Our Research & Development team leads new product development in India

 

At Godrej Consumer Products Limited (GCPL), we have been publishing a statutory annual report, in line with the Securities and Exchange Board of India (SEBI) (Listing Obligations and Disclosure Requirements) Regulations, 2015; Companies Act, 2013; and Secretarial Standards. This is our third Annual and Integrated Report, aligned with the principles of the International Integrated Reporting Framework (referred to as the framework) developed by the International Integrated Reporting Council (IIRC). This report is aligned with the Global Reporting Initiative (GRI) standards required by the Sustainability Reporting Guidelines of GRI and the Business Responsibility Report (BRR) requirements of SEBI.

 

Content of the report

Through integrated reporting, we aim to share an overview of our financial and non- financial performance that has helped create short-term and long-term value for our stakeholders.

This report provides insights on:

  • Material issues and our operating context
  • Governance structure
  • Our key strategies
  • Our approach to value creation within each of the capitals
  • Our performance against identified KPIs
  • Interconnectedness between our material issues, strategies, performance, and value creation
  • Financial and statutory reports

 

Scope and boundary

This report is for GCPL, including GCPL manufacturing plants in India, Africa, Indonesia, Latin America, and USA. The data and content are consolidated for the business, unless otherwise specified.

 

Reporting period

All information, financial and non-financial, is reported for the period from April 1, 2020 to March 31, 2021. For our performance on sustainability, we have also incorporated comparative figures for the previous year (fiscal year 2019-20) and baseline year (fiscal year 2010-11 except for statutory financials) for a holistic view.

 

Management Committee endorsement and assurance

The GCPL Management Committee remains committed to high levels of disclosure and transparency in communication with all stakeholders. The Committee has been involved in the process of drafting this report and fully endorses its contents.

In addition, GCPL has commissioned TUV India Private Limited to conduct an independent external assurance of non-financial information disclosed in GCPL’s Integrated Report for the period April 1, 2020 to March 31, 2021. It is a ‘limited assurance’ report of GCPL’s sustainability information for the applied reporting period. This assurance statement is based on the principles of IIRC Integrated Reporting, GRI standards, and ISAE 3000 standard.

Barcode

Read TUV India’s assurance statement of GCPL’s ESG and non-financial information

 

Materiality

 

Approach to materiality

We approach materiality from strategic and value-creation perspectives. Material issues are identified by engaging in conversations with our stakeholders and monitoring broad trends in the industry. Performance on material issues forms the core content of this Annual and Integrated Report. In fiscal year 2019-20, we conducted an extensive materiality exercise, which involved engaging an external partner and enabling a thorough understanding of the relationship of material issues with our business risks, objectives, and value creation. The process of determining materiality at GCPL is compliant with the prescriptions of the IIRC and draws from the six capitals of integrated reporting.

 

Methodology

Materiality analysis was performed through identification and prioritisation. A systematic step-wise process was followed. First, relevant insights were collected through with primary and secondary research, and then, necessary calculations were performed to obtain the materiality matrix. Primary inputs were obtained through direct stakeholder engagement, with discussions on material issues with various stakeholder groups. Furthermore, surveys were conducted to reach out to employees and gather information at scale.

The secondary research primarily involved the analysis of various sector trends, sustainability reports, and select peer analysis. These aspects were further rated by the level of importance by us and our stakeholders.

 

Overview of the methodology

Identify issues across 6 capitals
(Issue identification)

  • GCPL sustainability reports
  • Peer analysis
  • Sector trends
  • Internal team consultation

Engage with 450+ key stakeholders on material issues
(Stakeholder engagement)

  • Leadership team
  • Employees
  • Investors
  • Suppliers
  • Distributors
  • NGO partners
  • Consumers
  • Beneficiaries
  • Industry associates

Develop materiality matrix using a specialised tool
(Issue prioritisation)

  • Stakeholder responses
  • External requirements
  • Significant assessment
  • Internal team consultation

 


Stakeholder engagement

Upon identifying a broad list of material issues, interactions were made with each key stakeholder group. Each material issue was assessed for its relative importance with respect to different stakeholder groups and aggregated. Stakeholder analysis was performed by identifying key stakeholders and administering tailored questionnaires to each of them. To develop the materiality matrix, it was necessary to collate stakeholder responses.

Because not all stakeholders are equally important in the organisational context, they were rated based on two parameters: ability to influence GCPL and extent of influence due to GCPL. Stakeholders were then assigned weightages on the basis of these two parameters.

 

Stakeholder prioritisation

Stakeholder group

Ability of stakeholder to strongly influence GCPL’s performance and operations

Extent of influence on stakeholder due to GCPL’s performance and operations
Leadership team High High
Employees Medium High
Suppliers Medium Medium
Distributors Medium Medium
Consumers Medium Medium
Investors Medium High
NGO partners Low Medium
Beneficiaries Low Medium
Industrial associations Low Medium

 

Feedback from stakeholders determined our top material issues, which are all within our boundary of operations. Our material issues are linked to our strategic pillars:

 

Top material issues

Link to our
strategic pillars
  1. Sustainable packaging
  • Accelerating innovation and building purposeful brands: Integrating sustainability into our brand purpose through sustainable packaging
  • Enhancing go-to-market: Differentiating our products and exploring new market segments
  • Building a more inclusive and greener world: Driving responsible consumption by reducing post-consumer footprint of packaging material
  1. Research & Development
  • Accelerating innovation and building purposeful brands: Developing products with natural ingredients to differentiate our products from those already in the market and improve market position
  • Making our supply chain best-in-class: Integrating sustainable materials into our supply chain for rapid innovation and product development
  • Building a more inclusive and greener world: Reducing the overall footprint of our product penetration
  1. Responsible marketing and communication
  • Extending leadership in our core categories and geographies: Differentiating our brands through responsible communication as well as improving penetration in existing markets
  • Accelerating innovation and building purposeful brands: Communicating the brand purpose to targeted markets to build product relevance
  • Leveraging digital: Connecting directly with consumers to build trust and brand loyalty
  1. Building inclusive and
    prosperous communities
  • Making our supply chain best in class: Improving the environmental footprint of our entire supply chain
  • Building a more inclusive and greener world: Improving social relationships through Corporate Social Responsibility (CSR) interventions in local communities
  1. Governance and
    accountability
  • Making our supply chain best-in-class: Improving the performance of our entire value chain through governance, codes, policies, and audits
  • Fostering an inclusive, agile, and high-performance culture: Harnessing our company purpose to build greater engagement with team members and drive agility and innovation
  1. Occupational health
    and safety
  • Making our supply chain best-in-class: Ensuring best practices are followed to improve overall performance across the value chain
  • Fostering an inclusive, agile, and high-performance culture: Building greater engagement with team members by focusing on their safety and well-being
  1. Skill development
    and training
  • Extending leadership in our core categories and geographies
  • Leveraging digital: Achieving improved growth and market penetration by developing the skills (including digital skills) of team members
  • Fostering an inclusive, agile, and high-performance culture: Enhancing skills of team members to build capabilities and improve engagement

This diagram maps out the entire universe of material issues and stakeholder input and its significance in our business.

 

GCPL Materiality Matrix 

GCPL Materiality Matrix

GCPL Materiality Matrix

 

A note on COVID-19

The materiality study was carried out in fiscal year 2019-20. The COVID-19 pandemic had not spread at that point and so it does not appear as a material aspect.

In fiscal year 2020-21, however, the COVID-19 pandemic has had a multi-fold impact on the business, and this impact and our mitigation strategies are discussed in detail in our Chairperson’s message and our seven Strategic Pillars.

We engage with all our stakeholders on a regular basis to foster and nurture strong relationships, which in turn help us improve our strategy and decision-making and grow our business. In a crisis like the COVID-19 pandemic, our partnerships with our stakeholders became even more important. The table below provides an overview of our stakeholder engagement process and the steps we take to understand the needs and priorities of each stakeholder group.