ITC Limited
Sustainability Report 2013
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Key Impacts, Risks And Opportunities:
Sustainability Challenges

Poverty and Social Inequities

Nearly 700 million people living in rural India, with low adaptive capacities, have a direct and symbiotic dependence on climate-sensitive sectors (agriculture, forest and fisheries) and natural resources (water, bio-diversity, mangroves, coastal zones and grasslands) for their subsistence and livelihood. The limited options of alternative off-farm employment, combined with endemic poverty, continue to imperil the livelihood of millions of small and marginal farmers, mainly in the rain-fed agriculture regions. The production regime in rain-fed agriculture is inherently fragile and getting more so due to a number of factors:

  1. An estimated 147 million hectares suffer from various forms of land degradation due to water and erosion, stemming mainly from unstable use and inappropriate land management practices. Erosion rates are reported to be in the range of 5 to 20 tonnes/hectares.

  2. As many as 99 districts spread over 14 states were identified by the Central Water Commission as drought prone. Such areas are concentrated in the states of Rajasthan, Karnataka, Andhra Pradesh, Gujarat and Madhya Pradesh.

  3. Of the total water available for agriculture, groundwater alone accounts for 39% of the water used in agriculture. Yet the Central Ground Water Board reported that 1,565 blocks (one-third of the total) ranged from semi-critical to over-exploited groundwater status.

  4. Based on the current evidence, there is a compelling case to argue that these factors are likely to get exacerbated due to the changes wrought by climate change, leading to an increase in the frequency and intensity of droughts and floods. Climate change over the long-term will thus affect the rural economy in a number of ways - the majority of which would threaten food security for the most vulnerable people.

ITC’s Initiatives

Recognising that business enterprises are the economic organs of society and draw on societal resources, ITC believes that a company’s performance must be measured by its Triple Bottom Line contribution to building economic, societal and environmental capital. ITC is, therefore, committed to creating larger ‘stakeholder value’ by aligning its performance to such Triple Bottom Line objectives. As an Indian enterprise, the Company believes that this approach can unleash strong growth drivers to ensure inclusive and equitable development as well as long-term business sustainability and competitiveness.

ITC has implemented an extensive social investments programme in geographies where it has strategic business interests and presence. To ensure long-term sustainability of these investments and to enable replication and scalability, these programmes have been aligned and integrated with the business value chains of the Company.

The programmes strive to empower stakeholder communities to conserve and manage their natural resources, create sustainable on and off-farm livelihood sources and improve social infrastructure in order to support creation of sustainable livelihoods on a significant scale backed by an empowered stakeholder community.

The scale and impact of these initiatives are reflected in the following:

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