IMB 339

ABHOY K OJHA

ITC LTD.: TOWARD A TRIPLE BOTTOM LINE PERFORMANCE

INTRODUCTION

With a population of more than 1 billion, India has been a major market for all kinds of products and services,
including tobacco products. Despite significant opposition to the consumption of tobacco products by citizen groups,
and government efforts to restrict their consumption through a variety of legislations, India has been a very
attractive market for the tobacco industry in general, and the cigarette industry in particular. The decline in smoking
in the developed world, as a result of government-imposed restrictions and changing attitudes toward smoking has
made India one of the few opportunities for growth for the global cigarette industry. However, the tobacco industry,
including the cigarette industry, has been a source of significant health problems. Some estimates suggest that
globally 11,000 people die because of tobacco in a dayi. Other estimates suggest that 100 million died because of
tobacco in the 20th century and one billion could die in the 21st century ii. The dilemma for industry captains has
been to decide on the future direction of their firms such that it addresses the interest of all stakeholders, including
the society at large, while maintaining short-term and long-term viabilities.

ITC Ltd. has been a diversified company. In addition to being a dominant player in the cigarette industry in India, it
had interests in hotels, agri-business (which included tobacco), packaged foods, lifestyle products, personal care
products, education and stationery products, paperboard and packaging, and more. It also had subsidiaries in other
businesses, including information technology. It has been trying to keep the interest of all the stakeholders in mind
and position itself as a socially-responsible organization. The Chairman of ITC Ltd., while addressing the
shareholders on July 27, 2007 emphasized the need for corporate social responsibility and suggested that ITC Ltd.
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producing economic, environmental and social values, and thus contributing to national progress. His July 24, 2009
address to the shareholders, highlighted a wide range of initiatives in the communities within which the company
has reach, including watershed development, animal husbandry services, education services, and self-help services
as part of the efforts of the company to live up to the promise emphasized in its vision.

ITC Ltd. had to chart its future direction for the next phase of its lifecycle in light of the tremendous opportunities
for growth in the cigarette industry and the controversies around significant social costs, largely owing to health
risks for primary and even secondary smokers. Sanjiv Puri, a long time manager with ITC Ltd. with a wide range of
experience, in various segments of the company, had just then taken over the tobacco division as the chief executive.
What advice would one provide him given the strong evidence of high growth possibilities for the cigarette industry
in India, but also the health risks associated with the consumption of tobacco, including cigarette smoking?

TOBACCO INDUSTRY IN INDIA

Although some types of tobacco and tobacco products existed in India for long, the tobacco we know today was
brought to India by Portuguese merchants about 400 years ago iii. After that the British East India Company
extensively used tobacco as a cash crop for trade primarily to the United Kingdom. After India came under the
control of the British government, there were several initiatives to encourage the cultivation of tobacco across
different parts of the country with primary focus on markets outside India. However, various forms of tobacco
consumption became quite common in India too. After independence also, the tobacco industry continued to make a
significant contribution to the overall Indian economy. The Indian government established the Tobacco Board that

Abhoy K. Ojha prepared this case for class discussion. This case is not intended to serve as an endorsement, source of primary data, or to show
effective or inefficient handling of decision or business processes.

Copyright © 2010 by the Indian Institute of Management Bangalore. No part of the publication may be reproduced or transmitted in any form or
by any means ± electronic, mechanical, photocopying, recording, or otherwise (including internet) ± without the permission of Indian Institute of
Management Bangalore.

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 ITC Ltd: Towards a Triple Bottom Line Performance Page 2 of 10

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regulated the tobacco industry in India. Even as the government tried to discourage the consumption of tobacco
products owing to increasing opposition to consumption of tobacco products, it provided a number of subsidies to
the tobacco industryiv as it provided significant employment to people and income to farmers in the rural areas.

Table 1 shows the growth of the tobacco industry between 1970 and 2000. It shows that production of cigarettes
grew modestly although tobacco leaf production grew significantly. Although the land devoted to tobacco
production remained about the same, there was an increase in the number of people employed in the industry.
Imports of cigarettes and tobacco had fluctuated but grown modestly, and exports of tobacco and tobacco products
had increased significantly.

In 2011, India was one of the three largest producers of tobacco along with China and Brazil v. It was estimated that
229 million males and 11 million females in India consumed tobacco in some formvi. According to the National
Family Health Survey, 57% of men and 11% of women in India aged 15±49 years consumed one form of tobacco or
anothervii. Tobacco consumption in India could be broadly classified into three categories: (i) chewing tobacco,
including zarda, khaini, and gutka, which comprised about 48% of the consumption; (ii) bidis, tobacco rolled in leafs
largely produced in the unorganized sector, which comprised about 38% of the consumption; and (iii) cigarettes,
largely produced in the organized sector, which comprised the remaining about 14% of consumption. Cigars,
hookah and some other forms of tobacco consumption contributed very little to the overall market.

India has been the eighth largest exporter of tobacco and tobacco products in the world. According to the Tobacco
Board data, exports of tobacco and tobacco products rose by about 67% in rupee terms to Rs. 3,383 crore in the year
2008±2009 on a year-on-year basis. In dollar terms, exports increased by a record 47% to US$ 737 million viii.
Cigarettes accounted for 85% of the country's total tobacco exports. Some tobacco products were also imported into
the country.

The tobacco industry provided employment to over 10 million people who were directly involved with the various
stages of cultivation, manufacturing and distributions processes and contributed over Rs. 70 billion to government
earnings. The commercial cultivation of tobacco was concentrated in Andhra Pradesh, Karnataka, Gujarat,
Maharashtra, Bihar, Tamil Nadu, and West Bengal ix, with about 80% of the tobacco grown in Andhra Pradesh,
Gujarat and Karnataka. The tobacco production in India was expected to increase in the next few years. The increase
in demand for tobacco leaf was reflected in the fact that the average price received by tobacco farmers in Andhra
Pradesh increased from Rs. 84.75 in 2008 to Rs. 108.27 in 2009 x.

CIGARETTE INDUSTRY IN INDIA

There were 14 major cigarette manufacturing companies in India xi. Four companies, ITC Ltd., Godfrey Phillips
India Ltd., Vazir Sultan Tobacco Ltd., and Golden Tobacco Ltd. accounted for over 95% of the cigarette market.
ITC Ltd. was the largest of these and comprised about 75% of the market. It was involved with cigarette
manufacturing, tobacco leaf procurement and processing, as well as investments in the manufacture and export of
cigarette packaging materials. In addition to serving the growing domestic market, the company also exported
cigarettes and unmanufactured tobacco. Other tobacco companies included Kanhayya Tobacco Company, M.R.
Tobacco, Sapna Enterprises, Sudarshan Tobacco, Dalmia Consumer Care, and Kothari Products Ltd.

According to the Tobacco Institute of India, the number of cigarettes sold in the country had remained more or less
constant since the late 1980s, barring a few fluctuations. However, there had been some changes. Cigarette
production in India increased from 87,568 million pieces in the year 2001±2002 to 113,835 million pieces in the
year 2006±2007, which was a 30% increase. However, there was a slight decline in output owing to the impact of
the new taxes levied. The consumption of cigarettes declined from 19% to 14% as a proportion of overall tobacco
consumption over the previous 10 years. Largely because of the impact of high taxes on cigarettes, which were
lower for bidis and other products, people had moved to those forms of tobacco that were less taxed. Smuggling,
also as a result of high taxes, had an impact on the market. In the year 2008±2009, cigarette production dropped to
109,231 million piecesxii. However, most firms in the industry did not experience a drop in revenues; rather they
experienced an increase in revenues, as they raised prices to compensate for the drop in consumption.

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GROWTH OPPORTUNITY

The number of smokers in India has remained about constant for a long time xiii. Even after an increase in the number
of smokers, India has one of the lowest per capita consumption of cigarettes in the world. As shown in Table 2, the
per capita consumption of cigarettes in India was significantly lower than the world average. In most countries,
cigarettes accounted for about 85% of tobacco consumption. In India, cigarette consumption was about 14% in
2011xiv. Studies show that the urban low and lower-middle income households consumed more cigarettes compared
to the similar income groups in rural areas xv. Growing disposable incomes and increased media exposure for this
segment of the population provided growth opportunities for the industry. As affluence increased the possibility of
increase in cigarette smoking, many people moved from other forms of tobacco consumption to cigarettes. Further,
India is demographically very attractive to the industry as 65% of the population was below the age of 35 years. A
significant proportion of this segment of population is likely to have higher disposable incomes and possibly a lower
level of aversion to smoking, providing a potential for growth for the cigarette industry. A top executive of one of
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people become more prosperous and have more disposable income, consumption of cigarettes will go up. Cigarettes
are a much more moGHUQDQGVXSHULRUSURGXFW´xvi

Further, there were growth opportunities in exports. India's share in world cigarette production had remained at
around 1.7% whereas India's exports of around 2.8 billion sticks of cigarette per year accounted for less than 1% of
the world export of cigarettexvii. There was significant opportunity for the cigarette industry to extend and
consolidate its position in the international market owing to some recent trends such as withdrawal/reduction of
agricultural subsidy and escalating cost in the traditional cigarette exporting countries.

THE HEALTH HAZARD

Globally, about one billion men in the world smoke: of them, about 35% of men live in high-resource countries, and
50% of men in developing countries. About 250 million women are daily smokers. Estimates suggest that in 2010,
tobacco accounted for about 8.8% of all global deaths and 4.2% of disabilities xviii, and around 5.4 million people
died prematurely owing to tobacco-related illness. According to World Health Organization (WHO) estimates, about
80% of those who were negatively affected come from low and middle-income nations that would pay a heavy price
in terms of financial and social costs. Statistics indicate that more than half of the world's smokers live in 15
countries such as India, Bangladesh, Russia, China, and Indonesia xix.

According to the WHO, India is home to 12% of the world's smokers. Surveys suggest that there was an increase in
smoking in urban areas, and just 2% of the smokers were inclined to quit smokingxx. A study by the Centre for
Global Health Research, University of Toronto, Canada estimated that around 0.5 million people are likely to die of
smoking in India in one year 1$UHVHDUFKHUIURPWKHVWXG\JURXSZDVTXRWHGDVVD\LQJ³,QGLDLVLQWKHPLGVWRID
FDWDVWURSKLFHSLGHPLFRIVPRNLQJGHDWKV´ xxi. A study, "A Nationally Representative Case-Control Study of Smoking
and Death in India," covered as many as 1.1 million homes across India and involved 900 field workers. The
smoking histories of 74,000 who had died were studied. It concluded that men who smoked bidis lost 6 years of
average life while women lost 8 years. Men who smoked cigarettes lost 10 yearsxxii.

Nicotine from tobacco led to an acceleration of coronary artery disease, peptic ulcer disease, reproductive
disturbances, esophageal reflux, hypertension, fetal illnesses and death, chronic bronchitis, and delayed wound
healing. Studies suggested that tobacco acted on cells as a mutagen, disrupting the inherited regulation mechanisms
for repair and reproduction, making them susceptible to cancer xxiii. According to estimates, cancer of the oral cavity,
pharynx, esophagus, and lungs together accounted for 75% of tobacco-related cancers in the countryxxiv.

1
It is worth noting, however, that bidi smoking was one of the largest killers in India. Estimates indicated that bidis killed 6,00,000 people in
India every year1. According to a study done by the Health Ministry, 70% of tobacco smoked in the country was in the form of bidis. The states
with maximum bidi smoking were Manipur, Mizoram, Nagaland, and Sikkim. Some studies suggested that the mortality rate from bidi smoking
was much higher than cigarette smoking and overall mortality rate from tobacco smoking was even higher.

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 ITC Ltd: Towards a Triple Bottom Line Performance Page 4 of 10

The National Family Health Survey (1998±1999) revealed that smoking and chewing tobacco affected different
strata of society differently. Individuals with no education were 2.69 times more likely to smoke and chew tobacco
than those with post-graduate education. Households belonging to the lowest fifth of a standard of living index were
2.54 times more likely to consume tobacco than those in the highest fifth xxv. According to a study by the Indian
Council of Medical Research, the average economic cost of major diseases owing to tobacco use in India in 1999
was estimated at Rs. 350,000 for cancer, Rs. 29,000 for coronary artery disease and over Rs. 23,000 for chronic
obstructive lung disease. Total losses from these tobacco-related diseases in 1999 was about Rs 277.6 billion,
equivalent to US $6.5 billionxxvi

The Government of India tried to control the consumption of tobacco in a variety of ways, including taxation, ban on
advertising, ban on sales to minors, and ban on smoking in public places, etc. Many of these initiatives focused more
on the organized sector, particularly the cigarette industry. In September 2009, the Union Minister of State for
Health and Family Welfare indicated that India was committed to bring down tobacco production as per the
provisions of Framework Convention on Tobacco Controlxxvii. He acknowledged that there was a need for
concentrating on alternative livelihood for the millions of farmers and cottage industry workers who were engaged
in tobacco-UHODWHGDFWLYLWLHV+RZHYHUKHDOVRHPSKDVL]HGWKDWWKH³WREDFFROREE\KDVXVHGWKHVHWZRVWDNHKROGHUV
to stall many serious steps to curb the tobacco menace in the country,¶¶xxviii . He outlined various initiatives of the
Government of India to control tobacco consumption which, according to available estimates, killed about 0.9
million people every year in the country.

TAXATION

One of the tools that the government used to control the consumption of cigarette was taxes. Industry experts
suggested that cigarettes were taxed the highest among all tobacco products which was about 132% of the value of
the productxxix. Cigarettes contributed more than 90% of the total tax revenue from the tobacco sector despite
constituting only 14% of the tobacco consumption in the country. Since 1979, when duty on raw tobacco was
removed, the burden of tobacco tax had increasingly shifted to the cigarette industry xxx. However, the high taxes on
cigarettes continuously drove consumers to cheaper tobacco products2. In addition to the central government, the
state governments also imposed other taxes. A Supreme Court verdict ended a 12-year-long legal battle against the
imposition of luxury tax on cigarettes by 10 states declaring them illegal xxxi. However, the cigarette industry was still
heavily taxed. In 2007, the government increased excise duty by 6% and added 12.5% in VAT, bringing the total
effective tax to about 20%. This was a big challenge for the cigarette industryxxxii. Some argued that the decline in
domestic cigarette consumption discouraged investment in R&D and quality enhancement of tobacco varieties and
thereby undermined the export potential of high-value Indian cigarette tobaccos.

Analysts saw a conflict between the tax objectives of the government. The cigarette sector was taxed at higher rates
to meet government revenue needs. This did not serve the objective of discouraging tobacco consumption, as the
consumption pattern shifted to tobacco that was less taxed or not taxed at all. At the same time, other considerations,
such as employment and income generation in rural area hindered any serious effort toward reducing non-cigarette
consumption of tobacco. Some analysts argued that tobacco taxation in India achieved neither revenue optimization
nor tobacco control as an objective xxxiii.

2
The non-smoking tobacco products, commonly used among rural masses, were not taxed. Bidis, which were used by people in lower economic
strata, were not taxed till the early 1990s, and in 2011 were taxed only lightly. In 2011, taxes on bidis were 30 times lower than that of cigarettes
on per kilo basis. The Health Ministry recommended that taxes be on par with non-filter cigarettes, which would raise the price of a pack of 25
bidis from Rs. 4 to Rs. 82. Non-filter cigarettes attracted a much lower tax than filter cigarettes. The central government policy of keeping the
prices of certain tobacco products cheaper for low-income groups ignored the potential of higher occurrence of tobacco-related diseases.

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 ITC Ltd: Towards a Triple Bottom Line Performance Page 5 of 10

CIGARETTES AND OTHER TOBACCO PRODUCTS ACT, 2003

The Cigarettes and Other Tobacco Products (Prohibition of Advertisement and Regulation of Trade and Commerce,
Production, Supply and Distribution) Act, 2003 (COTPA) was being implemented in a phased manner with effect
from May 1, 2004. The purpose of this act was to reduce the consumption of tobacco consumption and also make it
more difficult for producers to reach potential consumers. In line with the provisions, the Government of India
banned the advertising of cigarettes. Advertising of cigarettes was banned on television and commercial radio
stations, and in government-owned premises. Cinema, outdoor advertising and sponsorship of sports, and other
events and cultural activities were permittedxxxiv.

The government had put a ban on smoking in public, and a ban on sale to minors. Smoking was banned in
government offices, public transport, cinema halls, theatres, and government-run stadiums. The law prohibited
smoking in workplaces and public places including hotels, restaurants, coffee houses, pubs, airport lounges,
shopping malls, cinemas, educational institutions, and libraries, hospitals, auditoriums and railway stations. A poll
conducted in four Indian cities, Mumbai, New Delhi, Chennai, and Kolkata found that there was near-universal
support for prohibiting smoking inside all public places and workplaces in India. Overall, 97% of the Indians
surveyed expressed support for the smoke-free law, with 92% expressing strong support. The level of strong support
ranged from 89% in New Delhi to 97% in Mumbai. In addition, 84% said that they thought secondhand smoke was
a serious health hazard, and 99% agreed that workers should be protected from secondhand smoke xxxv.

Under the provisions of the Act and rules approved in 2006, companies would have to display pictures of the
potential health dangers of smoking cigarettes, such as oral cancer and lung cancer. This provision had just been
implemented, and the industry was fearful that this may have a negative impact on volume sales.

CHALLENGES IN THE MARKET

Given the prevalence of high taxes on cigarettes, other unscrupulous elements could enter the industry illegally and
often create a market loss for the legal industry. For example, smuggled cigarettes posed a major threat to the legal
industry. According to industry estimates, cigarettes were the world's most widely smuggled legal consumer
product. In 2006, about 600 billion smuggled cigarettes were consumed, which was a missed tax opportunity for
governments, as well as a missed opportunity to prevent many people from starting to smoke and encourage others
to quitxxxvi. According to estimates, contraband cigarette sales caused a loss of Rs. 1,500±2,000 crore per annum to
the Indian government in terms of taxes and forex outflowxxxvii. As both imported and smuggled cigarettes did not
use Indian tobacco, their influx also served to erode the demand for Indian cigarette tobacco, thereby negatively
impacting farmersxxxviii.

Some illegal manufacturers in the small-scale industry or unorganized sector entered the market without formal
licenses. Some of these firms manufactured products illegally to avoid the high taxes. This not only led to the
presence of inferior products, which did not conform to strict quality standards, in the market but also hurt the
markets available to the legitimate cigarette industry.

Although imports constituted only a negligible proportion of the domestic pie, their rising share posed a threat to
players.

ITC LTD.

ITC Ltd. has been one of India's foremost private sector companies with a market capitalization of nearly US $14
billion and a turnover of over US $5 billionxxxix. In the year 2009±2010, ITC employed over 29,000 people at more
than 60 locations across India. It was rated amongst the best organizations in the world by Forbes magazine and in
Asia by Business Weekxl and in India by Business World and Business Today. ITC Ltd. was established in India by a
U.K.-based tobacco company in 1910 as a sales organization named the Imperial Tobacco Company of India Ltd.
Under pressure from the government of India, Imperial divested its equity in 1969 through a public offer, which
raised the shareholdings of the Indian individual and institutional investors from 6.6% to 26%. After this, the
holdings of Indian financial institutions were 38% and the foreign collaborator held 36%.

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 ITC Ltd: Towards a Triple Bottom Line Performance Page 6 of 10

In 2011, ITC Ltd. was a dominant player in the cigarette industry, with about 75% of the market. Although ITC Ltd.
dominated the cigarette business, it realized very early that making only a single product, especially one that was
considered injurious to health, could be a problem. Similar to other global tobacco companies, it diversified into
other markets. It had a presence in hotels, paperboards, specialty papers and packaging, agri-business, packaged
goods and confectionery, information technology, branded apparel, personal care, stationery, safety matches, and
other products. Table 3 shows the performance of the various business segments.

Although ITC Ltd. continued to be a market leader in the cigarette industry, it was doing reasonably well in its new
businesses in which it had diversifiedxli. The trend suggested that the other FMCG business would be profitable in
the near future. ITC Ltd. had been constantly making efforts to de-emphasize its tobacco business. However, in the
year 2009±2010, cigarettes contributed over 65% of its gross revenues, about 45% of its net revenues, and over 80%
of its profits. If the tobacco component of the agri-business was included, then the dependence of ITC Ltd. on
tobacco and tobacco products for the near future cannot be under-emphasized.

,7&/WG¶VFRUSRUDWHVWUDWHJ\KDd focused on creating multiple avenues of growth based on its core competencies xlii.
ITC had built on its core competencies: distribution reach, brand-building capabilities, supply chain management
and service skills. The vision of the company was to continuously enhance the wealth of its more than 3,53,000
shareholders, while fulfilling the aspirations of its other stakeholders and meeting societal expectations. Its vision
has been captured in its corporate positioning statement: "Enduring Value. For the Nation. For the Shareholder."

This vision is reflected in the address of the Chairman of ITC to the shareholder on July 27, 2007.

It is only when market forces make CSR a crucial component of shareholder value creation that new
competitive forces will emerge in favor of responsible corporate action. .The key to corporates¶ sustaining a
meaningful strategy for constructive social action therefore lies in the ability to create strong market drivers
that incentivize CSR.

And on July 30, 2008:

In the past, I have shared with you the abiding vision that inspires us to create sustainable stakeholder
wealth and enlarge our contribution to the Indian society. This commitment goes far beyond the market to
create simultaneously financial, environmental and social capital for the nation... The Triple Bottom Line
approach to creating economic, environmental and social capital unleashes strong multipliers that
contribute to making national progress more inclusive and sustainable.

,7&/WG¶VWULSOHERWWRPOLQHDSSURDFKLVDSSDUHQWLQLWVYDULRXVVWUDWHJLFHIIRUWV7KHVXFFHVVRQWKHHFRnomic
and financial parameters is quite apparent as the organization had a turnover of over US $6 billion and a market
capitalization of nearly US $30 billion. Returns to the shareholder, including increases in market capitalization
and dividends, grew at the compounded rate of over 24% per annum for 15 years before 2010. In order to
continue the creation of economic value, the organization diversified into other businesses to provide multiple
drivers of growth.

,7&/WG¶VHIIRUWVWRFUHDWHHQYLURQPHQWDOYDlue are visible in the various initiatives. It had been a carbon positive
company, which was storing twice the amount of carbon than it emitted, for five years earlier to 2010. It had been a
water positive company, which was harvesting three times the water it consumed, for eight consecutive years.
Besides, it also had several water recycling initiatives. Nearly 31% of its energy consumed was generated from
renewable resources. Two of its new hotels, ITC Royal Gardenia and ITC Green Centre, were awarded for being
green buildings.

,7&/WG¶VDOVRFUHDWHd social value in its context. It businesses generated direct and indirect employment for over 5
million people. Its e-Choupal initiative benefitted over 4 million farmers. It greened over 1,07,000 hectares of land
and its watershed initiatives helped provide water to 54,000 hectares of dry lands. In addition, ITC Ltd. had many
SURJUDPVIRUZRPHQ¶VHPSRZHUPHQWVXSSOHPHQWDU\HGXFDWLRQ, and integrated animal husbandry.
ITC Ltd.¶VHIIRUWVWRSXUVXHWKHWULSOHERWWRPOLQHDSSURDFKKDGDOVREHHQDSSUHFLDWHGE\WKH9LFH-President of
India, M. Hamid Ansari.

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 ITC Ltd: Towards a Triple Bottom Line Performance Page 7 of 10

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objective but also guides key organizations in the private sector, such as ITC. I hope your initiatives would
prove to be a trendsetter for the Indian Industry.

THE DECISION

How can Sanjiv Puri guide the future of the Tobacco Division to live up to the promises of the triple bottom line
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company?

(i) Given the overwhelming evidence of health problems caused by tobacco, including cigarettes, should he
work toward progressively winding down the cigarette operations? What are the implications for the
shareholders and other stakeholders, including employees, suppliers and farmers, associated with the
business?

(ii) Should he work on strategies to continue to grow the cigarette operations, and maybe invest afresh in the
industry, but also invest significantly into research on the health problems caused by the consumption of
tobacco, particularly cigarette smoking? Should he invest in research to make cigarette smoking less
harmful?

(iii) Should he increase efforts to counter the negative publicity for the tobacco industry as it might result in
further taxes and restrictions that might make the cigarette industry unviable? Should he lobby the
government and educate the general public on the needs for a fairer tax regime across all tobacco
products? Should he highlight all the positives that ITC Ltd. generates, despite the negatives that are
associated with the industry, to shore up support?

(iv) Should he try to focus entirely on export of tobacco products in the long run? This would allow the
positives to accrue to the stakeholders in the country with the potential negatives being ³exported´ to
other countries in which the cigarettes might be consumed.

i
www.indiatogether.org/2008/feb/hlt-tobacco.htm
ii
timesofindia.indiatimes.com/.../india/229-million-males-in-India-consume-tobacco-/.../4239447.cms
iii
http://www.businessworld.in/index.php/Economy-and-Banking/Tobacco-Timeline.html
iv
http://www.businessworld.in/index.php/Economy-and-Banking/Tobacco-Timeline.html
v
timesofindia.indiatimes.com/.../india/229-million-males-in-India-consume-tobacco-/.../4239447.cms
vi
timesofindia.indiatimes.com/.../india/229-million-males-in-India-consume-tobacco-/.../4239447.cms
vii
http://www.businessworld.in/index.php/Economy-and-Banking/Tobacco-Timeline.html
viii
http://www.mydigitalfc.com/industry/budget-lights-cigarette-industry-554
ix
dacnet.nic.in/tobacco/handbook/intro.htm
x
http://www.mydigitalfc.com/industry/budget-lights-cigarette-industry-554
xi
http://www.businessworld.in/index.php/Economy-and-Banking/Tobacco-Timeline.html
xii
http://www.mydigitalfc.com/industry/budget-lights-cigarette-industry-554
xiii
http://www.businessworld.in/index.php/Economy-and-Banking/Tobacco-Timeline.html
xiv
www.foolonahill.com/mbacigsenviron.html
xv
www.foolonahill.com/mbacigsenviron.html
xvi
www.tobaccofreekids.org/campaign/global/casestudies/india.pdf
xvii
dacnet.nic.in/tobacco/handbook/intro.htm
xviii
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 ITC Ltd: Towards a Triple Bottom Line Performance Page 8 of 10

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Calcutta from Dec 2021 to Mar 2022.
 ITC Ltd: Towards a Triple Bottom Line Performance Page 9 of 10

ANNEXURE I

Table 1
Annual Tobacco Trade and Agriculture Statistics in India

Unit 1970 1980 1990 1995 2000

Cigarette imports 5 8 68 169 44

Cigarette exports Sticks in millions 27 2187 6363 1220 3655
Tobacco leaf imports Sticks in millions 32 88 38 409 1423
Tobacco leaf exports Metric tons 47905 71146 69965 77678 97363
Metric tons

Cigarette production 62930 77376 61162 69589 75085

Tobacco leaf production Sticks in millions 337100 438500 551600 566700 609000
Land devoted to tobacco Metric tons 437900 425400 413100 381000 433400
Hectares

Employment 121000 358000 431452 471657 NA

People

Source: Regional Tobacco Surveillance System Country Profile India

Table 2

Source: ITC Web site

This document is authorized for use only in Prof. Nisigandha Bhuyan's Business Ethics_Term-III_Section-ABC&D_2021-22_Prof. Nisigandha Bhuyan at Indian Institute of Management -
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 ITC Ltd: Towards a Triple Bottom Line Performance Page 10 of 10

Table 3
Segment-wise Revenues and Profits at ITC Ltd. (Rs. crores)

2009±2010 2008±2009
Gross Revenue Net Revenue Profit Gross Revenue Net Revenue Profit

FMCG ± Cigarettes 17293.00 9321.00 4938.00 15115.00 7781.00 4184.00

- Others 6642.00 3634.00 (350.00) 3,014.00 3006.00 (483.00)
Total FMCG 20925.00 12955.00 4589.00 18,129.00 10786.00 3700.00
Hotels 911.00 851.00 217.00 1020.00 935.00 316.00
Agri-business 3862.00 3862.00 436.00 3846.00 3846.00 256.00
Paperboards, paper & pack 3234 3108.00 684.00 2800.00 2647.00 509.00
Total ITC Ltd. 28931.00 20776.00 5926.00 25817.00 18215.00 4781.00
Less: inter-segment revenue 2672.00 2622.00 2674.00 2603.00

Gross/net sales 26260.00 18153.00 23144.00 15612.00

Less: interest 53.00 18.00

Other expenditure/income (143.00) (63.00)

Total profit before tax 6015.00 4826.00

Source: Corporate presentation on ITC web site

This document is authorized for use only in Prof. Nisigandha Bhuyan's Business Ethics_Term-III_Section-ABC&D_2021-22_Prof. Nisigandha Bhuyan at Indian Institute of Management -
Calcutta from Dec 2021 to Mar 2022.