SUSTAINABILITY REPORT 2014/2015 TABLE OF CONTENTS Message from the CEO 02 Organizational Profile 04 Sustainability at Virtusa 10 Awards and Recognition 20 Our Clients 24 Governance and Compliance 28 Environmental Stewardship 37 Our People 50 IT for Good 60 Global Compact Principles and GRI Indicator Mapping 69 GRI Application Level 70 GRI Reporting Framework Content Index 71 1 MESSAGE from the CEO I am delighted to introduce our FY14/FY15 Sustainability Report to you. Publishing the Sustainability Report gives us an opportunity to share the progress we have made in our sustainability efforts, as well as to reaffirm our commitment to being a sustainable business. As a signatory to the United Nations Global Compact (UNGC), this report also represents our Communication on Progress (COP) in embedding the UNGC Principles in our business operations. Virtusa’s sustainability strategy is focused on five key areas: conducting business in an ethical manner, reducing our environmental footprint, delivering excellent service to our clients, creating a work environment that is safe and conducive to our employees, and using information technology for the benefit of the communities we operate in. While you will find detailed information on all our sustainability initiatives within this report, I would like to share some specific highlights from our FY14/FY15 program, in this letter. BUSINESS INTEGRITY: We extended our commitment to anti-corruption and anti-bribery by implementing two policies, the US Foreign Corrupt Practices Act Policy and the Virtusa UK Anti-Bribery Act Policy in FY14, as well as bolstering controls and safeguards set forth in our Code of Business Conduct and Ethics. The policies are further supported and implemented by ongoing training programs and mandatory, annual certification requirements for all our employees. CLIENT SERVICE EXCELLENCE: During FY14 and FY15, we leveraged our technology expertise to help our clients build solutions that delivered millennial experience for their consumers and employees. The 125 and 45 perfect 10/10 Client Delight Index (CDI) scorecards our teams received during FY15 and FY14 respectively, are a testament to our service excellence. We also received several accolades that recognize our service excellence and our competitive edge in the industry. In October 2014, Virtusa was ranked in the Forbes’ list of “100 Best Small Public Companies in America” and in January 2014, Virtusa was named a Top 20 Outsourcing Service Provider by the Information Services Group (ISG) for the fourth consecutive quarter. More information on these accolades is provided in the Awards and Recognition section. SUSTAINABILITY POLICY: We published a formal Sustainability Policy in FY14. This policy reinforces our commitment to sustainable business practices in the following areas: employee health and safety, environment, climate change, conservation of energy and water, waste reduction, business continuity, information security, adherence to HR/labor standards, anti-bribery and corruption elimination, making meaningful contributions to society, and promoting diversity in the workforce. ENVIRONMENTAL STEWARDSHIP: Code Green, our environmental management system, encompasses measures to manage the significant environmental aspects of our business operations. Code Green started in FY09 and has continued to grow in terms of scope and maturity with all our major technology centers, accounting 2 for 85% of our real estate, being certified ISO 14001. FY14/FY15 saw the Code Green program receive several accolades. First, our Hyderabad Campus facility was rated LEED Gold by the Indian Green Building Council. Second, we won Gold in the Private Institute Category at the National Green Awards in Sri Lanka. Third, but most importantly, we obtained a score of 84 from the Carbon Disclosure Project, which is a testament to the effectiveness of our Code Green program. PEOPLE EXCELLENCE: We increased our headcount by 1193 team members from FY14 to FY15. With more than 80% of our workforce consisting of millennials, our goal is to create a work environment where this digitally connected generation thrives. We utilize our V+ social business platform to enhance the way our team members work, learn, share and connect with each other. As we grow our organization, we also aim to grow 75% of our leaders from within. SOCIAL RESPONSIBILITY: Our CSR pillars—Campus Reach, Digital Reach and Tech Reach—focus on creating positive social impact. Detailed information about these initiatives are provided in the section, IT for Good. We were honored to be featured as a case study in “Responsible Business Advancing Peace”, a joint publication by the UNGC and the Principles for Responsible Investment (PRI). The case study highlights Virtusa’s contribution to national reconciliation and reconstruction in Sri Lanka through our Digital Reach and Tech Reach initiatives. In addition, Virtusans continue to contribute their time and energy to help others. For example, the Chennai CSR team formed ‘Rings of Support’ where a group of Virtusan volunteers support children affected by Thalassemia through blood donations. In terms of improving sustainability practices, our goal is to increase the scope of our environmental reporting to include more geographic locations and reporting indicators. However, we face a challenge in implementing environmental reporting in the smaller locations due to the lower number of resources available to gather and report on such data. We also aim to have third party verification of environmental data. As the first step, we have obtained limited assurance of ISAE 3000 compliance by EY for our Scope 1 and Scope 2 emissions data in FY14 and FY15. We look forward to reporting improved sustainability performance in the coming years. Kris Canekeratne Chairman & CEO 3 ORGANIZATIONAL PROFILE 4 Virtusa Corporation (NASDAQ: VRTU) is a global information technology services company with offices in North America, Europe and Asia. OUR MISSION OUR VALUES To be the partner of choice for corporations Pursuit of Excellence - Expand the contours of in creating competitive advantage through our customer experience through innovation technology excellence. and acceleration of business outcomes. To create the conditions for professional success Integrity - Be forthright and honest in all our and quality of life for all Virtusans. interactions. To be a socially conscious and responsible Respect - Treat our stakeholders, environment corporate citizen in all countries of operations. and our diversity with respect. Leadership - Lead by serving those being led and be accountable when things go awry. 5 FY15 FAST FACTS 9,247 Virtusans across the globe 1,193 new hires More than 80% of our workforce are Millennials 99% of senior management hired from local community Revenue: $479 million Net income: $42.4 million 20.7% increase in revenue 114 clients 125 perfect 10/10 Client Delight Index scorecards 87% of revenue from repeat business Emissions* per FTE** Reduced by 18% Energy Consumption per FTE Reduced by 22% Water Consumption per FTE Reduced by 18% *Scopes 1 and 2 **Full Time Employee 6 ABOUT VIRTUSA Virtusa Corporation (NASDAQ: VRTU) is a global information technology services company. Headquartered in Massachusetts, we have offices in the United States, the United Kingdom, the Netherlands, Germany, Sweden, Austria, Switzerland, Hungary, India, Sri Lanka, Singapore, Malaysia and the Philippines. We view our operations and manage our business as one operating segment. Our corporate structure also spans multiple jurisdictions, with Virtusa Corporation incorporated in Delaware and its operating subsidiaries organized in India, Sri Lanka, the United Kingdom, Hungary, Germany, Singapore, Austria, Malaysia, Sweden, Switzerland and the Netherlands. While there were no significant changes in structure or ownership during the reporting period, new technology centers were opened in New York and Pune in FY14. In FY14 and FY15, we made several acquisitions focused on adding domain expertise. On November 1, 2013, we acquired the business and assets of OSB Consulting LLC, a New Jersey limited liability company, to extend our service offerings to include a broader set of finance transformation services in the financial services and insurance domains. On January 2, 2014, we acquired all of the outstanding stock of TradeTech Consulting Scandinavia AB and its subsidiaries to expand our position within the banking, financial services and insurance industries by increasing our asset management and treasury services domain and technology expertise, as well as expanding our global presence into the Nordics. To strengthen our infrastructure management services (IMS) practice and solution offerings and enable us to deliver network operating center (NOC) support through nearshore facilities, as well as IMS services globally, on April 1, 2015, we acquired all of the outstanding shares of Apparatus, Inc., a leading provider of end-to-end IT IMS headquartered in Indianapolis, Indiana. OUR SERVICES We use an enhanced global delivery model to provide end-to-end information technology (IT) services to Global 2000 companies. These services include IT and business consulting, user experience (UX) design, development of IT applications, maintenance and support services, systems integration, infrastructure and managed services. To help our clients increase revenue, we leverage the emerging demand from Millennials to deliver solutions that use technologies such as big data analytics, social,