
been instrumental in bringing about technological and managerial excellence in the Company's
operations. He has been the Chairman of several Committees of CII.

Mr. Pradeep Dinodia


Non-Executive &
Independent Director

Mr. Dinodia was appointed as an Additional Director on the Board of the Company on March 31,
2001 in the category of Non-Executive and Independent Director. Mr. Dinodia is a fellow member of
The Institute of Chartered Accountants of India and a senior partner in the Delhi-based Chartered
Accountancy firm M/s. S.R. Dinodia & Company. He has considerable experience in corporate affairs
and allied legal and taxation matters.

Gen. (Retired)
V. P. Malik
Non-Executive &
Independent Director

Hero MotoCorp
Gen. Malik was appointed as an Additional Director on the Board of the Company on May 4, 2001 in
the category of Non-Executive and Independent Director. Gen. Malik retired as Chief of the Indian
Army in September, 2000. During his distinguished military career, he received number of awards
including the Ati Vishista Seva Medal (AVSM) and the Param Vishishta Seva Medal (PVSM) - the
highest National award for distinguished services.

Mr. Suman
Kant Munjal
Non Executive Director

Mr. Munjal was appointed as an Additional Director on the Board of the Company on July 29, 2010.
Mr. Munjal is the Managing Director of Rockman Industries Ltd., one of the leading suppliers of
Aluminium Die Casting, Machined and Painted Assemblies to Hero MotoCorp Ltd. Mr. Munjal, a
graduate in Commerce, possesses rich experience and expertise in business management and thus
has been instrumental in elevating Rockman Industries Ltd. to its current status.

Mr. Paul Edgerley


Non Executive Director

Mr. Edgerley was appointed as an Additional Director on the Board of the Company on May 4, 2011
in the category of Non-Executive Director. Mr. Edgerley has been a Managing Director at Bain Capital
since 1990, a private investment firm with over $65 billion in assets under their management, where
he focuses on investment in the industrial and consumer product sectors. He is currently on the
board of The Boston Celtics, Keystone Automotive, Steel Dynamics, Sensata Technologies, MEI
Conlux, HD Supply and Hero Investments Pvt. Limited. Mr. Edgerley is also a member of the Dean
Advisory Board at Harvard Business School, Kansas State University Foundation, The Shamrock
Foundation, serves on the US Board of The Right to Play and New Profit, Inc. He is a certified working
public accountant. He was also awarded an MBA with distinction from Harvard Business School and
a BS from Kansas State University. He brings with him enriched experience in the field of finance and
administration.

Hero MotoCorp

Dr. Anand C. Burman


Non Executive &
Independent Director

Dr. Burman has been appointed as an Additional Director w.e.f. January 13, 2010 in the category of
Non-Executive and Independent Director. Dr. Burman is an eminent Industrialist with particular
interests in the areas of Research and Development in the Pharmaceutical Sciences as well as
Biotechnology and Technology issues. Dr. Burman has Doctorate in the area of Pharmaceutical
Chemistry from the University of Kansas, USA. He is currently the Chairman of Dabur India Limited.
He is also a member in the Council of Governors at Birkbeck College, University of London.

Mr. Sunil Kant Munjal


Jt. Managing Director

Mr.Munjal is the Jt. Managing Director of Hero MotoCorp Ltd.and Chairman of Hero Corporate
Service Ltd. Recognised by India Today Indias largest English newsmagazine, as one of the Faces
of the Millennium for business. He is responsible for developing growth strategy and
implementation of new business plans for the Group.

Mr. M. Damodaran
Non-Executive &
Independent Director

Mr. Damodaran has been appointed as an Additional Director w.e.f. June 16, 2008 in the category of
Non-Executive and Independent Director. Mr. Damodaran, aged 61 years was born on May 4, 1947
and belongs to the Indian Administrative Service, Manipur-Tripura Cadre. He had held various

Hero MotoCorp
coveted positions in Government / Public Sector and Regulatory Bodies. In the past he held the
position of Joint Secretary (Banking Division) in the Ministry of Finance, Chairman Unit Trust of India.
He headed the IDBI bank before being appointed as the Chairman of the Securities and Exchange
Board of India (SEBI), the country's security market watchdog. He was also appointed as officer on
special duty with the Reserve Bank of India dealing primarily with the restructuring of three
identified weak public sector banks.

Pritam Singh
Non-Executive &
Independent Director

Dr. Singh was appointed as an Additional Director on the Board of the Company on September 28,
2004. in the category of Non-Executive and Independent Director. He is author of seven
academically reputed books and over 50 research papers. Dr. Pritam Singh is one of the pioneers of
Management Education in India who has devoted his life to the development of Management
Education in India and abroad. Dr. Singh received the Padam Shri Award in 2003 for his contributions
to this field.

Mr. Ravi Nath


Non-Executive &
Independent Director

Mr. Nath has been appointed as an Additional Director w.e.f. October 14, 2009 in the category of
Non-Executive and Independent Director. Mr. Nath, aged 64 years is an Advocate of Supreme Court
of India. He is a Partner of one of the India's oldest legal firms Rajinder Narain & Co. He has done his
B.Com (Honours), LLB, International and Competitive Laws from King's College, London, and PIL from
Harvard. He did his apprentice from Sinclair Roche and Temporally, London. He brings with him rich
and specialized experience in the field of Corporate and Commercial law, Asset Finance, Aviation and
Cross Border issues of nearly 40 illustrious years. He has also been recognized several times by
Euromoney and others as a leading lawyer in the field of Mergers & Acquisitions. He is listed in
Who's Who and Legal 500. The Bar Association of India conferred its highest honour on him.

Hero MotoCorp

Ms. Shobana Kamineni


Non-Executive and
Independent Director

Ms. Kamineni has been appointed as an Additional Director w.e.f. March 27, 2015 in the Category of
Non-Executive and Independent Director. Ms. Kamineni was named Executive Vice-Chairperson,
Apollo Hospitals Enterprise Limted (AHEL) in July 2014. A member of the founding family, she has
been director since February 2010.

Hero MotoCorp

Shareholding pattern of Hero MotoCorp


Share Price: 2704.85

Shareholding pattern of Hero MotoCorp


CATEGORY OF SHAREHOLDER

NO. OF SHARE-HOLDERS

TOTAL NO. OF SHARES

% Sharing

(A) Shareholding of Prom oter and Prom oter Group


(1) Indian
Individuals / Hindu Undivided Family

17

51,858,452

25.97%

17,307,630

8.67%

20

69,166,082

34.64%

20

69,166,082

34.64%

203

8,027,565

4.02%

Financial Institutions / Banks

64

4,142,524

2.07%

Insurance Companies

21

15,378,418

7.70%

Bodies Corporate
Sub Total
(2) Foreign
Total shareholding of Prom oter
and Prom oter Group (A)
(B) Public Shareholding
(1) Institutions
Mutual Funds / UTI

Foreign Institutional Investors

637

76,292,543

38.21%

Sub Total

925

103,841,050

52.00%

1,428

3,092,923

1.55%

12,564,974

6.29%

467,290

0.23%

2,417

10,555,181

5.29%

2,240

345,029

0.17%

129

347,890

0.17%

Trusts

45

1,327,267

0.66%

Others

8,534,906

4.27%

89

0.00%

Sub Total

88,774

26,680,368

13.36%

Total Public shareholding (B)

89,699

130,521,418

65.36%

89,719

199,687,500

100.00%

(2) Non-Institutions
Bodies Corporate
Individuals
Individual shareholders holding nominal
share capital up to Rs. 1 lakh
Individual shareholders holding nominal
share capital in excess of Rs. 1 lakh
Any Others (Specify)
Non Resident Indians
Clearing Members

Foreign Individuals

Total (A)+(B)

84,925
4

(C) Shares held by Custodians and against w hich Depository Receipts have been issued
(1) Promoter and Promoter Group

(2) Public

Sub Total

Total (A)+(B)+(C)

89,719

199,687,500

100.00%

Hero MotoCorp

Code of Conduct
Introduction
This Code of Conduct has been adopted by the Board of Directors of Hero MotoCorp Limited for its
members and senior-executives one level below the Directors, including all functional heads
(hereinafter referred to as "Specified employee").
There are certain clauses of the Code, which are meant for Directors only such as attending meetings
of the Board and Committee thereof. The Specified employees need to ignore such clauses.
The principal duty of the Board of Directors along with management is to ensure that the Company
is well managed in the interests of its shareholders. The Board of Directors plays the central role in
the Company's governance. It is the Company's decision-making authority on all matters except
those reserved to shareholders or delegated to the management. The Board of Directors is not
expected to assume an active role in the day-to-day management of the Company.

Duties of Independent Directors pursuant to provisions of Schedule IV of Companies


Act, 2013
The independent directors shall

undertake appropriate induction and regularly update and refresh their skills, knowledge
and familiarity with the company;
seek appropriate clarification or amplification of information and, where necessary, take and
follow appropriate professional advice and opinion of outside experts at the expense of the
company;
strive to attend all meetings of the Board of Directors and of the Board committees of which
he is a member;
participate constructively and actively in the committees of the Board in which they are
chairpersons or members;
strive to attend the general meetings of the company;
where they have concerns about the running of the company or a proposed action, ensure
that these are addressed by the Board and, to the extent that they are not resolved, insist
that their concerns are recorded in the minutes of the Board meeting;
keep themselves well informed about the company and the external environment in which it
operates;
not to unfairly obstruct the functioning of an otherwise proper Board or committee of the
Board;
pay sufficient attention and ensure that adequate deliberations are held before approving
related party transactions and assure themselves that the same are in the interest of the
company;
ascertain and ensure that the company has an adequate and functional vigil mechanism and
to ensure that the interests of a person who uses such mechanism are not prejudicially
affected on account of such use;

Hero MotoCorp

report concerns about unethical behaviour, actual or suspected fraud or violation of the
company's code of conduct or ethics policy;
acting within his authority, assist in protecting the legitimate interests of the company,
shareholders and its employees; and
not disclose confidential information, including commercial secrets, technologies,
advertising and sales promotion plans, unpublished price sensitive information, unless such
disclosure is expressly approved by the Board or required by law.
Further the Independent Directors shall have the following duties as Director as specified u/s
164 of the Companies Act, 2013
Subject to the provisions of this Act, a director of a company shall act in accordance with the
articles of the company;
A director of a company shall act in good faith in order to promote the objects of the
company for the benefit of its members as a whole, and in the best interests of the
company, its employees, the shareholders, the community and for the protection of
environment;
A director of a company shall exercise his duties with due and reasonable care, skill and
diligence and shall exercise independent judgment;
A director of a company shall not involve in a situation in which he may have a direct or
indirect interest that conflicts, or possibly may conflict, with the interest of the company;
A director of a company shall not achieve or attempt to achieve any undue gain or
advantage either to himself or to his relatives, partners, or associates and if such director is
found guilty of making any undue gain, he shall be liable to pay an amount equal to that gain
to the company;
A director of a company shall not assign his office and any assignment so made shall be void;
and
If a director of the company contravenes the provisions of this section such director shall be
punishable with fine which shall not be less than one lakh rupees but which may extend to
five lakh rupees.

Guidelines for Conduct

Each director and Specified Employees seek to use due care in the performance of his/her
duties, be loyal to the Company, act in good faith and in a manner such Director and
Specified employee reasonably believes to be not opposed to the best interests of the
Company. A Director and Specified employee should seek to also:
Make reasonable efforts to attend Board and committee meetings;
Dedicate time and attention to the Company;
Comply with all applicable laws, regulations, confidentiality obligations and corporate
policies of the Company; and
Be independent in judgment and actions and to take all reasonable steps to be satisfied as to
the soundness of all decisions taken by the Board of Directors.

Hero MotoCorp

Corporate Business Opportunities

In carrying out their duties and responsibilities, Directors and Specified employees should
avoid
Appropriating corporate business opportunities for themselves that are discovered through
the use of Company property or information or their position as Directors and Specified
employees;
Using Company property or information, or their position as Director and Specified
employees, for personal gain; and
Competing with the Company.
A corporate business opportunity is an opportunity:
Which is in the Company's line of business or proposed expansion or diversification;
Which the Company is financially able to undertake; and
Which may be of interest to the Company.
A Director and Specified employee, who learns of such a corporate business opportunity and
who wishes to avail of it should disclose such opportunity to the Company's Board of
Directors. If the Board of Directors determines that the Company does not have an actual or
expected interest in such opportunity, then, and only then, may the Director and Specified
employee avail of it, provided that the Director and Specified employee has not wrongfully
utilized the Company's resources in order to acquire such opportunity.

Conflicts of Interest

Each Director and Specified employee should endeavour to avoid having his or her private
interests interfere with:
i) the interests of the Company or
ii) His or her ability to perform his or her duties and responsibilities objectively and
effectively.
They should avoid receiving, or permitting members of their immediate family to receive,
improper personal benefits from the company, including loans from or guarantees of
obligations by the Company, except as may be provided in their employment contract.
They should make a full disclosure to the entire Board of any transaction or relationship that
such a Director and Specified employee reasonably expects could give rise to an actual
conflict of interest with the Company and seek the Board's authorization to pursue such
transactions or relationships.

Company Property
In carrying out their duties and responsibilities, Directors and Specified employees should endeavour
to ensure that management is causing the Company's assets, proprietary information and resources
to be used by the Company and its employees only for legitimate business purposes of the
Company.

Hero MotoCorp

Confidential Information
Director and Specified employees should maintain the confidentiality of information entrusted to
them in carrying out their duties and responsibilities, except where disclosure is approved by the
Company or legally mandated or if such information is in the public domain.
The Company's confidential and proprietary information shall not be inappropriately disclosed or
used for the personal gain or advantage of any Director and Specified employees or anyone other.

Fair Dealing
In carrying out their duties and responsibilities, Director and Specified employees should endeavour
to deal fairly, and should promote fair dealing by the Company, its employees and agents, with
customers, suppliers and employees.
Director and Specified employees should not seek to take unfair advantage of the Company through
manipulation, concealment, abuse of privileged information, misrepresentation of material facts or
any other unfair dealing.

Compliance with Laws and Regulations


In carrying out their duties and responsibilities, Directors and Specified employees should comply,
and endeavour to ensure that the management is causing the Company to comply, with applicable
laws, rules and regulations. In addition, if any Director and Specified employee becomes aware of
any information that he or she believes constitutes evidence of a material violation of any securities
or other laws, rules or regulations applicable to the Company or the operation of its business, by the
Company, any employee or another Director and Specified employee, then such Director and
Specified employee should bring such information to the attention of the Chairman of the Audit
Committee.

Insider Trading
Director and Specified employees should observe all applicable laws and regulations including the
Company policies and Codes as applicable to them with respect to the purchase and sale of the
Company's securities.
It is the responsibility of each Director and Specified employee to become familiar with and
understand these laws, regulations, policies and codes and should seek further explanations and
advice concerning their interpretation, if required.
Any waiver of or amendments to the Company's policies or Codes may be made only by the
Company's Board of Directors and will be disclosed promptly as required by applicable laws and
regulations including the rules of any exchange on which the Company's securities are listed or
traded.
Director and Specified employees should direct questions regarding the application or interpretation
of these guidelines to the Company Secretary/Compliance Officer.

Hero MotoCorp

Encouraging The Reporting Of Illegal Or Unethical Behaviour


Director and Specified employees should endeavour to ensure that management is causing the
Company to promote ethical behaviour and to encourage employees to report evidence of illegal or
unethical behaviour to appropriate Company personnel.
Director and Specified employees should endeavour to ensure that the Company will not allow
retaliation against any employee who makes a good faith report about a possible violation of the
Company's Code of Conduct.

Non-Compliance
Suspected violations of this Code may be reported to the Chairman of the Board or the Chairman of
the Audit Committee. All reported violations should be appropriately investigated.
A Director and Specified employees charged with a violation of this Code should not participate in or
vote on the matter in the meeting of a Committee or the Board concerning his/her alleged violation,
but may be present at a meeting of the Board or of a Committee convened for that purpose.
Any waiver of this Director and Specified employees' Code must be approved by the Board of
Directors and publicly disclosed if required by any applicable law or regulation.

Employees
The Director and Specified employee should respect each and every employee of the Company, treat
each of them in a fair and equitable manner; respect their privacy and not to share/disclose their
personal information without their prior consent; maintain non-discriminatory approach and refrain
from harassing employees, making sexual advancements, coercion, threat by virtue of his/her
position with the Company.

Customers
The Director and Specified employee should ensure to provide products and services, which meet
the desired quality and safety standards and redress the Customer's grievance genuinely.

Shareholders
The Director and Specified employee should ensure to protect shareholders interest by ensuring
maintenance of accurate and complete records by avoiding false misleading or artificial entries in
the Books of accounts.
This Directors' and Specified employees' Code sets forth guidelines for conduct for the Board of
Directors and Specified employees.

Penalty for misconduct:


Any Director or Designated Employee of the Company who acts in contravention of the Code of
Conduct may be penalised and appropriate action may be taken by the Company. Director and
Designated Employee of the Company who violate the Code of Conduct shall also be subject to

Hero MotoCorp
disciplinary action by the Company, which may include wage freeze, suspension, ineligible for future
participation in employee stock option plans, etc.

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