Corporate Social Responsibility Policy KMI – Legal – 001

Owner : Legal Department Revision Level – 00

COMPLIANCE Effective Date: 01st April, 2019

CORPORATE SOCIAL RESPONSIBILITY POLICY (“POLICY”) OF KIA

MOTORS INDIA PRIVATE LIMITED (“KMI”)

INDEX

S. No. Particulars Page

No.

1. Objectives of CSR Policy 1

2. Key Stake-Holders 1

3. CSR Road Map 2

4. CSR Programs 2

5. CSR Governance Structure 3-4

6. Implementation of CSR activities & criteria for 4-5

Selection of Implementation Partner(s)

7. CSR Budget / Expenditure 5

8. Reporting 5-6

9. Publication 6

10. Amendments 6

11. Effective Date 6

 Corporate Social Responsibility Policy KMI – Legal – 001
Owner : Legal Department Revision Level – 00
COMPLIANCE Effective Date: 01st April, 2019

1. OBJECTIVES OF CSR POLICY

1.1 The Objective of this Policy is:

① Achieve its global vision “Together for a better future” in line with its 5 core values.

② To comply with Section 135 of the Companies Act 2013 and the Companies (Corporate Social Responsibility)
Rules, 2014 as may be applicable and as amended from time to time.

2. KEY STAKEHOLDERS

2.1 The Key stake holders are as follows :

Customers

communities Societies

Stakeholders

investors Governments

Vendors
/suppliers

2.2 Focused CSR planning and activities specifically within Anantapur district shall be conducted for sustainable
development of the backward areas in coordination with district authorities.

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 Corporate Social Responsibility Policy KMI – Legal – 001
Owner : Legal Department Revision Level – 00
COMPLIANCE Effective Date: 01st April, 2019

3. CSR ROAD MAP

3.1 The detailed CSR Road map shall be prepared by the CSR Committee with support from Compliance
Department.

2021
2019
2020 •Review of trials and
•Identify the ideal
•Implement the extension of plans
program and activity
program in phases for •work on allocation of
•Prepare a plan for
trial resources and long
implementation
term sustainability.

4. CSR PROGRAMS

4.1 KMI shall undertake the following activities in Vision

compliance with Schedule VII of the

Companies Act, 2013. Core Value

a) Health and Nutrition Road Map/Strategy

b) Poverty
CSR program
c) Education
d) Community empowerment
CSR Activity

4.2 The Compliance Department shall identify key CSR programs and suggest specific activities relating to the
Programs given in clause 4.1 to the CSR committee, who shall then decide and finalise the activities as it may
deem fit and recommend it to the Board for approval.

4.3 In addition to above, KMI can contribute to any fund set up by the Central Government or State government
qualifying for CSR expenditure and/or providing support during natural disasters.

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 Corporate Social Responsibility Policy KMI – Legal – 001
Owner : Legal Department Revision Level – 00
COMPLIANCE Effective Date: 01st April, 2019

5. CSR GOVERNANCE STRUCTURE

5.1 The Governance structure for CSR shall be as follows :

① The Board of Directors shall constitute the Corporate Social Responsibility Committee (“Committee”) and
the Committee is responsible for recommendation of CSR Policy and Budget to the
Board of Directors
② The Committee shall consist of two (2) Directors who may further invite Managing Director, all Head of
Departments (HODs) and Chief Administrative Officer (CAO) to be a part of the Committee meetings and
shall be assisted by the Compliance Department.
③ The Compliance Department shall comprise of the Head of Legal Department, Company Secretary, and a
CSR resource person from legal department.
④ The Compliance Department shall assist & advice the committee on selection of activities and prepare a
draft policy, strategy, budget/expenditure report. The Compliance Department shall also monitor and
review performance of the organisation or internal team implementing the activities.
⑤ Based on the recommendations of the Compliance Department the Committee shall decide the activities
to be undertaken, review progress, monitor and maintain a transparent monitoring mechanism, prepare
an organisation for implementation of the activities and conduct impact assessment through external
agencies if required.
⑥ The Committee shall meet bi-annually and submit a report to the Board of Directors which shall include
review of the yearly plan and budget. Certain members selected by the Committee shall meet quarterly.
The meetings shall be coordinated by the Compliance department who shall also prepare the minutes.
⑦ The Committee may invite Executives, Advisors, Senior Management, social organization representatives
and other experts as it deems necessary to the Committee Meetings.

Appoint CSR Committee

Board of Directors (BOD)
Approve CSR policy & budget

Formulate & Recommend

CSR policy, budget to BOD
CSR Committee Approve
Programs, Activities, Organization
for implementation
• 2 Selected Directors
• Invited members
(MD&Head of Division)

Propose Policy(activity), Budget

Review Implementation
Compliance Department
Evaluate & Monitor
Proposals, Interim reports &
• In house CSR expert Implementation process
• Corporate Compliance
members
• Company Secretary

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 Corporate Social Responsibility Policy KMI – Legal – 001
Owner : Legal Department Revision Level – 00
COMPLIANCE Effective Date: 01st April, 2019

5.2 Quorum

The requisite quorum shall constitute of 2 (two) members of the Committee to be present in person.

5.3 Notice

The notice for any meeting shall be issued by the Compliance department to the members of the Committee
or any other person specifically required to be present in any meeting (including the Executives, Advisors,
Senior Management, HODs and other individuals referred to above) shall be accompanied by an agenda for
this meeting and shall be delivered well in advance, which in no case shall be less than 14 (fourteen) days.

6. IMPLEMENTATION OF CSR ACTIVITIES & CRITERIA FOR SELECTION OF IMPLEMENTATION PARTNER(S)

6.1 KMI can implement CSR activities on their own resources in accordance with clause 4.2.

6.2 In case KMI decides to select NGOs or other third-party non-profit organizations (“Partner Entity”) for CSR
projects or programs executions and implementation, the following minimum criteria shall be ensured:

① The Partner Entity is a registered Society / Charitable Trust / Section 8 Company which has previously
participated in and/or conducted constructive CSR activities;
② The Partner Entity has a permanent office / address in India;
③ The Partner Entity has a valid Income Tax Exemption Certificate; and
④ The Partner Entity has submitted a project proposal and budget which has been approved by the CSR
Committee.

6.3 The following procedure shall be followed by KMI for executing CSR Projects with partner entities:

① The Committee shall, prior to selecting any single or multiple partner entity, request a detailed project
proposal from the partner entity detailing the proposed program objectives, budget and scope of
collaboration and in addition obtain a statement of activities and projects that the partner entity has
previously engaged in.
② Upon project approval, the Committee, for every such individual program or project must formulate and
issue a Memorandum of Understanding with the partner entity, enumerating the key roles and
responsibilities of each of the parties.
③ Contributions shall be made only towards the specific projects identified by the CSR Committee and
subsequently approved by the Board.
④ Prior to expending the contribution amount to the partner entity, be it in stages or installments as per the
progress, the CSR Committee must ensure that the said entity has all the requisite approvals required
under all applicable laws.
⑤ In addition to the above, the Committee may at its discretion, conduct preliminary due diligence exercises
and assessment of partner entities based upon credentials, governance, risk, financial controls and
regulatory compliances. This may involve obtaining audited financial statements, including cash flow
statements within 60 (sixty) days of the end of the relevant financial year and any information which may

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 Corporate Social Responsibility Policy KMI – Legal – 001
Owner : Legal Department Revision Level – 00
COMPLIANCE Effective Date: 01st April, 2019

affect the implementation or adversely impact the CSR Project or activities of the partner entity in
general.

6.3 Infrastructure:

The basic infrastructure of the NGO should be in place which includes fixed place of operation, clearly
defined staff structure including number, names, roles & responsibilities of the staff etc. involved in the
project, organization's capacities, staff experience and expertise in the context of the proposed project and
otherwise, geographical area covered by the organization, other projects undertaken by the Organization.
NGO should disclose financial assistance received from other sources.

6.4 Credible links: NGO should, preferably, have prior experience in the proposed area of work.
① NGO should have an established track record of three years in any of the related development fields as
mentioned in Schedule VII of The Companies Act
② NGO should have no conflict of interest with the government, KMI or any of KMI’s shareholders

6.5 The CSR Committee may, subject to approval of the Board, engage external agencies or consultants to
undertake any of the above-mentioned procedural checks to evaluate the partner entity credentials.

7. CSR BUDGET/ EXPENDITURE

7.1 For achieving its CSR objectives through implementation of meaningful and sustainable CSR programmes,
KMI shall endeavour to allocate the following as its Annual CSR Corpus:

① As required by Law for compliance

 2% of average net profits made during the 3 (three) immediately preceding financial years, as prescribed
under Companies Act 2013 read with the Companies (Corporate Social Responsibility Policy) Rules, 2014
and unspent amount, if any, for any financial carried forward to the next financial year;
 Any income arising therefrom; and
 Surplus arising out of CSR activities.

② As may be approved by the Board of Directors in excess of the legal requirement.

7.2 All expenditure incurred by KMI in pursuance of CSR activities shall be diligently documented as per a
prescribed format or schedule mutually agreed between the Committee and the Board. It is hereby
clarified that surplus arising out of CSR projects or programs shall not form part of business profits of the
KMI.

8. REPORTING

8.1 An annual comprehensive CSR Report shall be included in the Directors’ Board Report within the Annual
Financial Report of KMI and submitted to the Board by the CSR Committee for approval.

8.2 The CSR report shall contain details of the CSR Policy, overview of programs, composition of CSR
Committee, financials, programs, budget, expenditure, Partner Entity, etc
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 Corporate Social Responsibility Policy KMI – Legal – 001
Owner : Legal Department Revision Level – 00
COMPLIANCE Effective Date: 01st April, 2019

8.3 The report shall comply with the specific requirements of Section 135 of the Companies Act, 2013 and shall
be in accordance with the prescribed format as provided in Annexure titled ‘Format for the Annual Report
on CSR Activities to be included in the Board’s Report’ as appended to the Companies (Corporate Social
Responsibility) Rules, 2014.
8.4 The Board of Directors’ Report shall also include a Responsibility Statement of the CSR Committee that
the implementation and monitoring of CSR Policy is in compliance with CSR objectives and Policy of KMI.

9. PUBLICATION:

9.1 The CSR policy recommended by the Committee and approved by the Board shall be displayed in the
Company’s website along with the Annual CSR Report for public viewing.

10. AMENDMENTS

10.1 The CSR Committee, subject to prior approval of the Board, reserves its right to amend or modify this Policy
in whole or in part, at any time without assigning any reason whatsoever. However, no such amendment
or modification shall be inconsistent with the applicable provisions of the Act or any law for the time being
in force.
10.2 In special circumstances the committee shall have the authority to allocate unused/surplus fund to
activities not covered under the list of CSR programs approved by the Board of Directors. This shall be
done by way of Circular Resolution and subsequently be ratified by the Board of Directors.

11. EFFECTIVE DATE

11.1 This CSR policy will come into force with effect from 01st April, 2019.

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