 "Sustainability: It's not just ecology, but also economics")
It is estimated that by 2030 the world’s population will reach 8.3 billion and, going by the current consumption patterns, it would require 50 percent more food, 45 percent more energy and 30 percent more water. At this rate, one would need four planets to sustain a century later. But sustainability is not just limited to environment protection.
“Sustainability as a concept is all about longevity, not just staying in business but also growing and flourishing for the next 100 years, being able to plan ahead of the challenges of tomorrow. Protecting the environment and natural resources is a key thread of sustainability concept and for all the right reasons,” says Sudhir Shenoy, CEO, Dow India – whose US-based parent company has recently launched the 2025 Sustainability Goals - the third era of sustainability after significant advancements since launching its first set of decade-long, sustainability-related goals in 1995.
During 1995-2005, Dow claims that it was able to reduce solid waste by 1.6 billion pounds, water use by 183 billion pounds and save over 900 BTU of energy globally. Its 2005 and 2015 goals were responsible for significant returns of $ 5 billion on investment of $ 1 billion for the company, globally.
“By redefining the role of business in society, through the 2025 sustainability goals, we will harness our innovation strengths, global reach, and dedicated employee population. We have set bold and aggressive sustainability targets designed to develop breakthrough product innovations, positively impacting the lives of a billion people, and deliver cost savings or new cash flow for the company by valuing nature in business decisions,” says Shenoy.
Green road to profitability
A major shift in thinking is paramount requirement to become sustainable as a company, a community or a country. Businesses have been increasingly embracing the concept of three pillars of sustainability (people, planet and profit). From fair and equitable people practices to being cognisant of ecological footprint to creating economic value for the company and society, sustainability is now getting progressively more embedded in the business fundamentals.
For example, Tata Chemicals has adopted a triple bottom line approach of people, planet and profits in everything it does. R Mukundan, managing director, Tata Chemicals, explains, “Sustainability has always been important to Tata Chemicals. We believe that as more organisations understand the linkage of economic prosperity with environmental, social and governance aspects, the importance of including sustainability in business strategy and growth will only rise.”
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“Over the last decade, a significant number of corporates have made strong commitments to environmental protection and biodiversity conservation. It is a central theme in today’s world and companies that achieve their environmental and social performance have superior financial performance and actually create long term value for their shareholders. This shift to the green highway continues to grow, and will be further reinforced if stakeholders and government bodies support and reward companies that operate in the spirit of sustainability,” opines Mukundan.
Sustainability has become an important topic of discussion in boardrooms today, not only because it helps businesses give back to the society but also because it helps to conserve energy and remain competitive. According to Ravichandran Purushothaman, President, Danfoss Industries Pvt Ltd, it is no more a CSR initiative because it has its own business dimension. For example, a 50,000 sq mtr green building can save about Rs 2 to 2.5 million in electricity costs and at least Rs 1 million in water costs.
ALSO READ: Grow more with every drop to save environment
Danfoss itself has globally committed to a 3×25 climate strategy where the company will be cutting CO2 emissions by 25 percent while increasing the share of renewable energy used by 25 percent (relative to the 2007 level) by the year 2025. For instance, at its LEED rated manufacturing and R&D facility in Oragadam (Tamilnadu), the company has an onsite renewable energy installation which meets 15-20% of its power requirements. “Danfoss products are made in sustainable zero wastage environments. Therefore, we bring significant energy and cost savings thereby transferring the baton of sustainability to customers,” claims Purushothaman.
Fuelling innovation
Ambitious sustainability targets often fuel innovation, providing products and solutions for environmental and social challenges, thereby unleashing growth in the process. It can act as a driver to improve profitability through operational efficiency.
“We firmly believe that sustainability fuels innovation. Companies worldwide are seeing the benefits of implementing sustainability initiatives. For us, sustainability means to bring in a balance among environmental, social and economic performance. We invest in developing better and new products and services. Concurrently, we ensure that our products can be used over their entire life cycle in a safe manner,” says Dr Parikh of Clariant.
According to Shenoy of Dow India said, chemical companies have a special responsibility towards sustainability – not just in terms of environment and resource optimisation, but also in innovating for safer, healthier, products and technologies, for tomorrow.
Green supply chain
Companies are developing sustainable strategy that focuses on the entire supply chain starting from understanding the needs of its stakeholders, raw material procurement, product development, manufacturing, transportation, and handling end-of-the-life products.
“We are working on ensuring a greater proportion of our portfolio or offerings are produced from green/sustainable technologies and projects that address the planet's most pressing issues, such as industrial flue gas treatment, affordable water treatment systems, etc. In fact, at the company's Innovation Centre, set up in 2004, all new product ideas have to pass through a ‘green’ screen so that all new products pass the sustainability test before they actually translate into businesses,” says Mukundan of Tata Chemicals.
According to Shenoy, even small initiatives such as ensuring partner network’s compliance with sustainable practices can produce a large impact.
Companies such as Clariant are now focusing on changing the way they operate their plants, with lower inputs of key resources, thus fulfilling their commitment to the environment. “Our improved ‘First Time Quality’ approach in production plants is another area that contributes significantly on reduced wastage. Using the right machinery, training, guidance and employee engagement activities, has enabled us to experience reduced time cycles, higher productivity, improved cost position, and improved safety positioning,” claims Clariant’s Dr Parikh.
By adopting measures to optimise resources, improve energy efficiency and develop improved production processes, manufacturers can lessen their overall impact on the environment. Sustainable development is critical to foster the growth of the Indian industry, and companies will have to keep pushing the envelope by adopting innovative processes and products.
As Mukundan rightly says, “Sustainability is a journey for us and we are setting stiffer targets for ourselves so that we continuously push ourselves to perform even better than before on sustainability.”
“Sustainability as a concept is all about longevity, not just staying in business but also growing and flourishing for the next 100 years, being able to plan ahead of the challenges of tomorrow. Protecting the environment and natural resources is a key thread of sustainability concept and for all the right reasons,” says Sudhir Shenoy, CEO, Dow India – whose US-based parent company has recently launched the 2025 Sustainability Goals - the third era of sustainability after significant advancements since launching its first set of decade-long, sustainability-related goals in 1995.
During 1995-2005, Dow claims that it was able to reduce solid waste by 1.6 billion pounds, water use by 183 billion pounds and save over 900 BTU of energy globally. Its 2005 and 2015 goals were responsible for significant returns of $ 5 billion on investment of $ 1 billion for the company, globally.
“By redefining the role of business in society, through the 2025 sustainability goals, we will harness our innovation strengths, global reach, and dedicated employee population. We have set bold and aggressive sustainability targets designed to develop breakthrough product innovations, positively impacting the lives of a billion people, and deliver cost savings or new cash flow for the company by valuing nature in business decisions,” says Shenoy.
Green road to profitability
A major shift in thinking is paramount requirement to become sustainable as a company, a community or a country. Businesses have been increasingly embracing the concept of three pillars of sustainability (people, planet and profit). From fair and equitable people practices to being cognisant of ecological footprint to creating economic value for the company and society, sustainability is now getting progressively more embedded in the business fundamentals.
For example, Tata Chemicals has adopted a triple bottom line approach of people, planet and profits in everything it does. R Mukundan, managing director, Tata Chemicals, explains, “Sustainability has always been important to Tata Chemicals. We believe that as more organisations understand the linkage of economic prosperity with environmental, social and governance aspects, the importance of including sustainability in business strategy and growth will only rise.”
ALSO READ: Zero defect zero effect: A myth or a reality?
L-R: Ravichandran Purushothaman (of Danfoss) & R Mukundan (of Tata Chemicals)
“Over the last decade, a significant number of corporates have made strong commitments to environmental protection and biodiversity conservation. It is a central theme in today’s world and companies that achieve their environmental and social performance have superior financial performance and actually create long term value for their shareholders. This shift to the green highway continues to grow, and will be further reinforced if stakeholders and government bodies support and reward companies that operate in the spirit of sustainability,” opines Mukundan.
Sustainability has become an important topic of discussion in boardrooms today, not only because it helps businesses give back to the society but also because it helps to conserve energy and remain competitive. According to Ravichandran Purushothaman, President, Danfoss Industries Pvt Ltd, it is no more a CSR initiative because it has its own business dimension. For example, a 50,000 sq mtr green building can save about Rs 2 to 2.5 million in electricity costs and at least Rs 1 million in water costs.
ALSO READ: Grow more with every drop to save environment
Danfoss itself has globally committed to a 3×25 climate strategy where the company will be cutting CO2 emissions by 25 percent while increasing the share of renewable energy used by 25 percent (relative to the 2007 level) by the year 2025. For instance, at its LEED rated manufacturing and R&D facility in Oragadam (Tamilnadu), the company has an onsite renewable energy installation which meets 15-20% of its power requirements. “Danfoss products are made in sustainable zero wastage environments. Therefore, we bring significant energy and cost savings thereby transferring the baton of sustainability to customers,” claims Purushothaman.
L-R: Deepak Parikh (of Clariant) & Sudhir Shenoy (of Dow)
Fuelling innovation
Ambitious sustainability targets often fuel innovation, providing products and solutions for environmental and social challenges, thereby unleashing growth in the process. It can act as a driver to improve profitability through operational efficiency.
“We firmly believe that sustainability fuels innovation. Companies worldwide are seeing the benefits of implementing sustainability initiatives. For us, sustainability means to bring in a balance among environmental, social and economic performance. We invest in developing better and new products and services. Concurrently, we ensure that our products can be used over their entire life cycle in a safe manner,” says Dr Parikh of Clariant.
According to Shenoy of Dow India said, chemical companies have a special responsibility towards sustainability – not just in terms of environment and resource optimisation, but also in innovating for safer, healthier, products and technologies, for tomorrow.
Green supply chain
Companies are developing sustainable strategy that focuses on the entire supply chain starting from understanding the needs of its stakeholders, raw material procurement, product development, manufacturing, transportation, and handling end-of-the-life products.
“We are working on ensuring a greater proportion of our portfolio or offerings are produced from green/sustainable technologies and projects that address the planet's most pressing issues, such as industrial flue gas treatment, affordable water treatment systems, etc. In fact, at the company's Innovation Centre, set up in 2004, all new product ideas have to pass through a ‘green’ screen so that all new products pass the sustainability test before they actually translate into businesses,” says Mukundan of Tata Chemicals.
According to Shenoy, even small initiatives such as ensuring partner network’s compliance with sustainable practices can produce a large impact.
Companies such as Clariant are now focusing on changing the way they operate their plants, with lower inputs of key resources, thus fulfilling their commitment to the environment. “Our improved ‘First Time Quality’ approach in production plants is another area that contributes significantly on reduced wastage. Using the right machinery, training, guidance and employee engagement activities, has enabled us to experience reduced time cycles, higher productivity, improved cost position, and improved safety positioning,” claims Clariant’s Dr Parikh.
By adopting measures to optimise resources, improve energy efficiency and develop improved production processes, manufacturers can lessen their overall impact on the environment. Sustainable development is critical to foster the growth of the Indian industry, and companies will have to keep pushing the envelope by adopting innovative processes and products.
As Mukundan rightly says, “Sustainability is a journey for us and we are setting stiffer targets for ourselves so that we continuously push ourselves to perform even better than before on sustainability.”