Key Impacts, Risks And Opportunities:
Sustainability Challenges

Climate Change and Environmental Degradation

The race for unbridled economic growth has left a planet seriously depleted of environmental resources.

The world’s ecological footprint suggests that consumption of natural resources every year will be far more than the earth’s capacity to regenerate.

With increasing population, people will have access to limited resources which will be far less than what was available in 1950.

India mirrors these environmental challenges. With over 17% of the world’s population, India accounts for only 2.4% of the global land mass, 4% of the world’s freshwater resources and 1% of the global forest resources.

The impact of climate change is manifest in the changed weather patterns and increasing frequency of extreme weather conditions. This affects agricultural production and severely impacts the livelihoods of farmers. Given that several of ITC’s businesses are dependent on agricultural inputs, climate change and global warming have important ramifications for the Company and some of its major stakeholders - the farmers and communities in rural India.

The conservation and management of India’s depleting water and other natural resources are very important as they directly impact the livelihood of over 75% of its population and 58% of its workforce, who are dependent on agriculture and related activities for their livelihood.

India is on the edge of a serious water crisis with more than one-third of the districts reeling under severe water-stress and 99 districts officially deemed drought-prone.

Largely consisting of resource-strapped small/marginal farmers, agricultural communities are almost invariably engaged in rain-fed agriculture and, therefore, most vulnerable to the adverse impacts of seasonality and environmental degradation

India is also confronted with the challenge of waste management. A large amount of resources get dumped as garbage every year and end up in landfills. This not only leads to wastage of precious natural resources but also affects public health and hygiene.

Energy security is today one of the biggest developmental challenges with 400 million people lacking reliable access to energy in India. Lack of investments as well as uncertainty of fossil fuel availability and pricing are other critical issues.

The world over, mounting public pressure from civil society and other stakeholders will compel the implementation of stringent regulations on carbon emissions.

It is clearly evident that the future competitiveness of companies will depend on their ability to adopt strategies for low carbon growth.

Given the economic growth in the country, there has been a significant increase in the consumption of natural resources and an imperative need to ensure resource efficiency.

ITC’s Initiatives

ITC has adopted the following strategies for climate change mitigation:

1. Identify and evaluate climate change risks for each business.

2. Reduce the environmental impact of our processes, products and services and work towards creating a positive environmental footprint.

Adopt a low-carbon growth path through reduction in specific energy consumption and enhancing use of renewable energy sources.

Enlarge our carbon positive footprint through increased carbon sequestration by expanding forestry projects in wastelands.

Reduce specific water consumption and augment rainwater harvesting activities both on site and off site at watershed catchments areas.

Work towards minimising waste generation, maximising reuse & recycling and using external post-consumer waste as raw material in our units.

Create sustainable livelihoods and promote sustainable agricultural practices.

Life Cycle Assessment studies have been carried out for different products to understand the impact across the value chain. Resource efficiency is integrated into product and process design and is addressed in the creation of physical infrastructure, the operations phase, logistics and waste management.

The adoption of these strategies has led to the following interventions:

1. ITC has expanded its renewable energy portfolio with more than 41% of its energy consumption being met from renewable sources.

2. As part of its low-carbon and green growth strategy, ITC has spearheaded the establishment of green buildings, which have set benchmarks in energy efficiency, water conservation and solid waste recycling. All ITC’s super premium luxury hotels are LEED Platinum certified. The ITC Green Centre has been identified as the highest rated Platinum rated Green Building in the world by the US Green Building Council during its recertification in 2012. ITC’s iconic property in Chennai, ITC Grand Chola, is now the largest LEED Platinum rated green hotel in the world.

3. ITC’s afforestation programme has greened over 1,42,000 hectares, which has led to large-scale carbon sequestration besides creating over 64 million person days of employment.

4. ITC’s watershed development programme provides soil and moisture conservation to over 1,16,000 hectares. This has enabled the Company retain its water positive status for 11 years in a row.

5. ITC’s Wealth Out of Waste programme promotes recycling and source segregation and creates awareness among all stakeholders on the benefits of the Reduce-Reuse-Recycle Approach. This initiative has enabled ITC’s paperboards business to source and recycle post-consumer waste, thereby contributing to ITC’s solid waste recycling status.