DISCUSSION Tata Steel – Measuring the impact of sustainable policies

by Yolanda Villafuerte _______20th March 2013
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For Tata Steel sustainability is a core value which extends across all the company’s activities including economic strategy, environmental action, social support and governance.  Its approach to sustainability is based on nine principles, and progress against each is measured and monitored:

  1. Ethics, transparency and accountability. This starts with leadership by the Managing Director who is the Chief Ethics Officer responsible for deployment of the Tata Code of Conduct. Compliance with the code is a condition of service for all employees and for Tata’s vendors and suppliers. The effectiveness of the code is evaluated every two years using independent third parties, and identified gaps are used to promote new initiatives.
  2. Sustainable products. The business provides goods and services that are safe and contribute to sustainability throughout their life cycle. Improvements in environmental and sustainability performance are identified through a Total Quality Management programme. A sustainability assessment tool is used to drive sustainability throughout the product life cycle. Customers are educated on product properties, safe use and disposal. Raw material, energy and water requirements are continuously tracked and compared with global benchmarks to optimise resource efficiency, driving resource conservation and cost reduction. All manufactured products are fully recyclable.
  3. Employee welfare. The business promotes the well-being of all employees. Worker health and safety has high priority. Tata Steel strives to achieve its goals of a zero fatality rate and lost time due to injury rate of 0.4. The company invests in developing the skills of its employees; in 2011 the Tata Steel Academy was launched to achieve the high standards of technical and professional expertise. Free association and collective bargaining are respected, and recognised trade unions are engaged. Anti-discrimination policies are actively pursued.
  4. Stakeholder engagement. Tata Steel’s processes of strategic planning and risk management collect and analyse information on existing and emerging stakeholders; the information is used to help define organisational priorities. The company recognises it has a responsibility to make the communities in which it operates benefit from its economic activities, both directly and indirectly, and has established a range of agencies with specific purposes such as sustainable livelihoods, employability, health care, education, empowerment, population stabilisation and ethnicity.  A proactive approach to stakeholder engagement advocating a just, fair and equitable society in the communities in which it operates results in a continued licence to run its business.
  5. Human rights. In its workplaces Tata Steel ensures equal opportunities and workforce diversity.  Its processes are monitored for compliance and subject to continuous improvement through SA 8000 standard independent third-party verification. The company’s own strict policies on child labour are extended so that nobody below 18 years of age can be engaged by contractors, suppliers or vendors anywhere within or outside the company premises. To promote inclusive growth the company encourages local buying from small entrepreneurs and NGOs, so revenue flows benefit local and disadvantaged communities.
  6. Environment. Tata Steel embeds its policies of reduce, reuse and recycle throughout its processes. Advanced techniques are used to extract iron and carbon by reusing most of the residual materials, reducing use of primary raw materials and overall CO2 emissions. Tata Steel India reported an 18% decrease in specific water consumption over a 10 year period from 2002/3 to 2011/12. In Europe Tata Steel is developing a tool that will provide a more accurate measure of fresh water consumed per tonne of steel produced. In India the company has developed a roadmap for reducing CO2 emissions to retain its position as the Indian benchmark in blast furnace steel-making. In Europe the company is working with others to develop new technologies to reduce CO2 emissions per tonne of steel produced by at least 50%.
  7. Policy advocacy. Tata Steel seeks to engage responsibly on public and regulatory policy. For example it is an active corporate citizen within the Confederation of Indian Industry, the Federation of Indian Chambers of Commerce and Industry, and the Federation of Indian Mineral Industries.  In Europe the company engaged with the European Commission and national governments on the implementation of the EU Emissions Trading Scheme.
  8. Inclusive growth. Tata Steel was founded on the belief that the creation of wealth could accelerate economic and social development to achieve inclusive growth. The company addresses urban and rural needs separately.  In 2011/12 the company introduced the Human Development Index as a composite index of health, education and income levels to assess the impact of the company’s interventions in rural areas. In rural India a range of initiatives addresses sustainable livelihoods, education, health care and empowerment of women.
  9. Customer value. By engaging with customers and consumers and by understanding their needs Tata Steel creates value. For example, an initiative led to improvements in the productivity of customers who manufacture continuous electrodes for the auto industry, leading to a reduction in power consumption.

For Tata Steel sustainability is synonymous with empowerment and success for everyone within the company and for the communities with which it works, and embraces the desire to leave a greener, healthier planet for future generations and for the business.

To read Tata Steel’s annual report in 2012 please visit the Tata website.

Jeremy Foster

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