‘Business models have to be crafted with embedded sustainability’

The ITC Group says it has been carbon positive for 10 years, water positive for 13 years and solid waste recycling positive for eight years now. The conglomerate regularly reports the creation of sustainable livelihoods.

The initiative covers about 6 million people now — many of whom are said to represent the weakest sections of the society. In a conversation with BusinessLine , ITC’s Executive Director Pradeep Dhobale underlined early moves and continued efforts towards sustainability at a scale that is critical to business. Excerpts:

How long has sustainability been on the corporate agenda for ITC?

We were talking about it from the mid 1990s.

When the country was going through winds of change in terms of globalisation and liberalisation, we had leadership change at ITC too.

Times of change make it easy to think of changes across the company. And we realised that businesses cannot succeed in societies that are poor or underperforming.

Would that have taken consistent investments over the years even at the cost of shorter-term losses to some ITC businesses?

It’s difficult to answer the question of investments in figures. When we decided to make all our businesses sustainable, we focused on the outcome of our efforts and that was what was made clear to our businesses by the leadership.

It really wasn’t about how much we will or will not spend on sustainability. Our businesses had to be innovative about operating in sustainable ways while remaining profitable.

Even apart from the government mandate of putting aside 2 per cent of profits for social responsibility initiatives, it is a commitment.

As of the year ending March 2015, we’ve spent ₹214 crore on CSR. But that does not really capture everything we do to remain sustainable across businesses.

So what is the mandate across ITC in a nutshell?

To build and enrich the nation’s social, economic and environmental capital. We’re clear that for sustainability to work, business models have to be crafted in a way that sustainability is embedded into them.

The ITC Group has the capabilities to achieve multiple outcomes against our sustainability agenda.

Which of ITC’s businesses would best showcase some of those outcomes achieved over the years?

Our paper business is definitely one of them. The long story in short is that the conventional paper mills operated on forest consumption.

The earlier model where commercial enterprises paid to the government for reforestation efforts wasn’t working.

We needed to use trees, and so we went into research to grow trees using less water and at a faster rate, and we decided to incentivise farmers to grow more.

It took us about eight to 10 years to come upon a model that gave us the results we wanted.

We could have imported pulp, but that meant jobs were being exported to other geographies. Over the past 15 years, our afforestation programme has generated nearly 90 million person days of employment and covered nearly 2,00,000 hectares. And while our farmers are free to sell to anyone, we also buy from them at market price.

What are you goals for the next few years, as far as sustainability investments and outcomes go?

The farming and rural communities are our largest beneficiaries. With e-Choupal, we’ve already empowered some 4 million farmers across 40,000 villages across 11 states.

We’ve touched over 40,000 women by helping them have sustainable livelihoods and we’re working with children from weaker sections of society in our education initiatives. We’ll continue all of that.

But ITC’s current renewable energy footprint is over 40 per cent and we want to increase that.

We’re committed to keeping up a low carbon growth plan.

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