Greening the industry
" environment audit is a form of social audit which the corporate sector has to accept in order to qualify as good corporate citizens," said former Union finance minister Manmohan Singh, while formally releasing the environmental ratings of 28 pulp and paper mills on July 28. The first of its kind in India, the Green Rating Project ( grp ), as it is called, was conducted by the New Delhi-based Centre for Science and Environment. While calling for a new mindset among captains of the industry, Singh emphasised: "The time has come for the industry to realise its responsibility to all the stakeholders and not only shareholders."
But, as of now, says project coordinator Chandra Bhushan Singh, "The overall health of the industry is not very good. The top-rated mills finished with only three leaves signifying that none could cross a weighted score of 50. As many as 12 mills were in the poor or one leaf category."
The ratings were presented to president K R Narayanan on July 19 at Rashtrapati Bhavan. The president complimented cse for undertaking such a project and suggested it should cover other industries and organisations, too. Malti Sinha, secretary, ministry of environment and forests ( mef ), informed the president that mef has requested cse to rate the chemicals and automobile sector and that work on the automobile sector had already begun.
Teaching business Supported by the undp and the mef , the project took 18 months to complete. The mills were evaluated using over a hundred green criteria under three broad categories -- corporate environmental policy and management systems, plant-level environmental performance and public perceptions of the mill's environmental responsibility. "This way," said Anil Agarwal, director, cse , "we hope to educate company managements and make managers play a proactive role in environment management."
Agarwal also highlighted cse 's findings that good financial and environmental performance go hand-in-hand. According to the grp analysis, there is a 60 per cent likelihood of a mill with sound environment sense churning out handsome profits, too. For instance, J K Paper Mills ( jkpm ), which has the highest score, makes 14 per cent profits as a percentage of its turnover. At the same time, tailenders Amrit and Mukerian Papers are running at a loss of 1.5 per cent and 4.5 per cent respectively.
Lauding the initiative taken by cse , Sinha noted: "The day companies realise that environment-friendly activities make business sense, they will themselves become advocates of change."
While asserting that urbanisation and industrialisation were the need of the hour, Manmohan Singh warned that if the processes were not environment-friendly, then the country could run into deep trouble. He added that at this point of time achieving economic prosperity is the primary focus of the people. And considering the level of poverty, we should keep an eye on the environment, or else economic growth will be sabotaged. "Self-regulation of the kind cse has done will help create an environment where industry is more and more sensitive," he said.
The industry view For the industry representatives present in strength at the release function the news was both bad and good. They were commended for cooperating after an initial hesitation. But the industry still has much to do. "The pulp and paper sector is plagued by resource inefficiency, improper sourcing of raw material, outdated technology and highly-wasteful and polluting production process... the paper sector has to improve on efficiency in use of water, chemicals used for bleaching, energy and fibre," says Chandra Bhushan.
But hope is in sight. Harsh Pati Singhania, owner of jkpm , who was present at the release function, described the project as "a unique venture" and urged fellow industrialists not to "indulge in end-of-the-pipe solutions but to invest in correct technology in the beginning itself." However, this can happen only when mills are able to have modern equipment. These, unfortunately, come in large sizes and, therefore, the scale of operation becomes very crucial to adopt such technologies economically, he said. Singhania also called for keeping up public pressure on the companies as well as government agencies to take up the environment cause. "The civil society," he said, "can pressurise the pollution control boards to act. In the past, only public pressure has prompted legal bodies and industries to act."
Suresh Kilam of Sinar Mas echoed Singhania's views saying: "In today's increasingly conscious world, no industry can be called successful unless environmental norms are followed and waste is minimised." While thanking cse for making an effort to enhance environmental awareness in the industry, Kilam said: "I am also grateful to cse for bringing eminent industrialists, environmentalists, policymakers and other citizens on a common platform to address issues like environmental protection. I am sure this will set guidelines for good governance for the industry."
Process hailed In a letter to Agarwal, R C Mall, executive director, Andhra Pradesh Paper Mills Ltd, which received the second-highest rating, also acknowledged cse for the rating. "I would like to thank cse for the study of our mills and reflecting their views in the form of the rating given to us," he says, adding, "I would like to reaffirm our faith in the pursuit of policies for environmental concern... as enumerated in the study compiled by you."
The phd Chamber of Commerce and Industry has also commended cse for "the detailed research and analysis". Ila Gupta, secretary, environment committee of the chamber, has requested cse for the report of the project for their information. In a letter to cse , she says: "As an industry association, we eagerly look forward to similar ratings for other sectors of the industry as well as constant upgradation of the ratings."
At the outset of the project, only one mill had a formal environmental policy, namely, jkpm , which also has an iso 14,001 certification. By the time the ratings were finalised, nine companies had an environment policy statement. cse had hoped the findings will induce the companies to better environmental performance in the future. And that is exactly what is happening. Various companies manufacturing chemicals, glazed floor and tiles, textile units, tanneries, electronics, industrial consultants, to name a few, have already approached cse to carry out an environmental assessment of their plants.
cse has also received numerous letters from various consultancy firms requesting to be involved in cse 's rating process or asking for information on various industries. "We would be highly obliged if you could keep us in touch with the pollution created by different industries," writes Sailen Avalani of Intra Project Consultants, a Calcutta-based company involved in environmental monitoring with gas analysers and dust monitors.
As Manmohan Singh said: "This ( grp ) is a hopeful beginning... the best is yet to come."