1. PRESENTATION OF ORGANIZATION:
ITC was established on the 24th August of 1910 under the name of Imperial Tobacco Company of India Limited. In the year 1970 name of the company was changed from Imperial Tobacco Company of India Limited to India Tobacco Company Limited. In 1974, it was again changed as I.T.C Limited. The company has its own portfolios of wide range of business like Cigarettes and Cigars, FMCG (Fast moving consumer goods), Personal care, Education, Brand Apparel, Stationery Products, Incense Sticks and Safety Matches, Hotels, Paperboards & Specialty Papers, Packaging, Agri-Business and Information Technology. Since the year 2001, Company is known as ITC Limited with full stops in the company name were removed.
1.1 Market(s)
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ITC has a quite favorable impact of political factors in the FMCG and Hotel business. Indian budget of tax regulation for the tobacco is 55%, which makes the company to spend the most the profit in the excuse duty. Advertising in the mass media is not allowed where as it can be done in the point of sale with a certain restrictions. Government of India also imposes the packing and labeling on the tobacco products like health-warning labels is to be pictorial and text for safety of the consumers. The cigarettes company operates in India with intolerable political factors, ruling party often changes the regulations keeping in mind about the safety of people but affects the companies like ITC business majorly. Which is also shown with potential customers are reducing day by day because of the price, results in lower sales. Apart from the government’s pressure, NGO’s in India are against the tobacco consumption and which in turn makes the selling of tobacco to consumers becomes tougher for the company. Though all the huge pressure company still able to make 65% of sales in the country and almost it’s the monopoly brand for the people for the consumption of
The Government of India has created an anti-tobacco plan to tackle the growing issues of tobacco, health concerns, and rising death toll. Their first goal was to eliminate advertising as this was perceived to encourage the youth to take up the dangerous habit. This ban posed ethical and commercial challenges for both sides of the argument. The government has the power to pass laws to help prevent people from smoking and protect its people. They found the ethical decision was to use this power by creating and
The prohibition of tobacco has been trending in foreign nations such as Finland, Norway and France. To conduct similar constraints is the intention of the government of India. Endangerment and possible victims of hazards are the concerns of those who are in favor of banning tobacco as well as other precarious commodities such as handguns and narcotics in India. Millions of deaths around the world have been the aftereffect of tobacco and cigarette smoking since the 90’s. Predictions of an increase of death toll would occur in the latter years to come. Utilization of tobacco among the youth is the product of propagandas’ enticements. Consequently, an increase in medical expenses such as hospital bills and health care expenditures would become the repercussion of such consumption. Additionally, even supposing that the occupation of 26 million people is the liability of tobacco industries, a boycott of tobacco and job turnovers would not create an adverse impact on the economy of India. Investments in other stocks would enhance the Indian economy. Finally, a decline of tobacco consumption would become fruitful if there is a proper implementation of banning tobacco endorsements.
Tobacco companies are no longer able to produce advertisements and brand their packaging (only brand name is allowed in plain text) with the introduction of the Tobacco Advertising Prohibition Act in 1992. With the acts in effect and the demonisation of the market it has made it increasingly harder for tobacco industries to enter and compete within the market. The result has led consumers to foreign markets for particular and cheaper goods (if customs doesn’t seize it), or illegal markets that are able to smuggle or grow tobacco in
On Feb 6, 2001 Government of India (GOI) dropped a bombshell on the tobacco Industry when it announced that it would shortly table a bill banning Tobacco Companies from advertising their products and sponsoring sports and cultural events. The objective of such a ban was to discourage adolescents from consuming tobacco products and also arm the Government with powers to launch an anti-Tobacco Program.
In 2001, there was an argument by the government of India trying to decide whether or not it was a good idea to ban all advertising from the tobacco industry. The government’s main goal was to find a way to reduce the number of teenagers using tobacco. The government believed that these advertisements encouraged teens to start smoking or to continue smoking if they were doing it already. As expected, this situation created a lot of tension between the government and the tobacco industry. This created two sides: those in favor of the ban, and those against it.
Smoking can most easily be defined as the most harmful habit to the human body.
A global hot topic that has been on debate for decades and does not appear to go silently into the night is the influence of tobacco advertising and its influence on the populous. Recently to join the discourse was the government of India versus the tobacco conglomerates. The Indian government hopes to follow suit of many other nations including: France, Finland, Norway, Canada and New Zealand who already imposed bans on cigarette advertising with successful results. The tobacco industry, however, holds their position that by placing a ban on advertising is controlling the opinion of the masses not allowing them to make their own decision of right and wrong. The government has the difficult task of weighing out the ethical issues of what causes more harm in the future, to allow tobacco advertisers to continue with business as usual or to out a halt on their advertising all together.
In an effort to discourage the consumption of tobacco products in India, a ban was issued stopping advertising and sponsoring of sporting events. This ban was brought to the table with the intentions of keeping the citizens of India from undue influence towards the use of a product that when used to the satisfaction of its producers would result in major health issues and eventual death. The use of tobacco products is directly attributable to the deaths of 3 million people in 1990 and the eventual death of 10 million people in the year 2030. Those in favor of the ban argued that a government that provides health insurance for the very people it collects taxes from in the purchase of the product that leads to their eventual illness is one
Big Business Tobacco aims to maximize its profits in the new market in Asian nations so the conclusion of
This essay is a case study analysis that uses the case Ban on Tobacco Ads and talks about the conflict of interests between tobacco producers and the Government of India.
The Government of India sought to create a mechanism to ban Ads on Tobacco usage. In doing so, it raised ethical concerns and arguments from two different sides, those in favor of and against it. For instance, Suhel Seth, CEO of Equus Advertisement, made a strong differing statement such as “The ban does not have teeth. It is typical Knee-jerk reaction by any Government to create some kind of popularity for itself.” Mr. Seth thought the Government was not serious enough to endorse Tobacco Ads prohibition, but instead that the Government was using it to gain acceptance. On the other hand, companies such as ITC Ltd voluntarily withdrew its ads from events, regardless “the legal position of the subject.” They were accessible to “a constructive dialogue” that would lead to the development of a suitable legislation. I suggest summarizing both the arguments of those who are in support of, as well as of those who are opposed to ban Tobacco Ads, and the conflicts of interest issues that pertain to the Government of India and lastly my own point of view of what I believe governments should do in regards to tobacco ads.
personal aspect, as for the ban on tobacco ads being shown in the country by the Indian Government 02/06/2001. Not only for health purposes such as lung cancer, chronic obstructive pulmonary disease, heart disease, stroke, asthma, reproductive affects in women, diabetes, premature, low birth weight in babies, blindness, cataracts, or age related macular degeneration. With India being a nation with war, as well as lots of heat as they are in the middle of the Sahara desert, many people are subject to having breathing issues without smoking. The reasoning was to block adolescents from purchasing tobacco products, where here in the United States there actually is a sting operation in many cities that police officers pay someone to attempt to purchase tobacco products in order to ensure that businesses are not selling to minors. Minors are not the only reason any country should ban the ads, as I remember as a little girl, the commercial was “ like father, like son” and it showed everything the father did the son would do, and at the end of the day and they would go sit under a tree, the father would then light up a cigarette and then the son would look at the pack and then look up to the father and the words “ like father, like son would be said and the brand was Marlboro, this was 1968 if my memory serves me correctly.
The government of India serves the people. When a product is produced that affects the health of the people the government is justified to take action. With Tobacco products India banned the advertising and sponsorship of sport and cultural events (IBS Center for Management Research (ICMR), 2001). Those in favor of the ban cite the French who stated that Tobacco advertising ban was to protect public health. They also, state the World Health Organization’s (WHO) death toll numbers. These numbers show that tobacco products are one of the leading causes of death in the world are continuing to grow. People who are in favor of the banning of advertising for tobacco products use a World Bank report that shows a substantial decline in smoking when ban of advertising in enacted for all forms of media. Finally, the fear of children becoming addicted to smoking has helped to support the justification to ban advertising on tobacco products. With these reasons we can understand and support a governments action to ban advertising on tobacco products.
The Government of India pursued to create a mechanism to ban Ads on Tobacco usage. In doing so, it raised ethical concerns and arguments from two different sides, those in favor of and against it. For instance, Suhel Seth, CEO of Equus Advertisement, made a strong differing statement such as “The ban does not have teeth. It is typical Knee-jerk reaction by any Government to create some kind of popularity for itself.” Mr. Seth thought the Government was not serious enough to enact a ban for Tobacco Ads, but instead that the Government was using it to gain more acceptances. On the other hand, companies as such as ITC Ltd voluntarily withdrew its ads from events regardless “the legal position of the subject.” They were more open to “a constructive dialogue” that would lead to the development of a suitable legislation. My suggest is to summarize both the arguments of those who are in support of, as well as of those who are opposed to it, and the conflicts of interest issues that pertain to the Government of India and lastly my own point of view to what I believe governments should do in regards to tobacco ads.
India in 2001 proposed a ban on tobacco advertisement in an effort to curb tobacco use with adolescents. It was met with sharp criticism from the tobacco industry. However, some saw it as a great move by the government in looking after the welfare of its citizens. I hope to explore in the essay each side’s voice as well as deal with the myriad of issues the government faced upon the bans proposal. Lastly I will give my opinion on what position the government should take.