So the World Builds Better ACC LIMITED Sustainable Development Report 2016 Contents

So The World Builds Better ACC LIMITED Sustainable Development Report 2016 Contents 1 2 3 01 - 03 04 - 21 22 - 35 Introduction Organization & Strategy Strategy & Approach 1.1 Chairman’s Message 01 2.1 Building the Nation 06 3.1 Stakeholder Engagement 24 1.2 Foreword - MD & CEO 02 2.2 Products & Services 10 3.2 Materiality & Strategy 30 2.3 Customer Excellence 12 3.3 Business Risks & Opportunities 32 2.4 Corporate Governance 14 3.4 SD Scorecard 2016 34 2.5 Compliances & other aspects 19 3.5 SD 2030 Plan 35 4 5 6 36 - 41 42 - 51 52 - 71 Disclosures & Reporting Economic Environmental 4.1 GRI Reporting 38 5.1 Economic Performance 44 6.1 Emissions 54 4.2 UN Global Compact Principles 40 5.2 Marketing Communications 47 6.2 Energy 57 4.3 CSI Dashboard 2016 41 5.3 Procurement Practices 49 6.3 Geocycle 62 6.4 Raw Materials 64 6.5 Water 66 6.6 Biodiversity 68 6.7 Waste & Effluents 70 7 8 72 - 91 92 - 102 Social Annexures 7.1 Health & Safety 74 8.1 Assurance Statement 94 7.2 People & Employment 79 8.2 Glossary 96 7.3 Human Rights 84 8.3 GRI Standards - In Accordance This report has been prepared in “Comprehensive” - Content Index 98 accordance with the GRI Standards: 7.4 Community Development Comprehensive option. & Social Responsibility 86 1.1 Chairman’s Message ACC crossed the eight decade mark in A change of guard was announced 2016, earning for itself the distinction towards the end of the year. Mr Neeraj of becoming one of a select few Indian Akhoury took over as Managing Director companies of this vintage that have & CEO from February 4, 2017 in a remained in the same business from seamless transition in place of Mr Harish inception. Over all these years, the Badami who tendered his resignation company has renewed itself periodically as Chief Executive Officer & Managing to keep it contemporary and up to speed Director after a short tenure that was with competition. rich in contribution. 2016 turned out a mixed bag of It is a matter of pride that the company’s challenges and opportunities. On the unwavering focus on sustainable one hand, notwithstanding some bold development and good corporate reforms and reasonable overall growth, citizenship was publicly reaffirmed the economy could not energize the by way of several prestigious awards construction sector; as a result, the including that of “India’s Most We look forward company had to contend with subdued Sustainable” for the third time by the CII- sales in most of its major markets. with enthusiasm to a ITC Centre of Excellence in Sustainable renewed momentum On the up side, our cement and ready Development. That this accolade was in the economy which mixed concrete businesses recorded shared with Ambuja Cements Limited positive developments by way of makes it all the more special for the shows a healthy enhanced cost efficiency, innovative group. appetite for growth product development and insightful customer excellence initiatives. The We look forward with enthusiasm to a company’s presence in the eastern region renewed momentum in the economy was strengthened with completion of the which shows a healthy appetite for Jamul integrated project that included a growth. The construction, building new clinkering line and cement grinding materials and cement industries unit in Jamul, Chhattisgarh and a second are particularly enthused by the grinding unit in Sindri, Jharkhand. Union Budget proposals announced this February that augur well for In August last year, ACC Limited became accelerated investment in infrastructure a subsidiary of Ambuja Cements development, housing and other key Limited (ACL) following a scheme of sectors. amalgamation between the latter and Holcim (India) Private Limited, I am confident that ACC, aided by its while LafargeHolcim Ltd continued to team of dedicated employees and loyal remain the ultimate Holding Company. associates, will remain professionally In April 2017, the Boards of ACC and managed, demonstrating sound ethics ACL announced their desire to explore and persevering on the path of delivering opportunities of a potential merger of customer excellence and maximum the two companies with a view to unite value to its principal stakeholders. the strengths of both entities in order to deliver greater synergies to their combined stakeholders. Narotam Sekhsaria 1.2 Foreword COMMITMENT TO SUSTAINABILITY manufacturing sector grew at about As with our parent group LafargeHolcim, ~8.5%. However these did not serve to sustainability is an essential part of our stimulate the construction sector. The business value chain and we are deeply landmark demonetization scheme, no committed to ensure that it remains doubt a major reform, had a tapering central to our strategy and decision- impact on construction activity in the last making. In this regard we aim to achieve quarter of 2016 as a squeeze on liquidity high standards in customer excellence, limited commercial transactions. innovation, resource conservation, environment management and CEMENT BUSINESS In 2016 we faced a decline in total community engagement to create value cement sales by 2.7% as compared to for all stakeholders. In the 10th Sustainable 2015 following subdued demand in our Development Report, presented here, we major markets. We also saw weaker price describe the progress made in respect trends. However, we were successful in of economic, environmental and social achieving higher cost efficiency with a aspects in 2016. reduction in fuel and input costs by 10% in 2016 as compared to 2015. Freight “ We were felicitated This was a year when ACC was again expenses also came down by 3% despite singled out as being among “India’s Most an increase in rail tariffs. with the prestigious Sustainable” and felicitated with the CII-ITC Sustainability prestigious CII-ITC Sustainability Award Three of our cement plants did us proud 2016 for “Outstanding Accomplishment” in a global benchmarking exercise. Gagal Award 2016 for in recognition of its continued effort and 2, Wadi 2 and Gagal 1 cement plants “Outstanding commitment to the cause of Sustainable ranked 6th, 17th and 19th respectively in Development. This is the third time in the a detailed overview of the performance Accomplishment” last four years when we are recipients of of 136 integrated cement plants of the this award, considered to be among the worldwide LafargeHolcim group. The country’s most coveted in the field of structured analysis is based on a set of corporate sustainable development. indices grouped along three categories viz. sustainability, efficiency and cost In 2016 we formulated our SD 2030 performance. Plan outlining the path we wish to take to build and secure for ourselves During the year we augmented our a sustainable future. Aligned with the cement capacity with the commissioning LafargeHolcim 2030 Plan that supports of the Jamul integrated project, showcasing a modern state-of-the-art Dear Stakeholder, the UN “Sustainable Development Goals”, our plan comprises a set of plant with features that enable it to meet global standards. The project comprises commitments divided broadly into It is a privilege to be invited to steer an a clinkering line at Jamul in Chhattisgarh four main fields of action that address organization with such an extraordinary and grinding units in Jamul and Sindri in climate change, circular economy, water legacy and outstanding reputation. In Jharkhand. delivering the demands of this office, it is & nature and people & communities. Our 2030 Plan targets sets quantitative awe-inspiring to follow in the footsteps CONCRETE GAINS of the many towering personalities who targets related to our direct and indirect The Ready Mixed Concrete (RMX) business have preceded me and are legends in impacts over the whole life-cycle of our continued its trend of performing well the company’s annals. These leaders products and services on which we will with an increase of 10.5% in sales by have led the company successfully, periodically monitor and report progress. volume and 9.0% in sales by value. A sharp providing it the requisite dynamism focus in tapping growth opportunities to reach for growth, profitability, ECONOMIC PERFORMANCE in the infrastructure, commercial and customer excellence and greater value The Indian economy grew at around realty segments accompanied by for shareholders. I am proud to note 7.0% in 2016, among the fastest growth enhanced customer services and the that this is a company which has always rates recorded by any of the world’s promotion of value added special shown respect for the nation, its people major economies. A good monsoon after application products enabled operating and environment with a long tradition two rain-deficient years brought good EBITDA of the RMX business to rise by of planet-friendly practices. cheer for the rural economy while the 37.7% during the year. 02 Sustainable Development Report 2016 HEALTH AND SAFETY year 1976 when ASSOCHAM instituted This will be the company’s third such Health and safety took the top spot in our what was possibly the country’s first unit after the two pre-processing agenda during the year. Having Health ever CSR award and chose ACC to receive facilities at Wadi in Karnataka and & Safety (H&S) as an over arching value that honour. CSR became a formal Kymore in Madhya Pradesh. means we remain committed to ensure process in the company with the Village that H&S is embedded in everything Improvement Scheme introduced in In 2016, we utilized 3.90 million tonnes we do and lived by each one of us at all 1952. In 2016 the company’s community of fly ash, 2.67 million tonnes of slag, times through our conduct behaviour development programmes reached out 1.10 million tonnes of crushed rock and actions.

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