Creating Shareholder Value

RIL’s Vision in 1980-81

…..the Company a multi product and well
diversified Company resulting in a
complete change in the face of the
Company and imparting a future
improvement to the net worth of equity.
RIL’s Vision in 1997-98
GOAL AND VISION
In the light of anticipated robust growth in
the Indian economy, and our earnings
growth forecast, we will endeavour to
double the value of Reliance in the next
five years. We plan to achieve this goal
through focussed growth, capital
efficiency and a single minded emphasis
on shareholder value.
RIL’s Vision in 1997-98

We have set ourselves the targets of

achieving a 20% compounded growth
in earnings per share and a return of
20% on shareholders’ funds over the
next 5 years.
Modi Xerox’s Corporate Goals
To deliver maximum customer
satisfaction.
To aim for enhanced Employee
motivation and satisfaction.
To increase market share.
To improve its Return on Assets.
ONGC’s Vision Statement
To be a world-class Oil and Gas
Company integrated in energy
business with dominant Indian
leadership and global presence.
IOC’s Vision Statement
A major diversified, transnational,
integrated energy company, with national
leadership and a strong environment
conscience, playing a national role in oil
security and public distribution.
BP-AMOCO’s Vision
To create long-term shareholder value
from a distinctive set of investment
opportunities, which are:
◦ biased towards the upstream
◦ capable of producing returns which are both
secure and highly competitive over the
long-term
BP-AMOCO’s Mission
 We currently expect to pursue that objective by:
◦ maintaining proforma return on capital employed (ROCE) at
least broadly flat between 2003 – 2005
◦ disciplined long-term investment growth
◦ maintaining proforma gearing in the range of 25 - 35%
◦ the strategic management of costs:
 best-in-class operating costs (e.g. field or site specific costs)
 value/benefit driven revenue investment (e.g. advertising, technology
costs)
 fit-for-purpose and efficient levels of overhead cost
BP-AMOCO’s Mission
a balanced value delivery to shareholders through:
◦ dividends - maintaining our track record over the past twenty
years where we have achieved dividend payments above the
rate of inflation and above the rate of growth of demand for our
products
◦ share repurchase – intent to spend, subject to conditions, $2bn
on share repurchases announced in February 2003, further
could be expected in future if surplus cash is generated above
the requirements of the financial framework at standardised
assumptions due to divestments or the environment.
ExxonMobil: Vision

Long-term growth in shareholder value is our core and fundamental

objective
ExxonMobil: Long-term shareholder
value creation is achieved through
 Unparalleled execution of business strategies.
 Unwavering capital discipline.
 Operational excellence and superior results.
 Ethics and business integrity.
Vision Statement of GAIL

Be the Dominant Natural Gas Company with

significant Global Presence, Integrated in
Energy and Petrochemicals.
We meet the objectives of our shareholders
by providing them superior returns and value
through their investments in us.
HPCL’s Mission Statement
 HPCL, along with its joint ventures, will be a fully
integrated company in the hydrocarbons sector of
exploration and production, refining and marketing;
focusing on enhancement of productivity, quality and
profitability; caring for customers and employees;
caring for environment protection and cultural
heritage. It will also attain scale dimensions by
diversifying into other energy related fields and by
taking up transnational operations.
To creating sustainable value for shareholders, all other
stakeholders have to be satisfied first

Suppliers Bankers
Employees Government

Consumers Shareholders

Community

Shareholders are the last stakeholder in the queue

What is the best measure of shareholder
value creation?

Sales?

Earnings?

Market Value?

Dividends?

Return on Assets?