Sustainable Business, Sustainable Growth

ESG-Driving Responsible Competitiveness

Environmental, Social and Governance (ESG) criteria represent a framework for evaluating an enterprise's impact on the environment and society, and the quality of its governance. Globally, evolving ESG frameworks are providing the impetus to spur a new paradigm of responsible competitiveness. Indeed, ESG is a powerful tool to build sustainable competitiveness while protecting the environment and promoting social justice. Integrating ESG principles into business strategies yields numerous benefits that collectively drive sustainable growth. However, for ESG to be effective, there is a need to address issues of complexities in data collection, multiple and non-standardized reporting & disclosure frameworks, and above all, the varying needs of different countries and stakeholders.

ITC's Strategy of Responsible Competitiveness

At ITC, we believe that integrating sustainability and societal value creation into corporate strategy fosters powerful drivers of innovation, leading to more sustainable growth for all stakeholders. This approach, known as 'Responsible Competitiveness,' emphasizes intense competitiveness while simultaneously replenishing the environment and promoting sustainable livelihoods. ITC's innovative business models integrate economic, environmental, and social capital, embedding sustainability at the core of its corporate strategy. Over the years, this approach has helped build robust, future-oriented businesses and a portfolio of world-class brands, establishing ITC as a global exemplar in 'Triple Bottom Line' performance. ITC is the only enterprise of its size globally to have sustained the three key environmental sustainability indices carbon positive, water positive, and solid waste recycling positive for over a decade. Additionally, ITC's businesses and inclusive value chains support over 6 million livelihoods.

Renewable energy

It is a matter of great pride that in FY 2023-24, ITC has achieved its goal of meeting 50% of energy requirements from renewable sources, well ahead of the target year of 2030. To date, the Company has installed and commissioned 205 MW of renewable energy capacity nationwide, utilizing solar and wind power. ITC has 40 green buildings; 12 of its hotels have received LEED Zero Carbon certification, and four have achieved LEED Zero Water certification, making it the first hotel chain in the world to achieve these credentials.

Plastic Neutrality and Circular Economy

For the third consecutive year, ITC has surpassed its plastic neutrality commitment by collecting and sustainably managing approximately 70,000 tonnes of plastic waste, exceeding the amount of plastic packaging it uses. ITC's waste recycling initiative, 'WOW Well Being Out of Waste', fosters a clean and green environment while promoting sustainable livelihoods for waste collectors. Since its inception, the program has reached over 25 million citizens in more than 6.4 million households, 6.7 million school children, and around 2,200 corporations. The Company also continues to make significant contributions towards building a circular economy striving towards 100% Reusable, Recyclable, or Compostable/Biodegradable packaging over the next 5 years.

Climate Smart Agriculture

In the farming sector, which is extremely vulnerable to climate change, ITC has implemented large-scale nature-based solutions. ITC's Climate Smart Agriculture program, encompassing approximately 2.8 million acres, aims to enhance farmers' resilience and protect them from unpredictable weather events. This is achieved through climate-smart agricultural practices, including the dissemination of relevant techniques, adoption of suitable mechanization, and provision of institutional services.

Water Stewardship Mission

Water stress is critical fallout of climate change. ITC's integrated water stewardship programme focuses on providing water security to all stakeholders by increasing water availability through rainwater harvesting and reducing water use in agriculture through demand-side interventions. ITC is also working on reviving river basins with negative water balance. ITC is leading the implementation of the Alliance for Water Stewardship (AWS) standard, a credible and globally recognized framework for sustainable water management. Till date, seven ITC units have achieved AWS Platinum level certification.

Social Investments

ITC's Social Investments Programme, Mission Sunehra Kal, has adopted a two-horizon approach to support livelihood generation. Horizon 1 focuses on strengthening the current dominant sources of livelihood of agri-communities through climate-smart agriculture, natural resources management, and diversification into off-farm and on-farm activities. Horizon 2 aims at building capabilities for the future through programs for women empowerment, support for education, public health, skilling, etc. It gives us pride that ITC's women-focused initiatives have reached over 6 million women.

Biodiversity

ITC acknowledges that preserving and nurturing biodiversity is essential for the long-term sustainability of its business. The company is committed to operating in a way that protects, conserves, and enhances biodiversity. In this regard, a Biodiversity Conservation Programme has been implemented in ITC's catchments, covering over 4.7 lakh acres of land, which focuses on reviving ecosystem services provided to agriculture and restoring degraded plots, whilst also supporting livelihoods.

Human Capital

In a volatile, uncertain, and highly competitive environment, ITC's human resources are the key to sustaining the Company's world-class ESG performance. ITC, therefore, directs its efforts and human capital investments towards strengthening the engagement of the workforce, upholding human rights, embracing diversity, equity, and inclusion, and ensuring a safe and healthy work environment.

ITC's sustainability performance continues to receive a global acknowledgment. The Company entered the prestigious 'A' League for 'CDP Water' and retained the 'A-Leadership' in 'CDP Climate' for the third consecutive year. ITC has maintained its 'AA' rating from MSCI-ESG for five consecutive years and has been included in the Dow Jones Sustainability Emerging Markets Index for the fourth consecutive year.

As we move into the future, ITC remains committed in its vision to build a climate positive and inclusive enterprise even as we strengthen business competitiveness. To achieve this goal, the company has embraced an ambitious new Sustainability 2.0 agenda that redefines sustainability in response to urgent challenges such as climate change and social inequality. Sustainability 2.0 envisages strengthening ITC's multi-dimensional interventions encompassing decarbonisation, building green infrastructure, scaling up carbon sequestration, promoting climate-smart and regenerative agriculture, restoring biodiversity through nature-based solutions, enhancing water stewardship, creating an effective circular economy and sustainable packaging solutions, strengthening the climate resilience and adaptive capabilities of value chains, while fostering inclusive value chains that sustain 10 million livelihoods.

Role of Finance Professionals

As ESG gains currency across the world, I am optimistic that it will motivate more companies to mainstream sustainability and inclusiveness in their business models and operations. Chartered Accountants and finance professionals must focus on building capability in this fast-evolving area so that they are well-equipped to contribute to shaping policy, business strategy, and growth, and ensuring compliance with regulatory requirements.