Sustainability Report 2013 Itc Limited
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The only Company in the world to be carbon, water and solid waste recycling positive More than 40% of energy consumption at ITC is from renewable sources SUSTAINABILITY REPORT 2013 ITC LIMITED ITC Hotels - Greenest Luxury Hotel Chain in the world FOR ALL OUR TOMORROWS Creating over 5 million sustainable livelihoods GRI - G3 COMPLIANT APPLICATION LEVEL A+ Contents CHAIRMAN’S STATEMENT: ITC’S VISION AND STRATEGY 04 KEY IMPACTS, RISKS AND OPPORTUNITIES 08 ITC ORGANISATIONAL PROFILE 16 CERTIFICATIONS, HONOURS AND AWARDS 26 REPORT PROFILE, SCOPE AND BOUNDARY 32 GOVERNANCE, COMMITMENTS AND ENGAGEMENTS 36 ECONOMIC PERFORMANCE 46 CREATING ENDURING INSTITUTIONS 56 ENVIRONMENTAL PERFORMANCE 58 CLIMATE CHANGE AND SUSTAINABLE DEVELOPMENT 60 WATER MANAGEMENT 70 RECYCLING AND WASTE MANAGEMENT 80 SIGNIFICANT AIR EMISSIONS 86 MATERIAL SUSTAINABILITY IN ITC’S BUSINESSES 90 SOCIAL PERFORMANCE 94 LABOUR PRACTICES AND DECENT WORK 96 SOCIAL INVESTMENTS - MISSION SUNEHRA KAL 110 PRODUCT RESPONSIBILITY 120 GRI INDEX 128 ALIGNMENT TO NATIONAL VOLUNTARY GUIDELINES 141 ANNEXURES MANAGEMENT APPROACH 145 POLICIES AND GUIDELINES 152 MEMBERSHIPS AND AFFILIATIONS 163 INDEPENDENT ASSURANCE STATEMENTS 165 SELF-DECLARATION ON APPLICATION LEVEL 171 TRIPLE BOTTOM LINE ITC: An Exemplar In Triple Bottom Line Performance ENVIRONMENT WATER POSITIVE: 11 YEARS IN A ROW CARBON POSITIVE: 8 CONSECUTIVE YEARS SOLID WASTE RECYCLING POSITIVE: FOR THE LAST 6 YEARS SOIL & MOISTURE CONSERVATION TO 1,16,000 HECTARES ITC’s Watershed Development initiative brings precious water to more than 1,16,000 hectares of moisture-stressed areas 40% RENEWABLE ENERGY More than 40% of ITC’s total energy consumption is from renewable sources GREENEST LUXURY HOTEL CHAIN All ITC’s premium luxury Hotels are LEED Platinum certified 1,42,000 HECTARES GREENED ITC’s Social and Farm Forestry initiative has greened over 1,42,000 hectares 02 SUSTAINABILITY REPORT FOR ALL OUR TOMORROWS SOCIAL CREATING 5 MILLION SUSTAINABLE LIVELIHOODS CREATING COMMUNITY ASSETS Strengthening the agri production base of nearly 4 lakh farmers EDUCATING 3,00,000 CHILDREN ITC’s Primary Education initiative has educated over 3,00,000 children EMPOWERING 4 MILLION FARMERS ITC’s globally acknowledged e-Choupal initiative is the world’s largest rural digital infrastructure benefitting over 4 million farmers 40,000 SUSTAINABLE LIVELIHOODS FOR RURAL WOMEN ITC’s Women’s Empowerment initiative has created nearly 40,000 sustainable livelihoods ECONOMIC ANIMAL HUSBANDRY SERVICES TO MARKET CAPITALISATION: 8,00,000 MILCH ANIMALS OVER $ 45 BILLION ITC’s Livestock Development initiative has provided animal husbandry services for over 8,00,000 milch animals TURNOVER: OVER $ 7 BILLION 26% COMPOUND ANNUAL GROWTH IN TOTAL SHAREHOLDER RETURNS OVER THE LAST 17 YEARS 30,000 EMPLOYEES ITC Group provides direct employment to more than 30,000 people POWERING GROWTH WITH MULTIPLE BUSINESS DRIVERS Diversified multi-business conglomerate spanning FMCG, Hotels, Paperboards & Packaging, Agri Business and Information Technology POWERED BY THE VITALITY OF WORLD-CLASS BRANDS 03 CHAIRMAN’S STATEMENT ITC’s Vision & Strategy Chairman’s Statement have great pleasure in presenting ITC’s Sustainability ITC in enriching the country’s environmental capital while Report 2013, a transparent and voluntary disclosure generating significant sustainable livelihood opportunities. I of the Company’s Triple Bottom Line performance. It These acknowledgements give us strength in pursuing a path encapsulates ITC’s abiding commitment and pro-active less travelled to create growing societal value. action in contributing meaningfully to India’s pursuit of sustainable and inclusive development. ITC’s multi-dimensional It also gives us humble pride that, as a company from a sustainability initiatives also support the global community’s developing nation, ITC has been able to achieve the unique efforts in building a secure future for the generations to come. global distinction of being the only company in the world of comparable dimensions to be Carbon Positive (for 8 successive This Report commemorates an important milestone as it is the years), Water Positive (for 11 consecutive years) and Solid 10th consecutive year of its publication. As in earlier years, this Waste Recycling Positive (for 6 years now). ITC’s businesses Report conforms to the stringent ‘G3’ guidelines of the Global and value chains support sustainable livelihoods for more than Reporting Initiative (GRI) at the highest ‘A+’ level. It has also 5 million people, many of whom represent the weakest sections been independently assured by M/s. Ernst & Young Pvt Ltd. of society. For the last 17 years under my watch as Chairman, total shareholder returns have grown at a CAGR of over 26 %. I am happy to once again reiterate the Company’s support to This triple bottom line performance is a manifestation of ITC’s the principles underlying the United Nations Global Compact. It abiding vision and commitment to create enduring value for its is a matter of great satisfaction that ITC’s unique and inclusive stakeholders. business models together with its focussed social investments contribute significantly to the Millennium Development Goals enunciated by the United Nations. GLOBAL CHALLENGES We have been deeply Five years after the outbreak of the global financial crisis, the encouraged by the In 2012, the Company world economy continues to remain fragile. The recurring dips accolades received, was honoured with in growth and employment are a cause for concern despite in India and abroad, all-out attempts to contain the Eurozone crisis and strengthen the World Business for the Company’s recovery in the United States. The cascading effect of the and Development exemplary performance economic slowdown in the richer nations have left deep scars in augmenting social Award at the historic across the globe. Though developing countries managed to Rio+20 United Nations and environmental drive more than half of the global growth in 2012, their growth wealth. For the second rate also plunged to new lows. Summit for its large- consecutive year, ITC scale social and farm was ranked first in the The continuing economic slowdown can have serious CSR category in the forestry programme consequences on social stability including that arising out Nielsen Corporate Image of increasing unemployment, mainly amongst the youth. Monitor. In 2012, the Company was honoured with the World The “Global Employment Trends 2013” Report of the ILO Business and Development Award at the historic Rio+20 United released recently presents an ominous picture. The number Nations Summit for its large-scale Social and Farm Forestry of unemployed worldwide will rise to 202 million in 2013 with programme. This award is a tribute to the efforts of thousands nearly 10 million accumulating in the last 2 years alone. What of tribals and poor farmers in rural India, who have partnered is worse is that youth unemployment, estimated to reach over 04 SUSTAINABILITY REPORT FOR ALL OUR TOMORROWS 75 million in 2014, is growing at a far higher rate. The crisis transformational change through innovative business models has dramatically diminished the labour market prospects for that deliver significant societal value even as they generate young people, as many experience long-term unemployment economic wealth. Shareholder value creation ought to be a right from the start of their labour market entry, a situation that reward for societal value creation. Responsible corporates was never observed during earlier cyclical downturns, the ILO create societal value by serving their consumers through Report says. This can turn out to be a colossal waste of human competitively superior value propositions, by preserving and resources with serious mismatch of education, skills and replenishing the environment and by innovating strategies that jobs; a generation losing out on valuable work experience and maximise sustainable livelihood creation. erosion of occupational skills while at the same time fuelling social unrest as disillusionment and frustrations rise. Austerity, Traditionally, companies have participated in the task of forced upon by economic circumstances, as well low incomes creating societal value through philanthropic activities. This and low demand will continue to put pressure on employment. approach, though well intentioned, has its limitations. Confined Therefore, it is now mission critical to find innovative solutions to philanthropy, corporates tend to limit their CSR to only for sustainable livelihood creation of a magnitude that can extending financial support to social projects. As a result, there arrest and avert a potential social disaster. is a disproportionate focus on outlays rather than on outcomes. In such an approach, the capacity to extend financial support far These global challenges are further aggravated by the continued outweighs the transformational capacity of business to create degradation of the world’s environment. Scientists recently larger societal value. Global research by renowned experts flagged yet another crisis alert when it was found that the such as Prof. Michael Porter and Mark Kramer of Harvard carbon dioxide levels in the atmosphere had reached an average have however established that societal value creation delivered daily level higher than that measured for at least three million through a strategic business context is more meaningful and years. This can further accelerate global warming and changes scalable. Philanthropy, as noble