Focus on Managing Material Issues

to Ensure Positive Outcomes

Material issues help us develop a more comprehensive, inclusive and consistent sustainability strategy. Any matter is considered material if it has the potential to significantly affect our ability to create, sustain and deliver value to our stakeholders in the short, medium and long term.

To protect ourselves from the possible adverse impact of material issues to our business, we undertake a detailed materiality assessment once every three years. The assessment guides us in the formulation of strategic priorities and to better understand our sustainability risks and opportunities. We had last carried out such assessment in FY2019 through a third party. Inputs were taken from key internal and external stakeholders. In FY2020, our Executive Committee reviewed and revalidated the Materiality assessment and a core committee was formed to identify the long-term goals to address the top eight material issues, thus interlinking sustainability into business decisions.

The rigorous and formal materiality process involving extensive internal and external stakeholder dialog led to the setting up of ambitious “Sustainability Goals 2025”. The detailed action plans and subaction plans, wherever needed, have been identified under each goal to drive actions towards high priority areas necessary for the accomplishment of goals over a period of next five years. Hindustan Zinc believes that these goals shall act as not just independent targets, but rather as a collective scorecard that requires tangible progress across different functions to bring about the desired positive outcome. To further ensure fulfillment of goals, various communities have been appointed for the implementation of action plans under the leadership of a Sustainability Committee, chaired by CEO.

The Sustainability Goals 2025
Sustainability Committee
Sustainability Communities
Sustainability Goals 2025
Climate Change

GHG emission savings in our operations from base year 2017

0.5 Mn tCO2e
Water Stewardship

Water positive company & achievement of 25% reduction in freshwater

5x
Circular Economy

Increase in gainful utilization of smelting process waste

3x
Biodiversity Conservation

Throughout the life cycle

Protect & Enhance Biodiversity
Zero Harm

Zero work related fatalities and 50% reduction in TRIFR

Social Impact

Positively impacting lives through social, economic and environmental outcomes

1 Mn
Diversity In Workforce

Diversity in an Inclusive workplace

30%
Responsible Sourcing

Responsible sourcing in the supply chain

100%

The Sustainability Goals along with action and sub-action plans have been reported in detail in Hindustan Zinc’s Sustainability Review Report FY2021.

Inclusion of Sustainability Criteria in Employee Incentive and Performance

Sustainability is an integral part of the way we do business. We follow Vedanta Sustainability framework and implement its requirements across units. This framework contains the management and technical standards and policies to guide us to drive our efforts towards the material issues. All the sites every year undergo Vedanta Sustainability Assurance Programme to ensure the implementation of Vedanta Sustainability framework that provides site-wise scores against the 13 pillars of Sustainability.

We use the scores to understand our relative performance and to determine the performance bonus of each individual including the CEO and Executive Committee members. The safety performance at Hindustan Zinc and Vedanta Sustainability Assurance Programme (VSAP) scores are key part of everyone’s KPIs and performance of both is linked with performance bonus of the senior leadership and all employees.

CEO and Other Senior Leadership

Our CEO’s performance-based compensation is determined through a combination of the Company’s financial results, such as revenue and operating profit, besides non-financial indicators such as leadership, progress on strategic goals, and contribution to sustainability performance.

CEO’s KRA – Make Hindustan Zinc a zero-harm organization by establishing and inculcating the safety culture and implementing efforts towards achievement of Sustainability Goals 2025 and Vedanta Sustainability framework. [In leaders score card, there is 20% weightage to the VSAP score and Zero Fatality]

ExCO KRA – Make Hindustan Zinc a zero-harm organization by fostering a safe and risk-free work environment through elimination of incidents/injuries and implementing Vedanta Sustainability framework. [KPI – VSAP score and Zero fatality]

All Executives

Performance-based compensation is determined by the VSAP Scores along with business performance. To give an enhanced focus, the weightage on VSAP Scores has been assigned as 17.5% for senior management and 15% for others. Further, in case of any fatality, the overall pay-out under performance-based compensation will be reduced by 10%, 20% & 25% for 1, 2 and more than 2 fatalities respectively. Consequence management is based on responsibility matrix, provision for penalizing in the form of withdrawal of last increment or demotion, or even nil/partial payment of Performance pay Scheme.

Contractors

Expanding our safety ethos to cover business partners too, we are increasingly linking payments / incentive & penalty with safety performance. For majority, monthly safety scorecards are already in place for performance evaluation, and more will be progressively brought into the ambit of payment linkage with compliance to safety metrics.

Materiality Assessment Result