United Nations Chief, Antonio Guterres, in a lecture held at The Energy and Resources Institute (TERI) in September 2020, spoke about the innovative steps taken by Mahindra Group in embracing clean technology and contributing to a sustainable energy future. He said it is ‘exemplary work that is being carried out in the country ’. This is an acknowledgement of the work done by the Group on sustainability — a key component of the Environment, Social and Governance (ESG) matrix.
The work is a personal passion of Group Chairman Anand Mahindra, who refers to it as ‘good for my country, good for our businesses, and we owe that kind of constructive approach to future generations’. The Group is a pioneer in the country, taking aggressive and ambitious goals of being carbon neutral by 2040, increasing energy productivity and announcing an internal carbon price.
Talking about the actions taken by the businesses and its climate change impact, Anand Mahindra says, “As a businessman, it benefits to create a business that promotes the economic prospects of as many people as possible. Businesses need to find a purpose that is transcending. And this work aligns itself to our guiding principle of shared value — doing good and doing well.”
The Group’s journey on sustainability started 12 years ago nudged by an investor query on ‘triple bottom line’. In a remarkably short period, the Group has gone from searching for the meaning of the triple bottom line to being a pioneer in scaling planet-friendly practices like energy efficiency, clean energy, water efficiency, zero waste to landfill and afforestation; investing in climate-friendly businesses like electric vehicles, shared mobility, green buildings, automobile recycling, micro-irrigation, waste to energy and sustainable cities; driving social development programmes like girl child education, integrated watershed management and community health interventions. At the same time, it has adopted cutting-edge business practices like policy deployment, balanced scorecard, total productivity management and rapid prototyping.
On how this work plays out within the Group, Anand Mahindra, says, “Each one of our own corporate milestones is accompanied by a more humane one; whether it is the creation of a truly inclusive workplace or a reduced environmental impact; whether it’s a deeper engagement with our communities, or providing the freedom to experiment (and, even fail) to all our employees.” The guiding factor in this is the Mahindra Sustainability Framework.
Mahindra sustainability framework: People > Planet > Profit
The sustainability framework’s overarching goal is to ‘give back more than we take’ – a simple articulation of the concept of shared value. The Group proposes to do this by building enduring businesses by rejuvenating the environment and enabling stakeholders to Rise.
“The real impact of sustainability lies in actions taken in the area where the planet, profit and people overlap. Only when we do good for the environment, people and businesses, do we enable sustainability. Sustainability is not just about doing good, it is about creating wealth while doing good,” explains Anirban Ghosh, Chief Sustainability Officer, Mahindra Group. The Group has embraced sustainability as the new idea of sustainable business demanded that it go beyond a shareholder-centric view and embrace a stakeholder-centric worldview. This ethos is enshrined in the Mahindra Sustainability Framework.
People - the first pillar of sustainability
We often regard sustainability and climate action as being about the continued well-being of the planet. Nothing could be further from the truth. The earth will continue to exist even if human beings do not, as it has in the past. Sustainability is about the continued well-being of all living things on earth.
75 years ago, Mahindra talked about its philosophy of doing business in the first advertisement it released. The philosophy included ‘initiative of the individual’, ‘harmonious work environment’ and ‘rightful worth of labour’. The word ‘sustainability’ was nowhere on the horizon in 1948, but the business was already being built on people principles that would stand the test of time.
Therefore, the first pillar of sustainability is about people, within the organisation and outside. It is about building a great place to work where people achieve their full potential. It is about fostering inclusive growth in society, especially in communities touched by the business and about making sustainability personal for each person associated with Mahindra to build a powerful movement.
Planet - the second pillar of sustainability
It is impossible to be a sustainable business in an unsustainable world. The unintended consequence of the path to development followed in the last couple of hundred years has been that we live beyond planetary boundaries. The planet can only replenish about 60% of the natural resources we use during the year. Nature doesn’t bill us for her services, and we live in the mistaken belief that economic growth represents sustainable progress. Rapid deterioration of natural assets puts the availability of the very resources that power our growth at serious risk. Reconfiguring business to operate viably within planetary boundaries is the next frontier that we must scale. It is a humongous transformation that presents amazing opportunities and has enormous risks.
Mahindra has committed to being a carbon-neutral Group by 2040 and has taken decisive steps towards the same on carbon, water and waste management. To know more, click here.
Profit – the third pillar of sustainability
Mahindra has a history of innovating sustainably. One of the major areas of innovation today is climate action. The biggest reason why we can expect organisations to contribute significantly towards achieving climate goals is that climate action makes business sense. Investments in projects to achieve carbon neutrality, water security, zero waste to landfill, resource efficiency, and other elements of environmental sustainability give handsome economic returns. They help reduce system cost, reduce operating risk and make the business more resilient. These actions are as relevant at supplier locations as they are within the company, and therefore, sustainability actions are key to ensuring sustained profits even in difficult times.
Sustainability is not just a story of efficiencies and risk reduction. If we must win the climate struggle, many new solutions are required to help change the way we live and work. These new solutions are excellent investment opportunities as they will be the industrial growth engines of the future. Mahindra has been prescient in its investment in electric vehicles and renewable energy. It has invested in shared mobility, micro-irrigation, green buildings, sustainable cities, automobile recycling, cloud computing and converting food waste to bio-CNG. This portfolio of businesses has already reached annual revenue of USD 600 million.
The transformation these industries will trigger in the country will be far greater than the revenue they will generate for the Group. Anand Mahindra calls climate action ‘this century’s biggest financial and business opportunity’.
Partnerships, learning and sharing – the foundation of sustainability
Sustainability is an evolving subject. Many climate solutions exist, and many more are emerging. Organisations discover new and more effective ways to practice sustainability. This makes partnerships, learning and sharing a crucial way of keeping up with the developments. ‘walking the talk’ helps enhance credibility, while ‘talking the walk’, helps spread good practices when done in an authentic manner.
Mahindra has partnerships with many climate organisations around the world such as World Economic Forum, Unites Nations organisations, The Energy and Resources Institute, World Business Council for Sustainable Development to name a few. It has also worked closely with Energy Efficiency Services Ltd. to experiment with and adopt energy-efficient devices at its locations and the residences of its employees. The power of the 17 Sustainable Development Goals created by the United Nations is clear in these partnerships.
The Mahindra Group’s ambition and actions have been noticed by many. Tech Mahindra is at the top of the Dow Jones Sustainability Index (DJSI) and Carbon Disclosure Project (CDP) Climate charts. Mahindra Finance and Mahindra and Mahindra have featured consistently in DJSI’s Emerging Markets Index, and M&M has featured alongside Tech Mahindra on the CDP charts. Most recently, The Wall Street Journal ranked Mahindra at #17 in a list of the Most Sustainably Managed Businesses of the World after sifting through 5,500 corporations. These recognitions are the positive affirmation of the Group’s ethos and practice of responsible business and motivate us to do more.
Anand Mahindra, while representing the Global Business Community at the signing ceremony of the Paris Accord at the UN headquarters, committed to investing in a greener future. Under his leadership, the Group has travelled a long way. The commitments made will be achieved and many other steps will be taken as Mahindra, along with other corporations in India, is helping the nation achieve its commitments and ensuring that the world keeps the average temperature rise in a region where human habitation on earth remains comfortable.
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