Annexure to the directors' report

a) Particulars pursuant to Companies (Disclosure of particulars in the report of the Board of Directors) Rules, 1988

Conservation of energy

Building infrastructure

During the year, two of our buildings, one in Jaipur and the other in Thiruvananthapuram, were awarded the prestigious LEED Platinum rating – the highest rating for Green Buildings, by the Indian Green Building Council (IGBC). All new buildings that were completed in the previous year have been registered for LEED rating from IGBC and we hope to achieve a Platinum rating in all cases. The energy performance of all the buildings designed in the previous year has been found to be more efficient than the globally accepted ASHRAE efficiency standards for buildings.

On new technologies, one building in our Hyderabad campus has been commissioned with radiant cooling, a method of cooling used for the first time in a commercial building in India. A chilled water storage tank of 300 KL capacity has been built at our Mangalore campus to increase the efficiency of the air conditioning system. This system is under testing and is expected to reduce peak load as well as energy consumption. Initial results of this system have been very encouraging. Chilled beam systems, which are expected to be more efficient than the conventional air conditioning systems, are being implemented in three new buildings in our Pune campus. High-efficiency chillers that consume considerably lesser power have been selected for all new upcoming projects, thus reducing peak demand as well as energy consumption.

During the year, we worked with electricity and power regulators in Karnataka and with the government of India for making green power cheaper, an achievement that is significant not only for us but would also benefit the community at large. A similar initiative is being taken up in other parts of the country. We purchased about 8.53 million units of green power during the year and this figure is expected to increase substantially in the coming years. On renewable energy, two solar photovoltaic systems of about 200 KW and 125 KW are being installed in our Jaipur and Thiruvananthapuram campuses respectively. Together, these are expected to generate about 4,50,000 units of electricity annually, thus reducing the burden on the grid.

A considerable amount of time and effort was earmarked for conserving power across all our development centers in India. Some of the measures taken include :

These measures have resulted in reducing the per capita power consumption by over 3% during the year.

IT infrastructure

During the year, optimized desktop power management configuration has been extended to around 80,000 desktops. Our in-house application, 'Terminator', designed to force-schedule the shutdown of desktops, is being enhanced to achieve further reduction in power demand by desktops. In addition to this, around 10,000 older desktops have been replaced this year with newer power-efficient models.

We have continued our efforts towards restructuring the existing data centers and server rooms. Around twelve server rooms have been revamped this year and about 4,400 sq. ft. of server room / lab space has been released. Further, our projects have been swift to adopt the internal enterprise cloud, a shared, secure and virtualized computing environment with an easy-to-use 'Self-Service' portal. On an average, 90% of the virtual instances are in use at any given time and we are planning to further augment the capacity.

Video Conferencing (VC) usage has increased steadily this year and currently, on an average, around 2,500 VC calls are happening per month. Further, we have introduced Telepresence, an Ultra High Definition (1080p) VC facility in three locations. Telepresence relays true life-size images and employs spatial audio to provide an immersive experience to the participants. Usage of this facility would help us connect with customers at CXO levels across the world and reduce our travel requirements.

Research and Development (R&D)

Our new strategic direction 'Building Tomorrow's Enterprise' identifies trends that are driving and transforming the businesses of our clients globally. These include digital consumers, emerging economies, healthcare economy, sustainable tomorrow, new commerce, smarter organizations and pervasive computing. These themes are now being used to define the research and innovation agenda of the Company.

Infosys Labs

Infosys Labs, a dedicated research and innovation group comprising technology and domain-focused members has been established. It builds on the successes of the award winning Software Engineering and Technology Labs (SETLabs) and envisages a broader mandate.

The primary research focus areas include Software Engineering, Convergence, Knowledge-driven Information Systems, Security & Privacy, Distributed Computing and Innovation. We also have dedicated Centers of Excellence on Maintenance & Service Differentiation, Microsoft Technology and Cloud Computing.

Some of the specific areas of research include semantic and language technologies for information extraction from social media and for customer engagement, context aware systems, pervasive computing including mobility & sensor networks, scalable computing including GPGPU, multi-core and cloud computing, data privacy and user authentication, preventive software maintenance and software engineering.

Learn more about Infosys Labs and its focus areas at http://www.infosys.com/infosys-labs/

Finacle

The Finacle R&D unit at Infosys is engaged in the research of developing new technologies in the banking domain. Finacle R&D solutions address the areas of core banking, wealth management, CRM, Islamic banking and treasury requirements of retail, corporate and universal banks worldwide. Finacle solutions also empower banks with multiple sales, service and marketing channels including e-banking and mobile banking.

Education & Research

The E-Com research lab of the E&R unit focuses its research in the areas of game theory applications to IT services, distributed computing, optimization theory applications to IT services, pattern recognition systems, face recognition algorithms, large data management and education technology.

Collaborations with academia and industry

We co-create with clients, technology partners, universities and the larger innovation ecosystem by setting up joint innovation centers and developing solutions for complex business problems.

We are associated with various universities globally including, Purdue University, Indian Institute of Science, Bangalore, IIIT, Hyderabad, IIIT, Bangalore, IIT, Bombay – Monash Research Academy, University of Southern California, University of Cambridge and the University of Illinois at Urbana-Champaign. We also associate with several industry consortia including the IU-ATC in the United Kingdom (U.K.) and the Smart Services CRC in Australia.

With a definitive aim to enlarge the innovation ecosystem to include start-ups, entrepreneurs, incubation cells and other innovation players in the industry, Infosys Labs organized an 'Innovation Camp' in Bangalore in March 2011. This is part of our larger program planned across the globe.

R&D highlights

Our efforts in R&D have helped us offer new services to clients in the areas of Software Engineering, Convergence, Knowledge-driven Information Systems, Security & Privacy and Distributed Computing. We are developing client-focused business solutions based on the intellectual property developed by multiple research groups. Our R&D efforts have helped us win large deals across industry verticals.

From a banking industry perspective, the Finacle R&D unit has launched innovative offerings such as FinacleTM Advisor, FinacleTM Mobile Banking 2.0, FinacleTM Treasury-in-a-box, FinacleTM Core Banking for regional rural banks and FinacleTM financial inclusion solutions. Our research has also helped develop key Finacle solutions like Core Banking, CRM, Consumer e-banking, Wealth Management and others.

Our R&D efforts have also helped differentiate our solutions and win awards. An illustrative list is provided here :

During the year, the research groups also published two books, Raising Enterprise Applications – A Software Engineering Perspective and Process-centric Architecture for Software Systems, and over 125 papers in leading publications and journals.

Future plan of action

We are now using the 'Building Tomorrow's Enterprise' theme to focus on our technology research and to identify large, multidisciplinary problem areas that embody the challenges facing our clients.

We will continue to focus on and collaborate with leading national and international universities, product vendors and technology start-up companies. We are creating an ecosystem to co-create business solutions on client-specific business themes.

Expenditure on R&D

in Rupee Symbolcrore

2011

2010

Revenue expenditure

521

437

Capital expenditure

6

3

Total

527

440

R&D expenditure / total revenue

2.1%

2.1%

Foreign exchange earnings and outgo

Activities relating to exports, initiatives taken to increase exports, development of new export markets for products and services, and export plans

During the year, 97.7% of our revenues were derived from exports. We have established a substantial direct marketing network around the world, including North America, Europe and Asia Pacific.

These offices are staffed with sales and marketing specialists who sell our services to large international clients.

Foreign exchange earned and used

in Rupee Symbolcrore

2011

2010

Earnings

23,960

21,075

Outflow (including capital imports)

10,765

8,490

Net foreign exchange earnings (NFE)

13,195

12,585

NFE / Earnings

55.1%

59.7%

for and on behalf of the Board of Directors

S. Gopalakrishnan
Chief Executive Officer and
Managing Director

S. D. Shibulal
 Chief Operating Officer and Director

Bangalore
April 15, 2011

b) Auditors' certificate on corporate governance

The Members of Infosys Technologies Limited

We have examined the compliance of conditions of Corporate Governance by Infosys Technologies Limited ('the Company'), for the year ended on 31 March 2011, as stipulated in Clause 49 of the Listing Agreement of the Company with the stock exchanges.

The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was limited to procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company.

In our opinion and to the best of our information and according to the explanations given to us, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in the above mentioned Listing Agreement.

We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which the management has conducted the affairs of the Company.

for B S R & Co.
Chartered Accountants

Firm registration number : 101248W

Bangalore
15 April, 2011

Natrajh Ramakrishna
Partner
Membership number : 32815