ITC and Sustainability
Ramaiah Institute of Management
ITC is a major Indian heterogeneous market or business with a diversification in the fields such as paperboards, packaging, apparel, foods, hotels, Information technology and tobacco products. The triple bottom lines encompassing economic, social and environmental parameters have said to be achieved by the company. The sustainable initiatives taken by the company have been indeed recognised and rewarded. The areas of sustainability and the balances the company have claimed to have taken initiative are examined in this case along with the criticisms made by different scholars and independent groups.
ITC the Imperial Tobacco Company which is now in Kolkata was established on august 24th 1910. The tobacco products and cigarettes in particular was there main focus for 15 years later in 1925 they had expanded the company into packaging and printing business. In 1974 they changed its name to Indian Tobacco Company Limited (I.T.C. Ltd). The company entered into a new venture with the Welcomgroup, a U.S. based Sheraton corporation, and by acquiring a property in Chennai they named the new hospitality industry as Welcomgroup Chola Sheraton.
In 1979 ITC ventured into the paper board business by promoting ITC Bhadranchalam Paperboards Limited (IBPL) in the state of Andhra Pradesh. IBPL merged with the Tribeni Tissues Limited which was the producer of a speciality paper and the supplier of a tissue paper to the cigarette company.
The company has diversified in several areas in the last few decades like confectionary, wheat flour, incense sticks, biscuits, retailing of men and women wear, soap, shampoos and creams and safety matches.
In 2001 the company changed its name to ITC Limited without any meaning and full stop.
The triple bottom line approach:
The E-choupal’s service is a unique website which provides valuable information on the weather, the rate at which the crops can be traded or bought, and the scientific technique of farming. This service reaches out to over a million of farmer cultivating different kind of crops in 4000 villages through 6500 internet kiosks across 10 states. Inadequate power supply, telecom connectivity and poor bandwidth in remote area in rural India pose a challenge apart from imparting the requisite skills to the computer users for the first time. E-Choupal has created or given employment to 48 million people in 100000 hectares of land by empowering small and marginal farmers through cloned propagation programs.
‘Mission Sunehra Kal’ meaning golden tomorrow is a program which strengthens the sustainability efforts. The main aim of this mission is to bring awareness among the rural communities about the adoption of the sustainable practise that will enable them to be economically competitive and socially secure. This mission has public -private-people partnerships which are project of high quality and social value which is engaged by several state governments.
Low carbon future is the second area of ITC’s claim in this approach. The carbon emitted from the company’s operations can be secluded twice by the afforesting initiatives. The renewable sources are used to meet its energy requirements. Plan has been made to move towards renewable resources by using the wind energy and green boilers (bio mass used as fuel).
The third pillar is based on the insights of the consumer, a world class distribution of network, formidable human capital and contemporary marketing practises. Significant investments have been made in the research and development to create innovative products and services that would enhance the company’s competitive advantage.
Sustainability challenge and responses:
1. Discriminatory rate of taxation
2. Frequent change in policies governing the agriculture sector 3. Climate change risk
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