HZL SDR 2017-18

Sustainability & Us

Strategy & Approach

Sustainability is the only business strategy at Hindustan Zinc. It entails long-term growth maximisation in a way that is both sustainable and responsive for the stakeholders and the society.

In whatever we do and the way we do it, the ethos of sustainability and growth are built into it. The strategy is aided by sustainability of our products such as zinc which has an intrinsic galvanisation property to protect steel or iron from rusting.

Hindustan Zinc is a Vedanta

Group Company, and we are

aligned to its Sustainable

Development Model which is

reinforced by Vedanta

Sustainability Framework (VSF).

VSF has been developed keeping

in mind multiple internal and

external sustainability

imperatives like materiality and

core values of each of the

business, UNGC's 10 principles,

United Nation's SDGs and

standards set by International

Finance Corporation (IFC),

ICMM and OECD.

Our management systems and processes have been aligned with VSF and to identify any lacunae between the current systems and processes we conduct gap analysis through Vedanta Sustainability Assurance Programme (VSAP). The identified gaps are discussed and reviewed by the leadership teams, and action plans are put in place to ensure compliance within specified period of time.

Our Sustainable Development Model comprises four pillars

RESPONSIBLE STEWARDSHIP

The way we manage our business in a sustainable manner is the measurement of our performance against both our own targets and international benchmarks, in line with our Sustainability Framework.

It is critical to defining how we operate, covering all aspects outlined in our Code of Conduct - including ethical behaviour and whistleblowing - and our approach to risk management.

It also encompasses our health, safety and environmental management - including the way we manage water and energy use, waste, carbon footprint and biodiversity management.

BUILDING STRONG RELATIONSHIP

The strength of the relationships we build with our stakeholders is one of the ways we add value in a broad sense as they play an important role in influencing the strategic direction of our business.

Engaging effectively and understanding the distinct requirements of our various stakeholders we identify groups with significant interest in our operations.

ADDING AND SHARING VALUE

Our operations are based in India and we believe that we can add and share value in the communities where we operate to facilitate the development of the nation.

We create value through structured and collaborative engagement with our stakeholders, including for our employees, our host communities and broader society. This is done not only through the commodities that we produce but through the economic and social contributions we make across our global operations, particularly in the developing world.

STRATEGIC COMMUNICATIONS

The pillar interlocks with the other three pillars of our model and is the guiding principle which enables the organisation to engage with our stakeholders in a transparent dialogue.

This pillar is the vital element of sustainable development, in implementing and strengthening our 'social license to operate' efforts.

This pillar further reflects our commitment to becoming a more transparent and responsible corporate citizen and emphasises on our principles of community dialogue and mutual respect, including free, prior and informed consent to access natural resources.

SUSTAINABILITY VISION & MISSION

We constantly strive to achieve our sustainability vision and mission in alignment with the VSF.
The framework has served as an effective tool to conduct business in line with our core values of trust, entrepreneurship, innovation, excellence, integrity, respect and care.

Vision

To excel in operations by upholding world-class standards of governance to achieve zero harm and zero discharge, while being socially responsible

Mission

Our mission is to become a global leader and create value by conducting our business in a responsible and ethical manner by:

Improving health, safety, and well-being at the workplace

Eliminating the potential damage of our activities on the environment, and reducing our environmental footprint with the adoption of sustainable practices and preservation of natural resources

Benefitting the communities in which we operate and enhancing their livelihood

Communicating our sustainability efforts and performance to our stakeholders with transparency, authenticity, and integrity

Sustainability Governance

Sustainability governance enables us to implement our sustainability strategy across our businesses, manage goal setting and reporting process, strengthen relations with our stakeholders and ensure overall accountability. We monitor and review our sustainability objectives and implement the same at regular intervals to comply with the Vedanta Sustainability Assurance Programme (VSAP). VSAP is an internal risk management tool run by Vedanta's Management Assurance System team.

Sustainability Governance Framework

Our sustainability governance framework consists of a three-tier governance mechanism, directed by the Vedanta Board to the units of operations at the site level.

AT THE GROUP LEVEL

QUARTERLY MEETING

Sustainability Committee at Group Level

advises on sustainability policies and framework, clearly setting out the commitments of the Group to manage matters of sustainable development effectively; review and approve targets for sustainability performance & recommend initiatives required to institutionalise a sustainability culture.

AT THE COMPANY LEVEL

MONTHLY MEETING

Sustainability Business Management
Group at Company Level

identifies risks and opportunities and areas for improvement, reviewing the performance and effectiveness of the initiatives.

AT THE UNIT LEVEL

MONTHLY MEETING

Sustainability Review at
Unit/Operation Level

Along with reviewing progress, they are also responsible for data collection and reporting.

We have eight sustainability policies which influence every decision we make and give us the confidence to perform in a safe, ethical, and transparent manner. Through a dedicated sustainability taskforce, which includes officials from the safety, environment, and occupational health division, we drive sustainability throughout our Company.

Sustainability Policies

Sustainability Risks

Hindustan Zinc is the world's second largest producer of zinc. The industry that we are operating in exposes us to a variety of internal and external risks. We have put a robust management framework in place to manage these risks, right from predicting them early on to working towards mitigating them.

Risk Governance Structure

At HZL we continuously identify, assess and mitigate risks arising as a result of internal and external factors. Through a formal monitoring process at the unit and Company level, new risks are identified, categorised as per impact and likelihood, mapped to key responsibilities of select managers and managed with an appropriate mitigation plan.

To ensure transparency and efficiency of the measures we have in place a Group Management Assurance System that coordinates the risk management framework, reviewed annually by the Audit Committee on behalf of the Board. This in turn is supported by a Board Level Risk Management Committee comprising the CEO, CFO and Chairman of the Audit Committee. The Head of Group Management Assurance, COO Mines and COO Smelters are permanent invitees of the committee.

Risk Impact and Analysis

The process of analysing risks and its impacts keeps Hindustan Zinc always ready for the future. As we move towards becoming a complete underground mining company, predicting, analysing and mitigating the impacts is imperative. We have analysed all our processes and spheres of influence for potential risks and appropriate mitigation measures are in place.

Some of the key sustainability risks and the kind of impacts they can have on the organisation and the stakeholders have been identified below: