Delivering Good Health through affordable medicines

and empathetic healthcare to patients whenever and

wherever they need it, is a commitment that we work
tirelessly on. This objective empowers us to leverage
cutting edge innovation and improve the quality of our
products, helping patients across the world.

Our presence is wide-spread across 26 countries, with

our global headquarter in Hyderabad, India. Our
manufacturing facilities are supported by four R&D
centres located in India, USA, UK and Netherlands.
 ur Purpose
If you point to one Accelerate access to affordable and innovative medicines
because Good Health Can’t Wait.

single factor that made us

what we are today, it is
serving the poorest of the ur Promises
Our five Promises clarify what we do, what we offer and the

poor in this country. It has

commitments we make to our customers. Our patients trust
our medicines. We focus our energies on renewing this trust
every day. As we keep the interests of our patients at the

actually made us prosperous.

centre of all that we do, our Promises drive us to reach higher
levels of excellence.

Of course we didn’t stop Bringing expensive medicines within reach

Addressing unmet patient needs

there. And we continue to

Helping patients manage disease better
Enabling and helping our partners ensure that our medicines

bring affordable medicines

are available where needed
Working with partners to help them succeed

to people.
ur Values
Integrity and Transparency
Safety
Quality
- Dr. K. Anji Reddy Productivity
Respect for the individual
Collaboration and Teamwork
Sustainability

03 | Our Purpose, Our Promises, Our Values Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 04
 ontents

Interaction with Dr. Reddy’s way Committed to Our sustainability

7 27 55 83
the CEO a better world performance
G V Prasad talks about Dr. Reddy’s approach Our commitment A snapshot of our
Dr. Reddy’s sustainability towards sustainability towards environment performance against
journey management key performance indicators

What we are today Delivering on our Building healthy Assurance statement

11 Our company profile and

value chain
43 promise: Good Health
Our efforts to ensure
availability and access to
63 communities
Our community
interventions and social
89 DNV GL’s assurance statement
for this report
affordable medicines responsibility initiatives

About this report Custodians of good Living our dreams GRI content index

19 Scope and boundary of

this report
49 health
How we ensure that our
medicines are safe and
71 People with diverse skills
working together for a
93 Alignment of this report
to the GRI G4 guidelines
effective common purpose on sustainability reporting
 nteraction
with our CEO
We believe that ‘Delivering Good Health’ requires more
than just good products. Therefore, we endeavour to
build a robust business created with a long-term
mindset, driven by the best people around processes
that are class leading and assets that are of high-quality
 What does sustainability mean
to Dr. Reddy’s?
Sustainability means meeting
the needs of today without
compromising the ability of
future generations to meet their
needs. It means protecting our
natural resources, reducing our
impact on the environment,
using resources very efficiently
and ensuring renewal of the
resources that we consume. It
means reducing our carbon
footprint by using the minimal
amount of energy, materials,
transport and not using
materials or generate wastes
that have an impact on the
environment. This is how we do
things to create a positive
impact in the society through
the products we make. Our
products are designed and
developed to bring to life our
belief that Good Health Can’t
Wait.
At Dr. Reddy’s, our commitment
to delivering Good Health goes
beyond the products we make.
It is really about
institutionalizing a belief and a
way of doing business.
Sustainability therefore to us
also means focusing on building
a business which is robust,
around processes that are
best-in-class, and with a
mindset that is long-term, while
investing in high-quality assets
and the best people. Over the
years, we have consistently
focused on delivering good
health to those who need it,
meeting the unmet needs of
patients and thereby
accelerating access to much
needed medicines. We are
building an organization on the
foundation of operational
excellence, with a strong
innovative products pipeline
and a sustainable business
model that is value-accretive
for all our stakeholders.
09 | Interaction with our CEO
Dr. Reddy’s has been publishing
sustainability reports for past 10
years. How has sustainability at
Dr. Reddy’s evolved?
As a company we place a huge
emphasis on doing things the
right way - an approach that
permeates every aspect of our
business including our
commitment to the
environment. We take our
responsibility to the planet and
society very seriously. This
means that we are constantly
finding ways to ensure that the
way we develop, manufacture,
and market our products has
minimal impact on the
The SMT program is one of our leading
interventions that successfully drives meaningful
change and responsible empowerment on the
shop floor.
environment. We are constantly
refining all our processes to do
things more resource
efficiently, gradually reducing
our carbon footprint and
making our operations much
more sustainable. While this is a
continuous journey, I am happy
to say that sustainability is
ingrained in the way we work.
What have been the key
sustainability highlights of FY
2015-16?
There are several
accomplishments that we are
very happy about. For instance,
all our plants are designed for
zero liquid discharge, which
means that all the liquid waste
and effluent generated is
treated within the premises and
reused. We upcycle 86% of our
organic waste by identifying
and supplying it to other
industries, who can use it as
raw material. Today, we meet
more than 13% of our energy
needs from renewable sources
which is a noteworthy increase
compared to the previous year.
During the year our focus was
on energy conservation across
our business units which
resulted in significant savings
thereby demonstrating the
business case for sustainability.
Water being critical to
sustainability of our business
and the greatest means for
survival of humanity at large,
we continue to deeply focus on
enhancing the capacity of
rainwater harvest year on year,
making a positive impact on our
planet through ground water
recharge.
We have also made significant
investments of time and
resources in strengthening the
three foundational aspects of
operational excellence –
People, Systems & Processes,
and Technology. We set out to
rewire our quality systems from
ground-up. This involved
overhauling our Standard
Operating Procedures by
removing redundancies,
simplifying, creating better and
more complete procedures, and
harmonising the entire system.
We made changes in our
organization design to focus on
the quality of our products
throughout their life cycle,
while also providing vital
integration between product
development, quality and
manufacturing on an ongoing
basis.
The SMT program is one of our
leading interventions that
successfully drives meaningful
change and responsible
empowerment on the shop
floor. This year, we extended
the spread of SMTs to more of
our existing facilities.
Our Corporate Social
Responsibility activities go well
beyond that stipulated by the
Government of India. We
primarily focus on three broad
areas – education, livelihood
and healthcare. In FY2015-16,
more than 12,000 students in
rural Telangana benefitted
through our School
Improvement Programme. We
trained over 7,000 young adults
to help them obtain secure
livelihood. Through the
Community Health Intervention
Programme (CHIP), we
conducted medical screening
camps that benefitted over
7,500 people across 145
villages. We celebrate the
Week of Giving, annually, in
memory of our founder Dr. K
Anji Reddy, in which the entire
organization participates across
globe.
What will it take for Dr. Reddy’s
to assume the leadership
position in India's
pharmaceutical sector? Is there
any particular message that you
would want to highlight to your
stakeholders?
Dr. Reddy’s today already has a
strong core business with a
valuable product portfolio and a
position of relevance in several
markets. Our current portfolio
of complex generics and
biosimilar is very valuable to
patients across the world,
because of the affordability and
access to expensive medicines
that we provide. Our effort will
be to strengthen this important
portfolio on one hand, while
globalizing these assets to
maximize the reach of our
medicines to patients who need
them around the world.
The other dimension of our further our innovation agenda;
growth strategy is our focus on increasing focus on biologics
creating our own portfolio of and developing innovative
internally conceptualized and proprietary products targeted
developed novel products to at unmet medical needs; and
address unmet medical needs. continue to invest in
We now have a strong pipeline value-added services to
of novel products in various improve patient outcomes.
stages of development. I am
confident of our progress to We take a holistic approach and
help patients in their journeys to look forward to a greener
good health through innovative future where the combination
products. of our efforts in terms of energy
In FY 2015-16, more than 12,000 students in rural
Telangana benefitted through our School
Improvement Programme. We trained over 7,000
young adults to help them obtain secure
livelihood.
Finally, of course, we are and water conservation,
preparing for change. The reduced use of solvents, waste
future of healthcare will be very recycling, engineering
different from what we know it excellence and material
as today. The industry is efficiency will ensure minimal
changing at a rapid pace, and it impact on the planet as we
is reasonable to expect that the pursue our goal of accelerating
traditional models as we know access to affordable and
them today will get disrupted. innovative medicines.
We are preparing for this new
world by exploring and piloting G V Prasad
concepts based on deep Co-Chairman & CEO
insights at both ends of the
spectrum - from the Science to
the patient experience. These
are early days yet, but we
expect that our focus on this
area will prepare us for the
future. Dr. Reddy’s has always
prided itself in being a pioneer
in the pharmaceutical industry.
We will continue to explore the
frontiers of our industry.
What are the sustainability
opportunities that you envisage
Dr. Reddy’s to encounter over
next three years?
Our priorities over the next
three years will be on: being the
first to market with
“tough-to-make” products and
differentiated formulations;
globalizing R&D efforts to
Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 10
 hat we are today
As a responsible player in the pharmaceutical industry, we have
made significant progress in ensuring good health and we recognise
our role in delivering good health to those who need it, and to
promote wellness among them.

Dr. Reddy's is a global organisation with offerings spanning the entire

pharmaceutical value chain. These include active pharmaceutical
ingredients, branded formulations, generic drugs, biologics and
specialty products. Our businesses are designed to deliver Good
Health by accelerating access to affordable and innovative
medicines.
 Our businesses Biologics
Proprietary
Products
Custom
Pharmaceutical
Services

Patient centricity is core to our approach and we strive to build awareness Biologics, or biologically Our Proprietary Products We have one of the largest
among the practitioners, patients and their families to help them take right synthesised medicines, are business focusses on custom pharmaceutical
increasingly preferred for the developing differentiated services business in India. We
decisions and participate in their own care. We work tirelessly to create an treatment of diseases like formulations that present offer end-to-end product
environment of innovation and ensure that patients across the world gain cancer and auto-immune significantly enhanced benefits development, manufacturing
access to affordable medicines. We carefully design our product mix to offer disorders. Our biosimilar, in terms of efficacy, ease of use services and solutions to
generic equivalents of the and the resolution of unmet innovator companies. Our
solutions for unmet medical needs and create better access to medicines. innovator's biologics, offer patient needs. For instance, this clients have access to the best
affordable yet equally effective involves developing a new technologies and a global
alternatives. Dr Reddy’s leads dosage of a current drug or new delivery network. We have a
the industry with four biosimilar combinations of synergistic well-earned reputation of
products currently marketed medication. The aim is to bringing innovations to the
Over the Active and an extensive development improve the patient's holistic market quickly, efficiently and
Generics pipeline. experience with our medicines, economically
counter Ingredients
so as to strengthen compliance
with the therapeutic regimen
and ensure positive outcomes.
Our Generic Formulations We actively develop We began as an Active
business offers more than 200 appropriate over the counter Pharmaceutical Ingredients
high-quality generic versions of products that do not (API) manufacturer and have
expensive innovator medicines necessarily need a doctor's consistently built on our
at an affordable cost in over 20 prescription. We make and strengths in this area through
countries around the world. market Over the Counter (OTC) the years, becoming one of the
Generic Formulations, including medicines in the areas of pain top producers of APIs in the
tablets, capsules, injectable, management, dermatology and world. During this journey, we
and topical creams, is the allergy management areas, and have developed deep technical
largest part of our business gynaecology. In the coming strengths in the development of
portfolio, making products years, we will continue to complex APIs such as steroids,
across the major therapeutic explore offering OTC versions peptides, complex long chain
areas of gastrointestinal of our generic products as synthesis and oncology
ailments, cardiovascular regulations allow.
disease, pain management,
oncology, anti-infective,
paediatrics and dermatology.

13 | What we are today Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 14

 Our therapeutic focus
Going beyond the pill: Over the last three decades, we have evolved from a
maker of active Ingredients to a patient-centric company with a global
footprint. Our development efforts also focus on creating newer
combinations as well as exploring new delivery mechanisms to improve
patient comfort, convenience and efficacy.
Gastro-
Oncology
enterology
We have developed a broad Dr Reddy’s has developed a
range of high-quality cancer broad portfolio of acid
care medications. Across the suppressive medications to
spectrum of cytotoxics, address Gastroesophageal
targeted therapies and reflux disease (heartburn), and
supportive care, our range is other gastrointestinal disorders
designed to effectively combat such as irritable bowel,
cancer and the side effects diarrhoea and constipation,
associated with the therapy. which are becoming widely
Oncology is also the field prevalent worldwide. We have
where we’ve successfully recently ventured into
demonstrated our cutting-edge Hepatology segment to address
research and development the patient needs of Hepatitis B
capabilities. and Hepatitis C, providing
affordable medications to more
people.
15 | What we are today
Cardio-
vascular
Changing lifestyles and dietary
patterns are causing an
unprecedented surge in the
incidence of cardiovascular
diseases, including
hypertension. Responding to
these needs, we have
developed a wide and varied
portfolio of anti-hypertensive
medicines to bring good health
to the millions affected by this
condition.
Anti-Diabetic
Dr. Reddy’s has a number of
established products like
Metformin, Glimepiride,
Glicazide and their
combinations in its portfolio, to
ensure good health to diabetics.
Many of our development
efforts focus on initiatives to
help improve patient
compliance. For example, we
successfully developed a
patient-friendly dosage form of
Metformin that was easily
swallowed, and helped the
patient stick to the prescribed
treatment regimen.
Dermatology
Dr Reddy’s has proven
expertise to develop solutions
for health conditions such as
Seborrheic Dermatitis,
Psoriasis,
Corticosteroid-responsive
Dermatoses, various types of
Dermatitis, Actinic Keratosis,
Rosacea, Warts and Acne. In
fact, some of our OTC products
in the area of trichology and
hair regrowth are leading
brands in their own right.
Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 16
Pain
Management
Dr. Reddy’s has a number of
established products – both
generic and branded generic –
that address a wide range of
pain conditions. Products such
as Nise, our brand of
Nimesulide, is one of the top
300 brands in the Indian
pharmaceutical market, for
instance. Apart from
Nimesulide, we have a number
of other products including
Ketorolac and Hyaluronic acid
that form a significant part of
our portfolio.
 Our value chain Performance highlights

Research and
Development

6.3 %
412
Reduced
specific Social
energy impact
consumption investment INR million
increased to
Ingredients Product
sourcing manufacturing

Millions
impacted through programs
like
Green
Product Operating
SIP, CHIPS chemistry
packaging procedures Helped to reduce
and and order waste, use of

13.6%
Renewable
warehousing management energy toxic solvents and
usage across conserve water
Dr. Reddy’s

Patient
management
INR million 213
invested to reduce environmental
adversities from disposal of waste
and care

17 | What we are today Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 18

 bout this report
We have spearheaded an integrated approach for measuring,
managing and disclosing our environmental, social and economic
impacts to our stakeholders.
 About this report
Dr. Reddy’s has been at the forefront when it comes to disclosing information
on its triple-bottom-line. We are the first Indian pharmaceutical company to
be registered under Global Reporting Initiative (GRI) database.
We published our first Safety,
Health and Environment (SHE)
Report in 2001, and have been
regularly publishing our
Sustainability Reports since
2004. With the guidance from
our senior management, we
have gone for third party
assurance for our Sustainability
Report of FY 2013-15 and we
continue to do that in this
FY 2015-16.
Since inception, we have
always operated in a safe and
responsible manner,
consistently demonstrating our
commitment to responsible
corporate citizenship. Though
inclusive growth, environmental
stewardship and effective
stakeholder engagement, we
now focus on ensuring that
Good Health is delivered to our
patients with clear and tangible
sustainability benefits across
stakeholder groups, as
described in sections of this
report.
The scope of this report covers
our operations across India and
the reporting period considered
is from April 1, 2015 to March
31, 2016. Where possible we
have provided comparative
data from the previous
reporting period. This report
has been developed with a
commitment to disclose our
sustainability performance
transparently.
The information represented in
21 | About this report
the report is sourced from our
various systems as well as from
respective plant locations.
Though we have presence in 26
countries, for the purpose of
this report, to describe our
endeavours and impacts of our
initiatives on environment and
society, we have defined our
significant locations of
operation as in and around our
manufacturing facilities located
primarily in Andhra Pradesh,
Telangana and Himanchal
Pradesh.
There has been no significant
change in our operations and
supply chain in the FY 2015-16
in terms of location, closure or
expansion. We recognise the
need to further strengthen our
measurement systems for
certain indicators and we are
currently establishing systems
to capture a wider set of
metrics. Case studies have
been used to further illustrate
our company’s approach to
sustainability.
We welcome your valuable
inputs on the report, please
write to Mr. Alok Mehrotra at
alokm@drreddys.com to share
your feedback.
The report has been
prepared in
accordance with
the guidelines of
the Global
Reporting Initiative
(GRI G4)
Framework’s ‘Core’
option.
Sustainability is not
new to us; and this
report represents
Dr. Reddy’s 10th formal
disclosure on our
non-financial
performance and
impact.
Engaging our stakeholders
Stakeholder engagement is an important aspect of our sustainability journey
and is carried out across our business through different functions and
operations, as described in this report.
We firmly believe in an inclusive
participatory approach that
values the voices of our
stakeholders.
Our key stakeholder groups
include our patients, investors,
governments and regulators,
employees, business partners,
suppliers, local communities
and health professionals.
Employees
Modes of engagement
— Organisation Health Index
— Publications (in-house):
Around Dr. Reddy's (Monthly)
| Elixir (Quarterly)
— Intranet (Round-the-year)
— CEO & COO
Communications (Quarterly)
— 360◦ feedback
— Celebrations
— Sustainability focussed
interviews and Focus Groups
— Circulation of sustainability
report
— Employee satisfaction
surveys
— Team building workshops
— Capacity building and
training
— Grievance redressal
mechanisms
Engaging with these As a result of this dialogue, we
stakeholders helps us establish have been able to draw linkages
and maintain an inclusive into defining the materiality
relationship with them. While assessment process for our
the inputs from our business. This helps us in
stakeholders help us putting the lens over issues of
understand their needs and importance to our business and
expectations, addressing their to our stakeholders and
concerns help us to establish formulating our overall
lasting partnerships based on sustainability strategy.
trust. We are striving to embed
their concerns while designing
our key sustainability focus
areas.
Topics and concerns
— Occupational health and
safety
— Career planning and
development
— Market based compensation,
benefits and amenities
— Employee Welfare
— Collective bargaining/
freedom of association
— Diversity at workplace
(gender, ethnicity, disability)
— Contract labour management
practices
Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 22
 Patients
Modes of engagement
— Dr. Reddy's Foundation for
Health Education (DRFHE)
meets
— Mobile Medical Van - Life At
Your Doorstep
— Living Well programmes in
association with Art of Living
— Sparsh
Investors & Shareholders
Modes of engagement
— Investor and analyst meets
— Industry forums
Presentations
— Annual / Sustainability report
— Emails on financial results
— Corporate website
— Quarterly and annual results
publication
— Earning calls with analysts
and investors
Business Partners & Suppliers
Modes of engagement
— Face to face interactions
— Vendor meets
— Strategic business partner
training and development
23 | About the report
Topics and concerns
— Affordable medicines
— Access to healthcare
— Emergency medicines
— Cure of difficult diseases
Topics and concerns
— Economic performance
— Sustainable wealth creation
— Risk management
— Responsible investment
— Sustainability reporting and
disclosures
— Investments in new products
and processes
Topics and concerns
— Economic growth
— Business ethics
— Transparency
— Status of Compliance
— Training and development of
partners and suppliers
— Environmental footprint of
operations
— Social accountability
Government & Regulators
Modes of engagement
— Face to face meetings with
ministries and regulators
— Structured engagements
through audits
— Participation in forums/
seminars
— Policy Advocacy
Communities & NGOs
Modes of engagement
— Direct engagement at facility
— Dedicated CSR team
— Initiatives and healthcare
projects
— Visits and camps
— DRF - Creating Sustainable
Livelihoods
— DRFHE
— Roundtables and workshops
Healthcare Professionals
Modes of engagement
— DRFHE – PG Diploma in
Health Management
— Case Manager's programme
for cancer counselling
— Inner Circle - relationship
building programme
— Abhilasha - nursing
efficiency
— Sarathi - doctor's assistant
programme
— Compliance
— Energy & water consumption
& conservation
— Climate change impacts
— Socio-economic impacts
— Green growth
— Pollution prevention
Topics and concerns
— Infrastructure development
— Education & healthcare
— Environmental protection
— Employment opportunities
& Employability
— Human rights
Topics and concerns
— Employability and
employment opportunity
— Career planning and
development
Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 24
 Validating material issues
We have adopted an approach to sustainability management, focusing on
materiality: identifying economic, social, environmental and governance
related issues that matter the most to our business and to our stakeholders.
We have adopted an approach
to sustainability management,
focusing on ‘materiality’, based
on the GRI G4 guidelines. We
understand materiality is about
identifying economic, social,
environmental and governance
related issues that matter the
most to our business and to our
stakeholders.
In FY 2015-16, we have
validated the key focus areas
based on the following:
Face to face interactions
guided by a structured
questionnaire with 17
representatives of senior
leadership and functional
heads (including the
chairman and co-chairman)
at the corporate office who
also acted as proxies for our
external stakeholders
–especially the patients,
investors, and the
communities. The senior
management interactions
were designed to elicit the
material aspects for the
organisation and how the
aspects are impacting the
stakeholders within and
outside the organisation.
Developing a universe of
sustainability issues and
obtaining materiality scores
(high, medium, low) on all the
issues from 13 representatives
of the senior management to
finally arrive at issues of
importance to Dr. Reddy’s (i.e.,
25 | About this report
issues that are rated as high by
most of them)
Conducting a brainstorming
session on materiality with
about 30 representatives of
the middle management of
different Formulations Plant
and API Manufacturing
locations at Hyderabad,
Visakhapatnam and Baddi. The
session was conducted at Dr.
Reddy’s corporate office and
all the plant locations were
connected through video
conferencing. The team
rated the universe of
sustainability issues as high,
medium, low against
Dr. Reddy’s Business Success
Factors (e.g. brand
value/reputation, cost
savings, access to new
markets etc.) as perceived by
them.
Face to face interactions with
the plant or operations heads,
representatives of Human
Resource (HR) and CSR teams
and employees from
management and
non-management cadre (e.g.
Self-Managed Teams or
SMTs) at different plant
locations – API
Manufacturing Unit 3,
Formulations Plant 3, API
Manufacturing-Special
Economic Zone (SEZ),
Formulations Plant -7 to
understand the material
issues from day to day
operations perspective,
issues raised by the local
community and key
expectations of the employees,
etc.
These inputs were then
consolidated and reviewed by
the management to validate Dr.
Reddy’s sustainability focus
areas as listed below. The
exercise has served as a guiding
tool for us to focus our
sustainability disclosure around
these material topics and
strengthen our monitoring and
reporting practices. `In
harmony with our six
sustainability focus areas, we
have identified nine pillars of
sustainable operations with
defined goals and clear targets,
aimed at securing positive
impacts across sustainability
parameters.
Our material issues:
— Affordable and
Innovative Medicines
— Environmental
Management and
Climate Change
— Being an Employer
of Choice
— Product
Responsibility
— Sustainable Sourcing
— Caring for
Communities
Defining boundaries
Going forward we will expand our materiality assessment process to include
a broader sample of both internal and external stakeholders, revisiting the
issues that may have a significant impact on our business.
Sustainability Management Material GRI G4 Aspect
Focus Area Approach Aspects Boundary
Ensuring robust pipeline of Economic Internal and
complex generics as well as our Performance, Indirect External
Affordable and new proprietary products for Economic Impacts
Innovative medicines unmet medical needs; custom
pharmaceutical services
Safety, Health and Environment Energy, Water, Internal
Policy, ISO 14001 certification, Emissions, Effluent
Environmental zero discharge facilities, and Wastes, Materials,
Management and Programme to Achieve Cost and Overall
Capabilities Excellence (PACE);
Climate Change
increasing the renewable energy
mix, recycling waste, carbon
reduction initiatives
Code of Business Conduct and Employment, Ethics and Internal and
Ethics; using technology that Integrity, Occupational External
Being an Employer allows us to redeploy our Health and Safety,
of Choice human resources towards value Training and Education,
added and more productive Diversity and Equal
work; SMTs, expanding training Opportunity, Freedom of
and development initiatives. association & collective
bargaining, Child labour
Building an organisation on the Products and Internal and
foundation of operational Services, Economic External
Product excellence to ensure product Performance
Responsibility quality through structural changes
across product life cycles by
providing vital integration
between product development,
quality and manufacturing
Local sourcing and improving the Procurement practices, Internal and
capacity and capabilities of local Supplier environmental External
Sustainable producers; optimisation of the assessment, Freedom of
Sourcing supply chain based on forecasting association & collective
– I^2 Intelligent Integration; bargaining, Child labour,
increase in sea shipments; Supplier human rights
maintaining optimal safety stocks; assessment
Continued focus on three Local Communities, External
broad areas – education, livelihood Indirect Economic
Caring for and heath care; Other projects: Impacts
Communities CHIP, Livelihood Advancement
Business School (LABS); and School
Improvement Program (SIP);
Increased CSR spend.
Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 26
 r. Reddy’s way
We continuously adapt to the evolving nature of societal
needs and remain committed to professional and ethical
business conduct.
 Dr. Reddy’s way Our sustainability journey
At Dr. Reddy’s, we firmly believe that Good Health Can’t Wait. We are driven
by an imperative to accelerate access to affordable and innovative medicines
to people who need them. 2004 2005 2006 2007
Pioneering Balancing Internalising Translating
sustainability short-term sustainability principles into
reporting in the Indian profitability principles within actionable steps
With a strong presence in key the markets we serve, we focus We strive every day to pharmaceutical sector with long term the organization
generics markets globally, our our efforts in developing do what matters most sustainability
medicines and services are products to meet the unmet
available in North America, demand; and increase to patients —
Europe and the emerging affordability and accessibility accelerating access to
markets of Asia, Africa and with minimal impact on the affordable medicines
South America. This helps us environment. We remain 2011 2010 2009 2008
stay close to needs of patients, resilient to the needs of patients and finding intelligent
doctors, healthcare providers while creating healthy solutions for unmet Introspecting our Going beyond Crystallizing Integrating
and business partners, ecosystems and strong performance compliance sustainability into sustainability into
therapeutic needs. across key 6 focus areas business strategy
wherever they are. communities.
sustainability
Sustainability at Dr. Reddy’s is Our stakeholders have varied indicators
about creating value. It is about expectations that extend
changing the paradigm of how beyond financial goals and legal
we operate our business and requirements. Our efforts to
understand expectations of our integrate sustainability within
stakeholders, especially operations helps us create 2013 2014 2015
2012
patients. Driven by macro long-lasting value for our
trends and changing needs in stakeholders. Seeding a Triggering strategic Benchmarking Shifting gears from
‘sustainability by actions and operational incremental
design’ approach outcomes, evolving excellence with developments to
across all operations to ‘sustainability in sustainability gold accelerated actions
progress’ standards across 9 pillars of
sustainable
operations

2016
Deepening impact
through strategic
interventions across
sustainability metrics

29 | Dr. Reddy’s way Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 30

 Sustainability
Governance
The globalisation of challenges
is the signum of our age. They
may manifest themselves as a
lack of security, wealth, health,
happiness, potable water, fresh
air, or fertile soils at many
levels: personal, local, regional,
and national. Defining these
challenges and integrating them
into our governance model
makes it necessary to redefine
our purpose and how we
measure success. We see the
evolution of corporate
governance as vital to building
sustained value by seamlessly
integrating environmental and
social risks and opportunities
into long-term business
strategy.
We have firmly embraced
sustainability principles in our
day to day operations by
striving to strike a balance
between economic success,
environment protection and
social responsibility. Over the
years we have implemented
policies and programs to ensure
we remain focused on our core
objective of delivering good
health.
31 | Dr. Reddy’s way
Sustainability
Strategy
Demographic shifts including
rising population, rise in the
middle class and ageing
population demand new
directions in the delivery of
healthcare. We align our actions
taking into account these
externalities and accordingly
develop approaches to
delivering good health while
minimising our impact on the
environment. We have crafted a
strategy “Dr. Reddy’s Way” to
gradually deepen sustainability
thinking with our business
philosophy.
Through this approach we seek
to build world-class, patient
centric operations that are a
source of competitive
advantage to help us deliver on
customer expectations, safety,
quality, cost and environment
through highly engaged
employees by leveraging
technology. We have
transformed our business to
infuse value across healthcare
services – from the pill to the
patient – helping people across
the world gain access to
affordable healthcare and get
back to good health.
Sustainability
Framework
Sustainability is an expansive
lens and it is important that we
identify our key priorities so
that we can align time,
resources and investment to
deliver triple-bottom-line
impact. We narrowed in on our
material sustainability issues
based on surveys, interviews
and desk research from our
patients, clients, employees,
regulators and NGOs.
Our Sustainability Framework is
defined by focus areas that are
aligned with our principal
business and operational risks,
informing our sustainability
strategy. A solid review of
material sustainability issues
forms the basis of sound
sustainability disclosure; and
we adjust the focus areas, as
the external and business
context changes, to ensure that
it still works as a useful toolkit
to help us manage our
sustainability agenda and
continuously improve our
performance.
Our Sustainability Framework
comprises 6 focus areas and
these are closely mapped with
our 9 pillars of sustainable
operations so that our
sustainability focus gets
reflected in our day to day
operational endeavours.
Sustainability focus areas
Environmental, social and governance metrics are managed through
Dr. Reddy’s sustainability framework, which is implemented and monitored
under our sustainability strategy, driving the 9 pillars of sustainable
operations. By tailoring our approach with specific operational goals,
Dr. Reddy’s has woven the principles of sustainability into all our operations.
This helps infuse ownership of our sustainability goals across all of our
operations.
Affordable and Product responsibility Environmental management
innovative medicines and climate change
Patient-centricity is vital to our
By reducing costs through product responsibility We have institutionalised an
efficient use of resources and approach. To monitor the 'Environmental Commitment
processes we strive to push efficacy, safety and stability of Statement' that articulates
down our product price. We our medicines, we have in place measurable targets for each key
have broadened our generics a competent environmental performance
footprint by introducing new pharmacovigilance team indicators – energy, emissions
products, entering new markets responsible for detection and water and waste. Our
and penetrating deeper in prevention of any adverse environment stewardship
existing ones. We work towards effects of our products. All our extends beyond our premises
enhancing the efficiency and products meet regulatory and and we actively educate and
efficacy of medicine by safety standards and approvals, encourage, our vendors and
developing differentiated ensuring consistent quality partners to adopt environment
formulations that facilitate easy from development and dispatch friendly practices.
and calibrated dosages to to consumption.
enhance patient comfort. Caring for the communities
Sustainable sourcing
Being an employer of choice We pursue community care
From local sourcing and raising with the same efficiency and
Every individual's effort is awareness to empowering them meticulousness with which we
valued, nurtured and rewarded. through training, from pursue our business. Our social
An egalitarian ecosystem, equipping them with various responsibility begins right from
purpose-driven work culture, tools and technology to community engagement, need
cross-functional growth extending resource assistance. assessment, intervention
opportunities, human dignity We proactively help our supply development, pilot run projects
and work-life balance are key chain partners to raise their and SOP definition, to scale-up
ingredients of our employee sustainability quotient. We and collaborations. We go
value proposition. We focus on strive to optimize our supply beyond philanthropic
identifying, selecting and chain to streamline costs, assistance to create real
nurturing talent from all groups helping us deliver affordable opportunities, building
including those disadvantaged healthcare solutions. This capabilities and empowering
and provide them with a canvas enhances their sustainability those who need them.
to shape their professional and performance and productivity.
personal goals.
Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 32
 The nine pillars
People
Hired 2500 talented rural youth
through Self Managed Team
(SMT) route transforming their
lives.
Over 100 leaders have
completed the New Horizon
Leadership Development
Program (NHLP) since its
inception in 2012.
Over 1400 employees are
engaged in higher education
programs.
Diversity at API manufacturing
increased from 7.6% to 10.3%.
Overall attrition reduced from
22% to 16% at API
manufacturing.
33 | Dr. Reddy’s way
Safety
Reported zero fatality for 2
consecutive years.
Installed aerosol fire
suppression systems at
formulation units for better fire
and safety management.
Advanced sprinkler systems
implemented at API
manufacturing SEZ.
Implemented safety across
value chain from R&D till
product manufacturing,
packaging and warehousing.
Near miss reporting has
significantly improved.
at API manufacturing
from 707 in FY 2014-15 to 3263
in FY 2015-16
at Formulations
from 3674 in FY 2014-15 to
4208 in FY 2015-16.
Quality
In formulation plants:
Introduced closed loop
operations.
Minimized operational errors
by introdcution of recipe based
systems, automated cleaning.
Total 34 quality improvement
projects implemented based on
"Define, Measure, Analyse,
Improve, Control" (DMAIC)
methodology.
In API manufacturing:
Increased compliance through
implementation of IT
innovations.
Environment
Fresh water consumption
reduced by 6.87% overall at
Dr. Reddy’s.
27% decline in "waste to
landfill" in FY 2015-16.
Invested INR 213 million for
advanced treatment and safe
disposal of waste.
Nearly 3,000 TPA of potassium
salt generated from
evaporation processes, is
disposed to authorized
recyclers to produce valuable
fertilizers.
96.3% of the organic waste
generated in API manufacturing
is used as auxiliary fuel in
cement plants.
Implemented 31 energy
conservation projects & saved
INR 63.54 million.
Productivity
Standard manning number
derived for all processes based
on Manyard Operation
Sequence Technique (MOST) to
optimize human resource in
Formluations.
368 manpower resources
redeployed for productive
utilization in Formulations using
MOST.
Savings from yield
improvement in Formulations-
INR 240 million against a target
of INR 150 million for
FY 2015-16.
Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 34
Community
Community investment at INR
412 million has doubled in
FY 2015-16.
Health: Community Health
Intervention Programme
reached out to 145 villages, 0.2
million population.
Livelihood: Supported 18,000
farmers with technology
through LABS for Farmers
(LABS-F) program.
Education: benefitted more
than 12,000 students in rural
Telangana through the School
Improvement Programme.
Under the ageis of Swacch
Bharat, conducted sanitation
assessment in 167 schools and
deployed sanitation assistants
in 59 schools.

Availability
New products launched from
formulations: Memantine,
Pramipexole, Pantaprozole
(China), Esomeprazole,
Rabeprazole (Australia).
Global Generics Intelligent
Integration (i^2) project was a
recipient of SAP ACE award for
supply chain excellence.
Reduction in average inventory
by 20 days.
Lower cost of supply chain
operations by optimizing
transportation, automation of
planning, execution & reporting
across the entire global supply
chain network.
35 | Dr. Reddy’s way
Continous
Improvement
Total savings of INR 458 million
from yield improvement, waste
elimination, green & black belt
projects in Formulations.
INR 55.7 million savings
realised from 120 improvement
projects.
Employees trained in Lean 6
Sigma at Global Manufacturing
Organization - 185 Green Belts,
578 Yellow Belts, 1237 White
Belts and 20 Black Belts.
Launched Engineering Star
Caps - additional responsibility
allocated to a work team
member for a year in the area of
Engineering, as a part of broad
skilling and empowerment.
Engineering
Excellence
Recipe management
implemented in Formulations
leading to avoidance of manual
errors, reduced physical
checks, robust data
management.
Implemented Level 2
Integration in Formulation
business unit that facilitates
direct data transfer from the
instrument to the operator
system which eliminates
manual interventions.
Implemented direct Data
Aquisition System in API
manufacturing that has led to
reduced human errors and
optimised time of operation.
Integrated preventive and
breakdown maintenance and
calibration in SAP leading to
increased compliance,
improved productivity in
Formulations.
Creating sustainable livelihoods
LABS was launched in 1999 to
address the needs of
economically weaker and
socially constrained youth
(18-35 years) to enable them to
gain a foothold in the
competitive job market. LABS is
aimed at vocational training and
soft skills development in an
environment of interactive
learning and mentoring that
strengthens their inherent
capabilities. Operational in over
132 centers across India, this is
one-of-its kind business school
tells the collective success
story of tens of thousands of
economically disadvantaged
youth, and of their journey to
self-respect and financial
independence.
LABS training courses are of
3-4 months duration, in which
the aspirants are given
technical inputs prepared in
consultation with industry
experts and professionals. To
enable the aspirants to face the
world confidently, they are also LABS is operational over
trained in various life skills such
as positive thinking, self-esteem
communication, team building,
132 centers
across India
decision-making, Strength,
Weakness, Opportunities and
Threats (SWOT) analysis, goal In FY 2015-16, we trained
setting, gender issues, time and
money management. As the 7,128 young people
ability to speak fluently in under LABS through our
English is an important supported centers
prerequisite at the workplace, a
‘Communicative English’
module has been designed to Since inception more than
give the aspirants practice in
public speaking and
290,000 young
marginalized youth across the
interpersonal communication
country graduated through
techniques based on real-life
LABS with specialized skills and
situations. The aspirants are
are economically independent
also put through a
comprehensive apprenticeship
training, which helps them
experience real-life work
situations. In FY 2015-16, we
trained 7,128 young people
under LABS through our
supported centers.
Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 36
 Integrating the supply chain
to deliver quality
Traditionally companies
maintain excess inventories or
use firefighting options like air
freights & rush order
processing to react to
fluctuations in customer needs
or capitalize on unforeseen
market opportunities. This
approach entails high cost of
stocking inventory &
Integration” project. By better
integrating the supply chain for
our Global Generics business at
Dr. Reddy’s, we are able to
optimize efficiencies and
provide our medicines where
and when they are needed.
Translating supply chain best
practises into tangible business
characteristics such as sales
value, demand variability and
plant volume and system based
capacity planning. This has
created complete viability
across the supply chain since all
demand inputs, supply
constraints and material plans
are inbuilt into one system,
leading to faster and effective
Mitigating environmental impacts
to deliver cleaner products
Eslicarbazepine acetate is
considered to be a second
generation drug to
oxacarbazepine and a third
generation drug to
carbamazepine, meant for
treating epilepsy. As a pro drug
to (S)-licarbazepine,
Eslicarbazepine acetate is
evolved in order to have
which by design, yielded a
maximum of 50% conversion.
This process left behind almost
the same quantity of material as
waste, along with a significant
quantity of liquid and solid
effluents. We adopted an
asymmetric reduction method,
allowing for 80% yield. We also
avoided a significant amount of
Focus on waste reduction,
operational efficiency
improvements and carbon
footprint reduction
Implemented 31 energy
conservation projects across
various business units, and
accrued savings of

operations, carrying the risk of
obsolete inventory write-off,
which are not viable to sustain
and thus there exists a struggle
to reach the desired supply
success was realised by
leveraging technological
capabilities, where end to end
integrated planning solutions
like SAP Advanced Planning
decision making to deliver on
our promise of Good Health
for all.
After the successful
improved efficacy and safety
preventing the formation of
toxic epoxide metabolite. Our
previously reported synthesis
involved a resolution strategy,
63.54 million
waste. As a result, our
manufacturing process has
become energy efficient. during the year
Renewable energy usage

chain optimization between
customer service levels, cost &
inventory. Well-designed
systems are essential to realise
seamless end-to-end supply
chain integration of planning &
execution.
To circumvent these challenges,
we have leveraged
technologies and tools through
the “i^2 - Intelligent
and Optimization (SAP APO) &
execution systems like SAP ERP
Central Component (SAP ECC)
are embedded with the
differentiated pharma specific
supply chain optimization logic
& business rules. Some of the
key features of our integrated
system include – forward
demand projections based on
past consumption and market
intelligence, mapping
13.6%
implementation of i^2, we have
been able to maintain a across
customer On Time, In Full Dr. Reddy’s is
(OTIF) of 95%+ in key markets
with a reduction in average
inventory and lower cost of
supply chain operations by
optimizing transportation &
through automation of
planning, execution & reporting
across the entire global supply
chain network.

Maintained a customer On
Time, In Full (OTIF) of 95%+
in key markets

Seamless end-to-end supply

chain integration of planning
& execution

Reduced inventory and

lower cost of supply chain
operations by optimizing
transportation & automation
of planning, execution &
reporting

37 | Dr. Reddy’s way Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 38

 Making an impact with a diverse
and empowered workforce
We at Dr. Reddy’s periodically
renew our HR strategy to better
engage with people and drive
productivity across our
21,000-plus employees
worldwide. Currently, our HR
Strategy is designed to place
our People Managers at the
heart of all our employee
practices. In this, we have
stepped up our investments in
leadership development and
talent management programs.
Our focus on leadership
development and talent
management was further
strengthened this year. We
continue to invest in our
leadership development
program (NHLP) which is built
on the four tenets of ‘Lead Self,
Lead Others, Lead Change and
Lead Business’. The participants
are beginning to show
39 | Dr. Reddy’s way
significant shifts in their
development journey and the
organization is benefiting
through unique breakthrough
projects that have been
undertaken.
Dr. Reddy’s is an employer of
choice for women. We lay
special emphasis on helping our
women colleagues grow
professionally and personally as
a part of our strategy to attract
and retain the best talent in the
industry. This year we made
distinct progress in this area
and rolled out our enabling
policies and programs to help
enhance gender diversity. By
identifying potential roles for
women, setting up on-site
crèches, promoting visibility
within the organization and
launching women-friendly
policies such as flexible
working hours pre and post
maternity, organizing regular
health talks for work-life
balance, we were able to foster
a working environment
conducive to women’s needs.
Over 100 leaders have
completed the New Horizon
Leadership Development
Program since its inception in
2012.
Attrition rate for women
reduced from 11% to 7% this
year.
12 female centric hiring drives
conducted at API
manufacturing.
Leveraging technology to deliver
better quality
We see digitization as a means
to our goal of affordable Reduction of total calibration
orders from 41225 to 21697 in
medicine and accelerated
access. It helps improve
productivity, boost quality and
enhance safety, while reducing
costs. We have sped up digiti-
Formulations through digitization
zation across the entire value
chain - be it drug discovery,
clinical trials, preventive main-
tenance and calibration, opera-
tions or distribution. To drive
these projects, a digitization
2784 log book reduction in
formulations through SOP
project structure is in place.
The structure comprises plant
teams, who report to the
Manufacturing Execution
harmonization
System Centre of Excellence
(MES CoE), which in turn
reports to the Central Steering
Committee of Digitization
Project Management Office.
Reduced ~6610 man-days
These efforts are implemented
through three significant
projects – Manufacturing
Execution System, Laboratory through mobile app for
Information Management
System and Learning Manage-
ment System.
preventive maintenance
Our innovation in the space of
development of mobile applica-
tion for preventive maintenance
and calibration activities in
Formulations has led to minimi-
zation of manual error, paper-
less operation, and reduced
man-days.
Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 40
 Corporate governance
We have incorporated policies and practices within our organisation to
ensure that the highest levels of ethical conduct, by all employees and
management are adhered to.
Dr. Reddy’s is committed to
ensuring that its operations are
carried out in an environment
built upon fairness,
transparency and
accountability. We believe that
fostering a culture of integrity
will help us build trust amongst
our stakeholders.
At Dr. Reddy’s the Board of
Directors provides direction,
supervision, counsel and
guidance towards defining the
Company’s long-term strategy.
The Board Committees focus
on specific areas and make
informed decisions within the
authority delegated. Our
corporate governance report
can be found in the Annual
Report for FY 2015-16.
In India, the Securities and
Exchange Board of India (SEBI)
regulates corporate governance
for listed companies.
Dr. Reddy’s is in full compliance
with all the applicable
provisions of the SEBI’s
corporate governance norms. It
is also in compliance with the
appropriate corporate
governance standards of the
New York Stock Exchange
(NYSE).
Our compliance report on
corporate governance can be
found in the Annual Report for
FY 2015-16, along with
'Management Discussion and
Analysis' and 'Additional
Shareholder Information'.
41 | Dr. Reddy’s way
Enterprise Risk Management
All businesses face uncertainty,
and the challenge for
management is to determine
how much uncertainty to
accept as it strives to grow
shared value. Uncertainty
presents both risk and
opportunity, with the potential
to erode or enhance value.
Enterprise Risk Management
(ERM) enables us to effectively
deal with uncertainty and
associated risk and opportunity,
enhancing the capacity to build
value. ERM demonstrates the
company’s precautionary
approach towards operational
planning across the product
value chain.
Dr. Reddy’s follows the
Committee of Sponsoring
Organizations of the Treadway
Commission (COSO) ERM
framework to effectively
manage risk across the
organization. Risks are
aggregated at the unit/function
and Organization level by risk
groups bucketed into Strategic,
Operational, Financial and
Compliance categories.
Objectives:
— Proactive identification and
highlighting of risks to right
stakeholders.
— Facilitates discussions
around risk prioritization
and risk
mitigation with the senior
management and the board.
— Provides a framework to
assess and monitor risk
capacity and risk appetite.
— Develop warning systems for
any breach of the defined
risk level.
— Provides an analysis that a
formal and focused risk
management process is
facilitating reduction in
residual risks.
We firmly believe that
timely disclosures,
transparent accounting
policies, rigorous
internal control systems
and a strong and
independent Board go
a long way in
preserving shareholder
trust while maximizing
shared value creation”
Risk
Management:
A Finance, Investment and Risk
Management (FIRM) Council
has been instituted to help the
Enterprise Risk Management
(ERM) team prioritise
organisation-wide risks, review
and steer mitigation efforts in
line with our risk capacity and
appetite. The Chief Risk Officer
provides periodic updates to
the FIRM Council and the Risk
Committee of the Board,
including - Quarterly updates
on the progress of mitigation of
key risks and specific ERM
initiatives carried out during
the year.
Risk
Prioritization:
The ERM team focuses on
identification and prioritisation
of key business, operational and
strategic risks. This is carried
out through structured
interviews, surveys, on-call
discussions and incidents
reporting. Risks are identified at
the unit, function and
organisation level and
categorised into four risk
groups – Financial, Reputation,
Regulatory and Safety &
Environment. Finally, risks are
prioritised on the basis of their
likelihood, severity and velocity
Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 42
Risk Appetite
Setting and
Monitoring:
The ERM team regularly
monitors risk exposure against
a pre-determined risk appetite
for key risks including
environmental, social ad
governance parameters. Any
risk exposure or event that
exceeds threshold is brought to
the attention of the Board or the
Management Risk Committee.
For financial risks, the risk
appetite is linked to the
Company’s Earnings Before
Interest, Taxes, Depreciation
and Amortisation (EBITDA) and
for operational risks such as
Safety/Health & Quality; it is
linked to pre-determined Lag
Key Risk Indicators.
 elivering on
our promise:
Good Health
We are in the business of treating diseases and
saving lives; and are driven by a vision to
accelerate access to affordable and innovative
medicines to people who need them.
 The promise of Good Health
We are driven by an imperative to accelerate access to affordable and
innovative medicines to people who need them. Our strong presence in key
generics markets globally, helps us stay close to needs of patients, doctors,
healthcare providers and business partners, wherever they are.
FY 2016 Filings and Launches
— 13 Abbreviated New
Drug Application
(ANDA) Filings and 1
New Drug Application
(NDA)
— As on March 31, 2016,
82 generic filings are
pending for approval.
— Of these 79 ANDAs,
52 are Para IV filings
and we believe, 18 to
have ‘First-to-File’
status.
Our patient centric approach
Understanding patient and
partner needs deeply and then
developing solutions to meet
those needs is central to our
purpose. At Dr. Reddy’s, our
commitment to good health
goes far beyond molecules and
medicines. We help patients
manage their disease and
health conditions through a
range of support and out-reach
programs and we are always
seeking new ways to improve
our products, packaging and
services to enhance patient
care.
45 | Delivering on our promise: Good Health
— 50 Drug Master Filings
— 8 Drug Master Files
(DMF) were filed in
the US.
— As on March 31, 2016,
there were 768
cumulative DMF
filings.
Patient-centric interventions
— Making advanced cancer
diagnostics accessible:
Non-Hodgkin’s lymphoma is
a type of blood cancer,
where the right diagnosis is
dependent on a complex and
difficult-to-find test called
Immuno Histochemistry for
CD 20.With the aim of
improving access to this test,
Dr. Reddy’s runs a program
which helps patients get
tissue sample tested with a
renowned laboratory chain
at a reduced cost.
— Providing lifestyle support
to cancer patients:
— 51 New Products
were launched in
FY 2015-16, of
which 3 are in
NAG, 9 in EUG, 22
in Emerging
markets and 17 in
India.
Cancer patients often
experience significant stress
as a result of their diagnosis
and treatment. Our lifestyle
support program for cancer
patients provides
confidential counselling,
psychological and emotional
support services for patients
to discuss their feelings,
needs, and concerns.
— Practice Aid for Cancer
Treatment - Using
technology to aid decision
making:
Appreciating the fact that
good health is a direct result
of the time and the quality of
interaction that cancer
specialists have with their
patients, we devised a
mobile application called
Practice Aid for Cancer
Treatment (PACT) to alleviate
some of the problems that
doctors aced, while treating
their patients.
— SAHYOG - Supporting
prostate cancer patients:
Prostate cancer can, at
times, leave the patient
stressed, overwhelmed or
confused. Sahyog is a patient
support program intended to
extend information, support
and advice patients affected
by prostate cancer.
— Liv Positive – ensuring robust
treatment of Hepatitis B
patients:
For patients diagnosed with
Hepatitis B, a lack of
awareness of the disease and
non-adherence to prescribed
therapy are among the most
common cause for lapses in
treatment and care. Liv
Positive is a patient support
and education program that
aims to improve adherence
by sending out regular health
tips, lifestyle modification
inputs, dosage reminders,
dos/don’ts, diet charts,
counselling and diagnostic
support.
— Committed to Help, Educate
and Encourage Renal
patients – educating Chronic
Kidney Disease patients:
Committed to Help, Educate
and Encourage Renal
patients (CHEER) aims at
improving adherence to
therapy for Chronic Kidney
Disease (CKD) patients. It
does this by helping patients
better understand and
manage their condition.
Enrolled patients advocate
positive lifestyle changes
related to nutrition and diet,
to help them cope with
emotional stress that often
overwhelms them.
— Metsmall – Putting patient
comfort first:
Making an effective
medicine is not enough.
Every aspect about the drug
– the form, the size, and even
the behaviours surrounding it
needs to be considered from
the patient’s point of view.
Diabetes usually requires
medication and a lot of
patient care. Metformin is
the first-in-line medicine for
the treatment of patients
suffering from Type-2
diabetes. Working together,
our R&D, formulations, IP and
marketing teams came up
with a new form of the
medicine, in a smaller pill but
with similar impact and
delivered it to market as
quickly as possible.
— Redesigning drug packaging,
keeping patients’
convenience in mind:
Our innovative
patient-centric blister
packaging brings about
significant advantages and
facilitates adherence to
medicine and convenience
for the patient. The new
packaging features include:
— Colour coded pack
extension: helping patients
easily identify medicines
— Dosage matrix: recording
prescriptions on pill pack
— White foil: to enable a
clearer paper-like reading
experience
— 14 pills per pack: helping
patients move from a
monthly to weekly buying
patterns
Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 46
 Disease Management and
Awareness initiatives
— ASSIST - Hair loss
awareness program:
Hair loss is a medical
problem and correct
treatment can only be sought
from a dermatologist. Assist
is our endeavor to spread
awareness and educate
patients about the various
facets of the problem, and
help them seek proper
treatment.
— Mitr - Lifestyle support
program for cancer patients:
Mitr – a warm and caring
companion is a toll-free
helpline which is a
confidential psychological /
emotional support service
program for cancer patients.
condition, making awareness
the first step towards
addressing diabetes and
associated complications.
— Save The Gen Next -
Anti-tobacco drive:
Save The Gen Next is an
awareness initiative
dedicated to fulfilling the
dream of a tobacco-free
India. We reach out to young,
impressionable children in
schools and adolescents in
colleges with the intent of
making them torch bearers
to spread the message of
Tobacco-Free India.
— Awareness for Life - Lifestyle
diseases awareness program
for corporates:
A program for corporate
India, Awareness for Life is
variety of natural sources -
human, animal, or
microorganism - and may be
produced by biotechnology
methods and other
cutting-edge technologies.
Biologics represent the
cutting-edge of biomedical
research and, in time, may offer
the most effective means to
treat a variety of medical
illnesses and conditions that
presently have no other
treatments available. We have
four products in the market and
an industry-leading pipeline
spanning oncology, nephrology
and autoimmune diseases.
Our revenues
Expanding to emerging
markets
Our Generic Formulations
business addresses this urgent
need by offering more than 200
high-quality generic versions of
expensive innovator
medicines—at a fraction of the
cost—in over 20 countries
around the world. In many
emerging markets, our
products are available under a
brand name, such as Omez
(Omeprazole), Nise
(Nimesulide), Ketorol (Ketorolac
Thromethamine), Stamlo
(Amlodipine Besylate), Razo
(Rabeprazole), among many
others. The success of our
research organisation
Over the years, these brands
have established themselves as can be judged by the
leaders in their respective fact that we have over
categories. Since 2006, we
have a successful track record
of commercialising 4 biosimilars 230 ANDAs,
in India and other emerging
markets. With a commercial 760 DMFs and
304 patents
presence across 26 countries,
we are looking to further
expand into emerging markets
to provide affordable medical
solutions for unmet healthcare
filed in the last five
needs. years.

— Vega Club - Education

program for Inflammatory
Bowel Disease patients:
Inflammatory Bowel Disease
(IBD) is a chronic medical
condition, which if left
untreated, may manifest into
more severe conditions.
Vega Club is a patient
support initiative in which
gastroenterologists educate
and counsel ulcerative colitis
patients about the disease.
aimed at educating
corporates on the causes of
lifestyle diseases, early
INR 154 Billion
detection, prevention and
timely treatment
interventions.
Difficult to produce medicines
We focus our work on being Russia and other CIS
first to market with products
that are difficult to make. Why?
These tough-to-make products
9%
are likely to be very expensive, Europe

Participating patients also
share their experiences and
success stories, which
motivate participants to
adhere to ulcerative colitis
therapy.
— Roshni - Diabetes awareness
initiative:
11%
and our unique capabilities
allow us to improve North america
accessibility to them. Similarly,
our patient-centric approach
means we tend to focus on
developing differentiated
53%
products that best address
unmet patient needs.
India

Roshni aims to bring
undetected diabetics to light.
Many patients with type 2
diabetes are unaware of their
15%
Biologics
Biologics (i.e. biological
products) are isolated from a

Rest of the world

11%
47 | Delivering on our promise: Good Health Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 48
 ustodians of
Good Health
We have spearheaded an integrated approach for
measuring, managing and disclosing our environ-
mental, social and economic impacts to our stake-
holders.
 Safety is our priority
Dr. Reddy’s has well defined Safety, Health & Environmental Policy and
Principles in place to motivate our employees to achieve 'Goal Zero' - zero
incidents, zero harm to people and zero damage to the environment.
Safety forms an integral part of
our Code of Business Conduct
and Ethics (COBE). Each of our
employees signs up to the
commitment towards safety,
health and environment, every
year.
A number of programs and
initiatives, such as the ‘Safety
Star Caps’ and ‘Parivartan’ have
instilled a sense of deep
ownership across all levels to
build an organisational attitude
that places a high priority on
safety, has zero tolerance
towards violations and drives
awareness at the shop floor.
“Star Cap” is an additional
responsibility a team member
undertakes in the work team as
part of the empowerment
process. It is a transitionary role
in which team members must
spend at least a year, to
broad-skill themselves, before
moving to a Team Leader role.
This 'broad-skilling' is the
functional expertise the team
members build in any of the
aspects - Safety, Quality,
Engineering, Delivery or People
depending which Star Cap role
they take on.
Our safety approach has
evolved into a responsive
framework from 'zero by
chance' to 'zero by design'
through 'Project Parivartan', a
safety culture transformation
journey. We organise regular
workshops and awareness
sessions on various safety
51 | Custodians of Good Health
QbD - Quality by Design
QbD is an approach, which we have championed, aimed at ensuring the
quality of medicines by employing statistical, analytical and risk management
methodologies in the design, development and manufacturing of medicines.
topics to enhance preventive improved and in FY 2015-16 we At Dr. Reddy’s, quality is inbred Today, QbD is spread across all As we advance our mission to
and precautionary attitudes have achieved an encouraging with care and infused through manufacturing facilities and is deliver Good Health, we are
ensuring that safety protocol performance with zero design and to deliver results in-built into our operational exploring new approaches to
are followed. fatalities. beyond mere product framework. manufacturing that leverage
specifications. technologies such as- robotics,
We provide regular training to We have also done exceedingly We are embedding quality as a automation, real-time data
all employees on health and well in the space of near miss Our pledge towards continuous way of life by steering the capture and analytics - to
safety in order to safeguard reporting and the statistics improvement and business Quality Management System secure greater patient value
them from any injuries and show our consistent excellence drives us to work right from the top management, through the highest standards
accidents. Safety training improvement in this area over toward exceeding these seeding the principles of of quality.
programs which are conducted the last three years. In this year, minimum standards. It ensures Quality by Design across
for employees and workmen 7471 near miss incidents were consistency, increases operations, adopting global Quality as a way of life
are also extended to reported as compared to 4381 productivity, reduces costs and benchmarking
contractual employees. Our in the previous year cycle time, facilitates tools, institutionalizing a series Our approach to delivering
safety statistics have constantly reproducibility, promises of self-checks and world-class products
greater shelf life, enhances incorporating corrective encompasses the following:
Nearmiss Reporting (Numbers) audit readiness, and accelerates measures.
8000 7471 the organisation's drive to — Quality Management System
‘getting it right the first time’. (QMS)
7000
Ensuring product safety To deliver Good Health
6000 We continue to adopt and and quality is of utmost consistently and reliability, a
master advanced tools such as well-conceived, rigorous
5000 4381 Failure Mode Effect Analysis
importance and this Quality Management System
4000 (FMEA), Process Mapping, commitment is (QMS) is implemented across
Hazard Analysis and Critical engrained within our our operations. Our QMS
3000
Control Points (HACCP), focuses on continual
Hazard Operability Analysis
culture and embraced improvement aimed at
2000
(HAZOP), Fault Tree Analysis by our entire streamlining production,
748
1000 (FTA) and Cause and Effect workforce. optimizing processes and
Analysis (CEA). eliminating non-value-adding
0
FY 14 FY 15 FY 16 efforts in production. These
Fire Prevention and Protection
In FY 2015-16 we have made significant progress in strengthening our
fire protection and prevention system.
— In Formulations, we have adopted the approach of “mitigation of
fire risk at its initial stage” through implementation of aerosol fire
suppression system, clean agent localized fire suppression system
and Dry Chemical Powder (DCP) modular fire suppression system.
— In addition, a new fire water pump house has been installed in
Formulations Unit 2, and a Fire Station and Fire Tender have been
set up for our Bachupally Campus. An Emergency Response Team
is available at the Emergency Control Center round the clock
across all Formulations Units.
Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 52
 efforts are primarily directed
towards reducing variability
in process and product
quality characteristics.
Structured governance
process is in place to ensure
that all important quality
metrics are reviewed at
different frequencies at
different hierarchical levels in
the organization and
significant issues are
escalated to highest level of
management.
Global Quality management
team plays an integral role as
part of the overarching QMS,
providing end-to-end
management support and
oversight to ensure effective
and timely implementation of
regulatory commitments and
other critical Corrective &
Preventive Actions (CAPAs)
across all our operations.
— Quality Compliance
Ombudsperson Process
Protected disclosures can be
made through the Quality
Compliance Ombudsperson
Process. Through this
process any concerns,
events or observations
where quality is
compromised can be
brought to the attention of
the senior management. The
Quality Compliance e-mail
and a dedicated hotline is
accessible to all employees
across our facilities. All
concerns are recorded
anonymously and are
53 | Custodians of Good Health
forwarded to the respective
Business Units (BU) Quality
Heads for further review and
action. Updates on the
contacts and actions taken
are shared on a quarterly
basis with the senior
management.
— Quality Culture
To extend quality as way of
life at Dr. Reddy’s, our
employees are not only
encouraged to follow quality
guidelines but to also
consistently see others
taking quality-focused
actions, hear colleagues
talking about quality, and to
feel quality in the
environment around them.
We have been creating
a culture in which our
employees “live” quality
in all their actions.
This grassroots, peer-driven
approach has developed a
culture of quality, resulting in
fewer mistakes—reducing
the bandwidth required for
corrective and remedial
action– with the aim of
getting it right the first time.
To this end, we have
introduced behaviour change
training programs, boot
camps on quality, conducted
employee surveys and
developed action plans to
further strengthen quality as
a way of life at Dr. Reddy’s. Our approach to engineering excellence encompasses six pillars:
We actively promote Lean
Six Sigma Programme, from
process to productivity.
Digitization Automation Mechanisation
— Focus on simplicity
Converting information Automating tasks and Delegating laborious
To ensure seamless into a digital format for processes to enhance tasks to machine, to
operations and minimise better data predictability and ensure dignity of labour
non-value adding processes,
management, reliability production performance, & safety of workers.
we are simplifying various
and security reduce cost, and Plus, improve the
tasks across our processes.
increase material and quality and efficacy of
By simplifying testing
methodologies, we have not energy efficiency. processes and products
only compressed timelines
but also saved on carbon
footprint by reducing the
high use of solvents, while
making man-power available
for more productive tasks.
Lean Predictive Equipment
Manufacturing Maintenance Standardisation
Engineered for excellence
Optimising resource Identifying and Delegating laborious tasks
Our approach to human
consumption without any addressing issues to machine, to ensure
resource development invests
loss in quality. before they manifest dignity of labour & safety
in developing our people’s
into unplanned of workers. Plus, improve
minds to unleash their innova-
tive potential, rather than breakdowns. the quality and efficacy of
deploying them across mun- processes and products.
dane and routine tasks which
are often better performed by
machines. As a result, the
benefits to operational excel-
lence due to improved produc- Automated closed loop systems
tivity, better consistency in
quality and shorter turnaround We have upgraded several of our operational processes by leveraging modern innovations in auto-
times are evident. mated closed looped systems. These systems provide greater benefits that include real time moni-
toring, enhanced productivity and product quality, minimum human interface, negating contamina-
tion and securing employee safety.
By introducing modern
Automatic closed sample transfer system implemented in Formulations Plant 2 and 3: Transfers
technologies across our
manufacturing raw materials and dosage samples from In Process Quality Assurance (IPQA) to
operations we seek to Quality Control Lab and vice-versa. This system can handle samples as well as documents. It has
replace muscle power reduced movement of people, saving time and ensures that samples are free from contamination.
with machines.
Automatic solvent transfer systems implemented in Formulations Plant 2 and 3: Automatic closed
transfer of solvent from solvent yard to day storage, RM warehouse, dispensing area and for coating
machines during manufacturing. This technology handles solvents, measures and controls the rate of
flow and quantity. It provides multiple benefits by avoiding manual handling of solvents, saving time
and prevents manual exposure from hazardous chemicals.
Powder transfer system in manufacturing implemented in formulations plants 3, 6 & 8: Closed
powder transfer system in Granulation – RMG (Rapid Mixer Granulator) charging, FBD (Fluidized Bed
Drier) charging and compression charging. This technology handles bulk densities of powders,
transfers powder from IPC (Inter Process Communication) to machine and in few cases it makes
transfers from one process to another; reducing manual effort, preventing exposure to powders and
improving quality compliances.
Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 54
 ommitted to
a better world
We are committed to have a positive impact on the
environment and the society we live in.
 Environmental performance
At Dr. Reddy’s, we firmly believe in doing business responsibly without
taking anything away from the environment that we breathe in and the
society that we thrive in.
Dr. Reddy’s advocates the idea
of environmental stewardship
and actively supports the Green
Industry Rating Programme of
Confederation of Indian
Industries (CII) that evaluates
companies on the basis of their
environmental performance.
We have partnered with CII to
carry out a project on
inventorying product specific
greenhouse gases to showcase
its relevance and significance
from the sectoral perspective.
A pilot has been implemented
in one of our units (API
Manufacturing Unit-2). The unit
was assessed by CII for
certification under the Green
Rating System and awarded
Bronze Rating.
We are actively engaging
environmental regulators in the
states where we operate to
bring about policy changes to
put greater focus on cleaner
technologies, processes and
57 | Commited to a better world
In the FY 2015-16 green energy use. In one of our
7 % increase in rainwater
efforts we actively engaged
harvesting with the State Pollution Control
Board to include clean energy
use as a means for power
generation for all
In the FY 2015-16 manufacturing operations in the
states of Andhra Pradesh,
55% ofwaste
the hazardous
generated
Telengana & Himachal Pradesh.
Indeed, this has now been
were sent for alternative use made a mandatory consent
in cement and other condition for all manufacturing
industries
operations in the state. In
another instance, we have
successfully engaged with the
In the FY 2015-16, specific
Central Pollution Control Board
energy consumption has
to obtain approval for
reduced by
conducting trial usage of sludge
6.3
generated from our Effluent
% compared to
FY 14-15 Treatment Plant (ETP) as an
alternative fuel in the nearby
cement plants.
In the FY 2015-16, renewable
Our belief in environmental
energy share is
leadership is institutionalised in
13.6 % as against 10.9%
in FY 14-15
our business strategy in terms
of the ambitious commitments
that we have taken to
significantly reduce our overall
environmental footprint in
terms of energy and water
consumption and waste
generation. Combining our
efforts in these areas, our total
environmental investment for
FY 2015-16 stands at INR 559
Million.
Energy Management
We aim to reduce our specific
energy consumption by 5%
every year so as to achieve 40%
reduction by 2020 (base
year=FY 10) while specific
energy consumption is
calculated as the ratio of
energy consumed within the
organisation per million sales.
At the same time, we strive to
increase the percentage share
of renewable energy by 25% in
our total energy profile by 2020
(base year=FY 10). In FY
2015-16, we have invested 91.35
million INR in energy
conservation activities leading 50 48 Specific energy consumption
(GJ/ Million Sales)
to savings of 63.54 million INR, 45
4.3 million units of electricity,
1070 kilolitres of furnace oil and 40 39
36
265 kilolitres of high speed 33
31
diesel for captive power 30
30
generation. Initiatives include
installation of Air-Operated
Double Diaphragm pumps,
20
elimination of vacuum pumps,
use of pumps with lower Horse
Power, installation of energy 10
efficient lighting system (LED
lights with voltage stabilizer),
power savings on air curtains 0
FY 10 FY 11 FY 12 FY 13 FY 14 FY 15 FY 16
etc. across several operations
and merger of power sources of
Formulations Plant 1 and API
Manufacturing Unit 1.
Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 58
 CO2 Emissions Reduction
As a combination of efforts in
energy conservation and
increased renewable energy
consumption, our overall target
is to reduce the carbon
emissions intensity by 40% by
2020 - the target considers the
projected business growth over
the years and takes note of the
predictions of climate science
about rise of atmospheric
temperature over the years.
The energy conservation
initiatives implemented in FY
2015-16 have led to 8211 tonnes
of CO2 savings in terms of
scope 1 and scope 2 emissions.
As a significant achievement,
we have been able to reduce air
shipment by 8.3% with an
increase in sea shipment by
8.3% in Formulation Plants for
FY 2015-16. This is one of the
reasons that led to 44%
reduction in scope 3 emissions
from upstream transportation
and distribution. Overall, we
reduced our overall carbon
footprint (combining Scope 1, 2
and 3 emissions) by 13% in FY
2015-16 compared to FY
2014-15.
Other Air Emissions:
At Dr. Reddy’s our aim is to
excel beyond the limits set by
the statute to ensure
environmental wellbeing.
Consequently, in addition to
carbon emissions, we take
utmost care towards monitoring
and control of the ambient air
quality beyond statutory
compliance. With this drive, we
have invested INR 4 million at
our Bachupally Campus to
install a Continuous Ambient
Air Quality Monitoring Station
for real time monitoring of key
air particles such as PM10,
PM2.5, SOx, NOx, and Volatile
Organic Compounds.
59 | Commited to a better world
15
Emissions intensity Water Management
(MT/ Million Sales)
12.3 Water is critical to
12 manufacturing of pharma
10.7
products. Keeping this in mind,
we have put up a rigorous,
9 real-time monitoring system for
fresh water consumption at all
our facilities. We have
6
implemented state of the art
Reverse Osmosis (RO)
3 technology at API
Manufacturing Unit 5 for
wastewater recycling. In all our
0 manufacturing units we have
FY 15 FY 16
achieved zero waste water
discharge where the effluent
generated in the facility is
treated through primary,
secondary and tertiary
processes and reused within
the facility for various
Rain water havested Water management
operations. (X1000 KL)
Waste water recycled
2500 Fresh water consumed
This year we have augmented
183 256
the capacity of rainwater 30
harvest and harvested 7% more 2000
rainwater compared to the 828
previous year. With these 799 829
efforts, not only we continue to 1500
perform way beyond the
statutory norms but we also
exceed our own target much 1000
before the set timeline of 2020. 1360
1313 1267
In FY 2015-16, we have reduced 500
57% of our specific fresh water
consumption compared to the
base year FY 10 while our target 0
FY 14 FY 15 FY 16
was to reduce 40% by 2020.
In the FY 2015-16, rainwater
COD COD and TDS load
harvested was 20% against TDS (KG)
13% in FY 2014-15 20000
16602
14825
In the FY 2015-16, Waste 15000
water recycled is 65% 10918
11690
against 61% in FY 2014-15 9586 9308
10000
In the FY 2015-16, we have
5000
consumed 6.87% less fesh
water compared to FY
2014-15
0
FY 14 FY 15 FY 16
Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 60
 Waste Management
Distribution of hazardous waste
At Dr.Reddy’s we continue to
enhance our waste Incineration
management practice with 4%
implementation of state of the
art processes and technologies. Salts recycled
We have invested INR 213 30%
Million this year only for
advanced treatment and safe
disposal of effluents and
TSDF
hazardous wastes. These 41%
initiatives have multiple benefits
in terms of reduced waste to
landfill, optimised chemical
load in the effluent discharge,
reduced sludge quantity and Cement plants
co-benefits such as energy 25%
efficiency, water conservation
and reduced noise level.

Across operations, especially in Hazardous waste to TSDF/ Landfill

the Formulation Plants, we have
installed efficient dewatering
systems such as Paddle dryer,
Belt press that has resulted in
improved moisture extraction
and reduction in volume and
weight of waste to the landfill.
These systems have co-benefits
in terms of energy
conservation, reduced water
consumption and ambient noise
reduction. In terms of reuse of
high calorific value waste we
have so far successfully
completed trial burn of 1000
tonnes of landfill waste (mixed
salts and sludge from Effluent
Treatment Plant) in different
cement plants. As a result of
our continued efforts, there has
been a gradual decline in
quantity of waste to landfill/
Transport, Storage and Disposal
Facilities (TSDF). Similar trend
is observed in the chemical and
biological load of the effluent
discharged.
(Tonnes)
20000
15572
14405
15000
11639
10000
Green Chemistry
5000 We have been researching in
the area of green chemistry for
the past few years to evolve
0 chemical processes in
FY 14 FY 15 FY 16 manufacturing of pharma
products with an objective to
simplify the steps, optimise
manual interventions, reduce
waste generation, minimise use
of toxic solvents. This has
helped us in achieving
environmental wellbeing and
also reduced human exposure
to harmful chemicals.
While manufacturing
Fexofenadine, a non-sedating
antihistamine for treatment of
seasonal allergic rhinitis, in FY
2015-16, as a green measure,
we have been able to adopt a
telescoped process that helps
to reduce the number of steps
and unit operations involved in
the entire process and eliminate
usage of a few toxic solvents
while improving the overall
yield. Similarly, the current
green process adopted for
production of Sumatriptan, a
drug used for treatment of
migraine, has led to simplified
steps, reduced waste
generation, optimised water
usage and elimination of use of
chloroform.
All our endeavours towards
solvent recovery, elimination of
chemical use, waste reduction
and reuse have led to efficient
material consumption.

In terms of the hazardous

waste, we have been able to
send 55% of the waste for
alternative use in cement plants
and other industrial processes
such as in soap industries.

61 | Commited to a better world Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 62

 uilding healthy
communities
We encourage the communities around our operations to
become a part of our growth story.
 Our CSR approach
Dr. Reddy’s Foundation conditions. DRFHE was We also contribute employee
conceived with the aim of time and financial resources to
Set up in 1996, Dr. Reddy's bridging the communication local villages, rural enterprises
Foundation (DRF) acts as a gap in healthcare. DRFHE and schools in supporting the
catalyst of change, driven by its works primarily in two areas: standard of living, health &
'Empathy' and 'dynamism' are the two guiding principles that define all our belief in the inherent motivation training initiatives that enhance hygiene, wellbeing and stability
and capacity of humankind for interpersonal skills of various to further develop social
intentions, actions and decisions. While 'empathy' helps us learn about and progress. DRF continuously healthcare stakeholders; and capital. All of our social impact
act upon the needs of the communities, 'dynamism' drives us to seed redefines its efforts to cover awareness initiatives that create projects are systematically
community interventions with business-like speed, precision, innovation and large groups of disadvantaged awareness about disease reviewed and monitored using
populations. DRF is mandated programs amongst employees appropriate evaluation tools to
aggression. This pronged approach enables us to address core needs and to undertake interventions, of corporation. measure impact and assimilate
widen outreach at a faster pace. conducting programs for the feedback.
benefit of the marginalized
communities and urban poor,
focusing in the areas education
Dr. Reddy’s CSR Policy, EDUCATION and livelihoods.
All of our social impact projects are
formulated in 2014, supported 12,000 students Along with our systematically reviewed and monitored using
provides an overview of partners, we engage in Dr. Reddy’s Foundation for appropriate evaluation tools to measure
key CSR programmes Health and Education
our social impact strategy, impact and assimilate feedback.
CSR programmes and LIVELIHOODS in, access to quality
Efficient healthcare delivery is
focus areas as: secured for 7,000 education, livelihoods not only about managing
young adults for the youth and the ailments, but also about Till date DRF has Our social impact
differently abled, effective communication delivered impact to investment
— Promote scientific for FY 2015-16
temper to encourage primary, maternal and between the provider and the
increased to INR
HEALTHCARE child health, and the patient. The patient wants to be
socially relevant service provided to heard, understood and treated
innovation in society
development of social
as an individual. Good 150542 343349
75,000 villagers change agents. communication from caregiver
— Empower the empowers the patient to take
an active role in managing his or Children Youth 412
community by her wellness and health
creating urban and
rural livelihoods, and 9227 77448 milllion
in particular enhancing
skills and employability
Differently- Households
— Support specific abled
initiatives based on
Through our Presently the SIP
need, relevance and support centres works in
capability in healthcare we have trained
and hygiene
Government
— Improve access to high 59 schools
quality education in 4544 640
schools
Supporting
Young Differently-
— Promoting employee people abled youth
volunteering
25250 Students

65 | Building healthy communities Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 66

 Education and Sanitation. opportunities in urban and rural
Initiated in 2011, SIP supports India to enhance their LABS – empowering growth and changing lives
Dr. Reddy’s firmly believes that 59 government schools employability. Dr. Reddy’s runs
access to a good education and surrounding Dr. Reddy’s a number of programs in line Though Rahul completed his senior secondary schooling in Burari,
schooling is every child’s right. manufacturing units in six with this objective. Delhi, due to financial constraints he was unable to pursue higher
Through its Foundation, Dr. districts that cover nearly 150 studies and further develop his skill set. It is during this period that
the door-to-door mobilisation team at DRF-LABS connected with
Reddy’s works with schools, villages and support more than Livelihood Advancement
him. With a little counselling, Rahul was convinced that the
communities and other 25,000 students. Business School opportunity would allow him to achieve his aspirations and he joined
stakeholders apart from the programme.
developing strategies to bring Teach for India The LABS program targets
children of all age groups into youth between the ages of 18 Initially it was hard for him, as he felt insecure and lacked
mainstream education. The Teach for India is a project that and 30, who lack opportunities confidence. However, after a couple of sessions he began to open up
various education initiatives is spearheaded by a leading due to inadequate skill sets. To and feel comfortable with his class mates, motivated by Pawan
include: media conglomerate in India. enable them, LABS equips Kumar, his facilitator who actively encouraged him to believe in
Dr. Reddy’s supports the Teach provides learning and himself and to strive for excellence. Apart from learning computer
Pudami Schools for India program by assisting development opportunities for applications and English language skills, Rahul found the Life Skills
their Fellows who teach in job-specific skills, soft skills, classes valuable.
Pudami Schools were classrooms of low-income Basic English, computer skills
On completing the LABS programme, Rahul was appointed by TATA
established in 2007 to make schools in Hyderabad and the and placement linkages. Westside as a Sales Associate. Today he earns a decent salary with a
quality English training available surrounding area. Trained performance based incentives. He has not only started supporting
for medium education to Fellows connect with local Today, the Dr. Reddy’s his family but is currently pursuing higher studies. Rahul continues his
children from all walks of life, children, providing a fun and Foundation has partnered with association with LABS and regularly visits the center. He has
with special focus on children rewarding education. The 5 social impact organizations delivered two guest lectures, so far and enjoys sharing the story of
from low-income communities. Teach for India Project and runs close to 85 centers in his transformational journey with other aspirants.
In addition to the academics, a strengthens the bond between more than 22 states. Of the
number of co-curricular Dr. Reddy’s Foundation and youth covered by this program,
activities and exciting Pudami schools. The program nearly 73% successfully Healthcare Community Health
Rural livelihoods – LABS for
inter-cluster and inter-school harnesses the energy and obtained entry-level jobs. Intervention Program
Farmers
competitions give the students capabilities of Dr. Reddy’s The delivery of healthcare is
an opportunity to showcase employees for educating and LABS for People with largely dependent on The Community Health
Along with urban livelihoods,
their talent and learning. 24 motivating the children. Disabilities developing a robust ecosystem Intervention Program is
Dr. Reddy’s Foundation also
Pudami schools are educating We supported 70 fellows in 27 capable of bringing good health designed to improve the rate of
runs programs that help
more than 9,668 students. schools reaching out to 2,519 Modelled on the lines of LABS, to every member of the survival of infants and children
farmers enhance their income.
students by implementing the LABS for People with community. However, there are in more than 145 villages
Called LABS-F, this program
School Improvement Program quality education initiatives in Disabilities (LABS-PwD) yet unmet needs – especially in covering three districts
uses technology and
government and low income program specifically targets rural India – where (Nalgonda, Vizanagaram &
methodology interventions with
School Improvement Programs schools through Teach for India people with disabilities, infrastructural problems Srikakulam) in rural India. The
farmers to increase
are designed to help schools fellowship program. preparing them for employment prevent delivery of healthcare. program improves basic
productivity, decrease input
and students in various and integration into mainstream Dr. Reddy’s runs a number of support for ante- and post-natal
cost and increase their income.
academic and non-academic Livelihoods society. The program is run programs designed to make care, safe delivery and infant
aspects such as Remedial across 24 centers. basic healthcare available in care, primary immunization of
Skilling Rural Youth
support, Scholarships, Dr. Reddy’s works with sections these communities. children by the age of one and
Computer Skills, Sports, Water of society that lack economic safe motherhood. The program
SkillinRural Youth program is
part of our rural program for leverages well-trained ANM,
enhancing rural employment GNMs and Nursing Midwives in
KARV College: The Kallam Anji Reddy Vocational (KARV) addition to two mobile
generation. This is a 10-day
College is a model Pudami school that caters to overall 2,020 ambulances, to deliver
capacity building program that
students. KARV trains students who have completed Class X in focuses on soft skills and linking healthcare to these villages.
two-year vocational courses preparing them for employment. youth with local employment Additionally, the program also
The college offers courses in the domains of Health, Automobile opportunities entails a Fixed Day Health Care
Engineering, Customer Relations, Nursing, Diagnostics Services, Service (FDHS), where
Computer courses, Pre-primary and Hotel Operations. healthcare staff conduct regular
Established in 2002, the college trains 500 students each year, screening and attend to basic
for exciting job opportunities ahead. Since its inception, the health issues on fixed days,
college has successfully put thousands of low-income youths on twice each week in each
village.
promising career paths.

67 | Building healthy communities Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 68


Voice of a CHIP’s beneficiary
“I am a hypertension patient, often bedridden due to age related
illness. I cannot walk on my own and I am dependent on others for my
mobility. I saw a ray of hope when the nurses of NICE Foundation
visited my house with a medical kit. On each visit they tested my BP
and gave me appropriate medicines.
Prior to this intervention, I had to rely on a local RMP for treatment and
would spend a considerable money for it. Now I get free treatment
right at my door step with no effort. The nurses have educated me on
lifestyle changes and are providing me with guidance on medication.”
G. Asirodu, a project beneficiary from
Kammasigadam village in Andhra Pradesh
Community Health Change-makers and social
Intervention Program has catalysts
been implemented in over
Enabling like-minded people
145 villages who are working on similar
social themes and equipping
15 RO water plants them with the right tools is an
benefiting 70,000 families effective way to achieve
impact. By enabling these
were established.
change makers, we ensure that
our own efforts are multiplied
12 free psychiatric camps
and the effects of social change
are conducted through are widespread, inclusive and
Roshni Counselling Centre. long lasting.
The patients are provided
In FY 2015-16, we trained 41
free psychiatric consultation,
free medicines and budding social change agents
and NGO staff on
counselling
entrepreneurial and leadership
skills through Centre for Social
Initiatives and Management
(CSIM) – Hyderabad. Besides
20 social agents were trained
through Acumen. These efforts
resulted in social delivery
projects relevant to community
needs.
Acumen India Fellows Program
Beginning in 2014, with support
from Dr. Reddy’s, Acumen
launched India-focused
Leadership Program – the
Acumen India Fellows Program.
The programme focuses on
supporting social change
leaders from across India who
69 | Building healthy communities
Impact created by an Acumen
fellow:
Bodhi Tree Skills, a Tamil
Nadu-based social venture that
trains, supports and mentors
rural college graduates so they
can access better career
opportunities. Bodhi has
trained 800 college students
to date.
are creating impact through
affordable education programs,
innovative mobile healthcare
technologies, and inclusive
credit solutions, inspiring slum
soccer programs, and liberating
programs for rural farmers.
Centre for Social Initiative and
Management -Hyderabad
(CSIM-H)
Through its support to CSIM –
H, Dr Reddy’s offers an
opportunity to aspiring
individuals to transform their
ideas and interests into
initiatives. Today, CSIM alumni
are generating social benefits in
diverse fields such as rural
development, education,
livelihoods, health, water and
sanitation, disability, child
protection, old-age homes, and
orphanages
Impact created by a CISM-H
change-maker:
The Founder and President of
an NGO (ARPF - Animal Rescue
& Protection Force) has
completed CSIM Course on
Social Entrepreneurship, runs
an animal & wildlife protection
organisation. He believes that
his confidence grew due to this
course, and has already taken
his NGO to serve challenging
situations like rescue, and
rehabilitation of rare species;
alongside regular educative
sessions at zoos. ARFP has
received awards from
International biodiversity
committee, and Andhra
Pradesh Forest Department. He
has been appointed to serve as
Curator of Indore Zoo which
makes him the youngest in the
country.
Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 70
Social Infrastructure
Dr. Reddy’s continues to
support and fund projects that
strengthen social infrastructure,
including services that benefit
and address core social needs.
e-Panchayat
Leveraging the power of
technology, we developed an
'e-Panchayat' platform at
Bollaram. A unique
e-governance initiative, this
new Panchayat is an IT-enabled
office with six workstations and
a cabin. Fully equipped with a
robust computer system
including a
printer-cum-scanner, the
e-Panchayat offers efficient,
people-centric services, better
access to resources and
improved management
enablers.
Hygiene and sanitation
Aligned with the governments
'Swachh Bharat Abhiyan', we
continued to build public toilets
through a public- private-
partnership model and are
operated on self-sustaining
models.
Other infrastructural
development projects
Laying village roads, road
safety, wall paintings, stopper
boards, signage boards etc.
 iving our dreams
We believe that when people with diverse skills are bound
together by a common purpose and value system, they can make
dreams come true.
 With more than 21,669
employees worldwide and a
commercial presence in
26 countries, we know the
importance of working
together with our employees,
communities and partners to
identify issues that matter to
us all.
73 | Living our dreams
Our people culture
The values that define us – empathy and dynamism in approach, ethical and
resolute in our actions, and caring towards each other – are deeply ingrained
in the company.
At Dr Reddy’s, people are at the
heart of our business. We
believe that given the right
environment and opportunities,
individuals can aspire to better
their lives, defining paradigms
to create new realities. Our
culture is one of empowerment
and we work together to unlock
each other’s full potential.
We focus on delivering good
health and thereby inculcate
empathy for patients in every
employee and provide an
enabling environment that
inspires individual talent and
teamwork. We also take pride in
being innovative and agile in all
of our endeavours, which is the
result of a vibrant workforce
capable of responding
progressively to changing
market dynamics.
Dr. Reddy’s Employee Value Proposition
As a value-driven, employee-friendly corporate, our focus is on
three key themes - ensuring consistent and quality
engagement with our employees; retaining high performing
talent, and providing better opportunities to potential talent.
Our people are guaranteed this unique set of offerings that
define our Employee Value Proposition.
— Make the world a healthier place - Every day, patients
across the world trust us with their health. We have earned
this trust through personal integrity, product quality and
organizational transparency.
— Become part of a team that cares - We are committed to
each other's safety and well-being. In each of our plants,
work sites, offices and out in the field, our people believe
in taking care of each other. And collectively we are
committed to taking care of the communities where we
operate.
— Enjoy professional freedom to create impact - We will
provide the space and freedom for you to experiment,
innovate and put your talents to work. All our people have
the opportunity to unleash their potential and create impact
in their roles.
— Learn continually, excel and grow - We work at the frontiers
of knowledge and our people are exposed to some of the
finest thinking in the world. We actively support their
development and provide access to leading-edge learning
resources.
— Expect to be treated with respect - We believe in respecting
every individual, regardless of position. All employees have
the opportunity to express their opinion and have the
freedom to interact with any of our leaders. All our people
are expected to be equally accessible and respectful at all
times.
Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 74
 Empowering employees
Opportunities for personal and professional growth
Our employees are an intrinsic
part of our identity and we
develop and implement policies
and programs that empower and
nurture our people, allowing
talent to thrive, and for
excellence to become a way
of life.
Recognizing the central role of
our employees, we address their
need to achieve their individual
dreams by providing avenues for
professional growth and
development. Employees at all
75 | Living our dreams
stages in their careers are
exposed to relevant skill and
knowledge upgrade programs
from time to time. This has
allowed our employees to
expand their capabilities and
climb the career ladder, taking
on greater responsibilities and
roles. As a result, a major share
of our managerial vacancies are
filled internally.
New Horizons
Leadership
Development
Program
Leadership is an “aspiration”
that includes a sense of
purpose, excellence and
influence. It involves being the
best you can be and helping
We firmly believe that others be their best. The New
Horizons Leadership Program
it is people-enabled (NHLP) was launched in
leadership that will December 2012 to raise the
help us stand by our effectiveness of each individual
and build their leadership
mission of Good ability.
Health and we pride
ourselves on the We believe that personal
transformation, which is the
autonomy and space crux of the program, invariably
we provide for people leads to organizational
to grow and to create transformation. It is through
personal transformation that we
an impact at work. aspire to build a culture wherein
our brand values of ‘empathy’
and ‘dynamism’ are lived.
Hired 2,500 talented rural youth through "SMT route" transforming their
lives by providing opportunities that strengthen careers.
Between the period
2012 & 2016,
approximately 100
leaders from various
BU’s were covered in
the 10 month long
program.
Through this program, we
want to:
— Strengthen leadership
capability to drive business
impact & change across a
wide range of situations
— Enhance personal
effectiveness, empathy and
dynamism
— Lead significant business
impact through Break
Through Projects (BTPs)
Over the years, NHLP has
grown to be Dr Reddy’s flagship
leadership development
program.
Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 76
Supporting
Higher
Education
Programs
We have tied up with a few top
level universities for the contin-
uous education of our employ-
ees, providing them relevant
education to prepare them for
the specialized roles of the
organization. Higher education
opportunities for the various
levels of our employees are
provided through partnerships
with Tata Institute of Social
Sciences (TISS), Birla Institute
of Technology and Science
(BITS), Indian Institute of
Chemical Engineers (IIChE) etc.
The qualifications earned
through these opportunities are
industry recognized and enable
individuals to take on higher
roles and greater responsibili-
ties.

Unlocking minds by leveraging
modern technologies
Moving ahead with times, we
have been modernizing our
operations leveraging the value
provided by new technological
solutions such as
mechanisation, automation,
robotics and digitization. All our
new plants are next-generation
manufacturing blueprints and
our existing plants are being
gradually migrated to smarter
technologies. These
technologies increase workers’
safety and dignity, enhance
quality, productivity and
availability of our products,
drive optimum use of natural
resources, propel greater
engineering prowess and
extend continuous
improvement down to the shop
floor.
77 | Living our dreams
Apart from operational benefits
such as efficiency
improvement, cost reduction,
safety enhancement and
energy conservation, a key
advantage is the elimination or
reduction of human
intervention across process,
where machines replace men to
perform repetitive tasks.
Shifting from muscles to
machines, reduces the number
of employees working on
manual tasks and we are able to
repurpose our human resources
towards productive avenues,
unleashing their minds and
freeing ingenuity for innovation.
Embracing diversity
We celebrate our differences
and capitalize on the intrinsic
values of a diverse workforce,
including gender, race, colour,
religion, age, nationality or any
other factor.
Enhancing diversity in our
workforce is crucial to
facilitating the interplay of
different modes of thinking to
broaden the length and breadth
of imagination, innovative ideas
and creativity. We do this by
amplifying our global talent
pool, inducting young and fresh
talent, employing
differently-abled individuals, or
increasing the ratio of female
employees.
Beyond these parameters, we
also focus on assimilating
people with varied educational
background, knowledge
domain, functional expertise,
industry excellence and
international experience, both
on the management board as
well as on the execution team.
Promoting health & wellness
Occupational
health and
safety
At Dr. Reddy’s, occupational
health is addressed at the
design stage; beginning with
R&D of our products. A
comprehensive toxicological
risk assessment is done at the
time of product selection &
appropriate controls are
implemented to prevent any
kind of exposure during R& D
and commercial manufacturing.
The objective is primarily to
ensure that the products we
craft are safe for the patients;
and that our operations do not
present any health risks to
employees, community,
environment or customers. We
subscribe to the precautionary
principles with a philosophy of
prevention to ensure zero work
related illnesses. We have
corporate standards,
procedures and an
occupational health governance
Employee
well-being
system to manage and monitor
health and safety.
Our employees undergo regular
comprehensive health check up
to ensure early detection and
prevention of potential illnesses
& ailments. We recognize that
employee wellbeing is much
more than people’s medical
health. To align with our
company’s mission “Good
Health Can’t wait”, we design &
execute various wellness &
fitness campaigns all across the
organization for better health of
our employees.
While we offer medical support
through health check-ups and
medical insurance, we also
provide flexibility in work, to
ensure that our employees lead
a balanced, stress-free and
fulfilling life. This helps enhance
employee loyalty, improve
Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 78
Work - life
balance
productivity and increase
retention.
At Dr. Reddy's, we
acknowledge that people need
work-life balance in order to be
productive, to be healthy and to
not suffer from burnout and
stress. Providing flexibility in
work ensures that our
employees lead a balanced,
stress-free and fulfilling life.
To this end, we have
implemented policies such as
flexible work timings, sabbatical
leave, part-time work, extended
paternity and maternity leave
(including for those adopting a
child).
 The SMT way
‘The SMT Way’ of working
focuses on creating a
“wholesome employee
engagement model”, where
team members share the vision
of the organization and work as
empowered team members
across levels. We are one of the
first and few within the highly
regulated Pharma industry to
aspirants from the lower
socio-economic groups to be
recruited in the firm, continuing
their education until
post-graduation while earning
and supporting their families.
The programme helps them
develop skills to grow as
professionals and become a
part of the company’s
Ten pillars of SMT
In our experience, SMT recruits
stand apart from their industry
peers and deliver high quality
The SMT framework consisted of the four foundational elements and
output. ‘The SMT Way’ as we ten pillars.
call it, is a cultural shift calling
for change not only in work
practices, but also in the
thinking process
This year, we extended the

O
implement this successfully. management based on their spread of Self-Managed Teams

RG LEA
10 1

O D
performance. (SMTs) to more of our existing

A RN
SI E

N I
VI AR
N
The framework provides an facilities. Workplace Organisation

IS N
SH
Design

AT G
opportunity to undergraduate improvement

IO
N
9 2
“I have been associated with Dr. Reddy’s Skill based
Scientific
Selection
since last 14 years. I started my career progression
after my 10+2 qualification as an Area system

leader (SMT) in Quality Control

department. It has been a great pleasure
to work with Dr. Reddy’s. Now I look after
the stability management section at
Formulation Plant 7, Quality Control
8 SMT 3
Continuous

Way
Recognition &
department. Celebrations
Learning

I enjoy working at Dr. Reddy’s for the

following:

— Learning is made engaging and fun 4

7
— Healthy competition among peers Community
Performance Living
— Opportunity to pursue higher Scorecard
education
— Helps strengthen financial security
EG

T
EN
6
A 5
LI

M
It is a great opportunity for young people TA

ER
Human Value
Communications
RI

W
who want to work hard, having Action Team
A

PO
(HVAT)
enthusiasm to learn and expose their N
IS

EM
learnings in practice.” M

- S Chamundeswari

79 | Living our dreams Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 80


Our current focus is on the
following:
Organization Design
(Work-teams on shop-floor)
An SMT driven organization is
essentially lean; and has few
layers in its structure, to ensure
it is responsive and enables
smooth flow of communication
across levels. Every plant is
divided into small “work-teams’;
and there are 160 plus teams
now. Each team consist of a
Communication
This is the key to success in any
SMT model where ongoing
engagement, update and
improvement is driven through
regular channels of
communication. There are
various modes of
communication that are used to
sharing information effectively,
including - Shift Assembly
Meeting (SAM), Fortnightly
Team Meeting, Monthly
Communication Meets (Open
Capacity building framework
“Initially we resisted
contributing towards
team scorecard
parameters like Kaizen
but that changed
completely. Now
teams recognize its
value with respect to Safety Quality
productivity/
simplification and
financial impact. We

Broad skilling
Team Leaders and about 20 house), Visual Display Boards
team members. etc. voluntarily come Delivery Engineering

Continuous Learning Skill Based Progression

Specific functional and
behavioural modules are
designed and woven together
where the emphasis is on
learning-by-doing. Continuous
Learning starts from a rigorous
induction plan followed by
On-the-Job-Training which
focuses on technical domains
like Manufacturing, Packing,
Quality and other support
functions. After they have spent
one year in the programme,
they are enrolled for a higher
forward with ideas
System during teams meeting Propagate
and brain storming
Skill-based-progression-system
is a model that enables an
sessions”
organization to build a Starcap
multi-skilled and flexible Satyavathi Mudundi,
workforce. Every employee has Multi-skilling
opportunity learn new skills or
Quality Assurance – Excel
deepen one skills basis his
interest and organisation need.
There is also opportunity
broaden skills through
“Star-Cap” that helps in
L L L L
acquiring capability for next
level roles traditionally held by Execute

Deep skilling
education program for which
they may earn a Bachelor’s
supervisors.
E E E E
degree.

Team Scorecard and

Workplace Improvement E E E E
Learn
Every work-team has a
scorecard consisting with four
parameters - Safety, Quality,
Delivery and Team Health-
P P P P
which is derived from the
factory scorecard. These
parameters are reviewed on an Skill Families
ongoing basis through Shift
Team Meetings, Monthly

Quality control
Reviews at department and

Ointments &

Engineering

Warehouse
plant level. The teams also

production

production

production
Injectables
Packaging

assurance
Oral solid
compete with each other to win
‘Team of the Month’, ‘Team of
dosage

creams

Quality
the Quarter’ and ‘Team of the
Year’ awards.

81 | Living our dreams Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 82

 ur sustainability
performance
 Our sustainability performance
Indicator Unit 2013 -14 2014 -15 2015 -16 Indicator Unit 2013 -14 2014 -15 2015 -16

Economic performance GHG emissions

Revenue INR Million 132170 148190 154708 Direct GHG emissions

tCO 2-e 160953 177841 135140
(Scope 1)
Operating cost INR Million 49769 59117 62662 Source of Emission Factor: Combined emission factors of CO2, CH4 and N2O are considered
for all the fuels (coal, diesel oil and furnace oil) used by the company as per average values
Employee wages & benefits INR Million 24936 28967 31174 mentioned in Intergovernmental Panel on Climate Change 2006.

Payments to provider of Indirect G HG emissions

INR Million 1274 1092 826 tCO 2-e 243206 254563 335254
capital (Scope 2)

Source of emission factor: Combined emission factor of grid electricity (Central Electricity
Payment to Govt. (tax) INR Million 5094 5984 7127 Authority Database Version 11, April 2016).

Community investment INR Million 198.6 291.7 412 Water

Economic Value Retained Total water withdrawal KL 1312800 1360106 1266609

INR Million 21500 22180 20000
(PAT)

Financial assistance received • Groundwater Kl 399279 479327 450322

INR Million 0 0 0 • Municipality Kl 237226 281260 274240
from Govt.
• Surface Water Kl 676295 599518 542047
Materials
Total water recycled KL (%) 798591 (60.8) 828200 (60.9) 848367(66.9)
API – Raw Materials (Top 10
Kgs 361749 354786 476978
used for formulations) Waste

Excipients – Raw Materials

Kgs 3465061 3982699 4240126 Hazardous waste generated MT 20133 22277 26247
(Top 10)
Hazardous waste disposed
Energy use & efficiency MT 14405 15572 11639
(to landfill/TSDF/incineration )

Fuel consumption –Non - Hazardous waste

GJ 1429259 1666006 1424248
renewable sources reused/recycled (to cement MT 5726 6705 6657
plants & others)
Fuel consumption –
GJ 264690 339716 250386
Renewable sources Non -Hazardous waste
generated (E.g.: Food waste, MT 19015 21861 22750
Direct energy consumption GJ 1693949 2005721 1752639 PPE waste etc.)

Indirect energy consumption GJ 1008213 1107857 1122647

85 | Our sustainability performance Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 86

 Our sustainability performance
Indicator Unit 2013 -14 2014 -15 2015 -16 Indicator Unit 2013 -14 2014 -15 2015 -16

Air quality Employee departures – gender wise

Suspended Particulate Matter Tons/yr. 42 61 81 Total attrition Nos 3025 3818 3692
Male %age 83% 86% 84%
NOx Tons/yr. 2611 2674 2646
Female %age 17% 14% 16%

SOx Tons/yr. 1193 1221 1191

Employee departures – age wise

Environmental expenditure Tracked from

<30 %age 66.9% 57%
FY 14 -15
Environmental expenditure Million INR 327.73 621.134 559
Tracked from
30 -50 %age 32.4% 46%
FY 14 -15
Total workforce -gender type
Tracked from
Tracked from >50 %age 0.7% 1%
Male %age 91.7% 91% FY 14 -15
FY 14 -15
Parental leave
Tracked from
Female %age 8.3% 9%
FY 14 -15
Employees availing parental Tracked from Male -653 Male -722
Nos.
leave FY 14 -15 Female -103 Female - 95
Total workforce -age type
Employees returning to work Tracked from Tracked from Male -722
Tracked from Nos.
<30 %age 54% 45% after the leave period FY 15 -16 FY 15 -16 Female - 71
FY 14 -15
Safety performance
Tracked from
30 -50 %age 44% 53%
FY 14 -15
Reportable Injuries
26
(Employees) - Numbers 15 19
Tracked from
>50 %age 2% 2% (LTI+MTI+RWC)
FY 14 -15
Lost days Tracked from Tracked from
Total workforce -employment type Numbers 3786
(Employees) FY 15 -16 FY 15 -16

Tracked from Fatalities

Management Nos (%age) 15847(91.4) 17913 ( 93.3) Numbers 0 0 0
FY 14 -15 (Employees)

Tracked from Reportable Injuries

Workers Nos (%age) 809 ( 4.7) 790 (4.1) Numbers 36 19 25
FY 14 -15 (Contractual workforce)

Tracked from This is tracked at unit level but not consolidated

Contractual Nos (%age) 686(4.0) 493 ( 2.6) Lost days
FY 14 -15 Numbers at c orporate level as on date. We plan to
(Contractual workforce)
consolidate and report this from next year.
Tracked from
New employee hires Numbers 4316 4563
FY 14 -15 Fatalities
Numbers 2 0 0
(Contractual workforce)
New employee hires who Tracked from
Numbers 539 170
have left during FY 2015 -16 FY 14 -15

87 | Our sustainability performance Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 88

 Independent Assurance Statement (FTOs) in Hyderabad, Visakhapatnam and Baddi (CTO-4, CTO-5, CTO-6, FTO-2, FTO-3, FTO-6 and
FTO-7) and its Corporate Office in Hyderabad. We undertook the following activities:

Scope and Approach  Review of Dr. Reddy’s approach to stakeholder engagement and recent outputs. We did not
have any direct engagement with external stakeholders;
Dr. Reddy’s Laboratories Limited (‘Dr. Reddy’s’ or ‘the Company’) commissioned DNV GL Business
 Review of information provided to us by Dr. Reddy’s on its reporting and management
Assurance India Private Limited (‘DNV GL’) to undertake an independent assurance of Dr. Reddy’s
processes relating to the Principles;
Corporate Sustainability Report 2015-16 (the ‘Report’) in its printed format. The intended user of this
assurance statement is the management of the Company. Our assurance engagement was planned  Interviews with selected senior managers responsible for management of sustainability issues
and carried out in June – September 2016 for the financial year ending 31st March 2016. and review of selected evidence to support issues discussed at the sites we visited. We were
free to choose interviewees and interviewed those with overall responsibility to deliver the
We performed our work using DNV GL’s assurance methodology VeriSustainTM1, which is based on our
Company’s sustainability objectives;
professional experience, international assurance best practice including International Standard on
Assurance Engagements 3000 (ISAE 3000) and the Global Reporting Initiative (GRI) Sustainability  Site visits to the CTOs and FTOs in Hyderabad, Visakhapatnam and Baddi to review processes
Reporting Guidelines. and systems for preparing site level sustainability data and implementation of sustainability
strategy. We were free to choose sites we visited and it was selected on the basis of their
We evaluated the performance data presented in the Report using the reliability principle, together
materiality;
with Dr. Reddy’s data protocols for how the data is measured, recorded and reported. The
performance data in the agreed scope of work included the qualitative and quantitative information on  Review of supporting evidence for key claims and data in the Report. Our verification processes
sustainability performance disclosed in the Report prepared by Dr. Reddy’s based on GRI G4 in line were prioritised according to materiality and we based our prioritisation on the materiality of
with its ‘in accordance’ – Core option, and covering economic, environmental and social performance issues at a consolidated corporate level;
for the activities undertaken by the Company over the reporting period 1 st April 2015 to 31st March
2016.  Review of the processes for gathering and consolidating the specified performance data and,
for a sample, checking the data consolidation. The reported data on economic performance and
The reporting Aspect boundary of sustainability performance is based on a process of materiality other financial data are based on audited financial statements issued by the Company’s
assessment covering Dr. Reddy’s operations and identifying concerns of key internal and external statutory auditors;
stakeholders, as set out it in the Report in the section “About this Report” and covers the sustainability
performance of significant locations of its operation, i.e., manufacturing facilities located primarily in  An independent assessment of the Company’s reporting against the Global Reporting Initiative
Andhra Pradesh, Telangana and Himanchal Pradesh. The boundary excludes subsidiaries in India, two (GRI) G4 Guidelines and the reporting requirements for its ‘in accordance’ – Core option.
warehouses owned by Dr. Reddy’s (i.e. CTO central warehouse at Hyderabad & GDC-Ghaziabad), and During the assurance process, we did not come across limitations to the scope of the agreed assurance
factory locations and Research and Development facilities outside India. engagement.
We understand that the reported financial data and information are based on data from Dr. Reddy’s
Annual Report and Accounts 2015-16, which are subject to a separate independent audit process. The Opinion
review of financial data taken from the Annual Report and Accounts is not within the scope of our
work. On the basis of the work undertaken, nothing came to our attention to suggest that the Report does
not properly describe Dr. Reddy’s adherence to the GRI G4 Principles for Defining Report Content
We planned and performed our work to obtain the evidence we considered necessary to provide a basis Principles, General StandardDisclosures and Specific Standard Disclosures for the ‘in accordance’ – Core
for our assurance opinion. We are providing a moderate level of assurance based on VeriSustain. No option of reporting as below:
external stakeholders were interviewed as part of this assurance engagement.
 General Standard Disclosures: The reported information on General Standard Disclosure
generally meets the disclosure requirements for the ‘in accordance’ – Core option.
Responsibilities of the Management of Dr. Reddy’s and of the Assurance
 Specific Standard Disclosures: The Report describes the generic Disclosures on
Providers
Management Approach (DMA) and Performance Indicators for identified material Aspects as
The management of Dr. Reddy’s Laboratories Limited has the sole responsibility for the preparation of below. The Internal processes are in place for monitoring, managing and reporting on these
the Report as well as the processes for collecting, analysing and reporting the information presented in material Aspects and focus areas on a continual basis to ensure long term organizational
the Report. In performing our assurance work, our responsibility is to the management of the sustainability:
Company; however our statement represents our independent opinion and is intended to inform the
outcome of our assurance to the stakeholders of Dr. Reddy’s. DNV GL was not involved in the Economic Social
preparation of any statements or data included in the Report except for this Assurance Statement. DNV  Economic Performance– G4-EC1; Labour Practices and Decent Work
GL provides a range of other services to Dr. Reddy’s, none of which constitute a conflict of interest with  Indirect Economic Impacts – G4-EC8;  Employment – G4-LA1, G4-LA2;
this assurance work.  Procurement Practices – G4-EC9;  Occupational Health and Safety – G4-LA6*;
Environment  Diversity and Equal Opportunity – G4-LA12;
DNV GL’s assurance engagements are based on the assumption that the data and information provided  Materials – G4-EN1; Human Rights
by the client to us as part of our review have been provided in good faith. We were not involved in the  Energy – G4-EN3 , G4-EN5, G4-EN6;  Freedom of Association and Collective
preparation of any statements or data included in the Report except for this Assurance Statement. DNV  Water – G4-EN8, G4-10; Bargaining - G4-HR4;
GL expressly disclaims any liability or co-responsibility for any decision a person or an entity may make  Emissions – G4-EN15, G4-EN16, G4-EN18, G4-  Child Labour – G4-HR5;
EN21;  Supplier Human Rights Assessment – G4-
based on this Assurance Statement.
 Effluents and Waste – G4-EN22, G4-EN23; HR10, G4-HR11;
 Products and Services – G4-EN27; Society
Basis of our Opinion  Overall – G4-EN31;  Local Communities – G4-SO1.
 Supplier Environmental Assessment – G4-EN32;
A multi-disciplinary team of sustainability and assurance specialists performed work at Dr. Reddy’s *Absenteeism and lost days are not aggregated and
operations in India, ie. Chemical Technical Operations (CTOs) and Formulations Technical Operations reported, and reason for omission has been
explained.

1
The VeriSustain protocol is available on www.dnvgl.com

89 | Assurance statement Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 90

 Observations Opportunities for Improvement
Without affecting our assurance opinion we also provide the following observations. We have evaluated The following is an excerpt from the observations and opportunities for improvement reported to the
the Report’s adherence to the following principles on a scale of ‘Good’, ‘Acceptable’ and ‘Needs management of the Company and are not considered for drawing our conclusions on the Report;
Improvement’: however they are generally consistent with the management’s objectives:

Stakeholder Inclusiveness  Dr. Reddy’s may extend its boundary of reporting to include all subsidiaries and other entities
The participation of stakeholders in developing and achieving an accountable and strategic response to over which it has operational control to further improve on the completeness of its reporting.
sustainability.
 A process of review and periodic validation of sustainability related performance and data may
The Company has an ongoing and continuous process of stakeholder engagement in place involving its be carried out to further improve on the quality and reliability of reported sustainability data.
key stakeholders. The outcomes of this process are fairly brought out within the Report as stakeholder
concerns, and these concerns are taken into consideration while identifying the Company’s material
aspects and issues. In our opinion, the level at which the Report adheres to this principle is
For and on behalf of DNV GL Business Assurance India Private Limited
‘Acceptable’.
Bengaluru, India
Materiality
12 September 2016
The process of determining the issues that is most relevant to an organization and its stakeholders.
Dr. Reddy’s has reviewed its key sustainability issues and focus areas through internal reviews by the
top and middle management, and has concluded that there are no change in sustainability focus areas
from the previous reporting period. Nothing has come to our attention to suggest that DRL has missed
out any significant material issues based on its selected reporting boundary. In our opinion, the level at
which the Report adheres to this principle is ‘Good’.

Responsiveness KIRAN RADHAKRISHNAN VADAKEPATTH NANDKUMAR

The extent to which an organization responds to stakeholder issues. Lead Verifier Assurance Reviewer
DNV GL Business Assurance India Private Regional Sustainability Manager - Region India
The Report brings out responses with respect to identified key sustainability issues and focus areas
Limited, India & Middle East, India
within the reporting boundary, however the Report does not bring out the short, medium and long
DNV GL Business Assurance India Private
term targets for its identified material Aspects across its supply chain i.e. key sustainability issues and
focus areas. In our opinion, the level at which the Report adheres to this principle is ‘Acceptable’. Limited

Reliability -------------------------------------------------------------------------------------------------
DNV GL Business Assurance India Private Limited is part of DNV GL – Business Assurance, a global provider
The accuracy and comparability of information presented in the report, as well as the quality of
of certification, verification, assessment and training services, helping customers to build sustainable
underlying data management systems. business performance. www.dnvgl.com
The robustness of the data management and aggregation systems was evaluated, and the majority of
the data and information verified at the CTOs and FTOs were found to be fairly reliable. Nothing has
come to our attention to suggest that reported data has not been properly collated from information
reported at operational level, nor that the assumptions used were inappropriate. Some of the data
inaccuracies identified during the verification process were found to be attributable to transcription,
interpretation and aggregation errors and the errors have been communicated for correction. In our
opinion, the level at which the Report adheres to this principle is “Good”.

Completeness
How much of all the information that has been identified as material to the organisation and its
stakeholders is reported
The Report has fairly reported the General and Specific Standard Disclosures including the
management approach, monitoring systems and sustainability performance indicator against GRI G4
requirements for its ‘in accordance’ – Core option within its identified reporting boundary. The
reporting of sustainability performance needs to identify and bring out material issues across the
Company covering all significant entities such as subsidiaries, warehouses and facilities outside India
included in its financial statements. In our opinion, the level at which the Report adheres to this
principle is “Acceptable”.

Neutrality
The extent to which a report provides a balanced account of an organization’s performance, delivered
in a neutral tone.
The disclosures related to sustainability issues and performances are reported in a neutral tone, in
terms of content and presentation. The Report may further bring out the Company’s responses to
challenges faced at various geo-locations of its operations during the reporting period. In our opinion,
the level at which the Report adheres to the principle of Neutrality is “Acceptable”.

91 | Assurance statement Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 92

 GRI Content Index
GENERAL STANDARD DISCLOSURES GENERAL STANDARD DISCLOSURES
General General
Page Number (or Link) External Page Number (or Link) External
Standard Standard
Assurance Assurance
Disclosures Disclosures
STRATEGY AND ANALYSIS STAKEHOLDER ENGAGEMENT

G4-1 3, 4 Yes G4-24 9-10 Yes

ORGANIZATIONAL PROFILE G4-25 8 Yes

G4-3 1 Yes G4-26 8-11 Yes

G4-4 5, 6 Yes G4-27 9-10 Yes

G4-5 1 Yes REPORT PROFILE

G4-6 1 Yes G4-28 8 Yes

G4-7 Annual Report FY 15 -16; pg 22 -27, 30 Yes G4-29 8 Yes

G4-8 Annual Report pg 30 Yes G4-30 8 Yes

G4-9 1, 5, 6, 27; Annual Report FY 15 -16 pg 7 -9 Yes G4-31 8 Yes

G4-10 41, 47, 48 Yes G4-32 8 Yes

G4-11 16 Yes G4-33 Assurance Statement Yes

G4-12 16, 19 ; Annual Report FY 15 -16 pg 19 Yes GOVERNANCE

G4-13 8 Yes G4-34 14, 21; Annual Report FY15 -16 pg . 54-69 Yes

G4-14 22, 29, 43 Yes ETHICS AND INTEGRITY

G4-15 Carbon Disclosure Project (CDP) Yes G4-56 1, 16, 28 Yes

G4-16 32 Yes

IDENTIFIED MATERIAL ASPECTS AND BOUNDARIES

G4-17 Annual Report FY15 -16 pg 41, 50, 89 -91 Yes

G4-18 8-12 Yes

G4-19 11 -12 Yes

G4-20 11 -12 Yes

G4-21 10-12 Yes

G4-22 No Change Yes

G4-23 No Change Yes

93 | GRI Content Index Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 94

 GRI Content Index
SPECIFIC STANDARD DISCLOSURES SPECIFIC STANDARD DISCLOSURES
DMA and Identified Reason(s) for External DMA and Identified Reason(s) for External
Page Number (or Link) Page Number (or Link)
Indicators Omission(s) Om ission(s) Assurance Indicators Omission(s) Om ission(s) Assurance
CATEGORY: ECONOMIC MATERIAL ASPECT: EMISSIONS

MATERIAL ASPECT: ECONOMIC PERFORMANCE G4-EN16 46 Yes

Annual Report FY15 -16
G4-DMA Yes G4-EN18 33 Yes
pg. 2 -6
G4-EC1 46 Yes G4-EN21 33 Yes

MATERIAL ASPECT: INDIRECT ECONOMIC IMPACTS MATERIAL ASPECT: EFFLUENTS AND WASTE

G4-DMA 23, 36 -40 Yes G4-DMA 34-35 Yes

G4-EC8 19, 27, 36 -40 Yes G4-EN22 3, 34-35 Yes

MATERIAL ASPECT: PROCUREMENT PRACTICES G4-EN23 35, 47 Yes

G4-DMA 12, 16 Yes MATERIAL ASPECT: PRODUCTS AND SERVICES

G4-EC9 16 Yes G4-DMA 32-35 Yes

CATEGORY: ENVIRONMENTAL G4-EN27 32-35, 47 Yes

MATERIAL ASPECT: MATERIALS MATERIAL ASPECT: OVERALL

G4-EN1 46 Yes G4-DMA 32-35 Yes

MATERIAL ASPECT: ENERGY G4-EN31 47 Yes

G4-DMA 32-33 Yes MATERIAL ASPECT: SUPPLIER ENVIRONMENTAL ASSESSMENT

G4-EN3 33, 46 Yes G4-DMA 16 Yes

G4-EN5 32-33 Yes G4-EN32 16 Yes

G4-EN6 32-33 Yes CATEGORY: SOCIAL

MATERIAL ASPECT: WATER SUB -CATEGORY: LABOR PRACTICES AND DECENT WORK

G4-DMA 34 Yes MATERIAL ASPECT: EMPLOYMENT

G4-EN8 34, 46, 47 Yes G4-DMA 41 -45 Yes

G4-EN10 34, 47 Yes G4-LA1 47, 48 Yes

Annual Report FY15 -16
MATERIAL ASPECT: EMISSIONS G4-LA2 Yes
pg. 156
G4-DMA 33 Yes G4-LA3 48 Yes

G4-EN15 46 Yes

95 | GRI Content Index Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 96

 GRI Content Index
SPECIFIC STANDARD DISCLOSURES SPECIFIC STANDARD DISCLOSURES
DMA and Identified Reason(s) for External DMA and Identified Reason(s) for External
Page Number (or Link) Page Number (or Link)
Indicators Omission(s) Om ission(s) Assurance Indicators Omission(s) Om ission(s) Assurance
MATERIAL ASPECT: OCCUPATIONAL HEALTH AND SAFETY SUB -CATEGORY: SOCIETY

G4-DMA 18, 28-29 Yes MATERIAL ASPECT: LOCAL COMMUNITIES

This is tracked
G4-DMA 16, 36 -40 Yes
at unit level but
not consolidated
Lost days for G4-SO1 36-40 Yes
at corporate
G4-LA6 17, 48 contractual Yes
level as on date.
workforce
This is planned
to be reported
from next year.
MATERIAL ASPECT: TRAINING AND EDUCATION

G4-DMA 41-42 Yes

G4-LA10 41-42 Yes

MATERIAL ASPECT: DIVERSITY AND EQUAL OPPORTUNITY

G4-DMA 43 Yes
47 ; Annual Report FY15 -
G4-LA12 Yes
16 pg. 22 -27
SUB -CATEGORY: HUMAN RIGHTS

MATERIAL ASPECT: FREEDOM OF ASSOCIATION AND COLLECTIVE BARGAINING

G4-DMA 16 Yes

G4-HR4 10, 16 Yes

MATERIAL ASPECT: CHILD LABOR

G4-DMA 16 Yes

G4-HR5 16 Yes

MATERIAL ASPECT: SUPPLIER HUMAN RIGHTS ASSESSMENT

G4-DMA 16 Yes

G4-HR10 16 Yes

G4-HR11 16 Yes

97 | GRI Content Index Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 98