Integrated Annual Report 2022-2023
Message from the Chairman
Our commitment towards a sustainable world has now transformed into a much larger and ambitious vision as we embark upon the ‘Sustainability 2.0’ journey, launched on June 5, 2022, commemorating the 50th anniversary of World Environment Day (led by the United Nations Environment Programme).
Dear Shareholders,
It is a great privilege to present to you the fifth Integrated Annual Report for your Company for the financial year 2022-23.
As we reflect on fiscal year 2022-23, your Company has delivered a fairly resilient performance in a rather challenging business environment. Escalating geo-political tensions, volatile commodity prices, inflationary pressures and rising interest rates marked the operating environment during the year. Consequently, the FMCG sector grappled with a subdued demand sentiment, which was even more pronounced in rural consumption trends. However, with inflation moderating and commodities stabilising gradually in the latter half of the year, some green shoots of recovery have emerged as overall FMCG sector volume growth moved into positive territory in the last quarter of the fiscal year after five consecutive quarters of decline.
Over the last few years, there have been notable, and probably, lasting shifts in consumer behaviour and preferences such as much faster adoption of the digital medium for shopping, entertainment and making payments, heightened focus on health and wellness and stronger push towards sustainable and ethicallyproduced products. Your Company continues to prioritise the needs and preferences of consumers, to be able to create long-term relationships, build trust and foster loyalty, which are crucial levers for succeeding in today’s highly competitive and dynamic market. We constantly endeavour to understand and meet the expectations of our consumers through innovative and effective products that enhance their lives and provide a delightful experience. Notwithstanding recent trends, we remain confident of India’s robust consumption story and believe that an evolving and strengthening portfolio, coupled with a consumercentric approach, will enable your Company to drive sustainable value creation for all stakeholders.
Your Company has always been a firm believer of creating value for the society by building solutions to its challenges. Sustainability lies at the centre of our business strategies while we aim to create shared value for all. As I had alluded to in my last letter, we were able to surpass the ambitious five-year targets set across various environmental, social and governance (ESG) parameters up to FY22. Our commitment towards a sustainable world has now transformed into a much larger and ambitious vision as we embark upon the ‘Sustainability 2.0’ journey, launched on June 5, 2022, commemorating the 50th anniversary of World Environment Day (led by the United Nations Environment Programme). The Sustainability 2.0 framework comprises over 50 key performance indicators across eight materially relevant categories and serves as a launchpad to achieve our Decade of Action (2030) vision and purpose. The eight focus areas of the Sustainability 2.0 journey are Net Zero Emissions, Water Stewardship, Circular Economy, Responsible Sourcing, Responsible Brands, Inclusion and Diversity, Sustainable Agriculture and Human Rights & Ethics.
Your Company is committed to achieve ‘net zero emissions’ in its domestic operations by 2030 and global operations by 2040. To ensure your Company’s successful transition to a net-zero, carbon neutral and climate resilient future, it will drive faster adoption of renewable energy, lowcarbon technology, carbon forestry and completely phase-out fossil fuels from its operations.
India is one of the most water-stressed countries in the world, and therefore, judicious use of water by all is a key responsibility to ensure there is enough supply for community usage and agriculture. We are aiming for certified water-neutral operations in all manufacturing facilities. To achieve this, we have developed a longterm plan until 2030 to replenish more water for communities than we consume.
We are aiming for certified water-neutral operations in all manufacturing facilities. To achieve this, we have developed a longterm plan until 2030 to replenish more water for communities than we consume.
Under ‘Jalashay’ – our water stewardship programme, we have created over 290 Crore litres of water conservation capacity pan- India till date, especially around our manufacturing locations and key sourcing areas of our raw materials.
Plastic waste management has become one of the most pressing environmental issues of today and solving it requires an enabling ecosystem with stakeholders collaborating and devising innovative solutions. Under ‘Upcycle’, an initiative towards perpetuating a circular economy, your Company aims to achieving 100% recyclable packaging by 2025 (95% so far), phase out hazardous substances such as PVCs, and introduce at least 30% r-PCR in its packaging portfolio. We continue to fulfil 100% of our Extended Producers’ Responsibility (EPR) targets.
Your Company strongly believes in purpose-driven brands that not only delight consumers but also contribute positively to the community at large. Under the ‘Parachute Kalpavriksha’ initiative, we work towards improving small-scale farmers’ productivity. Since its launch, the program has expanded its reach to 3,11,000 acres of farms and 81,000 farmers, leading to 16% yield improvement for those who have participated in the program for over a year. The brand, Nihar Naturals Shanti Amla, continues to champion the cause of progress and nation building by contributing a part of its profits towards girl child education. The ‘Nihar Shanti Pathshala Funwala’ programme focuses on upskilling and empowering teachers in government schools. Over 3 lakh teachers have been trained through a mix of workbook-led and digitally enabled English literacy courses and more than a million students have benefitted from the programme. We continue our work towards nurturing brands, which are powerful agents of change, driving innovation, sustainability and social progress.
Marico Innovation Foundation (MIF), a not-for-profit organization set-up in 2003, supports disruptive innovations in businesses and social sectors in India. Driven by a commitment to make a progressive impact, MIF works tirelessly to provide assistance to potential game changing innovations along their growth journey. Over the past two decades, MIF has grown to be a torchbearer of innovation having been associated with 100+ ideas through various programs and themes. In January 2023, MIF also announced the launch of the first of its kind playbook, titled Innovation in Plastic: The Potential and Possibilities, which analyses and provides holistic insights on the potential solutions to address the swelling global challenge that plastic waste presents, by throwing a spotlight on 15 innovations in India that are working towards solving it. The Report, developed in collaboration with two knowledge partners, Indian Institute of Science (IISc) and Praxis Global Alliance, also highlights learnings from past innovations and initiatives undertaken at the international, national, corporate, and city level to support circularity in plastics.
Our sustainability efforts have received appreciation in various forums during the year. Marico was among 25 companies in the Asia-Pacific region to be honoured at the prestigious Steward Leadership Summit for its efforts in equipping farmers with sustainable agriculture methods. I am also pleased to share that Marico was the only company in the FMCG sector to feature in the ‘Leadership’ category in CRISIL’s Sustainability Yearbook 2022. The Economic Times felicitated your Company as the Corporate Citizen of the Year 2023 in recognition of its initiatives and commitment to delivering value for society.
Our sustainability efforts have received appreciation in various forums during the year. Marico was among 25 companies in the Asia-Pacific region to be honoured at the prestigious Steward Leadership Summit for its efforts in equipping farmers with sustainable agriculture methods.
Trust, ownership, innovation, inclusion and collaboration are key tenets that form the bedrock of our culture. We have always imbibed a ‘people-first’ approach, which has guided us towards achieving positive outcomes and meet our business objectives, holding firm even during unprecedented levels of uncertainty that we have witnessed in the operating environment over the last three years.
During the year, we continued our efforts to develop a future-ready talent pipeline where the major focus has been to empower our home-grown talent through bespoke learning interventions and internal movements, thereby, transforming them into ‘leaders of tomorrow’. We have also taken significant steps in our journey towards fostering Inclusion and Diversity through consistent evolution in our policies, processes and infrastructure, as we create a conducive growth environment for all and build organizational resilience.
In current times, the business landscape is in a constant state of flux and it is imperative for companies to evolve and adapt to changing market conditions and consumer trends. I believe that organizations, which embrace digital technologies, focus on innovation by incorporating a culture of creativity, ingrain sustainability considerations in business strategies and foster a culture of learning, are most likely to create long-term value for its stakeholders.
As we aim to become a leading FMCG multinational in each of the chosen emerging markets of Asia and Africa, we remain focused on accelerating our portfolio diversification, strengthening our distribution infrastructure, leveraging advanced digital technologies and empowering our people. Your Company will continue its steadfast commitment to propel the levers of growth across its diverse product portfolio and markets, while maintaining a long-term perspective on sustained growth and competitive advantage.
The Board has continued to exhibit an unwavering commitment to your Company’s mission to drive growth and innovation, while upholding the highest standards of corporate governance. I continue to act as the Non-Executive Chairman of the Board, while Saugata continues to lead your Company’s strategic growth initiatives. I also continue to lead efforts to improve the collective functioning of the Board and am actively involved in your Company’s CSR initiatives. I am pleased to welcome Mr. Rajan Bharti Mittal as an Independent Director on the Board. Mr. Mittal brings with him an astute business acumen and a fresh perspective through which I am sure your Company will greatly benefit.
I want to express my heartfelt appreciation to the Board for their ongoing engagement and guidance and to our shareholders for placing their unfettered faith in Marico. I am grateful for the steadfast commitment of our members, even amidst fairly challenging times. I would also like to express my sincere gratitude towards all our business partners, vendors and associates for their sustained support as we continue to chart our way forward towards building a futurefocused Marico.
Warm regards,
Harsh Mariwala
Chairman
