UNITED WORLD SCHOOL OF LAW

SUBJECT: CORPORATE GOVERNANCE

CORPORATE GOVERNANCE REPORT ANALYSIS OF VEDANTA LTD.

SEMESTER 8(B)

BATCH 2019-2024

SUBMITTED TO: SUBMITTED BY:

Prof. Grishma Brahmbhatt Shaily Agrawal

ENROLLMENT NO:
20190401081

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TABLE OF CONTENTS

INTRODUCTION OF VEDANTA LTD. ........................................................................................... 3

COMPANY VALUES AND PHILOSOPHY ..................................................................................... 3
BOARD COMPOSITION .................................................................................................................... 4
BOARD COMMITTEE ....................................................................................................................... 5
SHAREHOLDING PATTERN ........................................................................................................... 6
ANALYSIS ............................................................................................................................................ 8

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INTRODUCTION OF VEDANTA LTD.

Vedanta Ltd (Vedanta), formerly Sesa Sterlite Limited, is a natural resource company. It is a
diversified metal and mining company. The company, along with its subsidiaries, focuses on
the exploration, mining, processing, and exporting of natural resources, power, and oil and gas
businesses. Its product portfolio includes lead, zinc, silver, copper rod and cathodes,
aluminium, iron ore, commercial power, steel, nickel and copper and oil and gas across India.
The Iron Ore segment explores, mines, and processes iron ore, pig iron, and metallurgical coke.
The Power segment consists 600 MW thermal coal-based commercial power facility at
Jharsuguda in the State of Odisha in Eastern India. The company also provides support
activities, such as shipping, port services and shipbuilding. It has operations in the US, Asia-
Pacific, Europe, the Middle East, and Africa. Vedanta is headquartered in Mumbai,
Maharashtra, India. The company was founded by Anil Kumar Agarwal on June 25, 1965 and
is headquartered in Panaji, India.1

COMPANY VALUES AND PHILOSOPHY

Vedanta is dedicated to the highest standards of corporate governance while maintaining its
rapid growth and performance excellence. Being a listed company on the stock exchanges, they
keep their setting global benchmarks of all-round excellence in its sustainability performance.
The strong financial footing on which the company stands today is largely built on the system
orientation ingrained in their departments and business units. They strongly believe that
efficient governance at all levels is necessary to drive change, towards a more resilient and
responsible future. In order to continue to sustain as a progressive company balancing financial
return to investors with unwavering focus on being socially responsible, there is a need to
constantly reinvent and upgrade their governance models in synchronization with the demands
of the contemporary times. Effective corporate governance is a continuous process of
prioritisation and improvement, and they must adapt their processes and activities to be relevant
to the evolving external and internal landscapes. At Vedanta, it is believed that maintaining
high standards of corporate governance has been primitive to the business of the Company

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Forbes <https://www.forbes.com/companies/vedanta-limited/?sh=5b283f114b7b> Accessed on 14th April,
2022

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since its inception. Their Corporate Governance replicates the values, vision, mission and seven
pillars of the Company. To enduringly ensure utmost trust and confidence of their stakeholders
in them and to meet the stakeholders’ aspirations, transparency, culpability, quality, fairness,
safety, competence and professionalism form a vital part of their functioning and practices.

The objective is to meet the stakeholders’ expectations and generate value for its shareholders
through enhanced corporate governance principles. The Company is incessantly working
towards its performance goals focusing on long-term and sustainable value creation.

Seven Pillars of Vedanta

 Sustainability, Health, Safety & Environment

 People
 Values, Ethics & Governance
 Digitalisation, Innovation, Technology & Excellence
 Quality
 Growth
 Giving back to Community/ Society

BOARD COMPOSITION

The Board of Directors is an apex body and an enlightened board creates a culture of leadership
providing long-term vision and improving the governance practices. They play a crucial role
in guiding, overseeing, monitoring strategy, performance and long-term success of the
Company as a whole through strategic directionThe Company is chaired by Mr. Anil Agarwal,
Non-Executive Chairman effective 01 April 2020. With a view to effectively discharge its
obligations and functioning of the relevant areas, the Board has delegated certain
responsibilities to its various designated Board Committees. Each of the Committee has a
clearly defined charter containing the specific terms of reference and scope and is entrusted
with discharging its duties, roles and responsibilities which further recommends to the Board
for action.

As on 31 March 2022, the Board has a One-Tier structure comprising of eight (8) members,
consisting of a Non-Executive Chairman, an Executive Vice Chairman, an Executive Director,
a Non-Executive Woman Director and four Non-Executive Independent Directors including

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one Woman Director. The composition is in conformity with the provisions of SEBI Listing
Regulations and Companies Act and in line with global best practices.

 Anil Agarwal - Chairman

 Navin Agarwal - Vice Chairman
 Priya Agarwal - Non-Executive Director
 UK Sinha - Independent Director
 Padmini Sekhsaria - Independent Director
 Dindayal Jalan – Independent Director
 Akhilesh Joshi – Independent Director
 Sunil Duggal – Whole-Time Director & CEO

BOARD COMMITTEE

Vedanta Ltd. had several board committees that met periodically to oversee various aspects of
the company's operations.

 The Audit and Risk Management Committee

UK Sinha – Chairperson, Akhilesh Joshi and DD Jalan - Member

The Committee met Seven times during the financial year 2021-22 and was responsible for
overseeing the financial reporting process, internal control systems, and risk management
practices of the company. The committee also reviewed the financial statements and
recommended their approval to the board. The Audit Committee comprises three independent
directors, and all the meetings were attended by all the members of the committee.

 The Nomination and Remuneration Committee

UK Sinha – Chairperson, Anil Agarwal and DD Jalan - Member

The Nomination and Remuneration Committee met Four during the financial year 2021-22 and
was responsible for identifying and recommending suitable candidates for appointment as
directors and senior management personnel. The committee also reviewed and recommended
the remuneration of the directors and senior management personnel. The committee comprises
two Independent Directors and one Non- Executive directors, and all the meetings were
attended by all the members of the committee.

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  The Corporate Social Responsibility Committee
Akhilesh Joshi – Chairperson, Priya Agarwal, UK Sinha, Padmini Sekhsaria - Member

The CSR Committee met thrice during the financial year 2021-22 and was responsible for
overseeing the company's CSR activities and ensuring that they align with the company's CSR
policy and the provisions of the Companies Act, 2013. The committee comprises three
directors, including one independent director. All the members attended all the meetings of the
committee.

Apart from these committees, Vedanta Ltd. also had other committees like the Stakeholders
Relationship Committee, ESG Committee, Other Committee which met periodically to oversee
specific aspects of the company's operations.

Overall, the board committees of Vedanta Ltd. met regularly and ensured that there was
adequate oversight and governance of the company's operations. The presence of independent
directors on these committees ensured that there was adequate accountability and transparency
in the decision-making process.

SHAREHOLDING PATTERN (AS OF 31ST MARCH, 2022)

Vedanta Ltd. had a significant shareholding pattern, with the majority of the shares being held
by the promoter group. The promoters of Vedanta Ltd. are Vedanta Resources Limited and
Twin Star Holdings Limited. Together, they held a 69.69% stake in the company, while the
public shareholding stood at 30.31%.

The high promoter shareholding in the company indicates that the management has a
significant stake in the company and a strong alignment of interests with the shareholders. The
presence of FIIs and DIIs also indicates that the company is attracting institutional investor
interest. The presence of individual shareholders is also significant, as it indicates retail investor
participation in the company.

Here,

 Foreign institutional investors (FIIs): FIIs held a 9.35% stake in the company.
 Domestic institutional investors (DIIs): DIIs held a 11.6% stake in the company.
 Individual shareholders: Individual shareholders held a 10.6% stake in the company.

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  Others: Other shareholders held 0.2% stake in the company.

It is important to note that the shareholding pattern of a company can change over time as
investors buy or sell their stakes.

Overall, the shareholding pattern of Vedanta Ltd. indicates a significant ownership by the
promoter group, which may have an impact on the company's corporate governance practices.
However, the presence of a diverse set of public shareholders also ensures that there is some
degree of accountability and oversight.

CORPORATE SOCIAL RESPONSIBILTY (CSR) ACTIVITY

Vedanta Ltd. has a robust and sustainable CSR (Corporate Social Responsibility) program that
is aligned with the UN Sustainable Development Goals (SDGs). The company believes that its
CSR activities play an essential role in creating a positive impact on the communities and the
environment where it operates. It is this integration of business and CSR which provides them
the social licence to operate and helps them to usher in a different developmental paradigm
towards sustainable change in society. As part of their CSR policy, they regularly engage with
government agencies, development organisations, corporates, civil societies and community-
based organisations to carry their durable and meaningful initiatives.

Vedanta Ltd. focuses on four key areas for its CSR initiatives, namely education, healthcare,
women empowerment, and livelihood development. The company has implemented several
programs and projects under these focus areas to address the needs of the communities around
its operations.

Under the education focus area, Vedanta Ltd. has set up 55 schools and 12,500 Ekal Vidyalayas
across India, providing education to over 2,30,000 students. The company has also set up
several vocational training centers to provide skills training to youth and promote
entrepreneurship.

Under the healthcare focus area, Vedanta Ltd. has implemented several initiatives to improve
the health and well-being of the communities. The company has set up hospitals, clinics, and
mobile health vans to provide primary healthcare services to the communities around its
operations. The company also conducts health awareness campaigns and provides free health
check-ups and medicines.

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Under the women empowerment focus area, Vedanta Ltd. has implemented several initiatives
to empower women and girls. The company has set up self-help groups and skill development
centres to provide vocational training to women and promote entrepreneurship. The company
also conducts awareness campaigns on women's rights and health.

Under the livelihood development focus area, Vedanta Ltd. has implemented several initiatives
to promote sustainable livelihoods in the communities around its operations. The company has
set up several agri-based and animal husbandry projects to provide income-generation
opportunities to the communities. The company also promotes sustainable forestry and
promotes renewable energy sources.

ANALYSIS

The Analysis helped me to understand the complex yet insightful report on Corporate
Governance of the company. It helped me understand what all things are involved whole
running a company and what are company’s responsibility towards its shareholders, directors,
consumers, employees, society, etc. Vedanta has maintained the highest standards of corporate
governance all through its operations. Their sustainable development journey continues to
create value for their stakeholders. They have invested their time and resources in introspecting
their actions; they have achieved their targets and formulated ambitious new ones; they have
adopted global best practices and taken innovative leaps; they have aligned our standards with
industry benchmarks and charted some of their own. They have done all this and will continue
to do it with a singular agenda: ensuring long-term growth of all stakeholders. In addition to
complying with the statutory guidelines, the Company has voluntarily adopted and evolved
various practices of governance conforming to utmost ethical and responsible standards of
business. These practices reflect the way business is conducted and value is generated. Since
its inception, Vedanta Limited has taken conscious efforts to operate in a manner responsible
to all stakeholders. Every decision and action at the Company are taken after considering the
impact they may have on the Company’s relevant stakeholder groups. This is a true reflection
of the organisation’s integrated thinking, which considers all the resources and relationships
that affect Company’s ability to create sustained value. The company has also fulfilled their
Corporate Social Responsibility towards the society by working towards the betterment of the
society.