Sixty-fourth annual report 2008-09
Tata Motors Limited
34
REPORT ON CORPORATE GOVERNANCE
1.
COMPANY’S PHILOSOPHY ON CORPORATE GOVERNANCE
1.1. As part of the Tata group, the Company's philosophy on Corporate Governance is founded upon a rich
legacy of fair, ethical and transparent governance practices, many of which were in place even before
they were mandated by adopting highest standards of professionalism, honesty, integrity and ethical
behaviour. The Board, being elected by the shareholders, is their representative and a bridge between
them and the executive management. Since shareholders are residual claimants, the value creation
and sustainability of all the other stakeholders viz. customers, creditors, employees, vendors, community
and the Government (of countries in which the Company operates) are of paramount significance to
the Company and its shareholders. The Board would therefore have a fiduciary relationship and a
corresponding duty to all its stakeholders to ensure that their rights are protected. Through the
Governance mechanism in the Company, the Board along with its Committees endeavours to strike
the right balance with its various stakeholders.
1.2. The Corporate Governance philosophy has been further strengthened with the implementation, a
few years ago, by the Company of the Tata Business Excellence Model, the Tata Code of Conduct
applicable to the Company, its subsidiaries, directors and employees. The Company is in full compliance
with the requirements of Corporate Governance under Clause 49 of the Listing Agreement with the
Indian Stock Exchanges (“the Listing Agreement”). The Company's Depository Programme being
listed on the New York Stock Exchange, the Company also complies with US regulations as applicable to
Foreign Private Issuers (non-US listed companies) which cast upon the Board of Directors and the Audit
Committee, onerous responsibilities to improve the Company's operating efficiencies. Risk management
and internal control functions have been geared up to meet the progressive