TATA GROUP SUSTAINABILITY STRATEGY

Mathew Ashley
Bill O’Brien
Rachel Reiter
Kevin Richards

Leadership with trust

 EXECUTIVE SUMMARY
Goal

Develop a ten year strategy to continue Tata’s profitable growth and sustainability
leadership while addressing:
 Tata’s growing global presence
 Evolving definitions of sustainability
 Increasing demand for measurement and transparency

Recommendations

 Simplify Tata’s internal definition of sustainability and articulate it through a credo

 Create a separate subsidiary to coordinate, communicate, and expand
sustainability efforts across every business unit
 Establish a “multi-local” strategy tailored to the unique challenges and
opportunities of each country and business

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Many independent initiatives and organizations

CURRENT SITUATION
TCCI Innometer
Annual Management Workouts Tata Trusts Tata Power Indian Hotels
AsTata
TataMotors
grows globally, how
Tatacan the company
Chemicals Tatapreserve its unique tension
Relief Committee
TQMS Tata International
Tata Index forbetween
Sustainable
profit and purpose to meet evolving definitions of sustainability?
Human Development Innoverse
Tata Tea Tata Consulting Services Tata Protocol for Internal
Tata Steel Assessment
CSR silos are usually the norm

Steel TeleCom Tea International Consulting Hotels Motors Power Chemicals

Ongoing Community Tetley Tea Employee Community EARTH Tata Nano Combat Innovation
community literacy Rainforest generation literacy Project Climate Center
service Certification IIP CII Energy Change (3C’s)
Animal Carbon
Health & Certification Green Globe Mgmt Award mapping
Recycling Ethical Tea husbandry Sustainability
wellness collaboration
program Partnership Community council Tata Swach
Tata Swach EMS
(ETP) development (H20 purifier) standards Imported Coal (H20 purifier)

The status quo has risks

 Future funding is loosely defined  Measurement and transparency  Role clarity
 Employee standards inequity  Inadequate stakeholder  Overlapping efforts
communication

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 Goals of Tata’s corporate communication on sustainability

SUSTAINABILITY DEFINITION & CREDO

 Simple and easy for employees to understand
 Flexible for changing and differing definitions of sustainability
 Creates a “roadmap” for employees and stakeholders
 Inspires new thinking for existing businesses and processes
 Articulates Tata’s aspirations for sustainability

Sustainability Definition
“Corporate Sustainability (CS) is integral
is a local, to value-creation
national, in our business
and global endeavor through
for creating the enhancement
long-term of human,
economic, social, and
natural,
financial and social
growth forcapital complementing
the enterprise their economic and financial growth in order to give the enterprise
and its stakeholders.”
an enduring future and also help create and serve a larger purpose, at all times. It facilitates accountability to
all stakeholders as a systemic practice.”
The Tata Credo
1) Everything we do within Tata can be re-examined through 6) All sustainable initiatives should be transparent,
a sustainability lens. measurable, and auditable to all stakeholders.
2) Sustainable initiatives strive to add value to Tata's 7) Our businesses should inspire new sustainable ideas, and
enterprise and shareholders over a reasonable time frame. our sustainability efforts should inspire new business ideas.
3) Social philanthropy and development initiatives are a core 8) Sustainable thinking and implementation is a key skill that
competency and should be treated as an essential output every future Tata manager should possess.
of the organization. 9) Tata's companies will encourage their business partners
4) Sustainable creativity and knowledge should be shared and stakeholders to achieve sustainable business practices.
across all Tata organizations and outside of our company. 10) Our initiatives should lead environmental, economic, and
5) Tata's sustainability development should be managed with social development in India and the world. Our efforts go
the same rigor, focus, and precision as other Tata business. beyond a "compliance" mindset and accomplish what was
once thought impossible.

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TSS VALUE CREATION
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ORGANIZATIONAL CHART BREAKOUTS
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 ORGANIZATIONAL CHART BREAKOUTS
Create New Markets
 Internal Consultants: Facilitation & subject matter expertise
 Innovation Center: Creates new products or new markets for existing products
 Financial Planning: Funding, budgeting, agreement with shareholders
 Internal Audit: EVA in collaboration with TQMS
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 Climate Change Task Force: Internal conservation across all business units
 ORGANIZATIONAL CHART BREAKOUTS
Build Intellectual Capital
 Management Training: Rotations & development
 Climate Change Task Force: Grow environmental CSR
 Innovation Center: Improving business practices
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 ORGANIZATIONAL CHART BREAKOUTS
Monetize CSR Knowledge
 Financial Planning: External fundraising
 External Audit/Measurement: Outside credibility
 External Consultants
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 ORGANIZATIONAL CHART BREAKOUTS
Strengthen Brand
 Communications: Publicize CSR efforts in receptive markets
 Trust/Endowments: Protect & grow company culture of philanthropy
 External Audit & Measurement: Company-wide CSR report
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 ORGANIZATIONAL CHART BREAKOUTS
Attract & Retain Talent
 Trust/Endowments: Protect & grow company culture of philanthropy
 Management Training: Rotations & development
 Communications: Employee engagement
 Financial Planning: Employee incentives
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 Innovation Center: Improving business practices
 If managed properly, TSS can address and overcome traditional barriers to

IMPLEMENTATION
implementation and common CSR challenges.

A silo mentality develops Make TSS part of BU

(Robert Sutton) strategic plan &
operating review
Incentivize BU managers

Project prioritization
TSS is under-resourced &
committee
overcommitted
Budgeting process
Financial
Planning

Management rotations
Hiding place for ineffective
HR training/retraining
managers
Recognize & reward success

Corporate culture diluted Continue to support innovation

from “ground up”, everyone
part of success
Tata’s
Stars 12
Growth opportunities should fit Tata’s values while staying sensitive to economic,

MULTI-LOCAL STRATEGY
environmental, and social considerations in local communities.

Tata Values Country Challenge & Opportunity

 Carbon Unites States Education, Regulations, Green investments
footprint
 Recycling China Gov., Pollution, Human Rights, Economy
 Water
purification EU Safety nets, Green Movement
 Ethical
sourcing
Brazil Deforestation, Natural resources

 Human Canada Safety nets, Green Movement

rights
 Gender Gulf CC Oil rich, Cultural views, Gender roles
rights
 Education South Africa HIV/AIDS, Developing economy
 Literacy
 Health,
Sri Lanka, Developing economy, Government
HIV/AIDs
Thailand, stability, wages
 Fair wages
Vietnam

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END OF LIFE VEHICLES (ELV) PROJECT

INITIATIVE EXAMPLE
 ELV processing is already mandatory in the EU Multi-Local Implementation
Tata Credo Alignment
1) Everything we do within Tata can be re-
 By combining expertise across businesses, Tata can examined through a sustainability lens.
create an ELV initiative in the EU and new markets 3) Social philanthropy and development
initiatives are a core competency and should
be treated as an essential output of the
 The estimated value of an ELV-processed vehicle is organization.
$267, which could be split between Tata and the 4) Sustainable creativity and knowledge should
customer be shared across all Tata organizations and
outside of our company.
7) Our businesses should inspire new
sustainable ideas, and our sustainability
efforts should inspire new business ideas.

TSS Facilitation of Initiative

 Leverage business knowledge in target markets  Communication and marketing to promote
 Measure returns and costs across all businesses initiative
 Coordinate business unit interactions  Secure NGO support

Steel International Motors Power Chemicals

Tata ELV Services 14

CSR SOFTWARE CONSULTING
 Leveraging Tata’s CSR core competency into a
sustainability software consulting practice
 Developing Tata Consulting Services group specializing
in Enterprise Carbon Accounting (ECA) software
 Test and develop new market for “human” sustainability
software
 Future value creation through external CSR consulting
beyond software
TSS Facilitation of Initiative
 Finance and audit function provides
measurement and transparency
 Develop “human” software in Innovation Center
and through inter-company collaboration
Consulting Steel
Tata CSR Consulting
INITIATIVE EXAMPLE
Multi-Local Implementation
Tata Credo Alignment
5) Tata's sustainability development should be
managed with the same rigor, focus, and
precision as other Tata business.
6) All sustainable initiatives should be
transparent, measurable, and auditable to all
stakeholders.
9) Tata's companies will encourage their
business partners and stakeholders to achieve
sustainable business practices.
10) Our efforts go beyond a "compliance"
mindset and accomplish what was once
thought impossible.
 Climate change group leveraged for CO2
tracking software
 Seek out potential clients across existing
business
Power Telecom International
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 EXTERNAL RISKS
If implemented correctly, our recommendations can create value by anticipating outside
change and giving Tata the structure and capability to continue profitable sustainability.

External Risk Credo TSS Multi-Local

Strategy
Continued Global
Recession  
Market Indifference
 
Stakeholder
Obstructions  
Evolving Definition
of Sustainability   

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 TIMELINE & ACTION PLAN
Costs and Returns
 Initial investment for TSS and initiatives: $52M
– TSS assumed to have up to 500 headcount
– Total Tata 2009 investment in social initiatives: $159M (Graham, “Too Good To Fail”, 2010)
 Additional expenditures of $20M - $60M per year as staged initiatives roll out
 Minimum 10% return projected if Tata brand value increases by $4M per year

Next Steps
 Discuss TSS idea with key leaders  Investigate initiative feasibility
 Begin work on standards for employee  Investigate legal/tax/reporting implications of
equality across countries subsidiary

If preliminary feedback is positive, hold an offsite leadership meeting to

finalize credo, TSS plans, budget, and communication strategy.

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QUESTIONS? THANK YOU

Leadership with trust

 ENERGY EFFICIENCY INITIATIVES

 Tata Steel leads group on energy efficiency programs
and has several innovative pilot programs 1)
2)
 Reduce its carbon footprint in existing and new markets
 Projected to save $3.1 million in fuel costs, savings from 4)
other energy programs $17.9 million with initial roll out
in India, EU, China and expanding to other markets 6)
9)
INITIATIVE EXAMPLE
Tata Credo Alignment
Everything we do within Tata can be re-examined
through a sustainability lens.
Sustainable initiatives strive to add value to Tata's
enterprise and shareholders over a reasonable
time frame.
Sustainable creativity and knowledge should be
shared across all Tata organizations and outside of
our company.
All sustainable initiatives should be transparent,
measurable, and auditable to all stakeholders.
Tata's companies will encourage their business
partners and stakeholders to achieve sustainable
business practices

TSS Facilitation of Initiative

 Leverage business knowledge in target markets  Communication and marketing to promote initiatives
 Measure savings and costs across all businesses  Ensure alignment with Climate Protocol
 Coordinate business unit knowledge sharing  Secure NGO support

Steel International Motors Power Tea

Tata Energy Efficiency Initiatives 19

 COMBATTING CLIMATE CHANGE (3C’s)

INITIATIVE EXAMPLE
 Diversify energy mix and develop strategies to meet the Tata Credo Alignment
expanding demand for power over the next ten years 1) Everything we do within Tata can be re-examined
through a sustainability lens.
4) Sustainable creativity and knowledge should be
 Work with government stakeholders to develop shared across all Tata organizations and outside of
alternative energy technology our company.
5) Sustainable creativity and knowledge should be
shared across all Tata organizations and outside of
 Carbon footprint reduction opportunities through the our company.
use of nuclear, wind, solar and hydro 10) Tata's companies will encourage their business
partners and stakeholders to achieve sustainable
business practices.

TSS Facilitation of Initiative

 Integrate Power Sustainability Council into TSS  Communication and marketing to promote
 Measure returns and costs across all businesses initiative
 Coordinate business unit interactions  Secure governmental support

Steel Consulting Motors Power Chemicals

Tata Power Initiative 20

 STRATEGIC REORGANIZATION FOR TEA GROUP

INITIATIVE EXAMPLE
 Transparent reporting of ethical sourcing through the Tata Credo Alignment
Rainforest Alliance Certification (RAC) in Western 2) Sustainable initiatives strive to add value to
European and North American Tata's enterprise and shareholders over a
reasonable time frame.
 Renewable packaging through Life-Cycle Analysis 4) Sustainable creativity and knowledge should
be shared across all Tata organizations and
outside of our company.
 Fair Trade certified products and standards 5) Sustainable creativity and knowledge should
be shared across all Tata organizations and
outside of our company.
9) Our businesses should inspire new
sustainable ideas, and our sustainability
efforts should inspire new business ideas.

TSS Facilitation of Initiative

 Integrate Tetley sustainability initiatives  Communication and marketing to promote
throughout Tea Group initiative
 Measure returns and costs across all businesses  Share Tata Chemical competency in sourcing ,
 Coordinate business unit interactions packaging, and distribution to Tata Tea

Tea International Power Chemicals

Tata Tea Group 21

 TATA “GREEN CHEMISTRY” INITIATIVE

INITIATIVE EXAMPLE
 Flue gas treatment, carbon absorption and nano glass Tata Credo Alignment
coating for insulation 1) Everything we do within Tata can be re-
examined through a sustainability lens.
 Entered into the bio-fuels market in 2007 3) Social philanthropy and development
initiatives are a core competency and should
be treated as an essential output of the
 Fresh produce sourcing, packaging, and distribution organization.
4) Sustainable creativity and knowledge should
be shared across all Tata organizations and
 Innovation Center outside of our company.
7) Our businesses should inspire new
 Center for Agriculture and Technology sustainable ideas, and our sustainability
efforts should inspire new business ideas.

TSS Facilitation of Initiative

 Integrate Innovation Center into TSS  Communication and marketing to promote
 Measure returns and costs across all businesses initiative
 Coordinate business unit interactions  Share competency in sourcing , packaging, and
distribution to Tata Tea

Steel International Tea Power Chemicals

Tata Chemical Initiative 22

 HOTEL CONSERVATION INITIATIVE

INITIATIVE EXAMPLE
 Indian hotels is pursuing an internal project Tata Credo Alignment
known as EARTH
1) Everything we do within Tata can be re-examined
through a sustainability lens.
 There are best practices from other hotel chains 2) Sustainable initiatives strive to add value to Tata's
and Tata companies that can be leveraged for enterprise and shareholders over a reasonable time
near-term immediate savings frame.
4) Sustainable creativity and knowledge should be shared
across all Tata organizations and outside of our company.
 Long term goal should be LEED certification for 5) Tata's sustainability development should be managed
new hotels with the same rigor, focus, and precision as other Tata
business.
9) Tata's companies will encourage their business partners
 Total annual savings/profit for 8 targeted hotels = and stakeholders to achieve sustainable business
$1M practices.

TSS Facilitation of Initiative

 Work with other Tata companies to discover  Communication strategy for hotel customers to
conservation best practices get help with conservation efforts
 Set up conservation measurement system for hotels  Leverage Climate Change task force

Tea Consulting Hotels Power

Tata Hotel Conservation Initiative 23

FINANCIAL VALUATION
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FINANCIAL VALUATION
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FINANCIAL VALUATION
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FINANCIAL VALUATION
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DECISION ANALYSIS MATRIX
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DECISION ANALYSIS MATRIX
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CURRENT ORGANIZATIONAL CHART
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TQMS INNOVATION MATRIX
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TQMS COMMUNICATION STRUCTURE
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TQMS COLLABORATIVE RESEARCH
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TQMS FACILITIES FOR LEARNING
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 TIME, DIFFICULTY, IMPACT, & RISK
Medium/ Medium
Steel Plant
Energy
Tata Tea Efficiency
Medium/ High Low/ Low
Implementation Difficulty

Certification $23.6M
ELV $12.5M
Low/ Low
Recycling
Hotel $1.4M Sustainability Low/ Medium
Conservation Software
$3.9M Truck/ Trailer Consulting
Expansion $71.6M
$6.9M

Medium/ High

Estimated Break-Even Timing

Size =
Profit
Market Risk
Impact Economic/ Political

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