MAHINDRA & MAHINDRA LTD. | Integrated Annual Report 2022-23

199 COMPANY OVERVIEW BOARD’S REPORT MANAGEMENT DISCUSSION AND ANALYSIS CORPORATE GOVERNANCE BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT STANDALONE ACCOUNTS CONSOLIDATED ACCOUNTS 24. Overview of the entity’s material responsible business conduct issues Material responsible business conduct and sustainability issues pertaining to environmental and social matters that present a risk or an opportunity to your business, rationale for identifying the same, approach to adapt or mitigate the risk along-with its financial implications: S. No. Material issue identified Indicate whether risk or opportunity (R/O) Rationale for identifying the risk opportunity In case of risk, approach to adapt or mitigate Financial implications of the risk or opportunity (Indicate positive or negative implications) 1 Water Security R Fresh water is an important input for both manufacturing processes and domestic purposes of the Company. Processes such as paint booths are water intensive processes in automotive and farm industry. It is important to use quality water to maintain the paint quality. Water scarcity is India’s silent crisis and unpredictable rainfall across India makes the manufacturing plants more vulnerable for water shortages. Tractor sales are also largely dependent upon the monsoon in India. Hence insulating against water risk is one of the identified business risks and priorities. The Company strives to mitigate the water risk by adopting following four methods: 1. The Company utilises various global tools to identify the water risk across its operation sites and value chain. Based upon the amount of risk in respective river basins, the mitigation action is planned and executed. 2. O ptimum usage of water in all operations through various water efficiency measures adopted such as low volume water taps, arresting leakages in pipelines, amongst others. 3. R ainwater harvesting: By increasing rainwater storage capacity. 4. R ecycling: By installing ETP/STP and RO plants, we strive to increase our recycling capacity. 5. Ground water recharge: By installing specially designed deep aquifer pits for improving ground water table. To ensure the availability of water for the community, the Company is also working on watershed management projects. Negative Implication: Stoppage of water impacts manufacturing processes and utility set ups. 2 Carbon Emissions R The business risk of climate change can affect the Company in multiple ways including regulatory impact on vehicle sales, physical changes which could affect the operating environment of the products, among others. As the Company operates in an evolving carbon emissions regulatory environment, it is essential that the Company plans and works on ways to mitigate the risk. The Company has laid down a comprehensive and detailed plan to manage its Greenhouse Gas (GHG) emissions. Some of the programs or commitments are mentioned below: 1. C ommitted for carbon Pricing-invest $10 per ton of carbon emission. 2. Committed for EP 100 i.e., double Energy productivity by 2030 in association with The Climate Group. 3. C ommitted to reduce carbon intensity by 47% by FY 2033-34 (with base year of 2018-19) - signatory to the Science based Targets. 4. C ommitted to become carbon neutral by 2040. The Company is also focusing on increasing the market share of the electric vehicle portfolio in India, emerging, and developed markets. Negative Implications: Impacts the environment such as physical damage from floods or brushfire or forced closures. Flow-on effects of climate change or extreme events such as supply chain being disrupted by extreme weather.