TO THE MEMBERS
Your Directors have pleasure in presenting their Seventy-seventh Report and the AuditedFinancial Statements of the Company for the financial year 2020-21.
| || ||(Rs. in Crore) |
|Particulars ||For the year ended March 31 2021 ||For the year ended March 31 2020 |
|Revenue from Operations ||4310.02 ||4093.14 |
|Other Income ||80.90 ||114.39 |
|Total Income ||4390.92 ||4207.53 |
|Profit Before Tax ||925.95 ||802.70 |
|Profit After Tax ||690.69 ||592.93 |
|Retained Earnings and Other Comprehensive Income (OCI) || || |
|Balance brought forward ||1922.54 ||1567.49 |
|Profit After Tax ||690.69 ||592.93 |
|OCI arising from remeasurement of employee benefits ||1.25 ||(4.96) |
|Dividend-FY 2019-20 ||(531.23) ||- |
|Dividend-FY 2018-19 ||- ||(138.12) |
|Dividend Distribution Tax* || ||(28.39) |
|Transfer to Reserves ||(69.07) ||(59.29) |
|Implementation of IND AS 116 (Net of Tax)* || ||(7.12) |
|Balance carried forward ||2014.18 ||1922.54 |
*Under modified retrospective method.
# Effective April 1 2020 dividends distributed by the Company shall be taxable in thehands of the shareholders.
Your Directors recommend a final dividend of Rs.120/- and special dividend of Rs.155/-per share (previous year : final dividend of Rs.107/- and special dividend of Rs.143/- pershare) for the year ended March 31 2021 on 21249302 fully paid-up Equity Shares ofRs.10/- each. The proposed dividend if approved at the Annual General Meeting willabsorb a sum of Rs.584.36 Crore (previous year : Rs.531.23 Crore).
In view of the changes made under the Income-tax Act 1961 by the Finance Act 2020dividends paid or distributed by the Company shall be taxable in the hands of theShareholders. Your Company shall accordingly make the payment of the proposed dividendfor the year ended March 31 2021 after deduction of tax at source.
DIVIDEND DISTRIBUTION POLICY
Dividend Distribution Policy adopted by the Company in terms of requirements under theSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 is available on the Company's website at https://www.abbott.co.in/investor-relations/policies.htmlThe said Policy lays down various factors which are considered by the Board whilerecommending dividend for the year.
MATERIAL CHANGES AFFECTING THE COMPANY
There have been no material changes and commitments affecting the financial position ofthe Company between the end of the financial year and date of this report. There has beenno change in the nature of business of the Company.
India has been one of the fastest growing large countries in the past decade regularlyachieving an annual growth of 6-7%. The rise in GDP is largely credited to factorsincluding urbanization and improvement in the efficiency and productivity of technologies.
As per IMF the economy contracted by 8% in 2020 owing to the COVID-19 pandemic andlockdown. The Government has made significant efforts towards safeguarding citizens andenergizing the economy.
Going ahead accelerating global recovery ample liquidity/ low rates are expected toaid upturn. Growth in 2021 was expected to bounce back to 12.5% due to recovery posteasing of lockdowns. However second wave high caseloads new lockdowns rising inputprices MSME stress and weak labour market are some of the headwinds in need of immediateaddressal. A combination of policy reforms and rapid digitalisation continue to boost theIndian economy onto a higher growth trajectory despite the debilitating effects of thepandemic. Monetary and Fiscal support is crucial in this regard. The Reserve Bank of Indiais committed to keeping rates well anchored and the Government must keep up spending.Finally quick progress on vaccination is paramount.
The global pharmaceutical industry has seen an increased use of medicines over the pastdecade where the rate of growth of medicine usage has outpaced both population andeconomic growth. This expansion has been largely on account of the pharmemerging markets.
The Indian pharmaceuticals industry is poised for a big leap forward in this decade.Health science and innovation have come into sharp focus as never before. Thedevelopments over the past year have emphasized the importance of an innovation ecosystema robust infrastructure for production of drugs and pharmaceuticals and the need toconstantly build a huge talent pool of scientists researchers and technologists who canbe the arrowheads for the future. India has emerged as a pharmacy to the world supplyingcritical drugs and vaccines in the course of this pandemic.
Indian pharmaceuticals industry supplies over 50% of global demand for variousvaccines 40% of generic demand in the US and 25% of all medicine in UK as per the IndianMinistry of Commerce. It is also the largest producer of generic medicines and vaccinesoccupying 20% volume share in generics and 62% in vaccines as per the National IndianPromotion Agency.
As per IQVIA India's domestic Pharmaceuticals Market (IPM) is estimated at Rs.153534Crore in 2021 with growth of 4.4% v/s 2020. Acute therapies dominate IPM with 64% of totalsales however the chronic segment shows faster growth. There are estimated to be over8000 pharmaceutical companies however the market is dominated by a core of around 300manufacturers whose products generate the majority of sales in most therapy areas.Domestic manufacturers claim around three-quarters of the market in value terms.
Branded generics dominate the domestic prescription pharmaceutical market accountingfor around 80% of sales by value as per IQVIA. While efforts to raise the regulatory barare being pursued brand names and company image are still widely regarded as de-factoindicators of quality. The market is expected to grow at 8% per annum over the next 5years driven by high economic growth increasing penetration of health insurance andincreased private sector investment.
OPPORTUNITIES AND CHALLENGES
The COVID-19 pandemic has transformed the industry with increasing digitization andtraction of e-pharmacy and pharmacy chains. Increased healthcare coverage and betterpolicy support are likely to boost growth whereas adverse regulation could impact in anegative way.
Factors which impact Industry and Company growth include :
Technology and Digitalization : The COVID-19 pandemic has changed thecomfort level of patients and doctors with using technology. Over three-quarters ofdoctors also expect to conduct remote consultations more widely in the long term. Whileresults of tele-detailing by medical representatives have been mixed a substantialproportion of physicians have proved receptive to these shifts which appear likely totrigger a permanent change in promotional models. Going forward there will be a greateremphasis placed on the sales representative's ability to communicate effectively throughdigital channels.
Ayushman Bharat : AB-PMJAY targets to cover around 500 million of thecountry's poorest individuals with health insurance of Rs.5 Lakh per family per annum forsecondary and tertiary care hospitalization. By May 2021 it had issued approx. 150 millione-cards however take up was slow with only 50% of the total budget allocated being used.The transformation of public primary care facilities into Health and Wellness Centers isfaring better with more than 75000 Health and Wellness Centers operational by May 2021.
E-pharmacy and pharmacy chains : The retail pharmacy sector is estimatedto comprise at least 600000 licensed outlets. Most are small independent businessesbut pharmacy chains and e-pharmacies are a growing force. Pharmacy chains have expandedaggressively with MedPlus at 1650 stores and Apollo at 3700 stores. E-pharmacies' shareof the retail market is currently estimated to stand at around 5% on an all-India basisbut shares are topping 15% in some major cities and expected to grow. The Company hasengaged with leading players in this space and is poised to benefit from any growth.
Price Controls and Regulations :
The 2021 update of the National List of Essential Medicines (NLEM) is likely toincrease downward pressure on drug prices. Additional downward pressure could come fromplans to cap the MRP of Non-NLEM drugs by limiting trade margins as well as fromexpansion of the span of DPCO price controls. While those plans may have been put on holdin the face of the COVID-19 pandemic both are expected to re-emerge in the medium term.
OTC Drug Regulations :
With rising patient empowerment and growing willingness to self-medicate there isgrowing demand for drafting a well-defined OTC policy. A committee tasked with thedevelopment of recommendations on the establishment of an explicit OTC medicines categorywas set up in 2016. Any policy mandate is likely to benefit the Company given itsdedicated OTC vertical.
Uniform Code of Pharmaceuticals Marketing Practices (UCPMP) :
UCPMP while currently voluntary could become mandatory in future. A mandatory codewould require ethical marketing practices to be followed by all companies. Given that theCompany has a strong compliance process in place it would be well positioned under astrict enforcement of UCPMP.
REVIEW OF OPERATIONS
The Company has consistently grown above market in the last few years by keeping aclear focus on providing scientific trusted products backed by expert clinical support.
The Company's position has been enhanced through consistent engagement with doctorsincreasing geographic penetration strong customer insights innovative products andcomprehensive pill plus service approach.
Revenue from Operations:
Revenue from Operations for the year ended March 31 2021 is Rs.4310.02 Crore incomparison to Rs.4093.14 Crore last year recording a growth of 5.3% over the previousfinancial year.
Profit Before Tax : Profit Before Tax for the year ended March 31 2021 atRs.925.95 Crore grew by 15.4% over the previous year.
Other Income : The Other Income stood at Rs.80.90 Crore mainly comprising interestincome from bank fixed deposits. The Company continues to invest in fixed deposits withbanks that have high credit ratings with a view to safeguarding the principal andmaintaining liquidity. Income from bank deposits reduced by 29.4% due to reduction ininterest rates. The Company has an investment portfolio of Rs.2332.14 Crore as on March31 2021.
Material Cost : The Material Cost increased on account of inflation but wascompensated by improved sales price realisation resulting in a marginal decrease in thesame as a percentage to Sales from 57.1% in financial year 2019-20 to 56.3% in the currentyear.
Employee Cost : The Company increased its employee strength to 3585. The EmployeeCost as a percentage to Sales shows a marginal decrease at 11.6% in the current yearvis-a-vis 11.7% in the financial year 2019-20. The increase in Employee Cost by 3.5% overthe last year is mainly due to merit increase.
Other Expenses : Other Expenses including Depreciation and Finance Cost decreasedby 5.2% over the last year. Also as a percentage to Sales it has decreased to 13.7%vis-a-vis 15.1% in the previous year.
Kev Financial Ratios :
|Particulars ||2021 ||^^^2020 ||Change |
|Debtors Turnover (Days) ||15.2 ||13.8 ||10.1% |
|Inventory Turnover (Days) ||6.9 ||7.2 ||(4.2%) |
|Interest Coverage Ratio* ||51.7 ||95.1 ||(45.6%) |
|Current Ratio ||3.4 ||3.6 ||(5.6%) |
|Debt Equity Ratio ||0.5 ||0.5 ||- |
|Operating Profit Margin (%) ||22.0 ||20.0 ||10.0% |
|Net Profit Margin (%) ||16.0 ||14.0 ||14.3% |
|Return on Net Worth (%) ||27.0 ||26.0 ||3.8% |
*Interest Coverage Ratio has dropped because of accounting impact of Ind AS 116-Leases.
There is no significant change (i.e. change of 25% or more as compared to theimmediately previous financial year) in the Key Financial Ratios except Interest CoverageRatio.
Detailed explanation of ratios :
(i) Debtors Turnover (Days)
The above ratio is used to quantify a company's effectiveness in collecting itsreceivables or money owed by customers. The ratio shows how well a company uses andmanages the credit it extends to customers. It is calculated by dividing Revenue fromOperations by average trade receivables.
(ii) Inventory Turnover (Days)
Inventory Turnover is the number of times a company sells and replaces its inventoryduring a period. It is calculated by dividing Revenue from Operations by averageinventory.
(iii) Interest Coverage Ratio
The Interest Coverage Ratio measures how many times a company can cover its currentinterest payment with its available earnings. It is calculated by dividing Earnings BeforeInterest and Taxes by finance cost.
(iv) Current Ratio
The Current Ratio is a liquidity ratio that measures a company's ability to payshort-term obligations or those due within one year. It is calculated by dividing thecurrent assets by current liabilities.
(v) Debt Equity Ratio
The Debt Equity Ratio is used to evaluate a company's financial leverage. It is ameasure of the degree to which a Company is financing its operations through debt versuswholly owned funds. It is calculated by dividing a company's total liabilities by itsShareholder's equity.
(vi) Operating Profit Margin (%)
Operating Profit Margin is a profitability or performance ratio used to calculate thepercentage of profit a company produces from its operations. It is calculated by dividingthe Earnings Before Interest and Taxes by Revenue from Operations.
(vii) Net Profit Margin (%)
The Net Profit Margin is equal to how much net income or profit is generated as apercentage of revenue. It is calculated by dividing the profit for the year by Revenuefrom Operations.
(viii) Return on Net Worth (%)
Return on Net Worth is a measure of profitability of a company expressed in percentage.It is calculated by dividing total comprehensive income for the year by average capitalemployed during the year.
The Company operates in a single reportable business segment i.e."Pharmaceuticals".
The Company provides products and solutions across various therapeutic areas such asWomen's Health Gastroenterology Central Nervous System Metabolics Multi-Specialty(Pain Management Insomnia Nutritional supplements and Vitamins) Vaccines ConsumerHealth etc.
Performance for the year under review in respect of the Company's various therapeuticsegments are highlighted below :
This portfolio was adversely impacted during the year due to key elective proceduressuch as In-Vitro Fertilisation (IVF) being postponed owing to the ongoing COVID-19pandemic. Overall there was a de-growth of 19.8% during the year. The key brand underWomen's Health is Duphaston (miscarriage and IVF). The Company has robust plans in placeto address generic competition to lead brand Duphaston leveraging its high level ofequity credibility and trust with gynecologists and IVF specialists. The launch of afirst-of-its-kind "Tender Love and Care" program to provide virtual counselingand curated lifestyle management support for couples undergoing pregnancy has provided asignificant boost to our value proposition in this therapy. Regaining strong growthtrajectory in Duphaston shaping menopause therapy and expanding into new areas throughlaunch of new products and indication expansions are the key priorities in this space.During the year Parihep 60 (deep vein thrombosis) was launched.
The Gastro portfolio was a key growth driver for the Company with 7.9% growth duringthe year. This was mainly driven by growth of top brands Cremaffin Plus (constipation)Udiliv (cholestatic chronic liver disease) and Duphalac (constipation). Increasedgeographic presence relevant line extensions and differentiated marketing contributed tothe sustained growth. Focus on new launches has yielded substantial results with Digeraft(antacid) being one of best performing new products in recent years. Beyond-the-pillsofferings have also seen significant scale up and we continue to invest in this area toconnect and support our patients better. A robust new product introduction process throughextensive market research has helped to further enhance the portfolio. Going forwardfocus remains to launch new products and support our consumers with a comprehensiveservice offering. Besides Digeraft we have launched 3 other new products viz. Colohep(fatty liver disease) Pankreoflat HD (indigestion) Rowasa 2 (ulcerative colitis).
This portfolio achieved a growth of 7.0% mainly driven by Thyronorm (hypothyroidism)which continues to maintain it's leadership position*. We have increased our focus onenhancing our digital footprint in *Source : IQVI
A all therapy shaping initiatives especially during COVID-19 period and look forward toscaling these up going forward. Consolidating presence in space of hormone management welaunched Cabernorm in January 2021 which is preferred widely to treat hyperprolactinemia.Combinorm continues to establish concept of usage of pre-probiotics in treatment ofbacterial vaginosis.
Central Nervous System (CNS):
The CNS business achieved a growth of 10.0% which was higher than the market* mainlydriven by Vertin (vertigo). The other key brands in CNS are Prothiaden (pain &depression) and Inderal (migraine & hypertension). We have restructured our salesforce to drive higher focus on the key brands and have seen positive results from that.Innovative new products like the mouth dissolving Vertin MDS strip (first globally)(vertigo) Lacoxa a syrup formulation of Lacosamide (which is a new generation ofanti-epileptic) and Brivetoin (anti-epileptic) were launched during the year. Growth ofthese new products will be a priority for the business going forward.
Multi-Specialty : Under Multi-Specialty the Company offers products for insomnianutritional supplements and vitamins Pre-term labor and pain management. This portfoliohas shown a growth of 6.6% during the year despite the pandemic situation. Zolfresh(insomnia) Arachitol portfolio (Vitamin D deficiency) Brufen (analgesics) and Duvadilan(preterm labor) are the key contributors in the business. We pioneered a crossfunctionalinitiative for process enhancement which helped us build a progressive business.
To expand portfolio 3 new products with patient centric solutions Arachitol NanoDaily 2K IU with innovative Acudose caps (Vitamin D deficiency) Doxstem 20 (antiemetic)and Digecaine (antacid) were launched.
Vaccines : The Vaccines portfolio showed strong doubledigit growth of 42.3% whichwas mainly driven by Influvac (prevention of influenza). Influvac is the key brand for theCompany under this portfolio and leads its participated market. The Company has alicensing arrangement with Bharat Biotech India Limited to market vaccines in immunologysegment. The key brands under this arrangement are Enteroshield (prevention of typhoid)and Rotasure (prevention of rotavirus gastroenteritis). The launch of a very criticaladult immunization guideline for vaccine-preventable diseases by the Association ofPhysicians in India (API) will help us increase awareness and equip HealthcarePractitioners (HCP) with evidence-based information to guide vaccine recommendation andadministration. We have also conducted a special vaccination drive for HCPs during thelockdown so that the frontline workers and their families could get their flu vaccineswithout supply constraints. Going forward a key priority is to establish adultimmunization segment in India through a dedicated adult vaccination task force.
We are looking to expand the portfolio beyond current set of vaccines and targetsegments. During the year we launched Influvac Quadrivalent 0.5 ml vaccine (prevention ofinfluenza) which will help us receive advocacy from doctors and launched JE Shield(prevention of japanese encephalitis).
Consumer Health : During the year this portfolio delivered growth of 15.9% despitepandemic challenges. Digene flagship brand in antacids strengthened its positioning andwas awarded the Economic Times "Best Brand Award" for 2020. We further expandedthe portfolio with the launch of Digene Ultra fizz in May 2020 a differentiatedinnovation with 50% higher ANC (acid neutralizing capacity) than leading powder antacids.Cremaffin continued its efforts on consumerising the brand post its Cx switch. Weincreased awareness of our scientific positioning of gentle and effective relief throughdirect-to-consumer campaigns and new packaging launch along with increasing availabilityand visibility at pharmacists.
We extended our footprint in analgesics category with launch of Brufen Power Spray.With a category-first unique metered spray and double strength diclofenac formula itprovides targeted and powerful pain relief.
IMPACT OF COVID-19
Throughout the year the Company and its employees displayed speed resilience andagility to ensure minimum disruption in business operations by proactively assessing thedemand and ensuring uninterrupted supply of our products. There has not been anysignificant adverse impact on the business operations.
The Management has exercised due care made reasonable judgements and estimatesinteralia in determining carrying amounts of trade receivables property plant &equipment inventories and other financial assets based on the information available todate while preparing the financial results as of and for the year ended March 31 2021.
The second wave of COVID-19 pandemic has been fast-moving and has had very serious andunprecedented effects across various parts of the country. Our unwavering focus remains toensure the uninterrupted supply of our medicines to meet the needs of our customers.
The Company's plant at Goa is functioning at normal capacity with stringent socialdistancing norms keeping health and safety of employees at priority. Office basedemployees have been working remotely as per the State Government guidelines. There is nosignificant disruption in availability of raw materials manufacturing supply chain anddistribution.
In view of the uncertainties regarding the extent and duration of the current COVID-19situation we are unable to predict the future impact on the business operations. TheCompany will continue to closely monitor the situation and take appropriate measures in anattempt to mitigate adverse impact.
MEDICAL RESEARCH AND KNOWLEDGE SHARING INITIATIVES
Evidence-based medicine is gaining importance in empowering healthcare professionals toensure better patient care. Research studies undertaken by the Company ranging fromreal-world evidence-based studies (observational or epidemiological) to registrationstudies have been instrumental in defining and driving organizational strategies andcreating high-quality scientific evidence thus aiding the optimisation of healthcare.
During the year the Company executed 8 new studies published 8 articles in majorindexed journals. All the studies were conducted in compliance with Good Clinical Practice(GCP) and regulatory requirements.
Capability building of healthcare professionals has remained a high strategic priorityfor the Company. During the year more than 3500 medical education programs wereconducted towards achieving this objective. The Company also partnered with over 12medical associations to drive capability building in various therapy areas. Furthermoreas a continued commitment towards knowledge dissemination 100 workshops were conductedtraining approximately 20300 medical staff. Over and above these over 4000 patientawareness programs were conducted on multiple therapy areas across India.
As per IQVIA the pandemic will continue to affect healthcare provision andpharmaceutical sales through 2021 due to emergence of new variants that can spread fasterand also vaccination availability challenges. While economic growth is forecast to reboundin 2021 the after effect of the economic downturn during the pandemic will continue toimpact patient spending on healthcare and drugs negatively through 2021. However even inthese challenging times we strive for market beating growth. We have adapted to newer waysof working and provided continuous support to our patients and doctors. The following areexpected to be major drivers of growth :
Multi-channel doctor engagement : A key focus of the Company is engagingwith doctors through multiple physical and digital touchpoints. This is likely to increasethe productivity of the field force enabling them to reach a larger base of doctors. Weare also constantly revamping our knowledge platforms to be able to provide more relevantinformation to doctors.
Beyond-the-pill patient support : Engaging patients directly foreducation counselling or compliance support is crucial today due to their increasedawareness. The Company has been at the forefront of patient support programs and hascontinued expansion of the same with new programs including a first-of-its-kind"Tender Love and
Care" program to provide virtual counseling and curated lifestyle managementsupport for couples undergoing pregnancy. Our existing programs have shown success inensuring therapy adoption and adherence and we plan to explore targeted partnerships withother industry players and start-ups to expand the same.
Pharmacy engagement :
The OTC vertical has played a key role in establishing deeper relationships with ourpharmacists. Further strengthening of our channel management capabilities and earlypartnerships with emerging players will be an important focus going ahead.
Therapy shaping : We are prepared to accelerate growth of current brandsand future launches with clearly defined strategies developed through in-depth analysesof market trends along with our capabilities and strengths. Shaping of key therapies iscritical to drive therapy leadership and ensure that we continue on our path of consistentmarket beating growth.
RISKS AND CONCERNS
The Pharmaceutical Industry in India is considered amongst the most critical and henceis strictly regulated by the Government. Increase in the list of drugs covered by theNational List of Essential Medicines (NLEM) restrictions on trade margin mark-ups andamendments in pricing regulations will create price pressure on the industry. Growingawareness about cheaper alternatives to branded generics and Government efforts for theirincreased penetration could also impact volume growth. Uncertainty on implementation ofUniform Code of Pharmaceuticals Marketing Practices (UCPMP) and any adverse regulationcould cause a negative impact as well.
INTERNAL CONTROL SYSTEM AND ITS ADEQUACY
The Company has an internal control mechanism commensurate with its size and nature ofbusiness. These systems provide a reasonable assurance on achievement of its operationalcompliance and reporting objectives including safeguarding the Company's assetsprevention and detection of frauds accuracy and completeness of accounting records andensuring compliance with corporate policies.
This mechanism is sound in design and the framework is continuously evaluated foreffectiveness and adequacy. The mechanism operates through well-documented standardoperating procedures policies and process guidelines. Periodic analysis and reviews areconducted by the Senior Management to assess its efficiency. Also the same is discussedwith auditors on a regular basis.
The Internal audit plan is finalized based on current perception of internal controlrisk and compliance requirement in consultation with the operating divisions. The Internal
Auditors as a part of their audits review the design of key processes to assess theadequacy of controls and also propose remedial measures wherever required.
The Internal audit reports issued by the Internal Auditors are discussed with theSenior Management and presented to the Audit Committee on a quarterly basis. Anindependent and empowered Audit Committee reviews the significant observations andassesses the adequacy of the actions proposed while monitoring their implementation. TheInternal Auditors conduct a quarterly follow up for implementation/remediation of allaudit recommendations and the status report is presented to the Audit Committee regularly.
The Company has implemented both preventive and detection controls. Appropriatecorrective actions taken to reduce the risks include the following :
The Abbott Code of Business Conduct requires annual certification by allemployees;
The Compliance Committee is formed with representatives from all the operatinggroups;
Senior Management has oversight of the compliance programs;
The Business Compliance Cell is assigned the responsibility of trainingmonitoring and ensuring employees' compliance with the Company's policies and procedures;
The Company has a Whistle Blower mechanism in place;
Internal investigation reports are presented before the Audit Committee on aquarterly basis;
Business divisions have periodic meetings with the Director- Office of Ethicsand Compliance to monitor and discuss compliance with various business processes.
The Company Management has assessed the effectiveness of internal controls overfinancial reporting for the year ended March 31 2021 and basis the assessment believesthat the processes are working efficiently and effectively.
The Statutory Auditors have issued unmodified audit report on the adequacy of theinternal controls over financial reporting and its operating effectiveness.
The Board of Directors of the Company basis the recommendation of the Nomination andRemuneration Committee have approved the
Re-appointment of Ms Anisha Motwani (DIN : 06943493) as Independent Directorfor a period of 5 (five) years effective April 25 2021 not liable to retire by rotation;
Re-appointment of Mr Rajiv Sonalker (DIN : 07900178) as Whole-time Director fora period of 2 (two) years effective July 1 2021 not liable to retire by rotation.
These re-appointments are subject to approval of the Shareholders at the ensuing AnnualGeneral Meeting.
During the year the Board basis the recommendation of the Nomination and RemunerationCommittee had appointed Ms Karen Peterson (DIN : 08865448) as Additional Directoreffective September 8 2020. Ms Peterson resigned from the Board effective close ofbusiness hours on May 18 2021.
In compliance with Section 152 of the Companies Act 2013 Mr Kaiyomarz Marfatia (DIN :03449627) and Mr Ambati Venu (DIN : 07614849) retire by rotation at the ensuing AnnualGeneral Meeting and being eligible offer themselves for re-appointment.
Declaration of Independence
The Company has received declarations from all the Independent Directors confirmingthat they meet with the criteria of independence prescribed under sub-section (6) ofSection 149 of the Companies Act 2013 and the Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 as amended from timeto time. All the Independent Directors have registered themselves in the IndependentDirector's Database as managed by the Indian Institute of Corporate Affairs.
Number of Board Meetings
Six Board Meetings were held during the year on April 27 2020; June 8 2020; August 72020; November 11 2020; February 9 2021 and March 11 2021. The intervening gap betweenthe Meetings was within the period prescribed under the Companies Act 2013 Rules framedthereunder read with the Secretarial Standards on Meetings of the Board of Directors.
Policy on Nomination and Appointment of Directors/ Criteria for appointment of SeniorManagement and Remuneration Policy
The Company has adopted the Policy on Nomination and appointment of Directors/Criteriafor appointment of Senior Management and Remuneration Policy as per the provisions ofSection 178(3) of the Companies Act 2013 and the Rules framed thereunder. The saidPolicies are available on the Company's website at https://www.abbott.co.in/investor-relations/policies.html
Nomination Policy acts as a guideline for determining qualifications positiveattributes independence of Directors and matters related to the appointment and removalof Directors and Senior Management. The Policy lays down :
i) criteria and terms and conditions with regard to identifying suitable candidates whoare qualified to become Directors and Senior Management;
ii) appointment mechanism for Managing Director/Executive and Non-ExecutiveDirectors/Independent Directors/Key Managerial Personnel and Senior Management;
iii) tenure of Managing Director/Executive Directors/ Independent Directors;
iv) their removal process and succession planning.
Remuneration Policy lays down the Company's philosophy and criteria as well as mannerof determining the remuneration of Managing Director Executive/Non-Executive DirectorsIndependent Directors Senior Management Key Managerial Personnel and other employees.
Performance Evaluation of the Board Board Committees and Directors
The Company has adopted the Board Evaluation Framework and Policy based onrecommendation of the Nomination and Remuneration Committee which sets a mechanism andcriteria for evaluation of the Board Board Committees and Directors includingIndependent Directors. The same is available at https://www.abbott.co.in/investor-relations/policies.html
As per the aforesaid Framework Board and Board Committees evaluation is done by theBoard through self-assessment and group discussions. Parameters for evaluation of theBoard include structure and composition of the Board frequency and number of meetingsdevotion of time for important business matters-financials monitoring Internal Controls/Code of Conduct/Insider Trading Policy/Risk Management Framework and EmergingRisks/Governance and compliance issues adequate access to information for effectivedecisionmaking strategic guidance to management through regular interactions andcohesiveness in the overall working that facilitates open discussion.
Parameters for evaluation of the Committee include structure and composition of thecommittees adequacy of charter and working procedure frequency of meetings if theCommittee is functioning as per the charter and if the Committee recommendationscontribute effectively to the Board decision making.
Evaluation of the Directors is done by the Board (excluding the Director whoseevaluation is being done). Parameters for evaluation of the Directors include skill setknowledge attendance effective participation at Board/Committee Meetings theircontribution at the Meetings leveraging on his/ her experience to provide the necessaryinsights/guidance on Board discussions and display of candor in expressing views even whenthey are in divergence with the rest of the Board etc.
Independent Directors at their separate meeting evaluate the performance of the BoardNon-Independent Directors and the Chairman basis the feedback from Executive andNonExecutive Board Members.
During the year 2020-21 questionnaire along with feedback forms were circulated to theDirectors for evaluation of the Board Committees and Directors. The Board discussed theresponses received from each of the Directors on the same. The Board also confirmed thatthe Independent Directors continue to fulfil criteria prescribed under the Companies Act2013 and the Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 and remain independent from the Management. IndependentDirectors at their separate meeting reviewed performance of Non-Independent DirectorsBoard and the Chairman considering the views of the other Executive and NonExecutiveDirectors.
KEY MANAGERIAL PERSONNEL
Mr Anil Joseph Managing Director Mr Rajiv Sonalker Chief Financial Officer and MsKrupa Anandpara Company Secretary are the Key Managerial Personnel of the Company as onMarch 31 2021.
The Audit Committee comprises of Ms Anisha Motwani (Chairperson) Mr Munir Shaikh MrSudarshan Jain and Ms Shalini Kamath. Role of the Committee is provided in detail in theCorporate Governance Report forming part of this Report. All the recommendations made bythe Audit Committee during the year were accepted by the Board.
VIGIL MECHANISM/WHISTLE BLOWER POLICY
The Company has in place Vigil Mechanism/Whistle Blower Policy called "AbbottIndia Limited-Procedure for Internal Investigations". It lays down a mechanism forreporting and investigation of all unethical behavior alleged or potential violations oflaws regulations or Abbott Code of Business Conduct policies procedures or otherstandards.
A report indicating the number of investigations conducted including the status updateis presented before the Audit Committee and the Board on a quarterly basis.
The said Policy is available on the website of the Company at https://www.abbott.co.in/investor-relations/policies.html
Employees have numerous ways to voice their concerns and are encouraged to report thesame internally for resolution. The said Policy provides for adequate safeguards againstretaliation and access to the Chairperson of the Audit Committee.
Any concerns/grievances can be communicated through various sources as provided underthe said Policy or via toll free number 0008001001058 or online at https://speakup.abbott.com
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Companies Act 2013 your Directors state that :
a) in the preparation of the Annual Accounts for the year ended March 31 2021 theapplicable accounting standards have been followed and there are no material departuresfrom the same;
b) they have selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the Company as at March 31 2021 and of the profits of theCompany for that year;
c) they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
d) they have prepared the Annual Accounts of the Company on a going concern basis;
e) they have laid down adequate Internal Financial Controls to be followed by theCompany and that such Internal Financial Controls are adequate and operating effectively;
f) they have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems are adequate and operating effectively.
RELATED PARTY TRANSACTIONS
Policy on dealing with Related Party Transactions and Materiality
The Company has in place the Policy on dealing with Related Party Transactions andMateriality in terms of requirements of the Companies Act 2013 and the Securities andExchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015. The said Policy is available on the Company's website at https://www.abbott.co.in/investor-relations/policies.html
As per the said Policy all Related Party Transactions are preapproved by the AuditCommittee and Board as and when required. The details of such transactions are alsoreviewed by the Audit Committee on a quarterly/annual basis. Material transactions(transactions exceeding 10% of the annual turnover as per the last audited financialstatements) if any with any Related Party are pre-approved by the Shareholders.
The said policy was reviewed and updated at the Meeting of Board of Directors held onMay 18 2021 in line with the requirements of the Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015.
Details of Related Party Transactions
The Company enters into the business transactions with various Abbott affiliatecompanies ("Related Parties") in the normal course of business and on arm'slength basis. All the transactions with the Related Parties during the financial year2020-21 were pre-approved by the Audit Committee. Prior approvals of the shareholders arein place for the Material Related Party transactions. Actual transactions were reviewed bythe Audit Committee on a quarterly basis. The details of the same are provided in Note 41to the Financial Statements.
Pursuant to Regulation 23(9) of the Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 the Company has filed halfyearly reports on Related Party Transactions with the BSE Limited.
INVESTOR EDUCATION AND PROTECTION FUND (IEPF)
Pursuant to the applicable provisions of the Companies Act 2013 read with theInvestor Education and Protection Fund Authority (Accounting Audit Transfer and Refund)Rules 2016 ("the IEPF Rules") all unpaid or unclaimed dividends are requiredto be transferred by the Company to the IEPF established by the Government of Indiaafter completion of the seven years. Further according to the IEPF Rules the shares onwhich dividend has not been paid or claimed by the shareholders for seven consecutiveyears or more shall also be transferred to the demat account of the IEPF Authority.
During the year the unpaid dividend and shares were transferred in line with theabove the details of which have been given in the Corporate Governance Report.
CORPORATE SOCIAL RESPONSIBILITY
Corporate Social Responsibility (CSR) Policy
The CSR Policy is available on the Company's website at https://www.abbott.co.in/investor-relations/policies.htmlThe said Policy has been updated to meet with the requirements of the Companies(Corporate Social Responsibility Policy) Amendment Rules 2021.
CSR Programs/Activities undertaken during the financial year 2020-21
The Company spent an amount of Rs.13.88 Crore on various CSR programs during thefinancial year 2020-21. The Annual Report of the CSR activities undertaken by the Companyis annexed as "Annexure I" and forms part of this Report.
RISK MANAGEMENT FRAMEWORK
The Company recognises Risk Management as an integrated forward-looking andprocess-oriented approach. It has developed a Risk Framework which is directed to enablethe Management to effectively deal with uncertainty and associated risk and opportunityenhancing the capacity to build value. It enables to avoid pitfalls and surprises alongthe way.
Aligning risk appetite and strategy-The Company considers its risk appetite inevaluating strategic alternatives setting related objectives and developing mechanisms tomanage related risks.
Enhancing risk response decisions-Risk Management provides the rigor to identifyand select among alternative risk responses-risk avoidance reduction sharing andacceptance.
Reducing operational surprises and losses-The Company strives to gain enhancedcapability to identify potential events and establish responses reducing surprises andassociated costs or losses.
Identifying and managing multiple and cross-enterprise risks-The Company faces avariety of risks affecting different parts of the organization and risk managementfacilitates effective response to the interrelated impacts and integrated responses tomultiple risks.
Seizing opportunities-By considering a full range of potential events theCompany is positioned to identify and proactively realise opportunities.
Improving deployment of capital-Obtaining robust risk information allowsmanagement to effectively assess overall capital needs and enhance capital allocation.
These capabilities inherent in this Framework enable the Company to achieve theperformance and profitability targets and guard against loss of resources. It is alsodirected to help ensure effective reporting and compliance with laws and regulationsavoid damage to the Company's reputation and associated consequences. The Company'soperations and its business divisions are included in the scope of the Risk ManagementFramework.
A comprehensive exercise is done by the Risk Management Core Team comprising ofrepresentatives of relevant functional experts on an annual basis who help to identifyadditional mitigating actions that may be required to ensure risk management keeps pacewith the business strategy. The Company's Chief Financial Officer presents an overall RiskManagement update to the Risk Management Committee Audit Committee and Board once a year.
5 R B C & CO LLP Chartered Accountants (ICAI Firm Registration No. :324982E/E300003) were appointed as the Statutory Auditors at the Seventy-fifth AnnualGeneral Meeting of the Company held on August 22 2019 for a period of five years i.e.from financial year 2019-20 to financial year 2023-24 to hold office till the conclusionof the Eightieth Annual General Meeting of the Company.
The Auditors' Report for the financial year 2020-21 does not contain any adverseremarks qualifications or reservations or disclaimers which requireexplanations/comments by the Board.
M/s Kishore Bhatia & Associates Cost Accountants (Registration No. 00294) areappointed as the Cost Auditors of the Company for the financial year 2020-21 at aremuneration of Rs.0.08 Crores plus taxes as applicable and reimbursement of out-of-pocketexpenses.
The said remuneration to the Cost Auditors shall be subject to ratification by theMembers at the ensuing Annual General Meeting.
COST AUDIT REPORT
As per the provisions of the Section 148(1) of the Companies Act 2013 the Company hasmaintained the cost records as specified by the Central Government.
Cost Audit Report along with the Compliance Report for the financial year 2019-20issued by M/s Kishore Bhatia 6 Associates Cost Auditors was filed with the Ministry ofCorporate Affairs on August 24 2020 (due date of filing was September 27 2020).
M/s KPMG Chartered Accountants (ICAI Firm Registration No. BA62445) are the InternalAuditors of the Company. Internal Audit Report their significant observations and followup actions taken by the Management is reviewed by the Audit Committee on a quarterlybasis.
Ms Neena Bhatia Practising Company Secretary (Membership No. FCS 9492 and Certificateof Practice No. 2661) is the Secretarial Auditor of the Company for the financial year2020-21.
SECRETARIAL AUDIT REPORT
The Secretarial Audit Report issued by Ms Neena Bhatia Practising Company Secretaryfor the financial year ended March 31 2021 does not contain any adverse remarkqualifications reservations or declaimer except the observation that the name of theCompany is appearing in the breach list displayed on the website of the BSE Limited forhaving foreign investment in excess of prescribed sectoral cap.
With regards to the same the Company has obtained an Order from the Department ofPharmaceuticals for increase in the limits for Foreign Investment upto 80% subject tocompounding by the Reserve Bank of India. The Company has filed the application forcompounding with the Reserve Bank of India.
The said Report is annexed as "Annexure II" and forms part of this Report.
REPORTING OF FRAUD BY AUDITORS
During the year under review the Statutory Auditors Cost Auditors Internal Auditorsand Secretarial Auditors have not reported any instances of frauds committed in theCompany by its Officers or Employees to the Audit Committee under Section 143(12) of theCompanies Act 2013 details of which needs to be mentioned in this Report.
The key to the Company's agility and success is of course its highly dedicatedpeople. The focus of the Company is on attracting engaging and developing talented peoplewho share its vision and values. Therefore the Company offers innovative programsbenefits and resources that address the diverse needs of employees rewards their effortshelps them build their best careers at Abbott.
Talent Strategy and Development
The above objectives are fulfilled through five strategic pillars of the talentstrategy :
Leadership Engine : Have a robust talent pipeline for all criticalpositions by identifying and developing high performing talent and preparing them forsuccessful transition to critical roles;
No. 1 Field Force : Enhance quality productivity and diversity in FieldForce and retain strong performers;
Managerial Effectiveness : Develop Managerial capability to support andaccelerate team performance and drive higher employee engagement;
Best-in-class support functions : Build and strengthen functionalcapabilities to effectively meet changing organizational needs;
Stronger Employee Value Preposition (EVP) :
Strengthen the EVP through various internal and external initiatives for Abbottemployees potential talent pool and other external stakeholders.
The Human Resources team is instrumental in driving hiring effectiveness andon-boarding with focus on increasing representation of talent ensuring customized best inindustry training and development programs for all levels of employees and having theright campaign and processes to build culture of individual leadership and highperformance.
Capability building initiatives
The Company believes in providing career growth opportunities through upskillinginterventions across all levels of employees. Several leadership development programs suchas In-stride Global Citizen Development Program Emerging Leaders Program New LeadersProgram etc. were conducted during the year. The Company focuses on intentionaldevelopment through various interventions :
Emphasis on Individual Development Plan (IDPs) :
The focus is on having customized development plans for employees on current and futureaspirational roles. This helps in strengthening the internal talent pipeline andincreasing readiness for the next role. IDPs comprise of 70% of experiential learning 20%of internal/external coaching and 10% of classroom learning.
Talent Management Review (TMR) : Talent Management process is wellembedded in our system and supports leadership sales marketing and support functions. Itis a robust annual talent review to ensure that critical roles have high performingincumbents based on performance evidence and to identify key successors for these criticalroles.
Accelerate : This program is focused on building uniform functionalcompetency-based development journey for the First Line Managers (FLM). The key objectiveis to build best-in-class front line managers across business by contextualizing FLMcompetencies and identification of success profile behaviors.
Abbott Learning Academy : Abbott Learning Academy comprises ofcalendarized programs for employees across levels and functions. Employees have access toe-learning and virtual learning platforms to upskill themselves on a real-time basis. Allthe employees have access to the platforms like Career Connect and global training siteswhich offer personalized tools and resources to help them manage their careers and createa high-impact development plan. The experience involves access to online learningresources on LinkedIn learning/Skillsoft/Mindtools on-the-job development and buildingglobal connections through exploring role profiles and connecting with role advisors.
Diversity and Inclusion (D&I) :
Diversity continues to be a big priority for the Company. The guiding principlestowards that is to promote workforce diversity and not discriminating against any employeefor reasons such as race religion color age gender ethnicity disability maritalstatus and sexual orientation in addition to any other status protected by local law. Itis a focus area and is driven at a leadership level.
The Company's Equal Employment Opportunity Policy reinforces the commitment in ensuringthat workplace is free from discrimination and employment is based solely on merit.
There are various interventions for D&I undertaken and promoted during the year :
Women Leaders of Abbott (WLA) : WLA takes a proactive role in connectingwomen within the organization and offers dynamic programs and initiatives to enhanceleadership experiences and career development of women. It acts as a platform forattracting retaining and advancing women in the organization thereby becoming anEmployer of Choice for women.
ASCENT-Abbott Second Careers EngagemENT Program :
This program was launched to strengthen the diversity commitment by providing secondcareer opportunity to veterans and women returning from career breaks. ASCENT aims atempowering these professionals with relevant opportunities and providing the requiredsupport and flexibility to ensure a seamless transition.
Unconscious Bias Training for all Managers : Building individualawareness of unconscious bias and their understanding of its impact at work.
Happy Feet-Joy of Motherhood : Happy feet is a program designed tosupport and provide a conducive work environment for our female employees as they stepinto the phase of motherhood. The Joy of Motherhood document is shared with womenemployees who are expecting and also provide details of preparing for maternity leave andprovide support before during and after pregnancy.
Wo-Mentoring Program : This program is dedicated for Hi-Po womenemployees 150 women employees have been mentored so far and of these 40% women employeeshave had role rotation promotions and transfers.
Empower : As a part of this initiative women employees receive curatedcontent that include theme specific webinars videos articles and podcasts to sharpen andenhance skills.
Special Field Allowances for Women Employees :
The Field allowance was introduced to strengthen the measures focused on the health andsafety of women field colleagues.
Employee Recognition :
Abbott India Limited Excellence Club was launched in 2021 to recognize the employeesacross levels under different categories basis their high performance individualleadership and demonstration of the Company's behaviors and values. There are recognitionsranging from the best leaders projects business units and brands.
Prevention of Sexual Harassment (POSH) at Workplace
The Company has an Internal Complaints Committee (ICC) in place as required under theSexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013.
Appropriate training is imparted to employees regularly through the online learningportal. In 2020-21 all employees completed the mandatory online training program on POSH.This training also forms part of the new Employee Orientation program.
During the year 2 complaints were received by the Company/ ICC under the aforesaid Actand the same were appropriately closed.
HEALTH SAFETY AND ENVIRONMENT
Health and Safety :
At Abbott employees' health and safety are the utmost priority and hence during theCOVID-19 pandemic the Company took key steps to protect and safeguard employees. CrisisManagement Team formed on day 1 of the COVID-19 outbreak regularly keeps assessing thesituation and takes timely steps to provide all support to employees. Work from hometransition for the PAN-India sales workforce and head office employees was announced on animmediate basis upon the lockdown being effective.
For those employees working at the Goa plant local transport is provided for commutingto the workplace safely. The cleaning frequency was increased at the plant and in officesto ensure best health and hygiene and to curb the chances of infections substantially. Allthe norms and measures of social distancing were followed. Guidance/Rules of the State andCentral government from time to time are being rigorously followed.
The Company is committed to keeping employees safe by preventing dangerous incidents inand around the workplace. The Company strives to maintain the highest standards ofEnvironment Health and Safety (EHS) practices.
The training is provided to EHS employees on applicable EHS regulations and internaltechnical standards through both internal and external trainings and conferences. Monthlywebinars are arranged by the subj'ect matter experts to promote EHS awareness and sharebest practices across the Company.
In 2020 we moved to virtual training of employees as per COVID-19 safety guidelines.Virtual training on hazardous waste disposal by GSPCB effective measures on handlingCOVID-19 crisis at site by Green Triangle Society in which site representativeparticipated. Site trainings were also conducted on topics like Slip Trip Fall MachineGuarding Material Handling and emergency preparedness.
The EHS Policy has been implemented through our Global EHS standards based on ISO 14001and OHSAS 45001 supported by a well-defined EHS organizational structure EHS StandardOperating Procedures and EHS specific programs that ensure that we meet all the localregulatory requirements.
Safety committee was reconstituted at site for the years 2021 and 2022 effectiveJanuary to comply with State government regulation. Occupational Safety & Health Auditwas conducted at site by competent person notified by Inspectorate of Factories &Boilers. Action based on audit recommendations were submitted to the concerned Inspector.
Special focus is maintained on critical safe work initiatives like contractor safetyhand safety and working on heights. Additionally several employee engagement programssuch as celebration of National Safety Week was conducted to help build a sustainable EHSculture.
During the year the following initiatives took place at the Goa plant :
The Plant successfully participated in Occupational Health & Safety auditcarried out at site by competent person as required under Goa Factories Rules 1985. Therewere no critical/maj'or findings in the audit report.
418 employees (including contractual employees) completed the Global EHSinduction training module and 30 employees attended Slip Trip & Fall under STOP forSafety program.
544 Behavior Based Safety (BBS) programs observations were reported against agoal of 407 (134% of goal).
Efficiently implemented COVID-19 safety guidelines and norms at site andresolved issues to ensure business continuity.
There is continuous improvement on the BBS program and a visible improvement in safetyculture has been observed. The Stop for safety initiative is being practiced in order tosupport the BBS program.
During the year the Goa Plant received internal EHS excellence award from globaldivisional team for upgradation of firefighting facility at site with no businessinterruption.
Road Safety :
Various Road Safety programs were conducted for field employees during the year such as:
100% of the sales employees completed the online defensive driving refreshertraining module;
About 2400 sales employees attended a Virtual Refresher training on DefensiveRiding skills and behaviors and Covid-19 Safety guidelines and behaviors;
Developed BTB 2.0 a program for new employees that involves virtual training ondefensive riding skills and behaviors as well as risk-assessment of their drivingbehaviors. The first program was rolled out in the month of March 2021.
To further enhance employee engagement on road safety and defensive riding a series ofinitiatives like Quiz competition Gamification-led engagement family and communityoutreach programs are planned.
A responsibility towards the environment is part of Abbott's mandate. We continuouslyendeavor to minimize the use of renewable resources and cut down on carbon emission. Inall our initiatives a holistic approach is adopted and efforts are made to curtailadverse environmental impact if any. The Goa site continued to implement multiple waterconservation and emission reduction projects.
The Company has a state-of-the-art effluent treatment plant with parameters of treatedeffluents well below the limit set by the local State Pollution Control Board. The plantis a zero- discharge plant.
Over the period of last five years the plant has achieved more than 20% absolute waterreduction in usage. The rainwater harvesting project continues to save water by reducingthe intake of purchased water. Total rainwater harvested and consumed during the financialyear 2020-21 was 1055 KL.
The Company continued to focus on process optimization and yield improvement throughvarious initiatives. Along with increasing productivity these initiatives have helpedprevent the discharge of raw materials and solvents into the environment.
Furthermore gas emissions from the boiler and generator stacks as well as the ambientair quality are monitored regularly and they are well below the limits set by the StatePollution Control Board. There is also a vermi-composting unit in place to convert canteenwaste into organic manure which is used in the lawns and in the plantation inside thefactory premises.
The plant retains its Zero Waste to Landfill (ZWL) certification. In financial year2020-21 64% of the waste was sent for recycling 34% for co-processing and 2% forcomposting. The plant continued sending hazardous waste for co-processing which has alsohelped reduce considerably the usage of plastic for packaging of such hazardous waste. TheCompany ensures that energy from the waste is recovered thus contributing to thereduction of CO2 emission and global warming. 33% of plant waste was incinerated withenergy recovery.
During the year World Environment Day was celebrated with distribution of vegetableseeds to all plant employees. Tree plantation was carried out by site leadership team.
Plastic Waste Management :
The Company is adhering to the requirements of Plastic Waste Management Rules as laiddown by the Central Pollution Control Board. During the year the Company has collectedapproximately 1383 MT of post-consumer waste through Extended Producer Responsibility(EPR) partners. This waste is recycled or disposed of in a scientific way. The Company isalso working towards several upstream eco-initiatives that will help in plastic wasteminimization which is fundamental to the concept of EPR.
A project was undertaken at the Goa plant in January 2021 to change the packaging fordisposal of off-specification product. This has resulted in change in the mode ofpackaging of off- specification product from 50 liters High Density Polyethylene (HDPE)drum to Low Density Polyethylene (LDPE) polybags. Around 1306 HDPE drums were changed toLDPE which has resulted in reduction of 3657 kg weight of hazardous waste. The emptydrums which are saved in this process are then in turn sold to authorized recyclercontributing to revenue generated from scrap sales at plant.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The required information under the provisions of Section 134(3)(m) of the CompaniesAct 2013 read with Rule 8 of the Companies (Accounts) Rules 2014 in respect ofConservation of Energy Technology Absorption Foreign Exchange Earnings and Outgo etc.are annexed as "Annexure III" and forms part of this Report.
The Annual Return of the Company as on March 31 2021 has been placed on the website ofthe Company at https://www.abbott.co.in/investor-relations/financials.html
DISCLOSURE UNDER SECTION 197(12) OF THE COMPANIES ACT 2013 AND OTHER DISCLOSURES ASPER RULE 5 OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES2014
Disclosures required in accordance with the provisions of Section 197(12) of theCompanies Act 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is annexed as "Annexure IV" and forms part ofthis Report. However as per the provisions of Sections 134 and 136 of the Companies Act2013 the Report and Financial Statements are being sent to the Members and othersentitled thereto excluding the Statement containing Particulars of Employees which isavailable for inspection by the Members up to the date of ensuing Annual General Meeting.Any Member interested in obtaining a copy of such Statement may write to the CompanySecretary at investorrelations. firstname.lastname@example.org
CORPORATE GOVERNANCE REPORT
Corporate Governance Report and Certificate from the Statutory Auditors of the Companyon compliance of the conditions of Corporate Governance pursuant to the requirements ofthe Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 form part of this Report.
BUSINESS RESPONSIBILITY REPORT
Business Responsibility Report as required under Regulation 34 of the Securities andExchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015 forms part of this Report.
COMPLIANCE WITH SECRETARIAL STANDARDS
The Board of Directors affirms that the Company has complied with the applicableSecretarial Standards issued by the Institute of Company Secretaries of India (SS1 andSS2) respectively relating to Meetings of Board and its Committees and General Meetings.
DISCLOSURES OF ORDERS PASSED BY REGULATORS OR COURTS OR TRIBUNAL
No orders have been passed by any Regulator or Court or Tribunal which can have impacton the going concern status and the Company's operations in future.
The Company has overall cordial Industrial Relations. The Company continues to receivethe support from distributors suppliers vendors stockists and other partners.
No fixed deposits were accepted during the year.
PARTICULARS OF LOANS INVESTMENTS AND GUARANTEES
The Company has not granted any loan or provided any guarantees to or invested insecurities of any other body corporate during the year.
No disclosure or reporting is required in respect of the following items as there wereno transactions relating to these items during the year under review :
1. Issue of equity shares with differential rights as to dividend voting or otherwise;
2. Issue of shares (including sweat equity shares) to employees of the Company underany scheme;
3. The Company does not have any joint venture or subsidiaries.
Your Board expresses gratitude towards all the employees business partnersinstitutions banks and the Members for their continued trust and support to theCompany.
| || |
For and on behalf of the Board
| ||Anil Joseph ||Sudarshan Jain |
|Mumbai ||Managing Director ||Director |
|May 18 2021 ||DIN : 08753233 ||DIN : 00927487 |