Chairman’s Message
Our fortitude and values come to the fore
Dear Shareholders,
I am pleased to write to you and present the third Integrated Report of your Company, but the backdrop is unfortunately not as ideal as we would like it to be. The ongoing COVID-19 pandemic has clouded over most of FY21, and I take this opportunity to send thoughts and prayers to all stakeholders affected by this crisis, including the families, friends and relatives of the valued members of your Company. We have not suffered a global health crisis of this magnitude in generations, and are more than grateful to all those frontline workers who have worked tirelessly to help keep others safe and provide essential goods and services to all.
At Marico, our members come first and we are focusing on their well-being by taking all possible steps to provide the support required to cope with these difficult times. Despite the widespread disruption during the year under review, your Company demonstrated both resilience and agility and delivered impressive results. This has only reinforced our faith in the lasting strength of the strategic building blocks of your Company, namely brand, people and culture. It is the trusted equity of our brands that consumers seek solace in, especially during such uncertainty. The fortitude of our members and the values ingrained in our culture have truly come to the fore in these unprecedented times. I firmly believe that it is only when you’re empowered with freedom and opportunity that you rise above the task at hand and take complete ownership to make a difference.
Our commitment to responsible growth has always been the focal point of everything we do at Marico. It has been our long-standing belief that sustainable and purposeful businesses will stand the test of time and drive superior long-term performance stands more validated now than ever before.
Harsh Mariwala Chairman
A visible silver lining
A year since the onset of the pandemic, the global economy remains under pressure, accompanied by sustained fatalities and widespread unemployment. However, despite the uncertainties, the way out of this health and economic crisis is increasingly visible. Vaccination is picking up pace and the workforce around the world is adapting to ways of working with reduced mobility. The International Monetary Fund (IMF), in its latest report, has projected a stronger recovery for the global economy compared to its earlier forecast, with growth projected at 6% in 2021, moderating to 4.4% in 2022, after a historic contraction of an estimated 3.3% in 2020.
The Indian economy contracted by 7.3% in FY21. In view of the severity and spread of the second COVID-19 wave in India, accompanied by the overwhelming pressure on the healthcare system, the IMF is likely to lower its most recent growth rate projection of 12.5% for FY22. With the human and economic toll on the rise, I hope that we overcome this crisis through a coordinated policy response to fight the virus, including acceleration of the vaccination campaign along with allocation of more fiscal resources to the health sector and social support for the vulnerable.
Sustainable value creation at Marico
Our commitment to responsible growth has always been the focal point of everything we do at Marico. It has been our long-standing belief that sustainable and purposeful businesses will stand the test of time and drive superior longterm performance stands more validated now than ever before. The severe human crisis that we are facing today has further necessitated a stakeholder approach to growth, which relies on compassion, collaboration and inclusivity.
In FY21, your Company continued to make concerted efforts to reduce operational risks, enhance environmental stewardship, garner eco-consciousness amongst consumers, maintain best-in-class governance standards and most importantly, safeguard lives to thrive in the next normal of business.
As part of our climate action goals, our aim is to transition the operations of all facilities to carbon neutral status and mitigate our value chain climate impact. Over 72% of your Company’s energy needs are met from renewable energy sources. Our Perundurai (Tamil Nadu) manufacturing facility has been certified as ‘Carbon Neutral’ and has received platinum-level certification from CII Green Company Rating System (GreenCo) and Indian Green Building Council (IGBC) - all three notable achievements.
Water conservation is a core thrust area of our sustainability agenda and your Company aims to become a water steward, thereby creating sufficient quantities for community usage and agricultural purposes. Under the ‘Jalaashay’ programme, your Company has continually replenished 100% of the water consumed in its operations and has built a cumulative conservation potential of approximately 2.15 Billion litres so far. We have also ensured that 100% of your Company’s liquid waste is treated and reused within the plant boundaries.
Towards plastic waste management, the ‘UpCycle’ programme has resulted in 95% of your Company’s product packaging (by weight) being recyclable. Additionally, in conformance with our Extended Producer Responsibility (EPR) commitment, we have completed collection, energy recovery and environmentally safe disposal of about 1,630 MT (equivalent in weight) of post-consumer multi-layer packaging used in our products. We have also completed a collaborative circular packaging initiative with Dow and Lucro Plastecycle towards the usage of post-consumer recycled (PCR) shrink films for the brand Parachute.
Through our Parachute Kalpavriksha programme, we are striving to empower coconut farmers in India to leverage scientific techniques, advanced agricultural trainings and a range of farm-support resources that improve the quality of yields as well as boost socio-economic livelihoods. The Company has enrolled 17,997 farmers this year (cumulative number stands at 39,040 farmers), covering 54,931 acres of coconut farms (cumulative number stands at 1.8 Lakh acres) and effecting an overall year-on-year improvement in productivity of 15%.
Enabling socially inclusive development
This year, your Company continued its efforts towards enabling responsible and socially-inclusive growth for the community through a variety of educational outreach initiatives, livelihood sustenance programmes and innovation-led value-creation campaigns.
During the ongoing pandemic, your Company has been able to distribute 1.4 Million masks, 6.7 Lakh PPE kits and 633 ventilators to help safeguard lives of primary healthcare workers, the police and emergency services staff, among others.
Since its inception in 2003, the Marico Innovation Foundation (MIF) has played a catalytic role in the innovation ecosystem to help start-ups scale-up. In collaboration with other organisations, the Foundation helped fund nine scale-up innovation challenges to recognise winning solutions. Of these, the most impactful has been the Innovate2Beat COVID Grand Challenge, which was launched to find affordable and scalable healthcare solutions in India. The five winning solutions received a grant of ` 24 Million.
Looking ahead
In any crisis, it is important to move quickly to reset objectives in line with changing market realities. However, our strategic priorities, which have always been guided by our credo – ‘Making a Difference’ – remain unaltered and gain even more relevance in this evolving context. Your Company will continue to focus on nurturing and building responsible, safe, authentic and trusted products for our consumers and making them more accessible through agile and resilient execution. We will maintain a collaborative approach with all our partners in the value chain and stay true to our commitment to the community and the planet in a bid to create sustainable value for all.
I continue to act as the Non-Executive Chairman of the Board, while Saugata continues to lead your Company’s strategic growth initiatives. While the Board remains the guide and mentor of the top management, keeping in mind the right balance in composition relative to Director tenure, your Company will undertake a Board rejuvenation exercise over the next few years. I also lead efforts to improve the collective functioning of the Board while remaining actively involved in our CSR initiatives.
I would once again like to express my gratitude to all our team members for valiantly fighting through the challenges posed by this unprecedented crisis and extend my sincere gratitude to the Board for its continued guidance and support. I also convey heartfelt appreciation for all our business partners, vendors and other business associates who have firmly stood by your Company amidst adversity. We deeply value the faith, guidance and support of all our shareholders and would continue to do so as we attempt to emerge stronger from the challenges and look ahead to brighter times.
Warm regards,
Harsh Mariwala
Chairman
