SR I_Brochure_I c.cdr - ONGC

Precautionary approach: Our operations emphasize risk management and abundant caution in our E&P operational activities.
We do not take lack of scientific uncertainty as a reason for delaying action in undertaking risk assessment, risk mitigation and
actions for safe operations, that would minimize the impact on environment.
For example, we understand the concerns of climate change and despite the regulatory and scientific uncertainty, we have
initiated voluntary mitigation plans, with initiatives to work on a low carbon growth trajectory. Similarly, for our offshore
operations, we conduct environmental surveys and monitoring of areas surrounding our operational activities in order to
understand potential impacts on the marine environment and biodiversity. We take into account residual impact if any, and
design necessary mitigation action plans.
ONGC is required and therefore seeks environment clearance before commencing operations at a location. The environment
clearance includes forest clearance and thus ensures that we do not own, manage or lease land and thus operate in protected
areas and areas of high biodiversity.
Linkage between compensation for members of the ONGC Board and the organization's triple bottom line performance: The
compensation and the performance related pay of the functional directors and the CMD are linked to the performance of the
company against the parameters fixed in the Memorandum of Understanding executed with the Ministry of Petroleum & Natural
Gas. Corporate social responsibility (CSR) and Health, Safety and Environment (HSE) are also included in these parameters.
Independent Directors are paid sitting fees for the meetings of the Board and committees attended by them. The Government
Nominees on the Board are not paid any fees or remuneration.
Avoiding shareholder conflict of interest: There is a process to ensure that conflicts of interests are avoided at the Board of
Director's level. Pursuant to the provision under the Companies Act, 1956, every director would have to disclose the nature of
his/her concern at a meeting of Board of Directors and thereby a related party disclosure certificate is to be obtained in this
regard.
Process for determining the qualifications and expertise of the members of ONGC Board : Being a Public Sector, all the directors
at ONGC are nominated by the Government of India. For the selection of the functional directors and CMD, the vacancies are
notified in advance and the candidates are interviewed by the Public Enterprise Selection Board. Their appointment is approved
by the Appointments Committee of the Cabinet (ACC) of the Government of India.
For appointment of non-executive directors, the Department of Public Enterprises forms a search committee and the
appointment is made by the ACC from amongst shortlisted candidates. The nominee directors are appointed by the Government
of India based on the advice of the administrative Ministries. The independent directors are usually distinguished peers in their
own right chosen from the field of management, industry and academics. These directors head and are the members of board
sub committees according to their qualification and experience background.
ONGC provides opportunities to its shareholders to voice their concerns or provide recommendations. All our functional
directors, including the chairman have designated public visiting hours on specific days of the week, during which any member of
the public can voice any issue or grievance.
The ONGC "Investor Service Centre", providing information frequently required by investors and analysts, is available on our
corporate website http://www.ongcindia.com/investorcenter.asp. The website provides updates on financial statements,
investor related events and presentations, annual reports, dividend information and shareholding pattern, along with our
corporate governance report. Existing and potential investors are able to interact with ONGC through this web link for their
queries.
A Management discussion cum analysis report (which is part of the Directors' Report) is circulated to all shareholders of ONGC
along with the Annual Report.
A core team comprising of senior, experienced officials and headed by the Director (Finance) has been assigned the
responsibilities for up-keeping the said link and also to serve as a platform for the shareholders to express their opinions, views
and suggestions to understand the influencing factors in their investment decision process.
Besides, the said team is also instrumental in maintaining close liaison and to share information through periodic meets
including teleconferencing in India and abroad, regular press meets with investment bankers, research analysts, the media, and
institutional investors. ONGC is committed to take further steps, as may be necessary, to fulfill the expectations of its
stakeholders.