The Greening of Corporate India

Bill Ford, Chairman of the Ford Motor Company said some months ago that his company should look ahead and never get into the same situation as the tobacco companies have faced in recent years in the US. His concern stems from the fact that automobiles are a major source of pollution, and the public would not for all time to come accept a technology which is polluting in nature. He, therefore,wants to position Ford Motor Company as an environmentally responsible entity. Ray Anderson, a manufacturer of carpets in the US decided that carpets, which are replaced, are generally thrown away as waste material and only add to pollution in several parts of the US. He, therefore, initiated an arrangement for leasing of carpets and taking them back once the customer had made adequate use of what he had installed. This allowed Ray Anderson to recycle the material and bring about a major reduction in pollution. These are just two of many examples whereby corporate leaders in the US and in other parts of the world have shown their responsibility to protect the environment. A similar trend is becoming evident in India as well, but there is a long way to go before India's corporate sector achieves a level of distinction that would earn generous approbation by the public. To gain an understanding of the record ofmajor companies in India, Business Today and TERI carried out a cross-country study of environmental management practices in the country. The results of this study have been published by Business Today in its May 6 issue. As the article mentions at the outset "It's far from a groundswell yet, but slowly corporates across India are hitching themselves to the green bandwagon". Disciplined companies of course, ensure compliance with environmental regulations and standards, but the more enlightened ones act on the basis of expectations. They also adopt the role of leaders in launching initiatives that in fact go beyond the demands and expectations of the public. In this age of swift communications, any act which shows a high level of social or environmental responsibility on the part of a corporate organization gets known on a widescale, and creates an attractive image for the company. Correspondingly, any act that has even the slightest adverse impact on the environment can get widespread publicity of a negative nature. It is for this reason that large organizations focus their attention and actions not only within the physical areas of their operations but upstream on the supply chain and downstream to even the environmental impacts of the actions of the consumer. More and more companies are now ensuring that they source their raw materials and other inputs from suppliers who are environmentally conscious in their own operations. The BT-TERI survey indicated that in the majority of the 47 companies that provided information for the survey, a majority of them had environmental policy operating either at the plant level or at the corporate level, but around 20% of them had such a policy both at the corporate as well as the factory level. There were also differences in the organizational reporting arrangements for the environmental heads within the organization, with 4 out of 10 cases involving a direct reporting line between the environmental head and the CEO of the company. An equal number however combined the functions of production, operations, research and development (R&D), quality control or safety with the functions of the environmental head. In most companies overseas a very normal designation at the corporate level that is prevalent is the Vice President for Safety, Health and the Environment. Typically the larger the company the greater the demand for sound environmental practices, but this is very much a function of the philosophy of the organization. In the oil industry globally, for instance, Shell and BP are now working hard to acquire a green image through several actions, but Exxon-Mobil on the other hand remain members of the Global Climate Coalition, a body that opposes any action to mitigate the emissions of greenhouse gases (GHGs), which are causing climate change throughout the planet. Happily the ranks of the Global Climate Coalition are being depleted rapidly with more and more companies opting out. At the same time several organizations like DuPont, BP and Shell are cutting down the emissions of GHGs within their own operations quite voluntarily. To move further along the path of environmental responsibility, efforts are required by governments, NGOs and the leadership of corporate organizations in upholding the role of the corporate sector in promoting the welfare of society. A major initiative involving all the stakeholders and creating the right level of knowledge can go a long way in creating models that give our companies in India an attractive green colour.