Today's Top Gainer
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On behalf of the Board of Directors (the "Board") of the Company, it gives me immense pleasure to present the 73rd Boards Report, along with the Balance Sheet, Profit and Loss account and Cash Flow statements, for the financial year ended March 31, 2019.
I. Financial Performance
The standalone and consolidated financial statements for the financial year ended March 31, 2019, forming part of this Annual Report, have been prepared in accordance with the Indian Accounting Standards (Ind AS) as notified by the Ministry of Corporate Affairs. On a consolidated basis, our sales increased to र 585,845 million for the current year as against र 544,871 million in the previous year, recording an increase of 7.52%. Our net profits increased to र 90,179 million for the current year as against र 80,031 million in the previous year, recording an increase of 12.68%.
On a standalone basis, our sales increased to र 480,298 million for the current year as against र 447,100 million in the previous year, recording an increase of 7.43%. Our net profits declined to र 76,140 million in the current year as against र 77,228 million in the previous year, recording a decline of 1.41%.
Key highlights of financial performance of your Company for the financial year 2018-19 are provided below: ( र in millions)
|Other Operating Income||940||-||4,344||-|
|Profit before Tax||98,705||100,343||115,422||102,422|
|Provision for Tax||22,565||23,115||25,243||22,391|
|Net profit for the year||76,140||77,228||90,179||80,031|
|Other comprehensive (loss)/income for the year||1,246||(7,300)||800||(3,127)|
|Total comprehensive income for the year||77,386||69,928||90,979||76,094|
|Total comprehensive income for the period attributable to:|
|Corporate tax on distribution of dividend||930||921||930||921|
Pursuant to Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended ("Listing Regulations"), the Board has approved and adopted a Dividend Distribution Policy. The policy details various considerations based on which the Board may recommend or declare Dividend, dividend track record, usage of retained earnings for corporate actions, etc. The policy is available on the Companys website at https://www.wipro. com/investors/corporate-governance. Pursuant to the approval of the Board of Directors on January 18, 2019, your Company paid an interim dividend of र 1/- per equity share of face value of र 2/- each, to shareholders who were on the register of members as on January 30, 2019, being the record date fixed for this purpose. The Board has not recommended a final dividend and the interim dividend of र 1/- declared by the Board in January 2019 shall be considered as the final dividend for the financial year 2018-19. Thus, the total dividend for the financial year 2018-19 remains र 1 per equity share.
Your Company is in compliance with its Dividend Distribution policy as approved by the Board.
Issue of Bonus Equity Shares
The Board of Directors at their meeting held on January 18, 2019, recommended issue of bonus equity shares, in the proportion of 1:3, i.e. 1 (One) bonus equity share of र 2/- each for every 3 (three) fully paid-up equity shares held (including American Depository Shares ("ADS")). The said bonus issue was approved by the Members of the Company vide resolution dated February 22, 2019 passed through postal ballot/e-voting, subsequent to which, on
March 8, 2019, 1,508,469,180 bonus shares were allotted to the Members whose names appeared on the register of members as on March 7, 2019, being the record date fixed for this purpose.
As part of the aforesaid allotment, 106,273 bonus equity shares representing fractional entitlement(s) of eligible Members were consolidated and allotted to the trustee appointed by the Board. Subsequently, the trustee sold such equity shares at the prevailing market price and distributed the net sale proceeds, after adjusting the costs and expenses in respect thereof, among the eligible Members in proportion to their respective fractional entitlements.
Buyback of Equity Shares
On April 16, 2019, the Board approved a proposal to buyback up to 323,076,923 (Thirty Two Crores Thirty Lakhs Seventy Six Thousand Nine Hundred and Twenty Three) equity shares of the Company for an aggregate amount not exceeding र 105,000,000,000/- (Rupees Ten Thousand Five Hundred Crores only), being 23.03% of the aggregate of the fully paid-up equity share capital and free reserves as per the audited standalone balance sheet as at March 31, 2019, at a price of र 325/- (Rupees Three Hundred and Twenty Five) per equity share. Subsequently, vide resolution dated June 1, 2019, the shareholders approved the buyback of equity shares through postal ballot/e-voting. The buyback is proposed to be made from all the existing Members of the Company as on June 21, 2019, being the record date for this purpose, on a proportionate basis under the tender offer route in accordance with the provisions contained in the Securities and Exchange Board of India (Buy-Back of Securities) Regulations, 2018 and the Companies Act, 2013 and the rules made thereunder.
During the financial year 2018-19, your Companys authorized capital was increased from र 11,265,000,000/- (Rupees One Thousand One Hundred and Twenty Six Crores and Fifty Lakhs) to र 25,274,000,000 /- (Rupees Two Thousand Five Hundred and Twenty Seven Crores and Forty Lakhs) by creation of additional 7,004,500,000 (Seven Hundred Crores and Forty Five Lakhs) equity shares of र 2/- (Rupees Two each). The said increase in authorized share capital was pursuant to approval of shareholders through postal ballot/e-voting dated February 22, 2019 and also as per the terms of the Scheme (as defined below) approved by the Honble National Company Law Tribunal ("NCLT"), Bengaluru Bench, on account of clubbing the authorized share capital of Appirio India Cloud Solutions Private Limited with and into the authorized capital of your Company.
During the year 2018-19, the Company allotted 1,681,717 equity shares and transferred 2,599,183 equity shares of र 2/- each from Wipro Equity Reward Trust, pursuant to exercise of stock options by eligible employees and allotted 1,508,469,180 equity shares of र 2/- each as bonus equity shares on March 8, 2019 by capitalization of sums standing to the credit of the free reserves and/or the securities premium account and/or the capital redemption reserve account of the Company. Consequently, the paid-up equity share capital of the Company as at March 31, 2019 stood at र 12,067,870,776/- consisting of 6,033,935,388 equity shares of र 2/- each.
During the year under review, the Company has not issued shares with differential voting rights and sweat equity shares.
Transfer to Reserves
Appropriations to general reserve for the financial year ended March 31, 2019 as per standalone and consolidated financial statements are as under: ( र In millions)
|Net profit for the year||76,140||90,037|
|Balance of Reserve at the beginning of the year||413,578||470,215|
|Adjustment on adoption of Ind AS 115||(1,605)||(2,279)|
|Adjustment on account of merger||(975)||-|
|Transfer to General Reserve||-||-|
|Balance of Reserve at the end of the year||481,852||552,158|
In accordance with Section 129(3) of the Companies Act, 2013, a statement containing salient features of the financial statements of the subsidiary companies in Form AOC-1 is provided at page 285 of this Annual Report. The statement also provides details of performance and financial position of each of the subsidiaries. Audited financial statements together with related information and other reports of each of the subsidiary companies have also been placed on the website of the Company at www.wipro.com.
During the financial year 2018-19, your Company invested an aggregate of र 36,373 million in its direct subsidiaries. Apart from this, your Company funded its subsidiaries, from time to time, as per the fund requirements, through loans, guarantees and other means to meet working capital requirements.
During the financial year 2018-19, your Company has carried out restructuring of its following subsidiaries: a) Merger of Wipro Technologies Austria GmbH, Wipro Information Technology Austria GmbH, NewLogic Technologies SARL and Appirio India Cloud Solutions Private Limited (wholly owned subsidiaries) with and into Wipro Limited pursuant to order dated March 29, 2019 passed by NCLT approving the scheme of amalgamation ("Scheme") for the aforesaid merger. As per the said Scheme, the appointed date is April 1, 2018. b) Liquidation of Appirio Singapore Pte Ltd and Appirio GmbH. c) Merger of Cellent Mittelstandsberatung GmbH with and into Cellent GmbH, Germany. d) Reduction of the Companys equity holding in WAISL Limited (formerly known as Wipro Airport IT Services Limited), which was a joint venture between Wipro Limited and Delhi International Airport Limited, from 74% to 11%, by selling the stake to Antariksh Softtech Private Limited on April 5, 2018. e) Setting up of a new subsidiary namely Wipro IT Services S.R.L in Romania. f) Setting up of a new subsidiary namely Wipro US Foundation in USA.
Transfer to Investor Education and Protection Fund a) As required under the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 ("IEPF Rules"), during the year 2018-19, unclaimed dividend for financial years 2010-11 and 2011-12 of र 7,929,792/- and र 4,714,164/- respectively, were transferred to the Investor Education and Protection Fund ("IEPF"). b) Pursuant to the provisions of Section 124(6) of the Companies Act, 2013 and the IEPF Rules, during the year 2018-19, 60,958 equity shares in respect of which dividend has not been claimed for the final dividend declared in financial year 2010-11 and interim dividend declared in financial year 2011-12 were transferred to the IEPF authority. c) Pursuant to Rule 6(8) of the IEPF Rules, under the bonus issue, 426,445 equity shares were allotted to the IEPF authority based on their shareholding as on the record date of March 7, 2019 and an amount of र 102,485 /- pertaining to sale proceeds of fractional bonus shares were transferred to the IEPF.
Particulars of Loans, Advances, Guarantees and Investments
Pursuant to Section 186 of Companies Act, 2013 and Schedule V of the Listing Regulations, disclosure on particulars relating to loans, advances, guarantees and investments are provided as part of the financial statements.
Your Company has not accepted any deposits from public and as such, no amount on account of principal or interest on public deposits was outstanding as on the date of the balance sheet.
Your Company is a leading information technology, consulting and business process services company. Your Companys range of services includes digital strategy, customer-centric design, consulting, infrastructure services, business process services, research and development, cloud, mobility and advanced analytics and product engineering. Your Company offers its customers a variety of commercial models including time and material, fixed price, capacity based, pay-per-use, as-a-service and outcome based models. Your Company offers all of these services and models globally by leveraging its proprietary products, platforms, partnerships and solutions, including state of the art automation technologies such as cognitive intelligence tool, Wipro HOLMES Artificial Intelligence PlatformTM ("Wipro HOLMESTM").
The vision for your Companys business is "to earn our clients trust and maximize value of their businesses by helping them in their journey to re-invent their business and operating models with its Digital first approach and best in class execution". To realize its vision and strategy, your Company is prioritizing and investing to drive growth in key strategic fields such as digital, cloud, cybersecurity and industrial and engineering services through its "Big Bet" program. For example, your Companys "Big Bet" in each of digital and cloud are at the heart of its Business Re-imagination and Engineering Transformation and Modernization pillars, while the "Big Bet" in industrial and engineering services is central to its Connected Intelligence pillar and the "Big Bet" in cyber security is central to its Trust pillar.
Your Company provides its clients with competitive advantages by applying various emerging technologies and ensuring cyber resilience and cyber assurance. Your Company works with its clients not only to enable their digital future, but also to drive hyper efficiencies across their technology infrastructure, applications and core operations, enabling them to achieve cost leadership in their businesses. Going forward, digital enterprises will increasingly require partners, such as Wipro, who are able to bring capabilities that span consultancy, design, engineering, systems integration and operations to enable them to achieve digital transformation. These combined capabilities will only be effective if delivered in the context of the relevant industry or domain. Hence, it is critical to your Company that it provides strong domain expertise along with "Digital". Your Company has invested significantly in building domain expertise and will continue to strengthen its domain capabilities. Your Companys IT Products segment provides a range of third-party IT products, which allows it to offer comprehensive IT system integration services. These products include computing, platforms and storage, networking solutions, enterprise information security and software products, including databases and operating systems. Your Company continues to focus on being a system integrator of choice where it provides IT Products as a complement to its IT Services offerings rather than sell standalone IT Products.
According to the Strategic Review 2019 published by NASSCOM (the "NASSCOM Report"), "Digital" continues to drive growth (more than 30% of growth in fiscal year 2019) and now contributes $33 billion to the overall IT industry in India. Technologies such as industrial automation, robotics, cloud, Internet of things ("IoT"), augmented reality ("AR")/virtual reality ("VR") and blockchain continue to fuel growth. Global IT service providers offer a range of endto-end software development, digital services, IT business solutions, research and development services, technology infrastructure services, business process services, consulting and related support functions. According to the NASSCOM Report, IT export revenues from India grew by 8.3% to an estimated $136 billion in fiscal year 2019.
Acquisitions, Divestments and Investments
Acquisitions are a key enabler for driving capability to build industry domain, focus on key strategic areas, strengthen presence in emerging technology areas including Digital, and increase market footprint in newer markets. Your Company focuses on opportunities where it can further develop its domain expertise, specific skill sets and its global delivery model to maximize service and product enhancements and higher margins.
During July 2018, your Company has entered into a strategic partnership arrangement with Alight Solutions, a leader in technology-enabled health, wealth, HR and finance solutions, which will reshape the HR services industry by providing Alights clients with the breadth and depth of capabilities from the two industry-leading organizations. Your Company has also divested its Workday and Cornerstone OnDemand business to Alight Solutions LLC.
Further, your Company completed divestment of its data center services business to Ensono Holdings, LLC, a leading hybrid IT services provider, consisting of Wipro Data Centre and Cloud Services, Inc. (USA) and data center services business in certain other countries.
The strategic investment arm of your Company, Wipro Ventures is a $100 million fund that invests in early to mid-stage enterprise software startups. As of March 31, 2019, Wipro Ventures has active investments in and partnered with 13 startups in the following areas AI (Avaamo, Inc., Vicarious FPC, Inc.), Business Commerce (Tradeshift, Inc.), Cybersecurity (IntSights Cyber Intelligence Ltd., Vectra Networks, Inc., CyCognito), Data Management (Imanis Data, Inc.), Industrial IoT (Altizon Systems Private Ltd.), Fraud & Risk Mitigation (Emailage Corp.), Testing Automation (Headspin, Inc., Tricentis GmbH) and Cloud Infrastructure (Cloudgenix, Moogsoft). In addition to direct investments in emerging startups, Wipro Ventures had invested in four enterprise-focused venture funds: TLV Partners, WorkBench Ventures, Glilot Capital Partners and Boldstart Ventures. During the year ended March 31, 2019, one of our portfolio companies, Demisto, was acquired.
Management Discussion and Analysis Report
In terms of Regulation 34 of the Listing Regulations and SEBI circular SEBI/HO/CFD/CMD/CIR/P/2017/10 dated February 6, 2017, your Company has adopted salient features of Integrated Reporting prescribed by the International Integrated Reporting Council (IIRC) as part of its Management Discussion and Analysis report ("MD&A Report"). The MD&A report, capturing your Companys performance, industry trends and other material changes with respect to your Company and its subsidiaries, wherever applicable, are presented from pages 18 to 64 of this Annual Report. The MD&A Report provides a consolidated perspective of economic, social and environmental aspects material to its strategy and its ability to create and sustain value to your Companys key stakeholders and includes aspects of reporting as required by Regulation 34 of the Listing Regulations on Business Responsibility Report. Statutory section of Business Responsibility Report is provided from pages 346 to 352 of this Annual Report.
Key Awards and Recognitions
Your Company is one of the most admired and recognized companies in the IT industry. Your Company won several awards and accolades, out of which key recognitions are given below:
1. Wipro was ranked as the third fastest growing global IT Services brand in 2019 in a study conducted by Brand Finance, the worlds leading brand valuation firm.
2. Wipro received Quality Global Supplier award from innogy SE.
3. Wipro was rated a Leader in Digital Transformation in ITSMA Report.
4. Wipro has been recognized as a Leader in Digital Process Automation by Independent Research Firm.
5. Wipro was included in the Dow Jones Sustainability Index (DJSI) World and Emerging Markets for the 9th time in succession.
6. Wipro has been cited as a Leader in Everest Groups Digital Workplace Services PEAK Matrix assessment.
7. Wipros Intellectual Property Portfolio was Recognized with National IP Award and WIPO Enterprise IP Trophy.
8. Wipro was cited as a Leader in Gartners Magic Quadrant for Data Center Outsourcing and Hybrid Infrastructure Managed Services, North America.
9. Wipro has been recognized for second successive year in the "Leadership" category for corporate governance practices on the basis of the Indian Corporate Governance Scorecard, which is a framework developed jointly by International Finance Corporation, a member of the World Bank group, BSE Limited and Institutional Investor Advisory Services based on globally accepted G20/OECD principles.
Further details of awards and accolades won by your Company are provided at page 11 of this Annual Report.
III. Governance and Ethics Corporate Governance
Your Company believes in adopting best practices of corporate governance. Corporate governance principles are enshrined in the Spirit of Wipro, which form the core values of Wipro. These guiding principles are also articulated through the Companys code of business conduct, Corporate Governance Guidelines, charter of various sub-committees and disclosure policy.
As per Regulation 34 of the Listing Regulations, a separate section on corporate governance practices followed by your Company, together with a certificate from V. Sreedharan & Associates, Practising Company Secretaries, on compliance with corporate governance norms under the Listing Regulations, is provided in page 115 of this Annual Report.
Board of Directors
Board Composition and Independence
Your Companys Board consists of global leaders and visionaries who provide strategic direction and guidance to the organization. As on March 31, 2019, the Board comprised of three Executive Directors and eight Non-Executive Independent Directors.
Definition of Independence of Directors is derived from Regulation 16 of the Listing Regulations, the NYSE Listed Company Manual and Section 149(6) of the Companies Act, 2013. The Company has received necessary declarations under Section 149(7) of the Companies Act, 2013, from the Independent Directors stating that they meet the prescribed criteria for independence. The Board of Directors, after undertaking assessment and on evaluation of the relationships disclosed, considered the following Non-Executive Directors as Independent Directors: a) Mr. N Vaghul b) Dr. Ashok S Ganguly c) Mr. M K Sharma d) Mrs. Ireena Vittal e) Mr. William Arthur Owens f) Dr. Patrick J Ennis g) Mr. Patrick Dupuis h) Mrs. Arundhati Bhattacharya All Independent Directors have affirmed compliance to the code of conduct for independent directors as prescribed in Schedule IV of the Companies Act, 2013.
Number of Meetings of the Board
The Board met five times during the financial year 2018-19 on April 24-25, 2018, June 8, 2018, July 19-20, 2018, October 23-24, 2018 and January 17-18, 2019. The maximum interval between any two meetings did not exceed 120 days.
Directors and Key Managerial Personnel
At the 72nd Annual General Meeting (AGM) held on July 19, 2018, Mrs. Ireena Vittal was re-appointed as an Independent Director for a second term with effect from October 1, 2018 to September 30, 2023.
Pursuant to the recommendation of Board Governance, Nomination and Compensation Committee, and subject to approval of the Members of the Company, the Board at its meeting held on October 24, 2018, approved appointment of Mrs. Arundhati Bhattacharya as Additional Director, designated as Independent Director of the Company for a term of 5 years from January 1, 2019 to December 31, 2023. Further, the shareholders of the Company approved the aforesaid appointment vide resolution passed by way of postal ballot/e-voting dated June 1, 2019. Pursuant to the provisions of Section 152 of the Companies Act, 2013 and Articles of Association of the Company, Mr. Abidali Z Neemuchwala will retire by rotation at the 73rd AGM and being eligible, has offered himself for re-appointment. The Board of Directors of the Company, at their meeting held on June 6, 2019, approved the following, subject to approval of the Members:
1. Appointment of Mr. Azim H Premji as Non-Executive Director for a period of 5 years with effect from July 31, 2019 to July 30, 2024 and conferred him with the title of Founder Chairman of the Company. Mr. Azim H Premji will retire from his current position as Executive Chairman and Managing Director effective July 30, 2019.
2. Re-appointment of Mr. Rishad A Premji as Whole Time Director for a period of 5 years with effect from July 31, 2019 to July 30, 2024 (designated as Executive Chairman by the Board of Directors of the Company).
As and when the amendments to Regulation 17(1B) of the Listing Regulations requiring appointment of Non-Executive Chairman by listed entities come into effect, Mr. Rishad A Premji will cease to perform any executive roles in the Company and continue in the capacity of Non-Executive Director (designated as "Non-Executive Chairman" by the Board of Directors) of the Company, such that the Company remains compliant with the Listing Regulations in force at all times.
3. Designated and appointed Mr. Abidali Z Neemuchwala as Managing Director of the Company with effect from July 31, 2019 till the end of his current term, in addition to his existing position as Chief Executive Officer of the Company.
Committees of the Board
The Companys Board has the following committees:
1. Audit, Risk and Compliance Committee, which also acts as Risk Management Committee.
2. Board Governance, Nomination and Compensation Committee, which also acts as Corporate Social Responsibility Committee.
3. Strategy Committee.
4. Administrative and Shareholders/Investors Grievance Committee (Stakeholders Relationship Committee).
Details of terms of reference of the Committees, Committee membership and attendance of Directors at meetings of the Committees are provided in the Corporate Governance report from pages 122 to 125 of this Annual Report.
In line with the Corporate Governance Guidelines of your Company, Annual Performance Evaluation was conducted for all Board Members, for the Board and its Committees. This evaluation was led by the Chairman of the Board Governance, Nomination and Compensation Committee with specific focus on performance and effective functioning of the Board. The Board evaluation framework has been designed in compliance with the requirements under the Companies Act, 2013 and the Listing Regulations, and in accordance with the Guidance Note on Board Evaluation issued by SEBI in January 2017. The Board evaluation was conducted through questionnaire designed with qualitative parameters and feedback based on ratings. Evaluation of the Board was based on criteria such as composition and role of the Board, Board communication and relationships, functioning of Board Committees, review of performance of Executive Directors, succession planning, strategic planning, etc.
Evaluation of Committees was based on criteria such as adequate independence of each Committee, frequency of meetings and time allocated for discussions at meetings, functioning of Board Committees and effectiveness of its advice/recommendation to the Board, etc.
Evaluation of Directors was based on criteria such as participation and contribution in Board and Committee meetings, representation of shareholder interest and enhancing shareholder value, experience and expertise to provide feedback and guidance to top management on business strategy, governance, risk and understanding of the organizations strategy, etc. The outcome of the Board evaluation for financial year 2018-19 was discussed by the Board Governance, Nomination and Compensation Committee and the Board at their meeting held in April 2019. The Board has received highest ratings on Board communication and relationships, functioning of Board Committees and legal and financial duties. The Board noted the actions taken in improving Board effectiveness based on feedback given in the previous year. Further, the Board also noted areas requiring more focus in the future, which include spending more time on trends, long-term threats and opportunities.
Policy on Directors Appointment and Remuneration
The Board Governance, Nomination & Compensation Committee has framed a policy for selection and appointment of Directors including determining qualifications and independence of a Director, Key Managerial Personnel (KMP), senior management personnel and their remuneration as part of its charter and other matters provided under Section 178(3) of the Companies Act, 2013. Pursuant to Section 134(3) of the Companies Act, 2013, the nomination and remuneration policy of the Company which lays down the criteria for determining qualifications, competencies, positive attributes and independence for appointment of Directors and policies of the Company relating to remuneration of Directors, KMP and other employees is available on the Companys website at https://www.wipro.com/content/dam/nexus/en/investor/ corporate-governance/policies-and-guidelines/ethical-guidelines/wipro-limited-remuneration-policy.pdf. We affirm that the remuneration paid to Directors is in accordance with the remuneration policy of the Company.
Your Company has put in place an Enterprise Risk Management (ERM) framework and adopted an enterprise risk management policy based on globally recognized standards. The ERM framework is administered by the Audit, Risk and Compliance Committee. The objective of the ERM framework is to enable and support achievement of business objectives through risk-intelligent assessment apart from placing significant focus on constantly identifying and mitigating risks within the business. The ERM Framework covers various categories of risks including, inter alia, information security and cyber security risks, effectiveness of the controls that have been implemented to prevent such risks and continuous improvement of the systems and processes to mitigate such risks.
For more details on the Companys risk management framework, please refer page 27 of this Annual Report.
Compliance Management Framework
The Board has approved a Global Statutory Compliance Policy providing guidance on broad categories of applicable laws and process for monitoring compliance. In furtherance to this, your Company has instituted an online compliance management system within the organization to monitor compliances and provide update to senior management and Board on a periodic basis. The Audit, Risk and Compliance Committee and the Board periodically monitor status of compliances with applicable laws.
Code for Prevention of Insider Trading
On December 31, 2018, Securities and Exchange Board of India amended the Prohibition of Insider Trading Regulations, 2015, prescribing various new requirements with effect from April 1, 2019. In line with the amendments, your Company has adopted an amended Code of Conduct to regulate, monitor and report trading by Designated Persons and their Immediate Relatives under the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015. This Code of Conduct also includes code of practices and procedures for fair disclosure of unpublished price sensitive information which has been made available on the Companys website at https://www.wipro.com/corporate-governance.
Your Company has adopted an Ombuds process as a channel for receiving and redressing complaints from employees and Directors, as per the provisions of Section 177(9) and (10) of the Companies Act, 2013 and Regulation 22 of the Listing Regulations. The Ombuds policy of the Company was amended to align with the requirements under Regulation 9A of Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015. Under this policy, your Company encourages its employees to report any reporting of fraudulent financial or other information to the stakeholders, and any conduct that results in violation of the Companys code of business conduct, to the management (on an anonymous basis, if employees so desire). Further, your Company has prohibited discrimination, retaliation or harassment of any kind against any employees who report under the Vigil Mechanism or participates in the investigation.
Awareness of policies is created by sending group mailers highlighting actions taken by the Company against the errant employees. Mechanism followed under Ombuds process has been displayed on the Companys intranet and website at www.wipro.com.
The Audit, Risk and Compliance Committee periodically reviews the functioning of this mechanism. No personnel of the Company was denied access to the Audit, Risk & Compliance Committee.
Information Required under Sexual Harassment of Women at Work place (Prevention, Prohibition and Redressal) Act, 2013
Your Company has constituted Internal Complaints Committee as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and also has a policy and framework for employees to report sexual harassment cases at workplace and its process ensures complete anonymity and confidentiality of information. Adequate workshops and awareness programmes against sexual harassment are conducted across the organization. Details of complaints received/disposed during the financial year 2018-19 is provided on page 126 of this Annual Report.
Related Party Transactions
Your Company has historically adopted the practice of undertaking related party transactions only in the ordinary and normal course of business and at arms length as part of its philosophy of adhering to highest ethical standards, transparency and accountability. In line with the provisions of the Companies Act, 2013 and the Listing Regulations, the Board has approved a policy on related party transactions. An abridged policy on related party transactions has been placed on the Companys website https://www.wipro.com/corporate-governance.
All related party transactions are placed on a quarterly basis before the Audit, Risk and Compliance Committee and before the Board for approval. Prior omnibus approval of the Audit, Risk and Compliance Committee and the Board is obtained for the transactions which are foreseeable and of a repetitive nature.
The particulars of contracts or arrangements with related parties referred to in Section 188(1) and applicable rules of the Companies Act, 2013 in Form AOC-2 is provided as Annexure I to this Annual Report.
Pursuant to Regulation 23(9) of the Listing Regulations, your Company has filed half yearly report on Related Party Transactions with the Stock Exchanges, for the year ended March 31, 2019.
Directors Responsibility Statement
Your Directors hereby confirm that:
(a) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;
(b) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for that period; (c) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; (d) the Directors have prepared the annual accounts on a going concern basis; (e) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively; and (f) as required under Section 134(5)(f) of the Companies Act, 2013, and according to the information and explanations presented to us, based on the review done by the Audit, Risk and Compliance Committee and as recommended by it, we, the Board, hereby, state that adequate systems and processes, commensurate with the size of the Company and the nature of its business, have been put in place by the Company, to ensure compliance with the provisions of all applicable laws as per the Companys Global Statutory Compliance Policy and that such systems and processes are operating effectively.
Wipro Employee Stock Option Plans (WESOP)/Restricted Stock Unit Plans
Your Company has instituted various employee stock options plans/restricted stock unit plans from time to time to motivate, incentivize and reward employees. The Board Governance, Nomination and Compensation Committee administers these plans. The stock option plans are in compliance with Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 ("Employee Benefits Regulations") and there have been no material changes to these plans during the financial year. Disclosures on various plans, details of options granted, shares allotted upon exercise, etc. as required under the Employee Benefits Regulations read with Securities and Exchange Board of India circular no. CIR/CFD/POLICY CELL/2/2015 dated June 16, 2015 are available on the Companys website at https://www.wipro.com/investors/ annual-reports/. No employee was issued stock options during the year equal to or exceeding 1% of the issued capital of the Company at the time of grant.
Particulars of Employees
I nformation required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided as Annexure II to this report. A statement containing, inter alia, the names of top ten employees in terms of remuneration drawn and every employee employed throughout the financial year and in receipt of remuneration of र 102 lakhs or more and, employees employed for part of the year and in receipt of remuneration of र 8.50 lakhs or more per month, pursuant to Rule 5(2) the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided as Annexure III to this report.
IV. Internal Financial Controls and Audit Internal Financial Controls and their Adequacy
The Board of your Company has laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively. Your Company has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures.
At the 71st AGM held on July 19, 2017, the Members of the Company approved the appointment of Deloitte Haskins & Sells LLP, Chartered Accountants (Registration No. 117366W/W-100018) as statutory auditors of the Company for a term of 5 years from the financial year 2017-18 onwards on such terms and conditions and remuneration as may be decided by the Audit, Risk and Compliance Committee. Accordingly, Deloitte Haskins & Sells LLP will continue as statutory auditors of the Company till the financial year 2021- 22.
Vide notification dated May 7, 2018 issued by Ministry of Corporate Affairs, the requirement of seeking ratification of appointment of statutory auditors by members at each AGM has been done away with. Accordingly, no such item has been considered in notice of the 73rd AGM.
There are no qualifications, reservations or adverse remarks made by Deloitte Haskins & Sells LLP, Statutory Auditors, in their report for the financial year ended March 31, 2019.
Pursuant to provisions of Section 143(12) of the Companies Act, 2013, the Statutory Auditors have not reported any incident of fraud to the Audit, Risk and Compliance Committee during the year under review.
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr. V Sreedharan, Partner, V Sreedharan & Associates, Practicing Company Secretaries, to conduct Secretarial Audit of the Company. The Report of the Secretarial Audit in Form MR-3 for the financial year ended March 31, 2019 is enclosed as Annexure IV to this report. There are no qualifications, reservations or adverse remarks made by the Secretarial Auditor in his report.
Cost Records and Audit
Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable for the business activities carried out by the Company.
V. Social Responsibility and Sustainability Corporate Social Responsibility
Your Company is at the forefront of Corporate Social Responsibility (CSR) and sustainability initiatives and practices. Your Company believes in making lasting impact towards creating a just, equitable, humane and sustainable society. Your Company has been involved with social initiatives for more than a decade and half and engages in various activities in the field of education, primary healthcare and communities, ecology and environment, etc. Your Company has won several awards and accolades for its CSR and sustainability efforts. As per the provisions of the Companies Act, 2013, companies having net worth of र 500 crores or more, or turnover of र 1,000 crores or more or net profit of र 5 crores or more during the immediately preceding financial year are required to constitute a Corporate Social Responsibility (CSR) committee of the board comprising three or more directors, at least one of whom should be an independent director and such company shall spend at least 2% of the average net profits of the companys three immediately preceding financial years towards CSR activities. Accordingly, your Company spent र 1,853 million towards CSR activities during the financial year 2018-19. The contents of the CSR policy and CSR Report for the year 2018-19 is attached as Annexure V to this report. Contents of the CSR policy are also available on the Companys website at https://www.wipro.com/corporate-governance.
The terms of reference of CSR Committee, framed in accordance with Section 135 of the Companies Act, 2013, forms part of Board Governance, Nomination and Compensation Committee. The Committee consists of three independent directors, Dr. Ashok S Ganguly, Mr. N Vaghul and Mr. William Arthur Owens, as its members. Dr. Ashok S Ganguly is the Chairman of the Committee.
Particulars Regarding Conservation of Energy and Research and Development and Technology Absorption
Details of steps taken by your Company to conserve energy through its "Sustainability" initiatives, Research and Development and Technology Absorption have been disclosed as part of the MD&A Report.
VI. Other Disclosures
Foreign Exchange Earnings and Outgoings
During the year 2018-19, your Companys foreign exchange earnings were र 444,584 million and foreign exchange outgoings were र 230,362 million as against र 391,807 million of foreign exchange earnings and र 207,831 million of foreign exchange outgoings for the financial year 2017-18.
Extract of Annual Return
Pursuant to Section 92(3) and Section 134(3)(a), extract of the annual return as on March 31, 2019 in form MGT-9 is enclosed as Annexure VI to this report. Additionally, your Company has also placed a copy of annual return for the financial year 2017-18 on its website at https://www. wipro.com/investors/annual-reports/.
Material Changes and Commitments Affecting the Financial Position of the Company
There have been no material changes and commitments, affecting the financial position of the Company which occurred between the end of the financial year to which the financial statements relate and the date of this report.
Details of Significant and Material Orders Passed by the regulators/courts/tribunals Impacting the going concern status and the Companys operations in future
There are no significant material orders passed by the regulators/courts/tribunals which would impact the going concern status of the Company and its future operations.
Acknowledgements and Appreciation
Your Directors take this opportunity to thank its customers, shareholders, suppliers, bankers, business partners/ associates, financial institutions and Central and State Governments for their consistent support and encouragement to your Company. I am sure you will join our Directors in conveying our sincere appreciation to all employees of your Company and its subsidiaries and associates for their hard work and commitment. Their dedication and competence has ensured that your Company continues to be a significant and leading player in the IT Services industry.
|For and on behalf of the Board of Directors,|
|Bengaluru||Azim H Premji|
|June 6, 2019||Executive Chairman|