m




AGENDA
Y History.

Y Organizational Structure.

Y CSR Initiatives.

Y Corporate Governance Practices.

Y Lesson Learnt.
SWEET HISTORY
r
 r 
r 
The Launched
Company Introduced Crackle
was Five Star followed by
Incorporate and Gems Perk and
d brands Bournvita

r 
r r 
Undertook Received Poor
Cocoa certificate to packing
growing in manufacture issue and
India 2,200 tonnes of restructuri
chocolates at ng.
Indori.
ORGANIZATIONAL STRUCTURE
Y Two structures ʹ Store and Company
Y Simple structure in stores
Y Regular hierarchy in the company
Y Has removed lots of it͛s managers.
Y Current managers look after many employees
Y Increased span of control
Y Maintenance and market research outsourced
 Anand Kripalu
MD ʹ Cadbury India
C Venketashan Atul Bhatia
Director Choco & Strat Director R&D

J Philips N Sundaraman
Director Opr Director Gum & Candy

Rajesh Garg
Director Finance R Ramanathan
Director HR

Sunil Sethi
Director Sales & IB
CSR ACTIVITIES
Y Sustainability is fully integrated into the Cadbury business
strategy
Y Clear roadmaps and goals established in the form of
Sustainability Commitments
Y Creation of new significant, leading edge programmes in
͚Purple Goes Green͛ and the ͚Cadbury Cocoa Partnership͛
Y Specific training in sustainable business practices for
colleagues and key suppliers
IMPORTANCE OF CSR
Ë Corporate Responsibility is one of the things that makes
Cadbury special. It͛s been integral to our business for nearly
200 years since the Cadbury family first sought to be a
͚force for good in troubled times͛. That sense of ambition
remains at Cadbury today.͟

- Todd Stitzer

CEO Cadbury
CSR VISION AND STRATEGY
Y Vision - ͚Working together to create brands people love͛
Y Outlook towards CSR-
Positive contributor to our competitive strategy
Doing responsible things profitably

Y CSR strategy ʹ Five Pillars of CSR: marketing, food and

consumer trends; ethical sourcing and procurement;
environment; quality, health and safety; human rights and
employment standards; and community investment
COMMITMENT TO THE ENVIRONMENT
Y Migratory birds stop over at their Bangalore factory

Construction of check dam

Y Pioneering cocoa cultivation in India

Research in collaboration with Kerala Agricultural

University
Y Bangalore factory: the sun shines at night͙

Use of solar panels to light the streets outside the factory

during the night
GROWING COMMUNITY VALUE
Ë Non-formal school for children of migrant workers in
Baddi (HP)
Ë In association with an NGO called SAHYOG

Ë Key areas addressed are village health, sanitation,

education & water harvesting.

Ë Gurikha Project
Gurikha is a village adopted by Cadbury India
Nutrition, Education and Security near our Malanpur factory (MP)
GROWING COMMUNITY VALUE

Y Sarvam Program
Working in partnership with a local charity on a five-year project, Cadbury is
contributing to the redevelopment of two villages in the costal region of
Pondicherry
The project addresses education, health, economic development, vocational training, organic
farming, water harvesting and attitude changes including the empowerment of women.

Y Cadbury India supports the building of a Neo-natal ward

Supported to build this ward at the Thane Municipal Hospital
Caters to specialized and intensive care for premature and critically ill newborns
DEARCADBURY.COM
Ë Cadbury launched a corporate social responsibility Web site
called DearCadbury.com, which provides consumers information on
ethical sourcing, responsible consumption and the environment.
Ë The site features Cadbury͛s 2007/08 Corporate Responsibility and
Sustainability report highlights-
Ë Reduction in carbon emissions by 4 % till date; Aiming for a 10%
reduction by 2010
Ë As part of Cadbury͛s Purple Goes Green͟ program, the company
committed to a 50% absolute reduction in carbon emissions by 2020
Ë Reduction in water wastage by 10 %.
CSR INITIATIVES PLANS
Y Cadbury publishes a CSR report every two years, highlighting all of its CSR
activities.
Y Total involvement of top management shows how serious the company is
about its CSR activities
Y The launch of dearcadbury.com signifies that Cadbury has dedicated a
whole new website to its CSR
Y This shows genuine efforts on the part of Cadbury to make CSR initiatives
an integral part of their day to day working
Y The initiative ͚Purple goes Green͛ sets stringent targets for the company to
be achieved by 2020 (aiming at Carbon cuts and water conservation)
CORPORATE GOVERNANCE
The New York Stock Exchange (the ͞NYSE͟) requires that a company quoted on the
NYSE should adopt and disclose corporate governance guidelines which address
the following:

ͻ Director qualification standards,

ͻ Director responsibilities,
ͻ Director access to senior management and, as necessary and appropriate,
independent advisors,
ͻ Director compensation,
ͻ Director orientation and continuing education,
ͻ Management succession,
ͻ Annual performance evaluation of the Board of Directors

Whilst Cadbury is not obliged to comply with this requirement (it only applies to
US companies) the Board has decided to do so as Cadbury is committed to
maintaining good standards of corporate governance and ethical behaviour
CORPORATE GOVERNANCE
i
irector qualification standards
a) Personal qualities:
Y non-executive Board members represent a broad range of
experience from a variety of industries and professions
Y diversity of background, gender, ethnicity, age and
experience
Y proven record of integrity and good character, exhibit high
standards of ethics and possess independence of mind,
objectivity and the ability to challenge and stimulate
management
CORPORATE GOVERNANCE
i
irector qualification standards
B) Board and Committee independence
Y Majority of the directors non-executives who meet the independence
criteria of the UKLA Combined Code and the NYSE
Y The Company͛s Audit Committee, Nomination Committee and
Remuneration Committee composed entirely of independent non-
executive directors, with the exception of the Chairman͛s membership of
the Nomination Committee
Y Each non-executive require to annually make an affirmative declaration
of their independence, and to declare immediately if any relationship or
conflict of interest potentially or actually impairs their independence and
the Audit Committee will monitor compliance by directors on an ongoing
basis
CORPORATE GOVERNANCE
i
irector qualification standards
C) Membership of other boards:
Y The Chairman shall not serve on more than  other public company
boards other than in exceptional circumstances, and with the approval of
the Board
Y A non-executive director may not serve on the boards of more than

other public companies, or  such boards if they are not an executive
director on any of those boards
Y An executive director may not serve on the board of more than r other
public company
Y No director shall serve on the board of a significant competitor or one of
the Group͛s nominated peer companies
CORPORATE GOVERNANCE
i
irector qualification standards

) Time commitment:
Y Directors - commit sufficient time and effort to Board matters in
order to ensure constructive and independent participation at
Board and Committee meetings
Y Expected to attend all meetings of the Board and of the
Committees on which they serve
CORPORATE GOVERNANCE
i
irector qualification standards
E) Term limits :
Y no term limit for executive directors
Y Non-executive directors will not, without detailed consideration by
the Board, and without the approval of shareholders at the next
Annual General Meeting, serve for more than three terms of three
years each
F) Size and composition of the Board:
Y The number of directors on the Board shall not be less than two
nor more than twenty
CORPORATE GOVERNANCE
ii
irector responsibilities
A) Principal obligations:
Y The Board is the ultimate decision making body of the Company,
except for those matters reserved to shareowners
Y In forming the judgment the directors are entitled to rely in good
faith on the honesty, integrity and expertise of the Company͛s
senior executives, its outside advisors and auditors
CORPORATE GOVERNANCE
ii
irector responsibilities
B)
ecision making guidance:
Y The Chairman and Company Secretary, in consultation with
the other directors, are responsible for establishing an agenda
of matters for consideration by the Board
Y Directors must be familiar with and act in accordance with
the Group͛s code of ethics
Y The Board review compliance with all aspects of relevant
corporate governance regimes, especially in the UK and US
but not necessarily limited to those countries, and agree on
any necessary or desirable actions to correct any
shortcomings identified
CORPORATE GOVERNANCE
ii
irector responsibilities
C) Board interaction with third parties:
Y The Chairman speaks for the Board
Y Senior management speak for the Company
Y Communications about the Company or Group with shareowners,
analysts, the press, media or other interested parties are handled
by senior management in most cases
CORPORATE GOVERNANCE
iii
irector access to senior management and independent
advisors
Y All directors have access to senior management and other
employees if necessary
Y Senior Management will attend meetings of the Board and
its Committees at the request of the Chairman
Y Each Director and each Board Committee is authorised to
obtain outside legal or other independent professional
advice
CORPORATE GOVERNANCE
i
irector compensation
Y A non-executive director (with the exception of the Chairman)
may not receive any compensation or benefit from the
Company or any of its subsidiaries other than directors͛ fees
Y Non-executives are encouraged, but not obliged to, elect to
receive part or all of their fees in shares, purchased quarterly
on their behalf
Y Each executive director is expected to hold shares to the
value of at least four times their basic salary
CORPORATE GOVERNANCE

irector induction and continuing education
Y The Company provides a comprehensive induction
programme for all directors when they join the Board,
including ͚Our Business Principles͛, background material on
the Group, briefings with senior management and visits to
some of the Group͛s key sites
Y induction programme is usually completed over a period of
six months after the director joins the Board
CORPORATE GOVERNANCE

irector induction and continuing education
Y The Company provides a comprehensive induction programme
for all directors when they join the Board, including ͚Our
Business Principles͛, background material on the Group,
briefings with senior management and visits to some of the
Group͛s key sites
Y Induction programme usually completed over a period of 6
months after the director joins the Board
Y The Company pay the costs of any director attending an
accredited director education programme
Y Directors also required to educate themselves with respect to
industry practices, general management, strategic planning and
international business issues
CORPORATE GOVERNANCE
i Management succession
Y A comprehensive presentation on management development
and the identification of high potential or experienced
managerial candidates to succeed present senior management
and executive directors discussed annually by the Board
Y The Nomination Committee review director succession planning
on an annual basis
CORPORATE GOVERNANCE
ii Annual performance evaluation of the Board
Y The Board has a formal annual self or independent evaluation
Y Evaluation will always include a consideration of corporate
governance, strategic planning, Board structure and role
Y The Board reviews the results of the evaluation and identifies
steps and actions necessary to enhance its performance and
ability to manage the Company
TURNING POINT
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EFFECTS
× The heat of negative publicity melted Cadbury's sales by 30 per cent, at a
time when it sees a festive spike of 15 percent.

× Net profit in 2003 dipped 37 per cent to Rs 45.6 crore as compared to a 21

per cent increase the previous year.

× Retailer stocking and display dropped, employee morale especially that of

the sales team was shaken.

× The Company had to shelve its plans of becoming a major sourcing hub for
British Chocolates and beverages giant Cadbury Schweppes.

× The largest impact on sales has been seen in Mumbai, Pune and Nagpur in
Maharashtra, Cochin in Kerala, Bangalore and Hyderabad.
REASONS
× Aggressive marketing by Company while neglecting on the
Quality of Retailers

× Lack of efforts to Educate Retailers and ensure adequate

hygienic storage conditions at retail outlets

× Poor quality in packaging of product

× Issues related to transportation of product

× No Norms in terms of Storage for Chocolates

STRATEGY
Phase r: Presenting Cadbury͛s view (October-

ecember )
Y The agency set up a media desk to ensure that
no media query went unanswered.

Y The Cadbury͛s Managing Director addressed

consumer concerns

Y Project Vishwas (Trust)

Y Editorial Outreach Program with 31 media

editors across affected cities
STRATEGY
Phase 2: Packaging Change and Communication
(January ʹ March 2004)
O
 
Y New ͚purity sealed͛ packaging ( Jan 2004) - investment of
Rs 15 crore on imported machinery
Y Metallic Poly-Flow was costlier by 10-15% but Cadbury
didn͛t hike the Pack Price
Y Investment of millions of Dollars leads to achieve a
production process in 8 weeks, that would normally take
6 months.
STRATEGY
 + )   
,-

. *
/0

  
Y Brand Ambassador to reinforce
the credibility

Y Amitabh Bachchan, a legendary

Indian film star, was chosen, as he
embodied the values of Cadbury
as a brand.
STRATEGY
Y Media Conference to compare the old
and new packs with an innovative
comparison kit
Y A VIDEO news release with packaging
shots and factory shots was given to
television channels
Y Audio-Visual ... series of sales
conferences to enthuse and reassure  

  
salespersons
     

Y The announcement of the new pack --a


    
testimonial advertisement on TV called 
  
   
͚Sincerity͛. 

LESSONS LEARNT
Y Attention to business ethics has substantially improved
society.
Y Ethics programs help maintain a moral course in turbulent
times.
Y Ethics programs cultivate strong teamwork and productivity
Y Ethics programs support employee growth and meaning
Y Ethics program are an insurance policy ʹ they help ensure that
policies are legal.
Y Ethics programs help avoid criminal acts of omission͟ and
can lower fines.
LESSONS LEARNT
Y Recognize that managing ethics is a process.
Y The bottom line of an ethics program is accomplishing
preferred behaviors in the workplace.
Y The best way to handle ethical dilemmas is to avoid their
occurrence in the first place.
Y Make ethics decisions in groups, and make decisions public ,
as appropriate
Y Integrate ethics management with other management
practices
Y Use cross-functional teams when developing and
implementing the ethics management program.
Y Value Forgiveness