Encore Vol 4 Issuu2 September 2007 - CBS 2016cbs.teriin.org/pdf/EnCore/3.pdf · VOLUME 4 ISSUE 2...

Sustainabilityreporting:challengesandopportunitiesin India Inc.

VOLUME 4 ISSUE 2 SEPTEMBER 2007

India and sustainability reporting: theory and applicationAn exclusive note by Ernst Ligteringen, GRI

Indian Industries gear towards sustainability reporting initiativesInspiring cases from Corporate India

Encore.indd 1Encore.indd 1 09/13/2007 4:51:32 PM09/13/2007 4:51:32 PM

2 Volume 4 • Issue 2 • September 2007

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Coordinator, T E R I –BCSD India

Annapurna VancheswaranAssociate Director, SustainableDevelopment Outreach, T E R I<[email protected]>

Editorial Board

R K Pachauri, Director-General, T E R I ;Chairman, T E R I –BCSD IndiaR K Narang, Distinguished Fellow, T E R I ;Convener, T E R I –BCSD IndiaMarcel Engel, Director, World BusinessCouncil for Sustainable DevelopmentRegional Network

Editor

Sulagna ChoudhuriResearch Associate, T E R I –BCSD India<[email protected]>

Associate Editors

N Deepa, Associate Fellow, T E R ISubrat Kumar SahuInformation Analyst, T E R I

1 ABN Amro Bank (India)

2 Air India Ltd

3 Alcatel- Lucent

4 Alcoa Asia Ltd

5 Apollo Tyres Ltd

6 Areva T&D India Ltd

7 Ashok Leyland Ltd

8 Ballarpur Industries Ltd

9 BASF India Ltd

10 BG Exploration and Production

India Ltd

11 Bharat Heavy Electricals Ltd

12 Bharat Petroleum Corporation Ltd

13 BP India Services Pvt. Ltd

14 Cairn India Ltd

15 Chambal Fertilizers and

Chemicals Ltd

16 Chennai Petroleum Corporation

Ltd

17 Coca-Cola India

18 Container Corporation of India Ltd

19 Continental Construction Ltd

20 DCM Shriram Consolidated Ltd

21 Dow Chemical International Pvt.

Ltd

22 E I DuPont India Ltd

23 Ecosmart India Ltd

24 Forbes Gokak Ltd

25 GAIL (India) Ltd

26 Hindalco Industries Ltd

27 Hindustan Lever Ltd

28 Hindustan Petroleum Corporation

Ltd

29 Hongkong and Shanghai Banking

Corporation Ltd (HSBC India)

30 IBP Company Ltd

31 Indian Farmers Fertiliser

Co-operative Ltd

32 Indian Metals and Ferro Alloys Ltd

33 Indian Oil Corporation Ltd

34 Industrial Development Bank of

India

T E R I–BCSD Indiabcsd@teri . res. in • www.ter i . res. in/core •www.ter i in.org • www.wbcsd.org

T E R I–BCSD (TERI–Business Council for Sustainable Development) India – initiated

by T E R I – is a regional network partner of the WBCSD (World Business Council of

Sustainable Development), Geneva. It provides an independent and credible

platform for corporate leaders to address issues related to sustainable development

and to promote leadership in environmental management, social responsibility, and

economic performance. Membership is open to organizations. The following are its

current members.

C O N T E N T S

35 Ispat Industries Ltd

36 ITC Ltd - Paper Boards and

Specialty Papers Division

37 Jaypee Cement Ltd

38 Kerala Minerals and Metals Ltd

39 Lafarge India Ltd

40 Mahanadi Coalfields Ltd

41 Mahindra & Mahindra Ltd

42 National Thermal Power

Corporation Ltd

43 Numaligarh Refinery Ltd

44 Oil and Natural Gas Corporation

Ltd

45 Oil India Ltd

46 Petronet LNG Ltd

47 Power Grid Corporation of India

Ltd

48 Power Trading Corporation of India

Ltd

49 Rabo India Finance Pvt Ltd

50 Rallis India Ltd

51 Reliance Energy Ltd

52 Reliance Industries Ltd

53 Seshasayee Paper and Boards Ltd

54 Shell India Pvt. Ltd

55 Shree Cement Ltd

56 SREI Infrastructure Finance Ltd

57 Steel Authority of India Ltd

58 Sterlite Industries (India) Ltd

(Vedanta Group)

59 SUN Group

60 Suzlon Energy Ltd

61 TATA Chemicals Ltd

62 TATA Motors Ltd

63 TATA Steel

64 The Andhra Pradesh Paper Mills Ltd

65 The Associated Cement

Companies Ltd

66 The TATA Power Company Ltd

67 Toyota Kirloskar Motors Pvt. Ltd

68 Usha Martin Industries Ltd

69 YES Bank Ltd

Editorial•

Point of viewIndia and sustainability reporting: theory and

applicationEnsuring ‘right to Information’ through

sustainability reporting•

FeatureThe transparency revolution

•Focus

Indian industries gear towards sustainabilityreporting initiatives

TATA SteelTATA Motors

•Partners in change

Bioremediation work at Cairn India Pvt. Ltd,Rajasthan

New member at TERI–BCSD India: Alcoa•

On the moveSustainability training workshop

TERI Corporate Awards 2007: a brief noteInternational initiatives

•Resources

PublicationsInternet resources

New arrivals at TERI Library•

Calendar of events

3Volume 4 • Issue 2 • September 2007

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R K Pachauri

Director–General

T E R I

Editorial

T he issue of sustainability in

economic decision-making

has come to the fore recently on

account of a global explosion of

interest in the subject and, with a

very high level of curiosity on the

part of the corporate sector.

Traditionally, corporate

performance is judged by a simple

quantity or measure that is

generally transparent. When it

comes to evaluating the

performance of business

organizations towards socially

relevant goals, companies use

sustainability reporting as an

important practice. This issue of

Encore, therefore, is devoting its

entire space to this particular

subject. The extent of commitment

that different companies have to

the concept of sustainability and its

relevance to the future of humanity,

comes from major corporations that

have a stake in doing and

appearing to do the right thing.

Given the rate at which the

economy is growing and, the huge

potential that exists for the typical

Indian corporation to become an

important part of the globalized

economy, Indian industry is also

beginning to wake up to the concept

and content of sustainability

reporting. The biggest benefit from

faithfully practising such an

approach does, of course, lie in

businesses becoming a stakeholder

in protecting the earth. But

sustainability reporting also creates

transparency and therefore greater

exposure to those aspects of a

company's functioning that

contribute to its bottom line.

The issue of climate change has

been highlighted in all its

dimensions by the recently released

reports of the (IPCC)

Intergovernmental Panel on Climate

Change and is seen as the result of

deviation from a sustainable path

of development. The impacts of

climate change would further

exacerbate current inequities,

particularly for the poorest regions

of the world. The corporate sector

has to be an important part of

solutions that society must devise

urgently. It is hoped that this issue

of Encore would be a small but

important step in creating a resolve

to implement sustainability

reporting across the Indian

corporate sector as a practice and,

sustainable development as an

important goal.


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POINT OF VIEW

India and sustainability reporting: theory and applicationErnst Ligteringen, Chief Executive, Global Reporting Initiative1

hat was onceconsidered anunnecessary garnish for

companies that could indulge inimage polishing by integratingsustainability issues into theirpublicity agendas has nowbecome an essential factor forbusinesses to remain competitivein their markets. Sustainabilityreporting, synonymous withterms such as ‘triple bottom line’and corporate responsibilityreporting, has becomeparticularly essential to thecompetitiveness of companies inemerging markets. So – make nomistake – sustainabilityreporting goes far beyond theconcept of corporateresponsibility and into the realmof competitive advantage. Asustainability report is aninternal management tool thatallows for, among other things,increased comparability, brandand reputation enhancement,and differentiation in themarketplace.

In the context of the potentialrisks associated withenvironmental factors, such aspollution and climate change,stakeholders and investors areexpressing a need for greatertransparency and social andenvironmental accountabilityfrom companies. A consequenceof this is that emerging marketsare coming under mountingpressure to follow safe andethical environment and labour

standards. According to the GRI(Global Reporting Initiative)Board member and ManagingDirector of TATA Industries,Mr Kishor A Chaukar, ‘Foreigninvestors need assurance thatIndian companies adhere to thesame standards as theircounterparts or clients in NorthAmerica or Europe.’

GRI Sustainability ReportingGuidelines by participating inand hosting various GRImulti-stakeholder workinggroups. In short, sustainabilityreporting is fast becoming anessential element in managementand a mark of competitivenessamong globally oriented Indiancompanies.

A company’s competitivenessis defined by the way it dealswith the opportunities it ispresented with and risks andpressures it is confronted with.In India, it is not only foreignpressure that counts; there arealso market pressures originatingfrom within India itself. In theend, all ranges of companiesaffected to different degrees byinternal and external – domesticand foreign – pressures share thedrive for competitiveness.

As for the external pressures,the business case forsustainability reporting isbecoming increasingly clear forbusinesses in emerging marketsthat depend on foreigninvestment or form part ofinternational supply chains.Pressures on businesses in Indiaon a domestic level include,among others, the relationshipbetween India's need for energyin view of its rapid industrialgrowth and its compliance withinternational treaties regulatingcarbon emissions. In addition,certain social and human rightsquestions related to equality,

In this issue, this section captures the macro perspective on the challenges and opportunities related tosustainability reporting practices.

1 A collaborating centre of the United Nations Environment Programme, the GRI (Global Reporting Initiative) is the steward ofthe most widely used reporting framework for performance on human rights, labour, environmental, anti-corruption, and othercorporate citizenship issues. Its reporting framework is largely seen as the global de facto standard in sustainability reporting.

India, as an emerging marketleader, is subject to thesepressures and has had asignificant role in theadvancement of sustainabilityreporting in both theory andapplication. In suit with its rapideconomic growth and emergingdominance in the global market,and in response to pressure fromforeign investors, India hasbecome home to a growingnumber of companies using theGRI Sustainability ReportingGuidelines, including TATA,Jubilant Organosys, ITC,Dr Reddy’s Laboratories, andReliance, just to name a few.Leading Indian businesses andother stakeholders have even hadan influential role in shaping the

W


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intellectual property rights, andchild labour feature as maindomestic issues to deal with.These are the kind of issuesabout which stakeholders likeforeign investors and civil-societyleaders are demanding to bebetter informed.

Parallel to and arguablypredating the recent push forsustainability reporting, Indiancorporate philanthropy in Indiahas developed over the years notonly into a time-honourednational tradition but also into aunique model of a kind ofcorporate responsibility in and ofitself. What is then the role ofsustainability reporting in asociety already recognized for itsown blend of corporateresponsibility?

According to Ms Aditi Haldarof the Confederation of Indian

Industry, the role of sustainabilityreporting in India is becomingincreasingly recognized as aninternal management tool used toadvancing companies’transparency and general marketcompetitiveness as opposed to areplacement for corporatephilanthropy. The leading Indiancompanies that are makingsustainability reports are seeingthat not only does sustainabilityreporting give them a competitiveadvantage when it comes toattracting foreign investors butthat it also contributes to theimprovement of internalmanagement systems. Indiancorporate philanthropy andsustainability reporting havedistinct roles in the companycontext and are most likely toco-exist, side by side, in thefuture.

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It is to be expected that asIndian companies see industryleaders produce sustainabilityreports, they will follow suit toprotect their position and gain acompetitive edge. To create acommon knowledge base onsustainability reporting processesfor companies, organizations,consultants, and report-users,the GRI has recently launched aprocess for the development ofGRI-certified trainingprogrammes to be offered byselected partners around theworld, adapting it to localcontexts. GRI partnerships haveand are being formed withtraining organizations in theUnited States, Brazil, and Indiain 2007, with expansion to othercountries planned soon.

Ensuring ‘right to information’ through sustainability reportingViraf M Mehta, Chief Executive, Partners in Change1

Sustainability reports bycompanies might go by variousnames, but I am pleased thatthere is increasing consensus onaccepting the reportingframework of the GRI (GlobalReporting Initiative) as the wayahead. This is supported by thenecessity of a ‘communicationon progress’ for companies—there are now in excess of 3000companies that have endorsedthe 10 Principles of the UNGlobal Compact. In India, itremains to be seen the extent towhich the provisions of theRight to Information Act,within its scope and limitations,can be a positive driver forpromoting disclosure of

themselves with how leadingcompanies are performing withregards to sustainabilityreporting, I would recommendthe report, Tomorrow’s Value: TheGlobal Reporters 2006 Survey ofCorporate Sustainability Reportingby SustainAbility, UnitedNations EnvironmentProgramme, and Standard &Poor’s. The following are a fewkey findings most relevant to theIndian context.1 An increasing number of

leading companies areshifting the focus of theirsustainability reporting froma risk-focused approachtowards ‘a more progressiveand entrepreneurial

1 With its head office in New Delhi, Partners in Change has successfully promoted corporate social responsibility byworking closely with a variety of stakeholders, at national and international levels, and is also associated with the GlobalReporting Initiative to take the initiative forward among Indian companies.

companies’ social andenvironmental impacts.

For readers who areinterested in acquainting


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approach that seeks toidentify opportunities forstrategic innovation andmarket building’.

2 There is a significantincrease in the proportion ofcompanies reporting theintegration of sustainabilityissues into their coredecision-making processes.

3 Financial markets, includingSRI (socially responsibleinvestment), andmainstream investors areincreasingly becoming primedrivers for and active usersof companies’ sustainabilityreports.

Significantly, the report alsohighlights the failure of amajority of corporatesustainability reports to‘sufficiently discuss and linktheir sustainability initiativeswith the wider influenceexercised either directly orthrough lobbying and tradeorganizations.’

Indian companies have –and, in several cases, for wellover a decade – been publishingseparate reports, whichhighlight their workplace andsocietal and environmentalachievements; but these earlyreporting initiatives were drivenmore by reputation and riskmanagement and much less asa process of learning on how tointegrate core sustainabilityissues into their core decision-making. It also stresses thenecessity of the governingbody to play an active role inthe sustainability reportingprocess. In this context, it isnoteworthy to mention thatmany leading companiesfrom the OECD (Organisationfor Economic Co-operationand Development) countrieshave established formalstakeholder panels to morewidely guide and advise ontheir CSR (corporate socialresponsibility) strategies andplans.

In a country such as ours,where many stakeholders,particularly the more vulnerableand marginalized, have little orno access to information fromcompanies on issues that impactthem, it will be necessary toensure that the sustainabilityreporting process provides amechanism that strengthens acompany’s relationship with itsdiverse stakeholders, andprovides the public with acredible and assured account oftheir sustainability-relatedimpacts and actions. And, in theinterest of promoting improvedgovernance throughmechanisms of accountability,transparency, and disclosure, letus remind ourselves that everycitizen has a ‘right’ toinformation, whilst continuingto debate the extent of andmechanisms of disclosure bycompanies of their social andenvironmental impacts, acrosstheir value chains.

CEO Forum 2008Sustainable development and climate change: the business outlook

Curtain raiser toDelhi Sustainable Development Summit 2008

Venue: Hyatt Regency, New DelhiDate: 6 February 2008; Timing: 3:00 p.m. – 9:00 p.m.

Business in the times of changing climate is not going to be easy. Join the congregation of top CEOs andexecutives from the Indian and global companies, as they discuss the impacts of climate change on theirbusinesses. The roundtable discussions will focus on

P sector-specific risks,P hindrances and opportunities offered for newer businesses and adaptation, andP stakeholder partnerships.

For further details, contact:Mr Kanishk Negi, Research Associate, TERI–BCSD IndiaE-mail: [email protected]: 011–24682100


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F E A T U R E

The transparency revolutionJudy Kuszewski1 , Director, Client Services, SustainAbility

ndia’s new-foundconfidence as a global

business centre is leading manycompanies to engage at ever-higher levels with theirinternational partners andpeers. The practice ofsustainability reporting hasemerged as standard amongleading businessesinternationally. So, it is nosurprise that India is waking upto the challenges and benefits ofthis increasingly sophisticatedpractice.

With the success of abusiness come expectations—shareholders want to be assuredthat companies they invest inwill succeed in the future;neighbours want to be assuredthat their towns are safe andderive a good benefit fromassociation with the company;NGOs want to understand howthe company’s strategy dealswith issues such as climatechange; employees want to beassured that their companyrepresents best practices. All ofthese stakeholders have theirown needs for information, butthey all add up to a completepicture of the moderncompany—intelligent, strategic,connected, and responsible.

The good news is that thepractice of sustainabilityreporting is now verywidespread among the largestmultinational companies (forexample, well over 90% of the

biggest companies listed on theUK stock exchange are regularsustainability reporters), sothere is a large and growingbody of evidence as to whatworks, and how to get the mostout of reporting with the leastpain. We have discovered sometried-and-tested truths aboutwhat separates goodsustainability reporting from thenot-so-good ones.

1. Identify your issuesIdentifying pertinent issues is inmany ways the most difficult –but the most important – aspectof good sustainability reporting.Companies have developedsophisticated tools to evaluatethe ‘materiality’ of their issues,so that they can focus on themost important ones. There isno sense reporting in greatdetail about your company’s useof paper if paper is not one ofyour top issues—it is ratherbetter to save your energy forthe issues that really make adifference, both to yourstakeholders and to yourstrategy.

2. Follow the leadersSustainability reporting is acomplex business, but there arestandards and guidelinesavailable to inform almost everyaspect of it. Chief among theseis the Sustainability ReportingGuidelines issued by the GRI(Global Reporting Initiative), an

Amsterdam-based internationalorganization dedicated to raisingthe prevalence and quality ofsustainability reporting. TheGRI has issued guidelines andtools relevant for all sorts ofcompanies, and has a stronginternational presence, whichmeans that the GRI hassomething to offer to nearlyevery business.

3. Seek feedbackNever underestimate thesophistication of your readers;they can and will be keen tounderstand the complexities ofyour business, and often seesustainability reporting as thebest window into the mind ofyour company. Invite theircomments in any way you can –formally or informally – regularlyor more opportunistically. Yourstakeholders will help youunderstand how your company’sissues, strategy, andperformance are viewedexternally much better than youwill be able to see for yourself.

These thoughts are only thebeginning; we encouragebusinesses to delve deeper andlearn more about internationalbest practices, and how they canbenefit from getting startedthemselves. To know more, theymay have a look at ourinternationally renownedresearch on sustainabilityreporting at <www.sustainability.com/tomorrows-value>.

1 Judy Kuszewski is the co-author of the Global Reporters 2004 Survey of Corporate Sustainability Reporting. She also spentthree years directing the Global Reporting Initiative when it was first conceived and launched as the CERES (Coalition forEnvironmentally Responsible Economies) project.

I


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F O C U S

Indian industries gear towards sustainability reporting initiatives

The TATA group have initiated the sustainability reporting system but have mixed experiences in terms ofthe impact and challenges they faced while reporting. TERI–BCSD India sought their views through aquestionnaire, which are presented here.

TATA SteelMr B Muthuraman, Managing Director, shares his views on his company’s reporting system.

What encouraged your companyto take up reporting?

TATA Steel has always believedthat a clear CSR (corporatesocial responsibility) strategy,sound ethics, and transparencyare critical to business. Theseyield trust. In an era of globaltrade, businesses areincreasingly being heldaccountable as corporatecitizens. This is because theincrease in business growth hasnot yielded the prosperity thatwas expected while, in somecases, it has even threatened it.Therefore, businesses have to betransparent about theiroperations, beyond themandatory financial reporting,to build trust and the right towork in existing and newgeographies.

What was the process that wasfollowed to bring about thesustainability report?

TATA Steel has always invitedscrutiny of the social andenvironment impact of itsoperations through socialaudits, much before reportingwas the norm. Since 2000, thecompany has used the GRI(Global Reporting Initiative)guidelines for voluntary

disclosure, to provideinformation that is consistentand comparable across

thinking companies couldleverage for growth.

How important is it for you tocommunicate about youractivities to the stakeholders?

Sustainability reporting is reallythe end-product of a process. Ina multi-stakeholderenvironment, where diverseviews must be represented,companies must first engagewith stakeholders, understandtheir concerns, allocatemanpower and resources toaddress these concerns, andthen, through reporting, placein the public domaininformation on the actionstaken to address these concerns,along with short-term and long-term plans and targets.

What are the key lessons learntin the process of reporting?

Reporting allows anorganization to demonstrate aclear purpose, especially withregard to how its utilization ofcommon resources – land,air, water, and minerals –from our ecosystem will benefitall those stakeholders who sharethese resources. The expectedbenefits or values thatorganizations can derive are

organizations, sectors, andtime. The guidelines aredynamic and have consistentlyevolved to representstakeholders’ concerns. TheG3 guidelines haverationalized the task ofreporting even further byasking organizations to reportonly on issues relevant tothem.

The current process ofreporting allows the companyto follow an accepted andresponsive internationalarchitecture, which forward-


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many, including opportunitiesthat lead to greater competitiveability and of course the licenceto operate.

What advice do you have forcompanies that would like toprepare their sustainability reports?

I urge all organizations that donot report to take the first step

by preparing a simple, fact-based document on their socialand environmentalperformance. It is not aptitudebut attitude towards reportingthat is necessary.

I would also like to remindthose who believe that reportingis neither necessary norapplicable to them, that trustand credibility are as vital to the

organization as its financialhealth. Both must be earned,both require responsiblepractices and accountability,and, therefore, sustainabilityreports are essential.

TATA MotorsMr Ravi Kant, Managing Director, shares the company’s experience with sustainability reporting.

What encouraged your companyto take up reporting?

TATA Motors believes that,for sustainable growth, itsstrategy and implementationshould be synchronous withsocietal, environmental, andeconomic well-being of thesociety at large. TATA Motorsrecognizes the value ofreporting on sustainabilityissues using the GRIguidelines and has preparedfour GRI reports till date, thelast being for 2005/06, whichis based on the recentlylaunched G3 guidelines. Thecompany plans to make itsGRI report public in thesubsequent years.

What was the process that wasfollowed to bring about thesustainability report?

The sustainabilityreport is compiled by apan-organization team drawnfrom environment, finance,secretarial, human resources,corporate communications,sales, and marketingdepartments. The reportingguidelines have enabled the

departments to capture data ina user-friendly format, makingsustainability issues for thecompany more clear. All theindicators are discussed withdifferent departments, and

economic concerns at the localand global levels, that affect thecompany as well, are embeddedin the company’s managementobjectives, targets, andgovernance. A multi-stakeholderengagement process is, therefore,used even in our company forintegrating CSR into the corebusiness of the company and alldevelopmental projects aredesigned and implemented withthe full participation of thecommunity members.

What are the key lessons andchallenges that have been learntduring the process of reporting?

Reporting under the GRIguidelines has helped inidentifying gaps that existed ineither the method of capturingdata or even, at times, in thedesign of certain interventions.Therefore, as the companymoves towards morecomprehensive reporting,covering core as well asadditional indicators,improvements are being madein various processes alongside.

The key challenge insustainability reporting liesperhaps in extending the scope

then the information iscollated. A core team has beenformed at the corporate office,which acts as a depository forall data from various locationsand offices of the company.

How important is it tocommunicate about youractivities to the stakeholders?

For TATA Motors, the reportingprocess ensures thatenvironmental, social, and


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of the report to include allcountry operations as well asthe subsidiaries and the channelpartners, given that TATAMotors has operations in over24 countries, 30 subsidiaries,and a wide base of vendors anddealers.

What advice do you have forcompanies that would like toprepare their sustainability reports?

Looking back at our ownexperience, we can confidently

state that, for any companyembarking upon the journeytowards preparing sustainabilityreport, it is a must that itssenior management be stronglycommitted to it. Once thedecision-makers gauge the valuein measuring and reportingwhat is done, it would bepossible to present a balancedand complete picture of thecompany’s current performanceand identify future needs. At thesame time, it is equallyimportant that a two-way

communication be wellestablished between thecompany and all itsstakeholders. That will ensurethat feedback provided isregularly incorporated andtransparency is maintained, sothat the stakeholders are awareof the company’s processes andinitiatives.

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Energy Efficiency in Buildings India Forum 200731 October 2007,

The Le Meridian, New DelhiIn association with World Business Council for Sustainable Development, Geneva

Theme: EEB - A National Competitive Advantage

Fifty percent the global energy demand is due to buildings, which is expected to grow by anadditional 45 percent by 2025. In this scenario introduction of energy efficient building designconcept has become critical for achieving the collective objectives of energy security andenvironmental protection, to ensure economic and social development.

TERI-BCSD (Business Council for Sustainable Development) in association with WBCSD isorganising an international forum comprising of plenary and breakaway technical sessions tofocus on developing plans for energy efficient buildings in India and upgrading the skill of localbuilding practitioners (architects, engineers, builders and others) to implement those plans anddesigns effectively. Sharing best international experiences will be a special feature in thediscussions.

Broad Plenary Session Themes:P Energy Efficient Pathways in the Building Sector: Policy & RegulationsP EEB – Making a Business Sense

Breakaway Technical Session Themes:P Mainstreaming Green Buildings – Smart Policies & Best PracticesP Market Mechanisms, Incentives and Financing in existing and new buildingsP Holistic Approach to Efficient Planning of Large Developments

Invitation to Attend!

For more information & registration details, contact:

Ms Sonya FernandesResearch Associate, TERI-BCSD India, TERI, New DelhiEmail: [email protected]: +91 11 2468 2100


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P A R T N E R S I N C H A N G E

P

Bioremediation for treating drill cuttingsetroleum is a majorsource of energy,providing over 50% of the

energy used all over the world.During extraction of crude oil,rotary drilling of mud isintroduced to continuouslyremove drill cuttings. Nearly allmud contains some of theadditives included in the ‘list ofnotified chemicals.’ Thesematerials come up the well tothe drilling floor in a slurry withdrill cuttings (rock fragments),crude oil, gas, natural gasliquids, produced water, tracesof heavy metals, and otherorganic substances. This leadsto contamination at the surfaceand has an adverse impact onthe environment and ecology.Some of the major impacts ofthis are loss of soil fertility;effect on terrestrial, aquatic, andmarine ecosystem; toxic effecton exposure to humans andother higher life forms; andothers. However, these impactscan be greatly reduced byincorporating careful

containment and storageprocedures, applying restorationand remediation techniques andthereafter practising safedisposal techniques afterreducing the toxic componentsto non-hazardous methods.

Bioremediation is a processthat uses naturally occurringmicroorganisms to transformharmful substances in the drillcuttings to non-toxiccompounds. In the process,microorganisms biologicallydegrade hydrocarbon-contaminated drill cuttingsinto non-toxic residues. Theobjective of biologicaltreatment is to accelerate thenatural decomposition processeither by indigenous bacterialflora by controlling oxygen,temperature, moisture, andnutrient parameters or byaugmenting specializedbacterial strains.

Extensive research at TERIhas resulted in the developmentof an easy and cost-effectivebioremediation process.

Providing great significance tobioremediation in theworldwide effort to tackle oilspills and oily sludge, TERI hasdeveloped ‘oilzapper’, aconsortium of bacteria thatdegrade crude oil / drill cutting /oily sludge, deriving fromvarious bacterial culturesexisting in the naturalenvironment.

TERI had initiated a researchand feasibility study of treatinghazardous drill cuttings by theoilzapper technology. Prior tocarrying out the actual field trials,a preliminary laboratorymicrocosm study was carried outat TERI, New Delhi. Based onthese results, about 34 tonnes ofdrill cuttings was undertaken forbioremediation at a pit of about100-m2 area at Cairn Energy PtyLtd, Barmer, Rajasthan. The drillcuttings undertaken forbioremediation contained 9.81%(98 100 PPM [parts per million])TPH (total petroleumhydrocarbon). The TPH wasdecreased below the permissiblelimit (0.89%, 8900 PPM) after120 days indicating 90.92%biodegradation by oilzapper.

Selected heavy metals wereanalysed from the drill-cutting(mixed with soil) samplescollected from the


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bioremediation site at thebeginning and end of thebioremediation process. It wasfound that the concentration ofheavy metals was within thepermissible limits. In the nextphase, the process will be scaled

up for around 400 tonnesof drill cuttings and atechno-feasibility studywill be carried out for theuse of the bio-remediated drillcuttings for green beltdevelopment.

For further details, please contactDr Priyangshu M SarmaFellowEnvironmental and IndustrialBiotechnology DivisionTERI, New [email protected]

New members at TERI-BCSD India: Alcoa India Pvt. Ltd

Alcoa: a sustainable leader

lcoa adheres to its2020 Strategic

Framework for Sustainabilityand world-class environment,health, and safety standards.Alcoa has made significantprogress against many of thegoals, such as meeting the 25%reduction in greenhouse gasesseven years before the 2010deadline and achieving 50%reduction in land-filled wastebefore the 2007 goal.

In China, Alcoa is involvedin creating a conservation planfor the country’s freshwater

needs and acceleratingcommunity education effortson the value of ecosystems. Inaddition, the Alcoa Foundationprovided a three-year grant tothe WRI (World ResourcesInstitute) for programmesfocused on sustainablesolutions on reversing harmfulglobal environmental trends—global climate change,sustainable mobility, andenterprise and communitydevelopment.

In India, the AlcoaFoundation sponsored a projecton strengthening business skills

of first generation rural womenentrepreneurs.

Alcoa will continue itsendeavour in supportingprogrammes and initiatingchanges in line with thecompany’s global ‘sustainability’vision.

Nodal person for TERI-BCSDIndia:

Mr Vipul RastogiDirector-India Liaison Office7th Floor, Le MeridienCommercial TowerRaisina RoadNew Delhi 110 001

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A

• News • Articles • Case studies• Announcements • Technical notes • Suggestions

All members are requested to send latest company annual reports; environment, corporate socialresponsibility, and sustainable development reports

EnCoRE invites contributions from T E R I–BCSD India members on themes related to

sustainable development in the form of

For details on advertising and contributing in EnCoRE, please contact

The Editor, EnCoRE Tel. 2468 2100 or 4150 4900

T E R I, Darbari Seth Block Fax 2468 2144 or 2468 2145

I H C Complex, Lodhi Road India +91 • Delhi (0) 11

New Delhi – 110 003, India E-mail [email protected], [email protected]

Contributions invited


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O N T H E M O V E

Sustainability reportingtraining workshopThe IFC (International FinanceCorporation), SustainAbility(UK), and TERI broughttogether their experience andknowledge of the sustainabilityagenda to develop a two-daytraining workshop onsustainability reporting during21–22 May 2007.

The objective of theworkshop was to understandthe evolving trend ofsustainability reportingglobally and to mainstreamsuch practices in the Indianscenario.

The workshop broughttogether a diverse group ofcompanies spread acrossdifferent sectors like oil andgas, food and beverage,automobiles, chemicals, andeven finance companies. Someof the companies that havealready publishedsustainability reports as perthe GRI (Global ReportingInitiative) guidelines areDr Reddy’s Labs, ITC Ltd,Jubilant Organosys, FordIndia, TATA Steel, RelianceIndustries Ltd, and TATAMotors. However, there aremany others that are atvarious phases of reporting,such as conceptualizing,building the practices, ornearing completion.

At the end of the workshop,there was an increased interestand commitment among theparticipating companies to

take forward the process ofbringing out theirsustainability reports.TERI–BCSD India wouldalso take forward the initiativeof sustainability reporting byorganizing a handholdingexercise with a membercompany in the preparation oftheir sustainability report.

(Some of the internationalinitiatives and websiteinformation on sustainabilityreporting is given at the endof the newsletter.)

Sixth TERI Corporate Awards2007The Sixth TERI CorporateAwards Ceremony held on23 May 2007 was honouredby the presence of theFinance Minister of India,Mr P Chidambaram,felicitating 10 Indiancorporate organizationschosen from amongst over120 applications. This year,besides the regular TERICorporate Awards forEnvironmental Excellence andSocial Responsibility, awardsfor business response to HIV/AIDS were also given away tocorporate agencies. The HIV/AIDS awards are instituted byTERI in collaboration withthe GTZ.

At the ceremony, the financeminister also released twoTERI publications – Citizens atwork and Cleaner is cheaper –each dealing with exemplarycase studies of sound

environment managementaland social practices byorganizations in India. He alsomentioned that CSR, health,and environmental activities area road to greater profitabilityand would create withinorganizations a productiveworkforce sensitive andproactive towards changes.

Since 2002, TERI hasawarded several organizationsfor their initiatives in socialand environmental practicesand have encouraged thecorporate sector towards suchsustainable practices byconstant follow-up andinformation dissemination.

The winners for 2007 wereLANCO infratech Ltd, AryaVaidya Sala, SatyamComputers Services Ltd, andHindustan Zinc Ltd forcarrying out outstanding workin CSR. UAL Bengal Ltd,Sona Koyo Steering SystemsLtd, Numaligarh RefineriesLtd, and Exide Industries Ltdgot awarded for theirenvironmental excellence, andZMQ Software Systems andReliance Industries Ltd fortheir response to HIV/AIDS.

The award is an ongoingendeavour and companies thathave adopted such initiativesmay apply to become a part ofthe TERI corporate awards.Visit our website <http://www.teriin.org/awards> for moreinformation, and download theapplication form.


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International initiatives

Global Reporting InitiativeThe GRI (Global ReportingInitiative) is a multi-stakeholdernetwork of experts worldwidewho participate in GRI’sworking groups and governancebodies, use the GRI guidelinesto report, access information inGRI-based reports, orcontribute to develop thereporting framework in otherways, both formally andinformally. The GRI vision isthat reporting on economic,environmental, and socialperformance by allorganizations should be aroutine activity and is asimportant as financialreporting. The GRI networkaccomplishes this vision bydeveloping, continuouslyimproving, and buildingcapacity around the use of aSustainability ReportingFramework, the core of whichare the Sustainability ReportingGuidelines. Other componentsin the reporting framework are‘sector supplements’ and‘protocols’. This reportingguidance – in the form ofprinciples and indicators – isprovided as a free public good.The Sustainability ReportingGuidelines includeP reporting principles,P reporting guidance, andP standard disclosures

(including performanceindicators).

To ensure the highest degreeof technical quality, credibility,and relevance, the GRIreporting framework isdeveloped and continuouslyupgraded through intensive

multi-stakeholder engagementthat involves reportingorganizations and informationseekers.<http://www.globalreporting.org/Home>

Sustainability Reporting ToolkitThis Sustainability ReportingToolkit was developed inresponse to an industry-identified need to have moreinformation and guidance onpractices related to corporatesustainability reporting. Theaim of the toolkit is to helpCanadian businesses that arenot currently reporting thiskind of information as also toexperienced sustainabilityreporters.

The objectives of the toolkitareP to respond to the needs for

improved sustainabilityreporting identified byCanadian business,

P to provide simple guidanceon how and what to report,

P to increase the number ofCanadian reporters whodisclose sustainabilityinformation, and

P to encourage compatibilitywith international reportingefforts.

Stratos Inc., an Ottawa-basedconsultancy, developed thecontent of this toolkit inconsultation withEnvironment Canada, theDepartment of Foreign Affairsand International Trade, andIndustry Canada.<http://ww.sustainabilityreporting.ca>

OneReport: the sustainabilityreporting networkOneReport is a web-basedsustainability reportingsolution by SRI (SustainabilityReporting Initiative) WorldGroup, Inc., that enablescompanies toP centralize all reporting

functions,P reduce the cost of

reporting, andP deliver timely and accurate

data.

OneReport is a reportingsystem that consolidates datarequests from leading researchand rating agencies within theGRI framework. It enables the‘reporting administrator’ –person responsible forsustainability reporting in acompany – to take control andoversee all aspects of thereporting process.

The United Nations GlobalCompact and the SRI WorldGroup have developed a web-based tool that simplifies theprocess of preparing andpublishing a CoP(communication onprogress)—the annualreporting requirement forGlobal Compact participants.The OneReport CoPpublisher is based onrecommendations from amulti-stakeholder processorganized by the GlobalCompact and is available toparticipants for free. The‘enhanced CoP publisher’ isalso available for companiesthat have more advanced web-publishing needs.<http://www.one-report.com>


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Learn from the Leaders‘Learn from the Leaders: bestpractice in sustainabilityreporting’ is a joint venturebetween Flag andSustainAbility. Learn from theLeaders is a comprehensiveonline database designed tohelp sustainabilitypractitioners access the finestexamples of sustainabilityreporting from around theworld. The database is apowerful tool for drivingcontinuous improvement insustainability reporting andstrategy, and aids to

P compare organizations’reporting with competitorsand peers,

P understand commontargets and emergingtrends by sector,

P appreciate how othersidentify and managematerial issues,

P decide how to adapt anorganization’s narrativeand design, and

P assess approaches toassurance and verification.

The ‘global reportersmethodology’, designed to

benchmark the quality ofsustainability reporting, is theprimary index to the database.For each criterion within themethodology, Learn from theLeaders provides an overviewof current trends and bestpractices, supplemented byexamples from sustainabilityreports. The examples includean analysis of what setsleading reporters ahead of therest.<http://reporting.sustainability.com>

R E S O U R C E S

Publications

Policy Directions to 2050: abusiness contribution to thedialogues on cooperative action

WBCSD. 2007Geneva: World BusinessCouncil for SustainableDevelopment. 52pp.Price: $ 15.00

The publication asserts thatthe only way to combatclimate change is throughdecisive, concerted, andsustained actions betweengovernments, businesses, andconsumers. It identifies policyoptions to sustain economicgrowth while transforming theways we access, produce, and

consume energy. Presented asan illustrative road map fromwhich routes must be chosen,the publication explores policyideas and concepts for thetransition to a low greenhousegas economy. It calls for thedevelopment and deploymentof leading-edge technologiesthrough partnerships andincentives and an approach tomitigate long-term market riskand deliver secure benefits forlarge-scale, low-carbon, newtechnology projects. PolicyDirections to 2050 explores andintroduces ideas for a newinternational framework andaddresses key policy issueswithin power generation,industry and manufacturing,mobility, buildings, andconsumer choices.

A Three-Pronged Approach toCorporate Climate Strategy

BSR. 2006San Francisco, USA: Businessfor Social Responsibility.44pp.

The book presents a briefbackground on businessreactions to climate change, andlays out a simple spectrum ofactions towards carbonneutrality, including efficiency,offsets, and renewables. Theseactions offer managers greaterchoice in defining climatestrategies. Climate-change-focused corporate actions havepotential upsides, in the form ofnew products and new markets,as well as risks, such as thoseassociated with large-scale


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Internet resources

Learning for Sustainability<http://learningforsustainability.net>

Learning for Sustainabilityaims to provide a practicalresource for proponents ofmulti-stakeholder learningprocesses. The site structurehighlights a number of activityareas or strands that areprerequisites for sociallearning, and points to howthese strands are woventogether in practice. Thesestrands include networking,dialogue, adaptivemanagement, knowledgemanagement, and evaluation.A short introduction to each

renewable energy investments.The publication offers examplesof which companies in whichindustry are working towardslimiting risk and liability,positioning for first moveradvantage, and expanding theirmarket share in the yearsahead.

The State of Responsible Com-petitiveness 2007: makingsustainability count in globalmarkets

Accountability. 2007London, UK: Accountability.156pp.

The publication is essentially aprogress report on countries’efforts in advancingcompetitiveness based onresponsible business practices. Itprovides a unique health check

on responsible globalization. Thereport also identifies majoropportunities in moreresponsible markets in climatechange, gender, human rights,and anti-corruption. Takentogether, these markets will beworth at least $5 trillion by2050. Smart businesses, climate-friendly cities, sunrise sectors,and responsible countries canwin massive market shares in theglobal markets of tomorrow.Others will fail to coordinatetheir strategies and lose out.

Beyond Monitoring: a new visionfor supply chain management

BSR. 2007San Francisco, USA: Businessfor Social Responsibility. 20pp.

The publication presents a four-part approach designed to

address the root causes ofsustainability challenges foundin global supply chains. BeyondMonitoring encouragescompanies to remake strategies,re-deploy resources, andconsider new partnerships tomaterially improve the well-being of workers andcommunities. The approachadvocated in this publicationintegrates labour andenvironmental considerationsmore decisively into companies’procurement efforts. It alsoseeks to re-emphasize the rolesof two often-overlookedconstituencies – workers andgovernments – who shouldmore prominently be at thecentre of sustainable supply-chain management.

section outlines the nature ofthe resource links provided,and provides pointers to othertopic areas, which are closelyrelated in use. The websitehosts the IntSci (IntegratedScience for sustainability)discussion network.

The international corporatesustainability reporting site

<http://www.enviroreporting.com>

The website is dedicated tocorporate sustainability, CSR(corporate social responsibility),and environmental reporting. Italso hosts news and an awardgallery. The resource libraryincludes guidelines, tools,articles, and reports. The sitehosts the portal forenvironmental, social, CSR,

and sustainability reports ofmultinational companies,<www.sustainability-reports.com>. The reports canbe browsed by sector, country,or alphabet.

Carbonfreezone<http://www.carbonfreezone.com>

Carbonfreezone is an onlineportal for CDM (cleandevelopment mechanism)project developers to meetCDM project investors andCER (carbon emissioncertified) buyers. It is acommon information-sharingplatform for various partiesinvolved in CDM-project-related activities. It showcasesprojects as well as invitesexpressions of interest from

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various buyers. Projectstakeholders can uploadproject-specific documentsand data providing details andimpacts of the project. Projectdevelopers looking for projectinvestors for trading andsponsorship can search forregistered investors, gettingthem directly interested intheir projects.

The Sustainability Report<http://www.sustreport.org>

The Sustainability ReportingProgram is an independent,

non-partisan, not-for-profitorganization. It draws onexpertise from government,industry, the non-governmentsector, and the academia, butdoes not ‘represent’ any sectoror interest group. It producesthe online SustainabilityReport to help users seecritical sustainability issuesand trends that affect ourhealth, wealth, and happinessand that of future generations.The goal is to help peoplemake more informed choices.Key elements of the report

include information aboutmajor sustainability issues andthe driving forces of change;policies, business practices,and personal actions affectingsustainability; commitmentsmade towards sustainability;stories and statementsillustrating the trends;background analysis andcommentary by experts; andprogress in measuringsustainability.

In the news

Emerging corporate leaders

According to reports by The Times of India (14 August 2007), TERI–BCSDIndia member companies TATA Motors, TATA Steel, and Hindustan UnileverLtd have emerged as leading corporate leaders in a study carried on CorporateReputation Index out by the global consulting firm, TNS. All three companiesjointly bagged the second position, with TATA Steel also declared as the first inthe stakeholder choice category.

A total of 70 leading companies across various sectors were selected for theCorporate Reputation Index in the last quarter of the previous fiscal year. Theindex was a reflection of opinions from financial community and senior andmiddle business managers in the industry. It also represented views of seniorbureaucrats, academics, company stakeholders, and media personalities.

Heartiest congratulations to the winning companies!

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New arrivals at T E R I library

Labatt S and White R R. 2007New Jersey, USA: John Wiley

and Sons. 268pp.

Luo Y. 2007Massachusetts, USA:

Blackwell Publishing. 276pp.

Lee H L and Lee C Y (eds). 2007New York, USA: Springer.

465pp.

Robbins P T. 2007London, UK: EarthscanPublications Ltd. 198pp

Carbon Finance: the financial implications of climatechangeThe book describes the climate change debate and the carbon marketthat is developing. It takes a close look at the entire energy chain andits relationship to today’s value chain. Climate change is becoming animportant factor for many financial-sector participants. The authorsillustrate how challenges and opportunities will arise within the carbonmarket for banking, insurance, and investment activities as well as forthe regulated and energy sector of the economy.

Global Dimensions of Corporate GovernanceThe book delineates corporate governance systems in internationalbusiness and addresses various governance and accountability issuesfacing MNCs (multinational corporations). The book providesresearchers, practitioners, and students with analytical frameworks, apractical guide, and case examples on how to develop a globalcorporate governance system for MNCs. Corporate governance inMNCs is not just a larger version of that in regular companies; it isinstead influenced by the big players’ unique strategies, structures, andenvironment. This volume in the Blackwell Global Dimensions serieshelps to translate these relationships and illuminate the relatedintricacies.

Building Supply Chain Economics in Emerging EconomicsThe book enables practitioners to gain insights on the developments,challenges, and opportunities when operating supply chains inemerging economies. Innovative approaches are outlined andillustrated with examples of real-world experiences by progressivecompanies and thought leaders. The book is organized in three keysections. ‘Global Supply Chain: general strategies and framework’develops the overall framework in managing global supply chains anddeveloping strategies. ‘Supply Chain Management in EmergingEconomies: challenges and opportunities’ describes the challenges andopportunities in supply-chain management of emerging economies –the infrastructure constraints, the logistics inefficiencies, andlimitations in service operations – and discusses how to createopportunities in such adverse conditions. ‘Building Supply ChainExcellence: innovations and success cases’ is devoted to a number ofindustrial cases highlighting innovative approaches to gain excellence,and share insights and lessons from such experiences.

Greening the Corporation: management strategy and theenvironmental challengeCorporate responses to environmental challenges are often helddirectly or indirectly responsible for significant worldwideenvironmental destruction. Corporations are beginning to respondto environmental and social concerns and are taking these intoaccount. The author examines traditional and social-environmentalcorporate cultures, green management styles, social auditing, andenvironmental regulatory systems in North America, Europe, andAsia. The author develops a management model to resolve thedilemmas and to combine environmental and business objectives.


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C A L E N D A R O F E V E N T S

The European Identity in Business and Social EthicsCentre for Economics and Ethics K U Leuven,Naamsestraat 69, 3000 Leuven, Belgium

Website: <http://www.kuleuven.be/cee/index.php?LAN=E>

Responsible Markets in Emerging Markets SummitEthical Corporation, 7–9 Fashion St. London E1 6PX, UK

E-mail: [email protected]: <http://www.ethicalcorp.com/emergingmarkets/>

Future Technologies and Future Markets Worldwide 2015ACON AG, Science and Business Consulting, CH-8004 Zürich,Switzlerland

E-mail: [email protected]: <http://www.hkc22.com/marketstudy.html>

The Ethical Supply Chain Summit 2007Ethical Corporation, 7–9 Fashion St. London E1 6PX, UK

E-mail: [email protected]: <http://www.ethicalcorp.com/supplychain/>

The Corporate Responsibility and CommunicationsConferenceEthical Corporation, 7–9 Fashion St. London E1 6PX, UK

E-mail: [email protected]: <http://www.ethicalcorp.com/reporting/>

Delhi Sustainable Development Summit 2008: sustainabledevelopment and climate changeThe Summit Secretariat, TERI, Darbari Seth Block, IHCComplex, Lodhi Road, New Delhi – 110 003, India

Tel.: +91 11 24682100 / 41504900Fax: +91 11 24682144 / 24682145E-mail: [email protected] • Website: <http://www.teriin.org/dsds>

Seventh International Symposium on AdvancedEnvironmental MonitoringYoung J Kim, Symposium Chair, Director, AdvancedEnvironmental Monitoring Research Centre, Professor,Department of Environmental Science and Engineering,Gwangju Institute of Science and Technology, 1 Oyrong-dong,Buk-gu, Gwangju 500-712, Republic of Korea

Fax: +82 62 970 3404E-mail: [email protected]: <http://www.ademrc.gist.ac.kr/7th_sym>

Leuven, Belgium18–20 September 2007

London, UK9–10 October 2007

New York, USA26 October 2007

Amsterdam, The Netherlands29–30 October 2007

London, UK13–14 November 2007

New Delhi, India7–9 February 2008

Honolulu, Hawaii, USA25–28 February 2008

Printed and published by Dr R K Pachauri on behalf of The Energy and Resources Institute, Darbari Seth Block, I H C Complex,

Lodhi Road, New Delhi – 110 003 and printed by him at I G Printers and published at New Delhi.

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