Analysis of Corporate Governance

1539 words 7 pages
Analysis of Corporate Governance of BAJAJ AUTO LTD.

Company Profile

Bajaj Auto Limited is one of India’s premier two and three wheeler automobile manufacturing companies. It was founded in the year 1945. For the financial 2009-10, the company had sales of Rs. 12152.74 crores and net income of Rs. 1597.22 crores. It exports its two and three wheeler vehicles to more than 50 countries. The company as of 2010 accounts for 24.3% of the Indian motorcycle market.

Corporate Governance practices of Bajaj Auto Ltd.

Here are the significant points regarding the corporate governance of Bajaj Auto followed by an analysis of their effectiveness and impact.

* The company has stated that its corporate governance policy is centered on 4 concepts
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Various measures have been taken to ensure that electricity, water and fuel (LPG) are conserved. Some of the measures taken include: * Electricity: introduction of LED lights, compact fluorescent lamps for office lighting, efficient use of compressor and installation of transparent roof sheets to make better use of natural lights. * Water: use of recycled water, drip/sprinkler system for better usage, more efficient use of water by installing timers, replacing of old pipes with new ones to prevent leakages. * LPG: installation of heat recovery system and reducing the number of heat up occurrences from two to one for the Continuous Gas Carburising furnance.

All these activities cost Rs. 81 lakhs but resulted in savings of Rs. 151 lakhs. Also this is an environmentally friendly measure that shows the company’s concern for other stakeholders as well.

* The company has a well defined Corporate Social Responsibility plan. The core activities of the plan focus on ethical functioning, respect for all stake-holders, protection of human rights and care for the environment. Some of the activities that form part of it are: * Code of conduct and affirmative action with regard to hiring and non discrimination of people belonging to the weaker sections of the society. * Education: promoting and upgrading of ITIs * Health: setting up of an anti retro viral treatment centre


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