UltraTech Cement Limited has informed the Exchange about Investor Presentation
28th July, 2022
BSE Limited Corporate Relationship Department Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai 400 001. Tel.: 22721233/4 Fax: 022 2272 2039 Scrip Code: 532538
Dear Sirs,
The Manager Listing Department The National Stock Exchange of India Limited “Exchange Plaza”, Bandra-Kurla Complex, Bandra (East), Mumbai 400 051. Tel.: 26598236 Fax: 2659 8237 / 38. Scrip Code: ULTRACEMCO
Sub: Disclosure under Regulation 30 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 Investor meeting and Corporate Dossier
We write to inform you that the Company’s officials will participate in a conference organised by Goldman Sachs for discussing ESG Strategy of the Company.
Attached is a copy of the presentation in this regard, which is also being uploaded on the Company’s website.
The same is for your information and records, please.
Thanking you,
Yours faithfully, For UltraTech Cement Limited
Sanjeeb Kumar Chatterjee Company Secretary
Encl. a/a.
Luxembourg Stock Exchange BP 165 / L – 2011 Luxembourg Scrip Code: US90403E1038 and US90403E2028
Singapore Exchange 11 North Buona Vista Drive, #06-07 The Metropolis Tower 2, Singapore 138589 ISIN Code: US90403YAA73 and USY9048BAA18
UltraTech Cement Limited Registered Office : Ahura Centre, B – Wing, 2nd Floor, Mahakali Caves Road, Andheri (East), Mumbai 400 093, India T: +91 22 6691 7800 / 2926 7800 I F: +91 22 6692 8109 I W: www.ultratechcement.com/www.adityabirla.com I CIN : L26940MH2000PLC128420
UltraTech Cement Limited Taking concrete action for a sustainable future
Stock code: BSE: 532538 | NSE: ULTRACEMCO | Reuters: UTCL.NS | Bloomberg: UTCEM IS/UTCEM LX
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02
ESG Strategy
Environment
03
Social
04
Governance
G L O S S A R Y MNT – Million Metric Tons, LMT – Lakh Metric Tons, MTPA – Million Tons Per Annum, MW – Mega Watts CY – Current Year period, LY – Corresponding period Last Year, FY – Financial Year (April-March)
Massive opportunity in sustainable construction
• World population
projected to reach 10 bn by 2050
•
India to be most populous country by 2023
• Urban population to
grow more than double by 2050
•
•
India is poised to grow at 7- 8% over the next decade and be the third largest economy by 2030
Globally USD 15 trillion investment infrastructure sector by 2030
•
Growing need of sustainable built environment
• More than 70% of built environment to be constructed in India in coming decades
•
Consumer preference to shift towards sustainable construction
•
•
Global focus on Net Zero Carbon, Circularity and Nature
India’s commitment to Net Zero by 2070
UltraTech is poised to grab this opportunity in Sustainable construction
3
Our sustainability playbook
Care for nature
Care for society
Decarbonisation
Community outreach
Circularity
Water positive
Employee well being & diversity
Sustainable supply chain
Biodiversity
Customer centricity
4
UltraTech: ESG Strategy
• Aligned with UN SDGs
•
Identifying opportunities and future-proofing the business
• Meaningful and
measurable progress on stakeholder’s relevant issues
Carbon offset projects
Internal carbon pricing
Water recycling
Groundwater recharging
Renewable Energy
Climate change, energy & emissions
Water Management
Biodiversity
Circular Economy
Environmental Impact Assessments
Municipal waster as alternate fuel
Sustainability is at our core
Rainwater harvesting
Water efficient technologies
Zero water discharge
Waste management
Industrial waste to blended cements
Industrial waste as alternative fuel
Concrete recycling
5
UltraTech: ESG journey
2005-2009
Awareness
2010-2019
Management
2020-2022
Leadership
• Adoption of Global Reporting Initiative (GRI) framework
• Published first GRI Sustainability report
• Registered Carbon credits projects with UNFCCC
•
first Business Responsibility Report (BRR)
• Became Water positive
• Response to Carbon Disclosure Project
•
First Biodiversity management plan
• Doubling Energy Productivity commitment (#EP100)
• Adoption of Internal Carbon Price (ICP)
•
Issued Sustainability linked bonds
• Committed to 100% RE under #RE100
• Targets aligned to SBTi validated
• Committed to Net Zero Carbon
• Committed to No-Net Loss on biodiversity
• Disclosing to TCFD framework
UNFCCC : United Nations Framework Convention on Climate Change, EP100 is a global initiative led by the international non-profit Climate Group, SBTi : Science based target initiative, TCFD : Task force on climate related financial disclosures, RE100 is a global initiative led by The Climate Group
6
Environment
Bold environment targets
Net Zero Carbon by 2050
100% RE by 2050
No Net Loss by 2050
5 times Water positive by 2024
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Decarbonisation
CO2 emission reduction path
9.1%
27%
12.7%
Net Zero
Net kg CO2 emission/t of cementitious material 632
582
462
2017
2022
2025
2030
2050
FY17
FY22
Target FY32
Accelerating our decarbonisation trajectory
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Action plan
Actions
Short term (~1-3 years)
Mid to Long term (beyond 2025)
Increase of alternative materials to get clinker factor to 0.7 & increase share of blended cement
Product Chemistry
Invest in in-house research and GCCA Innovandi to low carbon products
Increasing SCM in own RMC & customer side at built environment
Energy metrics & digitalisation
Invest in operations to optimize heat and electricity consumption
Adopt digitalization to improve kiln, mill and power plant energy performance
Increase share of green electricity mix
Invest in WHR & Renewable energy projects
Invest in storage solutions to source RTC power (100% RE)
Increasing alternative fuel
Invest in handling systems, network optimization and biomass supply chain (TSR – 10%)
Digital tools, oxy-rich firing and maximise biomass (TSR – 30%)
New age technologies
CSS & U, kiln electrification, hydrogen
WHR: Waste heat recovery, SCM: Supplementary Cementitious material, RTC: Round the Clock, TSR: Thermal substitution rate, CSS & U: Carbon storage system and use
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Accelerating decarbonisation
Electrification of cement kiln heating process using Coolbrook’s Roto Dynamic Heater (RDH) technology with a potential to eliminate up to 30% of CO2 emissions from fossil fuel burning in cement manufacturing.
UltraTech to leverage transformational technology for reduction of CO2 emissions in cement manufacturing
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10
Water
Targets
•
To become 5 times water positive by 2024
• Maintain WASH score above 1.8
Action plan
• Demand reduction measures (air cooled condenser, low flow fixtures
etc.)
• Invest in rainwater harvesting and recharge initiatives (both plant and
community)
• Increase efficiency of Sewage treatment plants (STP) • Increase recycle, reuse initiatives • Install water treatment plants, sanitation facilities • Alternative water source for sites with high physical climate risk
Impact
73 million m3 water returned to nature
80% sites already water positive
WASH score of 1.85+
WASH : Access to Safe water, sanitation and hygiene
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Circularity driven business growth
10+
Adopted innovative approaches to build our efforts on Circular Economy
BUILDING
CIRCULAR
BUSINESS
MODELS
Use of industrial waste like zinc slag, phospho- gypsum, red mud etc.
Circular approach promotes environmenta l and economic sustainability
Reddipalayam Cement Works achieves 25% AFR Utilization
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Zero discharge RMC plant
• Technology is fully-automated and enables the plant to be real zero discharge with no water and solid waste.
• This eliminates the cost of
waste disposal and recycling material generated out of the said process.
• The partial substitution of
sand, fly ash, and water makes it a sustainable business proposition.
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Biodiversity
Targets
Biodiversity management
• No Net Loss by 2050
•
Complete biodiversity assessment for all integrated sites by 2024
• Adopted GCCA guideline on biodiversity & nature
• Partnered with IUCN & other partners to create a scientific and
systematic approach towards biodiversity management.
• All the sites of UltraTech have been assessed for potential biodiversity-
related features through the Integrated Biodiversity Assessment Tool
(IBAT).
Impact
10 sites have biodiversity management plans
2859 Floral species found across sites
1936 Faunal species found across sites
GCCA: Global Cement and Concrete Association
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Progress so far
Power Consumption/t of Cement
79.3
75.4
73.9
Clinker Factor
76%
73%
72%
Kg CO2 emissions /t of cementitious material
632
FY17
FY21
FY22
FY17
FY21
FY22
597
582
Thermal Substitution Rate
4.6%
3.1%
2.1%
8.0%
Clinker Factor
Green Power Mix
17.8%
12.3%
FY17
FY21
FY22
FY17
FY21
FY22
FY17
FY21
FY22
Continuous measures and improvement across the operations helping in reducing CO2 emissions
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UltraTech on the global charts
CO2 emissions/t of cementitious material
ARM %
TSR
UltraTech - FY22
582
UltraTech - FY21
597
UltraTech - FY22
UltraTech - FY21
19%
18%
UltraTech - FY22
5%
UltraTech - FY21
3%
Global Average - FY21
639
Global Average - FY21
11%
Global Average - FY21
23%
Lower CO2 emission/t compared to global peers
Consumes higher alternative raw material
Catching up with global peers
Clinker Factor
Heat Consumption
UltraTech - FY22
72%
UltraTech - FY22
UltraTech - FY21
73%
UltraTech - FY21
718
722
Global Average - FY21
75%
Global Average - FY21
878
Lower clinker factor than global peers even higher contribution to infrastructure
Better operating assets on energy metric
Increase in TSR despite challenges: • lack of proper waste collection legislation Capital costs for waste processing facilities higher waste transportation costs
•
•
TSR – Thermal Substitution Rate
Global average – average of top 5 peers
Source: Research houses
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Efforts recognised
Ranked 7th globally in Construction material category
A- rating - Water Disclosure B rating - Climate Disclosure A rating - Supplier Engagement
Overall ESG Score – 2.2
“ESG Way” series* UltraTech scored 72.7 and in 1st quartile in the sector
“ESG Gauge” compendium* UltraTech scored 61 and amongst the top quartile in the sector
GS Sustain*
Global Governance Rank: 52
* Ratings given by various research houses during FY22
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Social
Social targets
10% Gender diversity by 2025
Assess 100% critical supplier by 2025
Sustainability awareness session of 25% of tier 1 suppliers by 2025
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Social value creation
FY22
FY21
FY20
Community project spent (million USD)
13.7
16.1
16.7
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Districts
507
Villages
Our outreach
47
Locations across India
1.6
Million beneficiaries
16
States
39
Blocks
Business level goals: By 2025 in 300 villages
• Reduction in poverty from 25% to 5% (vis-à-vis the currently measured – people living on less than USD 2 a day)
• Reduce malnutrition in children under 5 years of
age to less than 5%
• Halve percentage of anemic women aged 15-49
years
• Increase farm productivity by 50%
• Ensure access to quality essential primary health
services
• Zero Infant and Maternal Mortality (IMR & MMR)
• Ensure 100% enrolment and zero dropout rate
• Open Defecation Free (ODF) villages • Access to safe drinking water in less than 30 min
walk (round trip)
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Building a sustainable supply chain
Onboarding
Sustainability high risk & critical supplier identification
High risk & critical supplier ESG assessment
Supply chain risk minimization & Sustainability performance
ESG integration into Supply chain
Sustainable Supply chain performance
KPI
Target
New suppliers to be screened for ESG Criteria
Continuous
Status
Done
Assessment of critical suppliers
100% by 2025
Completed in FY22
Coverage of Tier 1 suppliers through sustainable supply chain awareness sessions
25% by 2025
Achieved 6% in FY22
Developing a local supply chain ecosystem
Procurement from local suppliers
Focus locally, even when operating from some of the remotest areas of the country. Responsible sourcing on our part also creates major gains for the communities around us as it creates employment and business opportunities and contributes locally.
FY20
FY21
FY22
11.2%
Contracts are from MSME suppliers
69%
71%
79%
60%
65%
70%
75%
80%
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Customer centricity
Product Stewardship
70+ various building material products certified under green label
Life Cycle Assessment (LCA) & Environment Product Declaration (EPD) completed for four type of cement
Atul Tunnel, Rohtang
Pimpalgaon-Nashik-Gonde Road
Deep carbon reduction achieved by engaging with customers
Active value chain engagements with customers for reducing climate emissions. On extending the boundary further downstream and evaluating the carbon footprint reduction, primarily by mixing supplementary cementitious material within the ready-mix concrete. Over the years UltraTech has developed this approach by influencing consumption of industrial waste in form of supplementary cementitious material (SCM).
The carbon intensity stands at 551.86 kg CO2/tonne cementitious materials and has resulted in achieving 15.06% of Scope 1 intensity target against the target value of 27% by 2032.
Estimated reduction of 4 Million tons of CO2 emissions over its lifetime.
Estimated reduction of 6 Million tons of CO2 emissions over its lifetime.
Sadar Double bridge, Nagpur
Signature Delhi bridge
(UltraTech Boundary) 2022
Target year
462
(Customer Engagement) 2022
552
582
Estimated reduction of 1.1 Million tons of CO2 emissions over its life.
Estimated reduction of 10 Million tons of CO2 emissions over its life.
Base year
635
kg CO2 per ton of cementitious material
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Employee development
Enhancing diversity and inclusion through four-pronged approach
Innovation culture
Infrastructural support
Gender Intelligence
Safe Environment
Women – friendly policies
Human rights management plan
Diverse workforce
Risk identification
Identify vulnerable group
Risk prevention & mitigation
Monitoring review
▪ Women represent 2.56% of our workforce. (Target 10% by 2025) ▪ Our workforce is comprising of 10
nationalities
Our in-house Human Right Due Diligence (HRDD) contains
78
38
Potential abuse
Human rights
100%
Sites assessed
22
Celebrating diversity with a difference
2 ‘All-women’ RMC plant in India More to come
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Governance: Board effectiveness
Shareholders
Board of Directors
Independent Directors
50%
Nomination, Remuneration and Compensation
Audit
Stakeholders Relationship
Woman Directors
30%
Finance
Risk Management and Sustainability
Corporate Social Responsibility
Board Attendance
>95%
Executive Management
Committee Attendance
100%
Organization
Average tenure of the Directors on our Board - ~9 years
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Governance: Policies governing our business
1.
2.
3.
4.
Sustainability Policy
11. Anti-Harassment and discrimination policy
Code of Conduct
Tax Policy
12.
Supplier Code of Conduct
13. Human Rights Policy
Policy on Related Party Transaction
14.
Safety Policy
5. Whistleblower Policy
15. Occupational Health Policy
6.
7.
CSR Policy
16.
Energy and Carbon Policy
Board Diversity Policy
17. Water Stewardship Policy
8. Dividend Distribution Policy
18. Biodiversity Policy
9.
Internal Audit Charter
19.
Stakeholder Engagement Policy
10.
Anti-Corruption and Bribery policy
20. Cyber security policy
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Disclosures
GRI report
BRR/BRSR
CDP
TCFD
Integrated Reporting
• One of early adopter of
GRI framework
•
First report published in 2007
• Publishing GRI report
for last 15 years
•
First BRR disclosure made in 2013
• This year made first BRSR disclosure
• Made first climate disclosure in 2013
• Climate disclosure
made for last 9 years
• Made first water
disclosure
• Completed study against TCFD framework
• Report will be
published in this year
• This year published our first integrated report
Have disclosure aligned to all global frameworks
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Disclaimer
Statements in this ‘presentation’ describing the Company’s objectives, estimates, expectations or predictions may be “forward looking statements” within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make difference to the Company’s operations include global and Indian demand supply conditions, finished goods prices, feedstock availability and prices, cyclical demand and pricing in the Company’s principal markets, changes in governmental regulations, tax regimes, economic developments within India and the countries within which the Company conducts business and other factors such as litigation and labour negotiations. The Company assumes no responsibility to publicly amend, modify or revise any forward-looking statement, due to any subsequent development, information or events, or otherwise.
UltraTech Cement Limited Regd. Office: Ahura Centre, Mahakali Caves Road, Andheri (E), Mumbai – 400 093 [Corporate Identity Number L26940MH2000PLC128420]
www.ultratechcement.com or www.adityabirla.com investorrelations.utcl@adityabirla.com
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