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About the Report This report details Toyota Kirloskar Motor [TKM] Pvt. Ltd. India's, sustainability performance from April 1 2009 to March 31 2010. Toyota Kirloskar Motor (TKM) policies, strategies and the field and the results that follow. published its first annual performances affecting its Environment Report in 2003 as a business and stakeholders during Our key target audience is our disclosure of information on the the financial year April 2009 to internal and external stakeholders. company's environmental March 2010. They include employees, dealers, activities. In 2007, the report customers, suppliers, widened its scope to include the The material included in this government, educational company's activities in corporate report is based on stakeholder institutions, the media, Toyota social responsibilities. feedback and extensive internal Motor Corporation and other dialogue conducted through companies that have an interest in Through this first Sustainability processes that form an integral sustainability and reporting. Report and the sixth annual part of the company's daily report, TKM intends to provide operations. TKM believes that this We welcome your feedback on transparency of its economic, report covers a balanced and this report. Please send us an environmental and social complete set of topics that email to: [email protected] commitments as well as the illustrates our committed efforts in We welcome your feedback on this report. Please send us an email to: [email protected] An online copy is available at: http://toyotabharat.com/inen/environment/index.asp SUSTAINABILITY REPORT 2010 Contents About the report 02 Message from MD 06 Corporate Philosophy 08 Stakeholder Engagement 22 TKM and Sustainability 23 Environment Performance 24 Social Performance 34 Customer 35 Employees 40 Society 45 Business Partners 49 Economic Performance 58 Special Stories 60 Auto Expo 2010 (New Delhi) 60 Prius Launch in India 61 Greenathon II 61 TOYOTA KIRLOSKAR MOTOR 05 SUSTAINABILITY REPORT 2010 Message from MD I take this opportunity to express my hearty thanks to all our stakeholders for your continuous support to Toyota Kirloskar Motors. At TKM, we strive to be the most loved and admired automobile company in India by following the Toyota-way philosophy. Team Toyota India is committed to contributing to economic and social development for a sustainable future. We strive to contribute to the Indian economy by: • Manufacturing value added products, with global standards of safety and quality • Bringing innovative technology to the Indian market • Generating employment • Raising the skill levels by imparting training through initiatives like Toyota Technical Education Programme (TTEP) and Toyota Technical Training Institute (TTTI) . • Creating road safety awareness through the Toyota Safety Education Programme (TSEP) In line with Toyota's global vision towards sustainability, our aim is to make the process and products eco- friendly. The Etios plant is an eco-plant in harmony with nature where we have incorporated environment friendly technologies like water-borne paint, energy efficient equipment and water recycling. The Delhi Auto Expo 2010 marked an important milestone in TKM's history through the launch of our Etios Concept and launch of hybrid car Prius in India which is the world's best selling hybrid car. Towards our journey in achieving sustainability, we have planted 64,000 saplings. We will continue this journey towards creating a potential natural forest. I thank my colleagues, the suppliers, dealers and all stakeholders for their continuous wisdom in meeting every challenge with speed, flexibility and cooperation towards sustainability. I am delighted to present TKM's 2010 Sustainability Report to you and welcome your feedback. Let's Grow Together, Hiroshi Nakagawa, Managing Director Toyota Kirloskar Motor 04 06 TOYOTA KIRLOSKAR MOTOR SUSTAINABILITY REPORT 2010 Key Figures Environmental Performance 23 % Reduction in power usage 20 % Reduction in Water Consumption 85 % Coverage of Dealerships Compliant with ISO 14001 98 % Coverage of Suppliers (core) Compliant with ISO 14001 Social performance 2008 2009 2010 Number of Employees 3762 3511 5637 Turnover rate for employees 6.3% 3.7% 2.8% Community Investments (through Community Spirit and Community Sponsorships) in Mil. Rs. 85.5 106.5 108 Economic performance 2008 2009 2010 Units Manufactured 53,774 46,251 63,269 Units Imported as CBU 1,295 492 504 (Completely Built Unit) Net Profit after Tax [Rs. in Mil] (08/09 and 09/10 fiscal years) 2,073 1,226 3,093 TOYOTA KIRLOSKAR MOTOR 07 Corporate Philosophy Seeking Harmony between People, Society and the Global Environment, and Sustainable Development of Society through Manufacturing… SUSTAINABILITY REPORT 2010 Corporate Philosophy Since its inception, Toyota has by applying its guiding worked continuously towards principles of conducting open contributing to the sustainable and fair corporate activities development of society and also contributes to through the manufacturing economic and social and provision of innovative development through its local and quality products and business activities. services that lead the times. Through its overseas Toyota Kirloskar Motor's subsidiaries, Toyota is performance in India and our dedicated to social corporate culture are driven contribution by addressing a by Toyota's guiding principles variety of cultural and social and the Toyota way. In India, issues and engaging in we reflect these global values proactive local through our sustainable plant communication. Toyota will activities and our customer remain a locally based first approach. corporation and will continue to play its part in promoting In every nation and region, the growth of each nation and Toyota aspires to be a good region with its automobile corporate citizen of the world production. The Guiding Principles Guiding Principles and 2020 Vision A framework for settling long-term business goals and policies Toyota Earth Charter applies principles and vision to environmental aspects of business Environmental Environmental Action Plan Management Systems translates long-term vision for monitoring performance, and policy into medium to implementing action plans long-term objectives and ensuring targets are met The guiding principles at methods that it has embraced Toyota (adopted in 1992 and since its foundation. The revised in 1997) reflect the guiding principles (detailed in kind of company that Toyota the section on 'Stakeholders') seeks to be in light of the define the values the unique management company delivers to its philosophy, values, and stakeholders. TOYOTA KIRLOSKAR MOTOR 09 SUSTAINABILITY REPORT 2010 Toyota Global Vision 2020 As we look ahead to 2020, society and nature is Toyota believes that re- extremely important. Toyota examining the relationship is helping promote efforts between nature and the toward finding a balance industry and pursuing between the cycles of synergy between nature and the cycles of manufacturing, people, industry. Toyota Global Vision Economic development is global scale, the environment useful member of both the global accelerating in a number of surrounding the automotive and local community and has regions throughout the world. With industry is undergoing drastic formulated its Global Vision 2020, environmental and energy related changes. Amid these changes which provides a future vision for issues having an impact on a Toyota endeavors to remain a Toyota's place in the world. Where Toyota would like to be in 2020 TOYOTA GLOBAL VISION 2020 "Cycles of Nature" "Cycles of Industry" An industry All people and creates new communities are subject to value, while the natural cycles of the spawning the birth earth. Toyota is committed to of a new industry - undertaking monozukuri such is the way of the Open the frontiers of tomorrow (manufacturing) that strikes a cycles of industry. harmonious balance with Toyota endeavours to be through the energy of people nature in order to carefully a driving force behind sustain the global the development of and technology environment. sustainable industries. Currently, Toyota is employing "Open the Frontiers of Tomorrow' as the slogan for Global Vision 2020. This slogan expresses the As it looks ahead to 2020, important. Also, by seeking commitment of Toyota and each Toyota believes in re- harmony between and every employee to never be examining the relationship monozukuri and the cycles satisfied with the status quo. To between nature and of nature, Toyota is helping create a path to a new world and industry and pursuing promote efforts toward to work steadily towards the harmony between finding a harmonious realization of society's dreams. monozukuri, people, balance between This progress is to be achieved society in general, and challenges in new fields in through the energy of people and nature is extremely order to achieve this. technology. 10 TOYOTA KIRLOSKAR MOTOR SUSTAINABILITY REPORT 2010 The Toyota Earth Charter (formulated in 1992, revised in 2000) is based on the Guiding Principles at Toyota formulated in 1992 (revised in 1997), and embodies Global Toyota's comprehensive approach to environmental issues. The Toyota Earth Charter has been adopted by about 530 affiliates worldwide to date. Toyota Earth Charter Basic Policy 1. Contributing towards a possible environmental global, national and regional prosperous 21st century technologies developing and scales and promotes society: Contributing to a establishing new technologies continuous