Oct 31
Sustainable to the Core
Sustainable to the Core
For business leaders, navigating the complex brew of ever-changing market trends, tech-driven disruptions, and social and environmental demands has never been more challenging. In a world increasingly concerned about things like corporate ethics and business practices, at a time when organizational worth is no longer measured solely on the basis of shareholder value but also the amount of ‘corporate good’, leaders are trying desperately to embed sustainability at the heart of their business. It’s a shift that’s hard for some and harder still for others.
 
For L&T however, it’s been both easy to anticipate and adapt to. This, for the simple reason that the company, right from its inception has lived by a strict code of ethics and a set of sustainable practices that create stakeholder value without being extractive. Drawing from the idea of ‘creating shared value’, L&T has long been making its corporate ecosystem more and more sustainable with the help of a clearly articulated roadmap converging with its business plan. This roadmap is built around constructive outcomes with clearly defined sustainability performance targets. Comprehensive yet highly focused, it has helped improve the L&T’s environmental, social, and governance performance wherever it has a material impact.
 
People Focus
 
For its large and spread-out workforce, L&T has in place mechanisms that not only help it achieve high performance benchmarks and deliver solutions to the delight of its clients but also ensure the growth of its employees. With its ‘people first’ credo serving as guide, the company recognizes their significance and motivates employees through training, performance rewards, and leadership opportunities.
 
At L&T, each business conducts need-based training programmes to upskill workers in their respective disciplines. It also strengthens institutional learning through captive training facilities such as Power Training Institute, Engineering Design & Research Centres, Switchgear Training Centres (at Pune, Lucknow, Vadodara, Delhi, Kolkata and Coonoor), and a Safety Innovation School at Hazira, near Surat, Gujarat.
 
For the office staffers, there exist a range of Core Development Programmes, viz., Supervisory Development Programme, Executive Development Programme, Management Development Programme (for individuals, teams and operational excellence) which help participants grow to their full potential. The company has invested in advanced training modules and uses state-of-the-art technology to provide learning solutions in its key focus areas. These training courses are developed to ensure that the content elevates the knowledge quotient of participants, sharpens their skills and matches its strategic requirements.
 
Intellectual Capital
 
Innovation at L&T spans across its domains of product, process, and people and the company continues to invest heavily in innovation to remain ahead of the curve in the market. An R&D force of 3060 engineers and a spend of Rs.2,243 million is indicative of this. Besides, as one of the early adapters of digitalization, L&T continues to leverage the same to enhance productivity and efficiency across its processes.
 
L&T’s focus on developing intellectual capital in-house has resulted in opportunities in emerging areas and successfully deliver landmark projects, few in the world could undertake and execute. One of the most visible examples of this is the Statue of Unity (SoU), world’s tallest structure unveiled last year.
 
Rising on the strength of L&T’s world-class design-build prowess and project management capabilities, the SoU is a remarkable piece of engineering that employs cutting-edge digital technologies. From tools that allowed designers and engineers to visualise the statue down to its last detail to geospatial technologies that helped the project team understand the topography of the riverbed and the Building Information Modeling (BIM) process which helped teams collaborate and orchestrate the massive task of planning, designing and constructing the statute and associated infrastructure, the list is exhaustive.
 
L&T’s work in Nagpur, Maharashtra, where the company leveraging its capabilities build a smart city is equally impressive. The company has deployed numerous cutting-edge technologies strengthening the smart city initiative such as video management software, facial recognition system software licence, smart parking information system, e-challan application, etc. It has even installed drones and software for effective monitoring of operations, while online EHS systems are being developed to oversee absolute compliance. To L&T’s credit, Nagpur recently assumed the first position in the index of Smart City rankings as the first integrated safe and smart city.
 
Similarly, through the Smart City project collaboration with the local administration in Prayagraj, Uttar Pradesh, L&T envisioned greater efficiency in citywide operations, facilitating high-quality crowd management solutions and a unified view of circumstances.
 
For Kumbh Mela held earlier this year, the Smart World and Communication (SWC) business in Prayagraj set up an Integrated Command and Control Centre I (ICCC) to monitor and control the movements of over 200 Million pilgrims, ensuring an incident‑free event. It laid out a 350 km optical fibre cable network for last-mile connectivity, while also installing surveillance cameras, viewing centres, intelligent traffic signals and solid waste management solutions to ensure the city remains clean and well managed. The ICCC helped with smart video management and key multi-domain analytics such as automatic number plate recognition, red light violation detection and facial recognition, among other smart elements.
 
Prayagraj, today, is Northern India’s first integrated smart city to be commissioned and operational, with a data centre and two command centres, a 24x7 emergency and civic contact centre, and fully equipped dashboards.
 
Safety First
 
For L&T safety has always been a top priority and it pursues the goal of zero accident relentlessly. With a slew of digital initiatives and active involvement of the workforce, L&T’s safety performance over the years has improved significantly across businesses. During FY19, the frequency rate of accidents reduced by 44% vis-à-vis FY16. The corporate EHS policy and management processes across businesses underline L&T’s efforts towards administering an accident-free workplace. The policy’s relevance is evaluated periodically by company’s senior management.
 
The Group business are run in accordance with international certifications, such as ISO 14001:2015 (Environment Management System) and OHSAS 18001:2007 standards. Most of them have already begun complying with the recently issued standard of ISO 45001:2018 (Health and Safety Management System) and are expected to receive certification in the near future.
 
The company extends its safety beliefs to its contract workers at project sites as well and assesses sub-contractors on the basis of their safety infrastructure and processes before assigning any jobs. Contract labourers are also expected to abide by its policies and practices. Regular refresher training sessions and capacity building programmes help refine the understanding of safety requirements among workers. Additionally, company’s senior management conducts intermittent site visits and audits to aid in improving the overall EHS performance.
 
Lately, digitalisation has been used extensively across businesses as a key enabler to improve safety performance. It is used to create e-learning modules at project sites, and devise virtual reality (VR) based training modules. It also plays a key role in designing safety cards for reporting unsafe acts / conditions, incident investigation, safety inspection, improved Safe Operating Procedures (SOPs) to reflect changing work methods, EHS suggestion systems; to name a few.
 
In addition, extensive mechanisation and enhanced training on behaviour-based safety programmes are conducted across businesses. Cross-functional safety audits are conducted along with training-the-trainer programmes to build site-based safety capabilities.
 
Preserving Water & Energy
 
L&T constantly seeks new ways to reduce its environmental footprint by following widely acceptable international norms. Its environment protection initiatives focus on reducing the use of natural resources, building efficient infrastructure, and cutting emissions.
 
The company’s Corporate EHS Policy defines its business philosophy on environment management and L&T regularly trains its workforce on aspects of environment conservation to ensure smooth implementation. In FY19, it spent roughly Rs.147 million on environmental pollution control and management measures.
 
L&T’s climate change, energy efficiency and renewable energy programmes are aligned with the National Action Plan on Climate Change (NAPCC). The Company’s programmes are also in line with the Nationally Determined Contributions (NDCs), ratified by the Government of India at the COP 21 - Paris Agreement.
 
In FY19, L&T’s total GHG emissions decreased by 7.1% with respect to FY16. This was the result of adopting a multiple renewable energy sources and efficiency enhancement measures at the company’s manufacturing locations, campuses and offices.
 
The company’s Modular Fabrication Facility (MFF) in Hazira near Surat for instance upgraded the HVAC system to a high-performing, fuel-efficient and electrical screw chiller, resulting in enhanced energy savings and reduced costs. Earlier it employed a conventional HVAC system, involving a gas-fired vapour absorption chiller. With an estimated capacity of ~150 TR, it consumed natural gas and electric power to the tune of 78,000 scm and 1,90,000 kWh annually resulting in a total energy bill of roughly Rs.38 lakh. However, the upgraded HVAC system has eliminated the use of natural gas as fuel. And while MFF’s electricity consumption might have marginally increased by 300,000 MJ annually, it now conserves natural gas equivalent to 2,200,000 MJ on an annual basis. The initiative has not only made the facility greener, it has also led to an annual savings of Rs.16 lakh for the company.
 
In another instance, the company formulated a series of energy-efficient measures at its Knowledge City campus in Vadodara. There, it replaced conventional lighting fixtures with efficient LED lamps in each office building which lowered its power load by 471.5 kW and resulted in an annual savings of approximately 1.2 Crore. Encouraged by the success at Vadodara, a similar initiative was carried out at the Armoured Systems Complex in Hazira across the test tracks and streetlights, reducing power consumption by more than half, and achieving annual savings of Rs.32.7 lakh.
 
Besides energy conservation, the company across its campuses and office locations has been promoting the idea of Water Positivity and encouraging means to lower water consumption. As part of these measures, 24 of its campuses have achieved water positive status and in FY19 12.45% reduction in domestic specific water consumption (Cu.m/workforce) was achieved at the group level as compared to FY16. Further in FY19, 75% of total waste water generated was recycled and reused. Seemingly small measures like installing waterflow restrictors in faucets in washbasins to minimise wastage and leakage and installing drip system and sprinklers to water the lawns at campuses have optimised water usage and saved several lakh litres of water annually.
 
Green Portfolio for Greener Planet
 
The last few years have seen L&T develop a green portfolio to deliver engineering and design solutions focused on sustainability. This includes technology solutions that are low on carbon emission, water consumption and air pollution to improve energy efficiency with clean energy and resource conservation. As the world moves towards a low-carbon economy to implement climate change mitigation, it is essential to create green infrastructure that reduces GHG emissions. L&T’s green portfolio offers infrastructure that has low impact on the environment and focuses on public well-being. The company’s green product and services portfolio has shown a stellar growth and is currently valued at Rs.317.65 billion. This constitutes 22% of L&T’s consolidated revenues and 35% of its standalone revenues.
 
Specifically, L&T’s green portfolio includes Renewable energy systems viz., Solar Power Plants, Hydro Power Plants, and a range of ‘Water to Wire’ solutions.
 
L&T offers highly-efficient Power Transmission and Distribution Systems (PTDS), designed to reduce pilferage as well as transmission and distribution losses. This saves 20-40% of electricity, and reduces CO2 emissions significantly. PTDS includes transmission lines, underground cable networks, substations, distribution networks, electrical, instrumentation and communication solutions.
 
L&T’s Electrical & Automation business offers a range of eco-friendly products, systems and services for industrial, commercial and residential applications. This includes products like low-watt loss fuses, AC drives, soft starters, power factor improvement capacitors and systems such as industrial & building automation solutions, and smart metering systems.
 
Besides, its Mass Rapid Transit systems (its Metro and Mono Rails) provide enhanced connectivity, reducing the number of vehicles on the road, which in turn reduces pollution and maximizes resource efficiency. Then there’s the Water Treatment & Distribution Infrastructure business as part of which the company constructs bulk distribution and water treatment systems, waste water treatment plants, effluent treatment and recycling plants and lift irrigation systems.
 
L&T’s supercritical and ultra-supercritical thermal power plants and equipment aid energy efficiency with lower fuel and water consumption, emitting lesser GHGs. Last but not the least, the green buildings which the company constructs consume less energy and water, utilise recycled material that are sourced locally.
 
The Social Connect
 
L&T plays a proactive role in empowering communities by providing them access to clean water, hygienic surroundings, healthcare facilities, education and skill-building, thereby helping transform the quality of life for millions around the country. Its corporate social responsibility (CSR) agenda is guided by a mission of ‘Building India’s Social Infrastructure’.
 
In FY 19, L&T’s CSR programme across the four stated thrust areas positively impacted more than 2.3 million lives. Behind this number is the team of CSR professionals working  tirelessly to maximise the impact of the company’s social interventions. The team members formulate, implement and monitor CSR programmes in collaboration with NGOs, which engage with individual causes and support teams at campuses and office locations.
 
CSR coordinators and teams at campuses, area offices and sites assess needs, identify local issues, monitor the proper implementation of projects and provide assistance in achieving the objectives. One of the company’s most visible successes has been its Integrated Community Development Programme (ICDP). In just four years multiple community development programmes across six water stressed districts in Rajasthan, Maharashtra and Tamil Nadu covering 20,100 households across 16,844 hectares have led to a visible change in the lives of lakhs of people. As part of these multi-faceted programmes the CSR teams first focuses on making drinking water accessible to the locals, followed by addressing their agricultural and sanitation requirements. The team along with implementation partners helps erect relevant structures in association with members of the community. These initiatives help increase water levels and retain soil moisture.
 
Educating farmers about methods of water conservation and contemporary agricultural practices also form a part of the ICDPs. Further sanitation programmes, educational and healthcare and entrepreneurial interventions aimed specifically at empowering women help elevate financial fortunes of community members.
 
Skill development is crucial to community development and the company in its bid to achieve inclusive growth, offers vocational training courses and promotes skill-building activities to unschooled youth. Its nine Construction Skills Training Institutes (CSTIs) extend free training (bar bending, formwork carpentry, masonry, scaffolding, welding, electrical wiring and so on) to rural and urban youth. Further to impart industry-oriented training, L&T has collaborated with 27 Industrial Training Institutes (ITIs) across the country.
 
The company’s CSR missions are ably supported by the Prayas Trust and L&T’s own army of volunteers. Instituted two decades ago, and formerly known as the L&T Ladies Club, the trust is administered principally by female employees and wives of employees, who serve the marginalised sections of society. L&T has a structured employee volunteering programme, L&T-eering, which enables and encourages employees to participate in community development. With more than 5,000 registered members, L&T’s is one of the biggest employee volunteers base in the country.
 
L&T’s CSR focus and its resolve to improving the social infrastructure of the country also has a positive impact on its turnover and recruitment. Studies have shown that the company benefits greatly in terms of attracting and retaining talent and has a stronger reputational currency than most other corporates in the country.
 
Sustainability for L&T was never an add-on or a ‘nice to have’. Unlike many others, it was always part of its core, enmeshed in the “business”. It is for this reason that L&T managed to transform itself into a sustainable business far more easily than it is normally made out to be. All the pieces were already in play.

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