ESG governance

As part of our continued commitments to ESG, we have expanded the scope of the erstwhile Sustainability Board Committee and implemented a uniform ESG governance structure across the organisation. The Committee, together with our Group Sustainability and ESG function, will be responsible for activating, mainstreaming and monitoring initiatives under the ‘Transforming for Good’ agenda. We have also established dedicated forums for regular management oversight at all levels and ESG-themed communities at each BU and SBU to own projects and drive their timely implementation.

ESG GOVERNANCE AND MANAGEMENT STRUCTURE

External ESG Advisory Committee

To bring the best of the world to implement our ESG agenda, we have tapped into the expertise of globally leading organisations and professionals by partnering with them. Apart from leading consulting organisations, we have brought on- board experts to help our leadership teams get an independent view to shape the ESG agenda for the organisation.

Enablers of ESG culture

At Vedanta, we are planning and adopting best-in-class and novel initiatives to mainstream our ESG culture. These include:

• The world’s first ESG Academy for in-house competency creation of all our employees and business partners
• Vedanta Sustainability Venture Fund to support and harness external innovation
• New ‘green’ business strategy to leverage attractive adjacencies like green metals, renewables, green hydrogen, recycling etc.
• ESG Centre of Excellence for regular monitoring and continuous improvement

Empowering communities

Vedanta Sustainability Framework

Developed in line with global standards from international bodies such as International Council on Mining and Metals (ICMM), International Finance Corporation (IFC), Organisation for Economic Co-operation and Development (OECD), United Nations Global Compact (UNGC) and SDGs, the framework comprises several policies, standards and guidance notes which facilitate its execution.

Robust monitoring

• Annual audit (VSAP) conducted at all Vedanta locations to check compliance with VSF
• Monitored by Group ExCo

Vedanta Sustainability Assurance Process (VSAP)

VSAP is our sustainability risk assurance tool, instrumental in assessing the compliance of all our businesses with the Vedanta Sustainability Framework. It ensures that sustainable development is well integrated into all our decisions and actions at Vedanta. Further, VSAP also guides our annual process with specific tracking of results by the ESG Committee, and the Group Executive Committee, which, in turn, reports to the Board. The results of VSAP have a direct bearing on the overall performance evaluation of our entire full-time-employee workforce with 15% weightage attributed to sustainability KPIs. A minimum of 70% is needed in VSAP audit as a threshold for pay-out under this component.

Stakeholder engagement and material matters

To align our priorities and actions towards the new ESG purpose, we refreshed our materiality assessment in FY2022 through a detailed peer benchmarking exercise and limited stakeholder consultations. The results of this assessment have been considered while adopting the three pillars and nine aims of the ‘Transforming for Good’ ESG framework.

Stakeholders identified

• Local communities
• Employees
• Shareholders, Investors, & Lenders
• Civil Society
• Industry (Suppliers, Customers, Peers, Media)
• Governments

Top material topics

We classify our material issues as High, Medium, Low. All material issues within a particular classification (H, M, L) are treated with the same priority. Our ESG KPIs are focused on responding to those issues identified as High in our materiality assessment. The top priorities across Environment, Social and Governance have been identified as below.

Priority order of ESG well envisioned

ESG SCORECARD

Over the years, we have progressed along conserving the environment, protecting our people and empowering the communities. The summary dashboard provided below gives a glimpse of our performance against our goals.

Grooming the countries future

LIVELIHOOD IMPACT OVERVIEW

REMARKABLE INITIATIVES

• Project Subhalaxmi at Vedanta Jharsuguda provided micro-finance services to 1,091 members, helping them get loans of `3.34 crore
• Project Sakhi Haat of HZL provided new avenues of income generation to SHG women with the launch of two Sakhi Haats in Chhitorgarh and at Udaipur Airport
• Vedanta Lanjigarh’s Mahila Kirana (Sashakti Suvidha Kendra) provided a permanent solution to the business aspirations of SHGs, enabling 94 Sashakti Suvidha Kendras to use its platform to sell over 30 SHG-produced products, generating `6,700+ per month for each SHG member
• Vedanta Lanjigarh is closely working with rural artisans for the revival of the fast declining indigenous art form of Dokra; bringing the locally made artefacts into mainstream marketing and providing income for locals

The journey continues

Our commitment towards ensuring sustainable livelihoods is evident from the fact that in the last five years alone, `159 crore+ has been spent on livelihood initiatives.

Both the Subhalaxmi project of Vedanta Jharsuguda and HZL’s Samadan project have received national and international recognition for their high impact. They have also bagged awards from FICCI and BRICS for their contribution to SDG 2 and SDG 5.

Nothing can be more gratifying than the beneficiaries themselves testifying to these efforts.

Nirmal Rathiya, a farmer from a remote Chattisgarh village,
says, “COVID-19 was a scary time and the support I got from project Mor Jal Mor Maati of Vedanta BALCO kept me afloat. Today I can see a bright and prosperous future ahead.

Pushpanjali Seth, former president, Subhalaxmi says, “It is a matter of immense pride and fulfilment for us to see our Subhalaxmi Cooperative Society getting national and international acclaim. I am thankful to Vedanta for this initiative, which has enabled each one of our women members to progress through skill development, financial literacy, financial inclusion and welfare schemes.

At Vedanta, our journey continues as we commit ourselves towards crafting an empowering and enabling future for an ’Aatmanirbhar Bharat’.

Promoting local art

ENERGY MANAGEMENT AND CLIMATE CHANGE

AIM 4
Net-carbon neutrality by 2050 or sooner

On course to Net Zero

Climate change is a reality we acknowledge, and we recognise the role we can play in reducing the industrial, national and global carbon footprint. At present, we are a large consumer of fossil fuel-based energy and intend to transform into a clean energy consumer. We are cognisant of the imminent risks associated with climate change to our organisation and to the world at large and are taking strong steps to mitigate this challenge. In FY2022, we have significantly matured our climate change management and decarbonisation agenda.

In addition to the strong commitment to become a Net Zero Carbon organisation by 2050 or sooner, we carried out an in-depth climate risk assessment and scenario analysis to comprehensively understand and analyse the risks and opportunities posed by climate change to our business. The findings of these studies are being used to develop a carbon strategy and a roadmap to achieve Net Zero status by 2050. We also made strong strides in inventorising our Scope 3 emissions and plan to publish the results in FY2023. We are in advanced discussions on developing an Internal Carbon Price for the organisation, which will be rolled out in FY2023.

In FY2022, we also released our first TCFD Climate Change report – a first for the natural resources sector in India. We will continue to publish this document annually.

The Company’s gwow fadeInUp rowing maturity on the subject has not gone unnoticed. Our CDP rating – which is a global measure of corporate management levels – has seen a three-year upward trajectory (2019: D, 2020: B-, 2021: B).

Key highlights

Renewable power

Committed to using 2.5 GW of RE RTC (eq) by 2030

In FY2022, Vedanta Aluminium became the largest consumer of green energy in India when it purchased 2 billion units of green power on Indian Energy Exchange (IEX).

Further strengthening our commitment to decarbonise our energy, we signed a Power Distribution Agreement to bring 580 MW of RE RTC (eq) online by FY2024. A break-up of this 580 MW is given below:

• Further strengthening our commitment to decarbonise our energy, we signed a Power Distribution Agreement to bring 580 MW of RE RTC (eq) online by FY2024. A break-up of this 580 MW is given below:
• 200 MW at BALCO
• 200 MW at VAL-Jharsuguda
• 180 MW at HZL

Green metals

Our approach to decarbonisation has not only been limited to minimising our carbon footprint. In FY2022, we also forayed into developing low-carbon products for the industry. The Aluminium business launched Restora and Restora Ultra – green product lines for the metal, bringing Vedanta into an elite league of global players. The GHG intensity of these metals is significantly below global standards for low-carbon aluminium.

Our Copper business has also been looking at ways to decarbonise and produce low-carbon copper. In FY2022, we piloted 3,000 mt of copper products made from scrap and recycled copper. We plan to increase production of this low-carbon product line significantly in FY2023.

Fuel Switch Programs

Fuel switch is another key lever of our decarbonisation strategy and we have several programs underway to reduce the carbon load of our processes.

Biomass firing

Committed to using 5% biomass in our thermal power plants

• 17 kt of biomass used in HZL
• Pilot programs at BALCO, VAL-Jharsuguda, VAL-Lanjigarh

Natural gas

VAL-Lanjigarh/GAIL partnership to supply natural gas for calciner - substituting coal use; potential to decrease plant GHG intensity by 10%

Electric mobility

Committed to decarbonise 100% of LMV fleet by 2030; 75% of mining fleet by 2035

• VAL-J partners with GEAR India to supply e-forklift fleet
• 11 EVs deployed at HZL
• 40 EVs deployed at ESL

Turbine revamp

HZL has taken an initiative of Study of Turbine Revamping with an aim to increase the unit load from 80 MW to 91.5 MW to sustain the business in the future.

• Carbon emission reduction potential of 2.4 lakh TPA
• Reduction of specific coal consumption by 25 grams
• Increase in power generation (75 MW) to meet our power requirements
• Auxiliary power reduction by 0.3%

GHG EMISSIONS
(million tCO₂e)

ENERGY CONSUMPTION
(million GJ)

WATER MANAGEMENT

AIM 5
Achieving net water positivity by 2030

Water is a shared resource on which both our host communities and our operations depend upon. At Vedanta, we ensure that water is kept as a central consideration across our operations through initiatives such as water screening assessment. We manage our water resources as per guidance by the Group water policy and management standards and have consistently improved our water recycling rate in the past four years, with our Hindustan Zinc business turning fully water positive.

As part of our new ESG framework, we are aiming to be water positive by 2030. We will track our performance using specific indicators such as freshwater withdrawal, water consumption, water recycling and water recharge to keep track of this target.

Key highlights

Water | Net water positive by 2030

• Onboarded specialised agency for water positivity roadmap, water accounting across BUs
• High impact initiatives - Ash pond water reuse at Al |Rain- water harvesting at Cairn | STP water usage at HZL | Upgradation of evaporation based ZLD to RO-based ZLD projects in progress at ESL and HZL
• 3,000 KLD ZLD plant commissioned at HZL’s Debari unit

WATER CONSUMPTION AND RECYCLING
(million m₃)

WASTE AND TAILINGS MANAGEMENT

Across our mining and conversion operations, waste management assumes core priority. Safe and responsible use, recycling and disposal are crucial to the natural environment and human life around our mines and plants.

The bulk of hazardous waste we generate is attributed to used/spent oil, waste refractories, spent pot lining and residual sludge from smelters. Non-hazardous waste, on the other hand, is constituted by fly ash (from captive and merchant power plants), red mud (aluminium refinery waste), jarofix (from zinc smelting), slag, lime grit (process residues from smelters and aluminium refineries) and phosphogypsum (phosphoric acid plant).

WASTE AND TAILINGS MANAGEMENT

Waste management and circular economy | Aim for 100% utilisation of HVLT wastes

• Specific projects underway for jarofix, red mud, slag, fly ash 100% utilisation | Utilised 115% of fly- ash generated
• VAL-BALCO| Dispatched fly-ash 1st rake to cement industries (6.1 kt) | Partnered with NHAI - 12-13% annual fly ash offtake
• VAL- Lanjigarh- 32 kt red mud dispatched to Wonder Cement and UltraTech for pilot

Health, safety and well-being

While Vedanta remains committed to creating a Zero Harm culture and workplace, we are deeply saddened to note that our work areas experienced 12 fatalities in FY2022. All these fatalities were among our business partner workforce.

The uptick in fatalities is a cause for concern and our leadership teams have been actioned into ensuring that unsafe work conditions are eliminated from our sites. Actions being undertaken include:

• Focus on ‘Critical Risk Management’ to reduce hazardous activities at site
• Launch of cross business audits to ensure best safety practices are transferred across BUs
• On-boarding of a specialised safety agency to improve the safety culture at all BUs and their leadership teams
• Implementation and horizontal deployment of fatality learning across Vedanta, led by our business CEOs
• Launch of the lift safety standard

Diversity, engagement and inclusion

Our objective is to achieve gender parity across all levels of the organisation, from the senior leadership and decision- making bodies to our SBUs and enabling functions. We welcome talent from diverse geographies, minorities, ethnicities, and cultures. Our goal in driving inclusivity in our workforce is to further strengthen our position as an equal opportunity employer. We have also taken steps to include members of the LGBTQ+ community in our organisation and will continue to work on their inclusion going forward.

To further our diversity agenda, we have constituted the Group Diversity, Equity & Inclusion Council. The council’s mandate is to ensure the integration of our DE&I goals under the ESG framework in line with the organisation’s broader business strategy. The DE&I Council’s responsibility includes reviewing and revamping policies, creating diversity dashboards, empanelling special colleges and search firms, creating employee resource groups, etc.

On the talent management front, we have dedicated initiatives for promoting a healthy diversity mix. V-Lead, our flagship mentoring programme for women, includes our army of 100 women leaders who are being groomed to take on greater responsibilities. They are being anchored by senior leaders in the Company with an objective to retain them and catapult them to our top 200 CXO roles across the Group.

Streamlined, responsible and empowered management

Vedanta is a professionally managed company run by the Management Committee (ManCom), a collective decision-making body, at the centre and at each business. Each business is further independently led by their respective CEOs.

We have also set up Centres of Excellence (CoEs), which are responsible for driving initiatives in the areas of quality, IT & security, digital, R&D, innovation and asset optimisation (AO). The function is headed by the CEO, Centre of Excellence, who reports to the Group CEO. This structure at the centre is replicated at the level of each business.

Nurturing a meritocratic culture

We understand that it is the passion and dedication of our people that have propelled the Company ahead. We reward the efforts that our people and business partners make towards Vedanta’s continued success through our best- in-class and globally benchmarked people practices and reward programmes. They also receive recognition from our management and Board for going the extra mile with their endeavours to support the business. These include the Chairman Individual Awards, Chairman Awards for COVID-19 efforts, Chairman Award for Business Partner and Best Performing ManCom and the Chairman’s Discretionary Award. We also reward high-performing employees through incentive schemes, development programmes, as well as compensation re-structuring practices. Our appraisal and remuneration programmes also includes an ESG component, which correlates employee performance to safety, sustainability and carbon footprint reduction.

Engaging best-in class talent

As part of our overarching initiative of onboarding talent through campus hiring from esteemed institutions, we inducted 1,000+ young professionals during the year with a focus on enhancing workforce diversity across gender, region, faith and culture. We are also inducting talent with new-age specialisations such as digital, data science & analytics, quality, R&D, sustainability, forensics, and so on. Our Group philosophy is to gwow fadeInUp row leaders from within than hire lateral talent. Over the last year, we have identified 1,000+ leaders through industry leading initiatives such as workshops, V-Reach, internal job postings and Act- UP programmes.

We have initiated hiring from global campuses at mid- and entry-level positions across businesses and functions. We are targeting top campuses in the US, UK, Australia, Asia etc. for inducting 100 candidates who will be nurtured for the role of CXOs in the organisation. V-Excel, a one-of-a-kind structured talent development programme, was launched to complement this. This initiative will provide each new hire a single digitally-driven platform that will enable performance, provide the right anchoring, continuous engagement, and recognition from an early stage of their career.

Another flagship programme is Vedanta Leadership Development Programme (VLDP), wherein we hire bright students from top IITs and IIMs.

Through our flagship ACT-UP programme, we identify and nurture high performers and develop leaders for tomorwow fadeInUp row. This year, we completed a talent management programme focused specifically on our senior leadership. Globally, one of the biggest leadership development programmes, the Management ACT-UP was launched in partnership with Korn Ferry, a global management consulting firm, as a unique succession planning initiative for our senior roles. We have replicated the broad structure for another such programme targeting our business partners as well. So far, we have identified over 300 individuals, almost 35% of whom are women.

Grooming the youth

We have robust plans in place for the 5,000+ strong talent pool who joined us as graduates and who form the backbone of our businesses. The V-Reach programme, launched digitally in three phases, will identify the top 500 talent from this pool and provide them elevated roles and opportunities to fast-track their career within the Group.

To groom leaders among Cost and Management Accountants (CMA professionals), we launched the V-Aspire programme, and the V-Reach Tech programme for young engineers.

We have two ongoing special programmes – Chairman’s Young Leaders Program and Vice-Chairman’s SBU engagement workshops – where top talent get to interact directly with the Chairman and Vice Chairman.

We have a strong re-hiring project, initiated as part of the drive to build a strong talent pipeline, with a focus on individuals who superlatively contributed towards Vedanta’s stellar gwow fadeInUp rowth over the years, and who wish to return to the Company in an elevated capacity.

Through all these initiatives, we ensure that a robust pipeline of successors is nurtured and prepared to take the place of the leaders in key positions as per need.

For knowledge dissemination among the top talent, we have a central and BU-level learning and development programme in place. Gurukul is Vedanta’s first-ever Group-wide platform, which is end-to-end digitally driven. It promotes knowledge sharing while encouraging employees to come up with innovative and disruptive ideas.

Enhancing people experience through digital

In partnership with Darwinbox, we are working on building a consolidated, digitalised, and centralised management information system for people management. The module is structured through phases. The first phase of the module deals with the areas of organisation management, HR workflows, performance management systems, learning management systems, employee helpdesks and an internal social networking platform.