PT ELEGANT TEXTILE SUSTAINABILITY REPORT 2016-17 · units received ‘Commendation for First Year...

SUSTAINABILITY PT ELEGANT TEXTILE

SUSTAINABLEVALUE

REPORT 2016-17

CONTENTSThe ContextCEO’s MessagePerformance- Snap Shot

CSO’s EpilogueAssuranceGRI IndexContribution to UNSDGDefinitions & Acronyms

7274768182

Strategic Stakeholder Engagement

Message from Finance

Our Operations & Products

ABG Sustainability Framework

Our Values Steer Our Conduct

Ten “Missions” of Resource Stewardship

The Board

Material Issues

Sustainable Governance

030405

23

08

12

17

13

19

15

20

Footprint

Sustainability Mission

Governance & Management

and Future Proofing

Resource Stewardship

Aligning manufacturing processes with our sustainability goals Energy & CarbonWater & EffluentsBiodiversityMaterials and WasteHealth & Safety Caring and Sharing Responsible Supply Chain Responsibility to Customer Employee Engagement Communities Engagement

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P.T. ELEGANT TEXTILES SUSTAINABILITY REPORT 2016-17 | 3

The Context Dear Reader,

It brings me great pleasure to introduce to you our third sustainability report for PT Elegant Textile Industry (PTE).

The Overseas Spinning business has exceeded expectations, despite sluggish market conditions and steep cost increases in Indonesia. Viscose yarn margins have been under constant pressure throughout the year. We have also been hit by lowered MVS margins. The team, however, have been looking at innovative methods of reducing power and water consumption, and also consuming more renewable power. The most critical focus area for the Overseas Spinning business is VAP portfolio enhancement and the team has been working to enhance the product mix. The teams have looked at diversifying its portfolio of products, and has stepped into the global technical textiles space. As a result, the volumes of VAPs as a percentage of total volumes has further improved. The team has also benefitted from the implementation of the supply chain solution, with better transparency being brought in the system. The efforts put in by my colleagues have been recognized both within the Aditya Birla Group and outside as well. The Indonesian units received a commendation awarded by NCSR, Indonesia, for the sustainability reports.

We continue to move ahead in our sustainability roadmap, having already reached a level of maturity in stakeholder engagement and responsible stewardship. We are embarking on a journey of future proofing our business, which would look at the long term strategy for the business.

The report will provide you with accounts of actions taken by us along with results achieved; I also encourage you to give us your feedback on the report, and share your kind views. Enjoy reading!

Thomas Varghese,Business Head


CEO’s Message It is my pleasure to introduce our third Sustainability report following GRI G4 Guidelines. The report covers the reporting period 01 April 2016 to 31 March 2017, disclosing performance on sustainability processes and material indicators. In line with Aditya Birla Group’s Sustainability Vision 2017, we continue to pursue- Responsible Stewardship, Stakeholder Engagement and Future Proofing. We are also presenting our performance on material aspects against targets taken for the year.

In a very competitive market and tough global economic scenario, our revenue generation has increased slightly. We have scaled up new product development and efforts in value added products. Emphasis is also given on material efficiency, energy and waste reduction to optimise the production cost. Our marketing team is constantly in touch with customers and in coordination with the product development team, we are able to tap new markets.

We are committed to contributing to UN Sustainable Development Goals and all our sustainability missions and programmes are tracked for contribution to the sustainability goals. We are committed to be climate steward; have assessed what should be our climate mitigation contribution to limit global temperature raise to 2oC and are exploring ways to meet such targets.

We enjoy very cordial relation with all our employees and the unions. Our continued investment in employee engagement including skill development, health and safety and celebrating many festivities as a family binds us together in a journey towards a sustainable organisation. We have initiated deployment of social accountability standards and wish to our make workplaces “Happy Work Places”.

Our efforts in in our sustainability journey were recognised and all three Indonesian units received ‘Commendation for First Year Reports’ by National Center for Sustainability Reporting (NCSR), Indonesia, for the sustainability reports.

I look forward to your support as we continue on this journey.

Mr. Kapil AgarwalCEO, Overseas Spinning Business - Indonesia

NCSR Award for the first time Sustainability Reporting


Performance - Snap Shot

Environment

Legend

Achievements No major changes Needs Improvements

WASTE INTENSITY (in MT waste/MT

production) Increase by 11%

0.20in 2016-17

0.18

6.5

in 2015-16

% RECYCLED & RENEWABLE MATERIAL

IN PACKAGING Decrease by 5%

% RECYCLED & RENEWABLE MATERIAL

IN PROCESS Decrease by 4.9%

84

62.4

in 2016-17

in 2016-17

89

67.3

in 2015-16

in 2015-16

ENERGY INTENSITY (in GJ/MT)

Decrease by 3.44%WATER INTENSITY

(in m3/MT) Decrease by 5%

GHG INTENSITY (in tCO2 eq/MT)

Decrease by 5.5%

12.9214.02

1.35

in 2016-17

in 2016-17

in 2016-17

13.38

14.75

1.43

in 2015-16

in 2015-16

in 2015-16

Economic

ECONOMIC VALUE GENERATED (in Mn

USD) Increase by 2.8%

Community Social Investments (in USD)

Increase by 19.9%

PROPORTION OF PROCUREMENT BUDGET FOR LOCAL PURCHASE (in %) Decrease by 11%

116.59

15,236

84

in 2016-17

in 2016-17

in 2016-17

113.41

12,712

73

in 2015-16

in 2015-16

in 2015-16

ECONOMIC VALUE DISTRIBUTED (in Mn

USD) Decrease by 0.1%

% CONTRIBUTION OF VAP

Increase by 1%

108.89

26

in 2016-17

in 2016-17

109.06

25

in 2015-16

in 2015-16


Performance - Snap Shot

Social Non GRI

Legend

Achievements No major changes Needs Improvements

Average Training Hours (in hrs)

Increase by 22.6%

Training Hours (Male: Female)

ENHESA It was started in the

FY 2016-17

Higg Index Facility Labour Module Score

(%) Increase by 6%

Supplier Satisfaction Level (%)

Increase by 0.77%

Higg Index Environment Module

Score (%) Increase by 3%

Employee Diversity by Age Group

(<30: 30-50 :> 50)

26.74

10:90

92.59

82

95.57

86

56:43:1

in 2016-17

in 2016-17

in 2016-17

in 2016-17

in 2016-17

in 2016-17

in 2016-17

21.8

9:91

0

76

94.8

83

57:41:2

in 2015-16

in 2015-16

in 2015-16

in 2015-16

in 2015-16

in 2015-16

in 2015-16

Employee Diversity

(Male: Female)

26:74in 2016-17

26:74in 2015-16

P.T. ELEGANT TEXTILES SUSTAINABILITY REPORT 2016-17 | 7P.T. ELEGANT TEXTILES SUSTAINABILITY REPORT 2016-17 | 7

FOOTPRINTOur economic,social and environmental footprint is extended across the globe through our supply chain, manufacturing operations and products. Our customers process our products and add value before delivering to the end user.

Operations & Products 08


Operations & Products

Associations:

USA

BRAZIL

SWITZERLAND

TURKEYEGYPT

PAKISTANSOUTH KOREA

TAIWANVIETNAM

BANGLADESH

INDONESIA

PT. Elegant Textile Industry (PTE) was established in the year 1973. The plant is located at Purwakarta, about 125 kms from Jakarta. PTE, a part of Overseas Spinning Business of Aditya Birla Group is their first venture in Indonesia. PTE is a closely held, non-listed company. Reporting to shareholders is done once in a year at the Annual General Meeting. However, key shareholders are represented on the Board of Directors and are kept informed about business developments via quarterly board meetings.

PTE commenced production in the year 1975 with an installed capacity of 14,960 spindles. Today the capacity stands at 174,240 spindles. PTE has MVS technology. We run 100% viscose, poly/viscose blends, linen blends and 100% polyester. MVS Yarn has special features, like low hairiness and low pilling properties, which results in extra shine, increased brightness, extended durability and a softer feel.

During the year 2014–15, modernisation of 31,680 spindles was completed with compact and siro-compact technologies. This installation is the largest in the world. It improved quality, increased productivity, and at the same time reduced hands. Our production in 2015 was 45,666 MT. which improved to 46,570 MT in 2016-17.

The total number of employees totalled 1,655 in 2015. This reduced to 1,651 in the reporting period 2016-17. This improvement was due to higher efficiency and better utilisation of manpower.

• Total Employee Strength: 1,651( 2016-17), Female: 1,228, Male: 423, Permanent: 1213, Contractual: 432, Casual: 6

• Net Sales: 116.78 Mn US$ (2016-17)• Quantity of Products Sold: 46,570 MT (2016-17)

BANGLADESHEGYPTEGYPTEGYPTEGYPTEGYPTTURKEY

EGYPTEGYPTTURKEY

EGYPTEGYPTEGYPTEGYPTEGYPTEGYPTEGYPTBANGLADESH

PAKISTANPAKISTANPAKISTANPAKISTAN

SWITZERLANDSWITZERLANDSWITZERLANDSWITZERLANDSWITZERLAND

TURKEYTURKEYTURKEYTURKEYTURKEYTURKEY

SWITZERLANDSWITZERLAND

TURKEYTURKEY

SWITZERLANDSWITZERLANDSWITZERLANDSWITZERLANDSWITZERLANDSWITZERLAND

TURKEYTURKEYTURKEY

SWITZERLANDSWITZERLANDSWITZERLANDSWITZERLANDSWITZERLANDSWITZERLANDSWITZERLAND

BANGLADESHBANGLADESH

SWITZERLAND

TURKEYTURKEYTURKEYTURKEY

SWITZERLANDSWITZERLANDSWITZERLAND

PAKISTANPAKISTANPAKISTANSOUTH KOREASOUTH KOREA

VIETNAMVIETNAMVIETNAMBANGLADESHBANGLADESH

PAKISTANPAKISTANPAKISTANPAKISTANPAKISTANPAKISTAN


PAKISTAN


PAKISTANPAKISTANPAKISTANPAKISTAN

BANGLADESH

PAKISTANPAKISTANPAKISTAN

BANGLADESH

BRAZIL

USA PAKISTAN

SWITZERLANDSWITZERLAND

TURKEYTURKEYTURKEYTURKEYSOUTH KOREASOUTH KOREASOUTH KOREASOUTH KOREA

VIETNAM

SOUTH KOREASOUTH KOREA

PURWAKARTA, INDONESIA.

INDONESIA

India – Indonesian Chamber of Commerce Business Forum of India

Association Textiles Indonesia

Association of textile employer, KADIN Indonesia,

ECAII - ECONOMIC ASSOCIATION OF INDIA

AND INDONESIA


We manufacture spun yarn in different counts for different end users. Our range of products include 100% Polyster as well as Polyster blends.

The products in our product range include:

· 100% spun viscose rayon yarn bright· 100% spun viscose rayon yarn semidull· 100% spun polyester· Polyester/viscose blends (65/35)· MVS yarns -Rayon -Polyester -Polyester/viscose blends -Linen blends

Value added products

· Birla Modal · Birla Excel· Bamboo Rayon· ABY™ Triblend · ABY™ Unifeel · ABY™ Style Value Added Product (VAP) ratio has increased from 25% to 26% of the total production in 2016-17.

In future, we are also focusing on other products such as recycled polyester, ABY glitter, High linen content yarns (including Coarse counts, slubs and 2-ply), CD polyester, BCI cotton blended yarns, Sewing threads and optical viscose and blends.

Product Portfolio:



SUSTAINABILITYMISSIONABG Sustainability framework drives us beyond being a responsible steward, to practicing future proofing of business through strategic stakeholder engagement. As a responsible steward we have identified ten material issues to focus on and have constituted mission teams to drive the pursuit of road map and targets.

ABG Sustainability FrameworkTen “Missions” of Resource StewardshipMaterial Issues

121315


ABG Sustainability Framework

Responsible StewardshipFocus on how we manage today and our goal is to build a framework of policies, technical and management standards aligned to international standards as defined by the IFC, OECD, UNGC, ISO and OHSAS. By introducing these standards into our systems we manage our operations in the most responsible manner.

Stakeholder EngagementTo understand the external changes that will inevitably impact our companies in the future and this step of the model is called “Stakeholder Engagement”. Our goal is to build strong relationships

with our stakeholders and key technical experts on climate change, water and waste management, developments in human rights legislation, safety standards, health impacts and the like. Future ProofingWe will embed sustainability trends into our strategic business plans to minimise the risks and find new opportunities that will be presented by the requirements of a sustainable planet and society by 2030 and 2050 and make our businesses sustainable.

RESPONSIBLE STEWARDSHIP

Create a framework to help us move to international

standards.

STAKEHOLDER ENGAGEMENT

Knowledge to think how fast things will

change & where disruptions will occur

FUTURE-PROOFING INCLUDING OUR SUPPLY CHAINA plan to create and share stakeholder value so we stay ahead of the Major Trend Curves - Roadmaps for Products, Energy, Water, Waste, Human Rights, H&S, Biodiversity, Suppliers, New business technologies, etc.

Legal Standards needed for a sustainable 2050

More demanding Legal Standards by 2030

International Standards Today

Bext Price TodayLegal Standards Today


Ten “Missions” of Resource Stewardship

Energy & Carbon Water & Effluent Waste Mgmt.Chemicals Mgmt.

Responsible Supply Chain

Compliance & Risk Management

Health & SafetySocial &

Labour

Stakeholder Engagement

Products Stewardship

-GHG Intensity -Water Consumption -Hazardous Waste-Compliance with REACH

-Recycled & Renewable input materials

-Compliance with applicable regulations along value chain

-Workplace hygiene -Diversity & Equal opportunity

-Dialogue with Internal & External Stakeholders

-Grievance mechanisms for: Impacts on society,

environment, labour, Human Rights

-Product Quality

-Customer Satisfaction-Packaging

-Customer Health & Safety-Safety

-Training & Retention-Occupational Health-Neighborhood Developement

-Energy Intensity -Water Risk -Non Hazardous Waste-Air Emissions -Waste Mgmt. -Waste Recycling-OEKOTEK

certification

-Procurement Practices

-Sustainability Risk Management

-Environmental, Labour, & Human Rights Assessment

-Delivering indirect economic benefits


Mission Champions:

1. ENERGY & CARBON 6. STAKEHOLDER ENGAGEMENT

2. WATER & EFFLUENTS 7. PRODUCT STEWARDSHIP (Higg Index, LCA etc.)

3. “WOW”-WEALTH OUT OF WASTE 8. SOCIAL & LABOUR

4. CHEMICAL MANAGEMENT 9. COMPLIANCE & RISK

5. SUPPLY CHAIN MANAGEMENT 10. SAFETY, HEALTH & ENVIRONMENT

N. K. Singh, P. Kanagaraj N K Singh, P. Kanagaraj

Mr. Hemant Changoiwala

Mr. Hemant Changoiwala

Praveen Sharma

N K Singh, Mukesh Jain Pak Dadang Jayalakshana

C.P. Bansal

Mukesh Jain, Mr. Hemant Changoiwala

N K Singh, P. Kanagaraj,Pak Pariyadi, Richo Mauland


Material IssuesThrough many internal and external stakeholder engagements, the material issues were determined in 2014-15. The assessment included identification and prioritization of issues that can pose risks to business and stakeholder interests in the short and long term. This is further reviewed during 2016-17 and also in internal stakeholder meeting and strategic stakeholder engagement meetings.

IMPO

RTA

NC

E TO

STA

KEHO

LDER

S

IMPORTANCE TO PTE

01

03

05

06

09

19

21

22

250708

10

14

11

15

12

16

18

20

2324

27

28

02

04 13

1729

26

Aspect Importance along the Value Chain:

-Supply chain; -Manufacturing; -Transport; -Customer

Policies, Standards & Code of ConductRegulations & Legal Compliance Grievance mechanisms (employee, Env, HR, society) Economic Performance Market Presence Indirect Economic Impact Renewable & non-renewable materials Responsible procurement Packaging Energy management Waste management and effluents Water stewardship GHG emissions and air pollution Compensation & benefits to employees Employee Recruitment & Retention Employee relations Employee health & safety Training and education Diversity and equal opportunity Collective bargaining Human rights assessment of operations Community Impact, Relations and Development Payments terms and negotiations with suppliers Supplier screening and Audits (Labour, HR, Community)Investments in developing local supplier network Customer health and safety Product and service labelling Marketing communications Customer satisfaction

0102030405060708091011121314151617181920212223242526272829

P.T. ELEGANT TEXTILES SUSTAINABILITY REPORT 2016-17 | 16P.T. ELEGANT TEXTILES SUSTAINABILITY REPORT 2016-17 | 16P.T. ELEGANT TEXTILES SUSTAINABILITY REPORT 2016-17 | 16

GOVERNANCE& MANAGEMENTABG Values steer our conduct in dealings with all our external stakeholders along the value chain. Our board supervises adherence to ABG values at all times and guides the business to deliver sustainable value. Sustainability practices in the business is guided by the APEX committee and is executed by the ten Mission teams covering all material issues that our business is challenged with.

Our Values Steer Our ConductThe BoardSteering Sustainability

171920


Our Values Steer our Conduct

INTEGRITY

COMMITMENT

SEAMLESSNESS

PASSION

SPEED

Acting and taking decisions in a manner that is fair and honest. Following the highest standards of professionalism and being recognised for doing so. Integrity for us means not only financial and intellectual integrity, but encompasses all other forms as are generally understood.

On the foundation of Integrity, doing all that is needed to deliver value to all stakeholders. In the process, being accountable for our own actions and decisions, those of our team and those in the part of the organisation for which we are responsible.

Thinking and working together across functional groups, hierarchies, businesses and geographies. Leveraging diverse competencies and perspectives to garner the benefits of synergy while promoting organisational unity through sharing and collaborative efforts.

An energetic, intuitive zeal that arises from emotional engagement with the organisation that makes work joyful and inspires each one to give his or her best. A voluntary, spontaneous and relentless pursuit of goals and objectives with the highest level of energy and enthusiasm.

Responding to internal and external customers with a sense of urgency. Continuously striving to finish before deadlines and choosing the best rhythm to optimise organisational efficiencies.

Code of Conduct:

Anti-Corruption:

We are in the process of strengthening deployment of the Code, we are focused on Values integration, Integrity, Safety and better deployment of our “prevention of sexual harassment policy”. If any employee comes across a violation of the Code of Conduct, he or she can report directly to the respective committees for an independent investigation. This will be closely followed by the Corporate Cell.

We voluntarily follow the Code of Conduct outlined by the Aditya Birla Group. The Code of Conduct, which incorporates the Business Principles, is our central guidance document for norms of behaviour. Under our Governance system we consider employees, suppliers, community, and our creditors as our stakeholders, and their legal rights are protected and treated with care.

We have mapped and assessed our risks related to corruption. We have identified and categorised aspects and impacts and areas of concern. During the reporting period the following actions were undertaken:

Our Commitments- UN Global CompactTen principles to usher in sustainable global economy

- UN Sustainable Development Goals. New sustainable development agenda 2030

- Science Based TargetsDriving ambitious corporate climate action

- Wash PledgeThe wash at the workplace pledge

- Higg IndexSelf-assessment empowering brands, retailers and facilities of all sizes, at every stage in their sustainability journey


Purchase of certain machinery, spares and equipments are preferred only through OEMs as a policy matter. Similar items are purchased through vendors on a common platform, which is overseen by a senior management committee.

In the coming year more focus will be given on the raw material weight verifications including bare weight, packing materials, and quality checks.

All employees are encouraged to bring to attention of the management i.e. their seniors/ other senior representatives of the Group when they come across a violation of Code of Conduct. The new joinees also sign the personal commitment that contains CoC, Values violation.

Two training programmes per month on anti- corruption, CoC and Values violation were conducted.

A total number of 433 employees have received anti-corruption training in the reporting period. During the reporting period no cases of corruption were reported.

Charitable Donations and Sponsorships

In order to ensure that donations or sponsorships to schools, communities or village government organisations are not misused, we ensure that we do not transfer cash but provide materials or items that are required.

Representatives from the company and the beneficiaries attend the hand-over event. The document duly signed by both the parties are made available to all concerned. We also take photographs for documentation and communication purposes.


The BoardThe Board of Commissioners for 2016-17 are listed below:

The board provides the oversight to environmental, social and economic performance of the organisation and oversees upholding a broad set of governance principles, delegating management authority to the Chief Executive within the defined limits.

The board reviews key risks, including risks arising from imperatives of sustainable development and how they are managed. The management exercises risk management through appropriate internal controls and periodically reports to the board.

Our sustainability governance organisation is :

Business HeadDT, AF & OS(Chairs Apex Council)

CEO - Acrylic Fibre(Chairs theCommittee)

Sustainability Committee

-HR, EHS, Eng., Mfg., Finance- Sustainabilty Champion (Secretary)





CEO - Textiles(Chairs theCommittee)

CEO - Overseas Spinning(Chairs theCommittee)

Sustainability Advisory Council

10 Workgroups

Apex Sustainability Council- CEOs, CPOs, CFOs- Sustainability Champions- CSO & VP-BE Secretary

Meeting: Once/QuarterGREENTEAM

Supply ChainSustainability

Compliance & Risk

Energy & Carbon

Water & Effluents

ChemicalManagement

Social & Labouur

Waste Management

Health & Safety

StakeholdersEngagement

Product Stewardship

TEN WORKGROUPTEAMS

Non-Executive Chairman

Non-Executive Director

Non - Executive Director


Non - Independent Director



Mr. Kumar Mangalam Birla

Mrs. Rajashree Birla

Mrs. Neerja Birla

Mr. S.S. Mhansaria

Mr. C.H. Mahtani

Mr. Vikash. C. Mahtani

Mr. Askaran Agarwala

LEGENDNATIONALITY : INDIAN NATIONALITY : INDONESIANGENDER: MALE GENDER: FEMALEAGE: >50 AGE: <50


Sustainable Governance

Overseas Spinning Sustainability Commitee:

Sustainability Committee:

For sustainability initiatives, PTE coordinates with all other eight textile businesses of the ABG. The nine businesses are further divided into three sub groups and five units involved in spinning viz., IPT, PTE, ILT, PTS and ITS are in the sub group Overseas Spinning. Our sustainability governance organisation is:

Mr. N.K Singh Mr. Ponnu Kanagaraj

Mr. Kapil Agrawal

Mr. Hemant Changoiwala Mr. Mukesh Jain

Mr. S L Sipani

Mr. Atul Sahu Mr. Ajit Chauhan

Pak Dadang J Ms. Lia

Mr. Kapil K. Agarwal

Mr. Yash Pal Singh

Mr. C.P. Bansal

Unit Head, Sr. V.P, Technical Asst. Vice President, Engineering

Chairman, Member

Sr. Manager - Utilities, Engineering General Manager, Finance & Commercial

Member

Dy. General Manager, HR Asst. Vice President, Production

Asst. Manager, Personnel Officer - WCM, WCM

Member

Member

Member

This institutional mechanism is the main enabler for driving sustainability practice and performance within the group. Besides, we have deployed a comprehensive set of enablers that drive sustainability.

Sustainability Advisory CommitteeThis committee consists of 6 members, which focuses on the enhancement of the sustainability vision. There was one meeting conducted in this reporting period where the previous year reports were reviewed and feedbacks were discussed. Also, discussed about the future plans and targets for the improvisation and development of the units.

Dr. Ancha Srinivasan

Mr. Dicky Hindarto

Asian Development Bank, Manila, Philippines

Principal climate change specialist

Head of Advisory Board of the Green Partner FoundationMember of the Expert Board of Indonesia Renewable Energy Society.Indonesia Vice Regional Manager of the Climate Reality Project.

Mr. Joseph Scaria

Dr. Satish Wate

Dr. Ram Babu

Dr. Shirish Sangle

Asia Pacific, Habitat for Humanity International

National Environmental Research Institute, India

National Institute of Industrial Engineering, India

Director- Development,

Ex- Director – NEERI

CEO - RSM GC Advisory

Professor of Sustainable Business


Sustainability Information ManagementSystem - powered by IT Platform

Policies & Management Framework:

We have implemented the Enablon- Sustainability Information Management System where we collate sustainability data as required by GRI standards.

We have also deployed on pilot basis spindle monitoring system for four of our spindles, where control mechanism is applied as per the desired charactersticks of the final product.

Energy & Carbon

Safety

Health

Bio-Diversity

Water Stewardship

Quality

Human Rights


Supply Chain

Procurement

Transportation

Product Stewardship

Security

Supplier Code of Conduct

Anti Corruption

ISO 14001, Oeko-Tex, Higg Index

OHSAS 18001

OHSAS 18001, WASH Pledge

ISO 14001


ISO 9001, Oeko-Tex

UNGC

SA 8000, AA 1000

ISO 9001, 14001, OHSAS 18001

ISO 9001, 14001, OHSAS 18001

ISO 9001, 14001, OHSAS 18001

ISO 9001, ISO 14001, Oeko-Tex,

ABG Group - Information Security

ISO 9001, ISO 14001, OHSAS 18001

Code Of Conduct


Higg Index

Policy

Environmental Policya.

b.

c.

d.

e.

f.

g.

h.

i.

j.

k.

l.

m.

n.

o.

p.


RESPONSIBLE STEWARDSHIPFocus on how we manage today. Our goal is to build a framework of policies, technical and management standards aligned to international standards as defined by the IFC, OECD, UNGC, ISO and OHSAS. By introducing these standards into our systems we manage our operations in the most responsible manner.

Balancing Economic ValuesAligning manufacturing processes with our sustainability goals Energy & CarbonWater & EffluentsBiodiversityMaterials and WasteHealth & SafetyCaring and SharingResponsible Supply ChainResponsibility to CustomerEmployee EngagementCommunities Engagement

2326

27303334374151526163


Balancing Economic Values

Strong and sound financial management and risk mitigation are crucial for the sustainable performance of an organisation both in short as well as in long term. Accordingly, we have adopted some of the best practices in the industry. One such practice is sustainability risk identification, mitigation and continuous monitoring.

The global textile industry is facing challenge from contracting demand and dumping of surplus production from China. The revenue generation was marginally up in all three Indonesian companies in adverse global markets. We have taken many actions such as reducing overhead costs, reducing packaging expenses, and investing in process improvements to improve process efficiency as well as our bottom line. We continue to operate debt free, which shows the strength of our Balance Sheets.

Guided by our business strategy and periodic updating of risk matrix, we identify areas and projects for improvement, assess feasibility and prioritize the projects. After careful consideration, as per priority, projects are taken up and implemented. While selecting such projects, sustainability aspects are duly and diligently considered. We give utmost importance to total compliance and take steps proactively even if administration of a certain regulation is weak in a geography.

We benchmark ourselves with the best in industry to understand the gaps and bridge and exceed in performance. The annual budget is prepared after many iterations of consultations with internal and external experts to arrive at challenging as well as achievable results. With all these actions and more to come, our aim is to make company stronger financially. We are well on our path to delivering benefits to our stakeholders including communities, customers, suppliers and employees.

Mr. C.P. BansalCFO, Overseas Spinning Business


Direct Economic Value Generated and Distributed (in Mn USD)

Indirect Economic Impacts

Economic Value Generated(in Mn USD)

Economic Value Distributed(in Mn USD)

Economic Value Distributed (in Mn USD) Value in USD

115.65

113.41116.59

108.89109.06

100.88

2014 2015-16 2016-17

The economic value generated has increased slightly in a challenging global market. This was achieved by increased sales of value added products and better customer relations. We did not receive subsidy during the reporting period.

The company has made efforts to localise most of its procurement so as to increase the indirect positive impact in the local economy. Local purchase accounts to 84% of our total purchases.

We constantly work with our key local suppliers on improving the quality of products. Joint improvement projects are undertaken with

an aim of continuously improving the quality at supplier end and also through periodic test of the improved products through out the value chain.

Local Employment

Environmental Expenditures

5.56% of management is local. Management cadre begins at section head and above.

We are running two programmes:• Upgradation of local staff for promotion to the next level,

including workers and management.• Tail end pool development. We are providing our staff both

internal and external training and exposure, including technical training to deepen our pool for management positions.

Our employment of locals is positively impacting, approx. 2,000 families’ viz. 8,500 people.

The environmental expenditure was lower slightly as there was no capex requirement in any of the related budget heads. All the essential O&M expenses were as usual as per previous years.

522,

004

419,9

66

28,5

30

Environmental Expenditures

Legend: 2016-172014 2015-16

Operating costs - 93,325,455 Employee wages and benefits - 9,730,690 Payments to providers of capital - 2,856,191Payments to government- 2,949,733Community investments - 32,872



Noted violations, fines (2016-17) : 0Target for 2017 : 0

0Number of Whistles blown (2016-17): 0Target for 2017 : 0

0ENHESA(2016-17): 92.59%Target for 2017 : 94%

92.59%

We give utmost importance to total compliance and take steps proactively even if administration of a certain regulation is weak in its respective geography. We are going to implement IT-enabled ENHESA compliance module and self-assessment questionnaires (SAQ), in order to evaluate our compliance performance in last week of November 2016. Also, we are planning to implement legal compliance modules for evaluation and tracking in December 2016.

Guided by our business strategy and periodic updates of risk matrix, we identify areas and projects for improvement, assess feasibility and prioritize the projects. After careful consideration, as per their priority, projects are taken up and implemented. While selecting such projects, sustainability aspects are duly and diligently considered.

Highlights of risk management plan:Legal Compliance1. First Aider Licensed Training for 10 persons was given 2. Waste Water discharge permit is renewed

Wash pledge1. All hygienic practices are in place as per guidelines.

ENHESAThe score is reviewed regularly and also audited within the Group companies.


Policies,Code of Conduct


Mission

IMS,ENHESA


Dear stakeholders,

I am happy to present the sustainability report for the year 2016-17. After initiating the sustainability journey in 2013 and our first report in 2014-15, we had determined targets for the material indicators to be achieved by 2017. In this report we disclose our performance against the targets.

The Enablon- Sustainability Information Management is fully implemented now and is used for regular management reviews and intervention where required. We have also normalised our production measure and this should help us streamline the monitoring, measuring, performance management and reporting the impact of various resource conservation initiatives. Further, in line with the Group’s commitment, we are also in the process of setting science based targets for our climate stewardship initiatives.

We have modified our production lines for the production of value added products. We have increased our renewable energy consumption and also taken up many energy saving initiatives. This helps us operate with efficient energy and GHG intensities within our sector among comparable size operations. We have also taken many initiatives in increasing material resource efficiency, reducing waste to landfill and fresh water consumption. We have also completed ISO 50001 certification. Various employee engagement initiatives and continuous dialogue between the employee and management helps us implement our annual production plans.

Mr. N. K. SinghUnit Head, Sr. V.P, Technical

Aligning manufacturing processes with our sustainability goals


Energy Conservation & Renewable Energy

Energy & Carbon

Energy Intensity (GJ/MT) 2016-17 : 12.92Target for 2017-18 (GJ/MT) : 12.71

12.92

GHG Intensity (tCO2/MT) 2016-17 : 1.35Target for 2017-18 (tCO2/MT) : 1.36

1.35

Energy and logistics amounts to approximately 11% of the product cost. It is the second highest cost component after raw materials viz. 62%. As per Government Regulation No. 70/2009 on Energy Conservation, it is mandatory to conserve energy continuously and make provisions for the proper utilisation of energy resources.

We aim to optimise resource consumption through the application of energy efficient technologies, upgradation of plants & machinery and related equipment. The facility has been certified for EnMS - ISO 50001 in the reporting period. The energy saving resulted from new initiatives in the reporting year has increased by 311% compared to those in 2015 - 16. This is helped is reduce the energy intensity by 3.44%.

Energy & Carbon

List of Energy Saving Projects

ISO 14000, Oekotek,

Higg Index

Energy & Carbon Policy

Energy & Carbon Mission Sl.

#Item Description Savings in

USD

1 Super high efficiency Motor (65KW) in Ring frame RX240 at M3E.

48,419

2 Atomization of Air washer with closed loop control with Inverters.

106,488

3 Modification of Air washer in TFO section by AESA 28,458

4 Low pressure nozzle usage in Air washer system. 67,108

5 Insulation of Chiller water tank. 12,118

6 Replacement of Compressor Motor by High Eff motor. 43,568

7 Solar water heater for Yarn conditioning room. 1469

8 LED lamps for street lighting. 1983

TOTAL 295,098


Indonesia’s dependence on fossil fuels is more than 90% and hence a cause of concern. Dependency on fossil fuels and constraints on its availability has driven up electricity cost, thus posing a challenge to the textile sector. 50% of our energy requirements is met through purchase of renewable power. We have undertaken the following projects which explores the use of both natural lighting and solar heating in the reporting period:

Renewable Energy

13.4113.38

12.92

Total energy consumption (GJ)

Energy Intensity (in GJ/MT)

301,721

302,120

309,718299,451

816 1,163

3,355

1,118

611,439

601,571

219,678

377,175

3201,232

596,853

Energy consumption- non renewable (GJ)

Savings due to energy efficiency projects (MWh)

Diesel consumption( in GJ)

Energy consumption – renewable (GJ)

Legend: 2016-172014-15 2015-16


348

79,139 1.78

324244

65,201 1.4362,933 1.35

Total Scope 1 Emissions (in tCO2/annum)

Total GHG emissions (in tCO2/annum)

GHG Intensity (GJ/MT)

9741,007


77,81763,871


Carbon

Air Emissions

We have reduced 3.7% of our GHG emissions over previous year through our energy saving measures. For us, GHG emission reduction is a continuous journey and we see the value proposition of higher performance and low carbon footprint.

Cognizant of the fact that the energy sector is the biggest contributorof greenhouse gas (GHG) emissions, accounting to about 49% of theworld’s total emissions, we have undertaken several energy saving initiatives to improve our performance, thereby reducing our GHGfootprint.

Ozone Depleting SubstancesWe use R134A in all our chillers which is a non- ODS refrigerant. We are using R22 in our split air conditioning systems.

Science Based TargetsAs a responsible corporate, PTE is in the process of conducting internal studies to set up Science Based Targets (SBT) for its GHG emission reduction target.In 2016-17, we have conducted background studies, like selection of a base year, deciding tenures for the short and long term targets, as well as activity data such as normalised production, GHG emissions and gross profits in the base year.

After completing these studies, we will establish and communicate the new targets for GHG emissions reduction, in line with the SBT, in the next report.

We understand the need to improve the air quality conditions in the work place and in the surrounding region.

NOx

SOx

PM

13.61 17.52

1.85 1.49

88.35 127.15

14.1

1.83

119.86

mg/lt

Pollutants in (mg/Nm3)*

*on instantaneous air sampling basis

Allowable Limit: 250



mg/lt

mg/lt

2014 2016-17

2014 2016-17

2014 2016-17

2015-16

2015-16

2015-16928 61,738

Legend: 2016-172014-15 2015-16


Water & Effluents

Rain water Harvested in (2015-16) (m3) : 0Target for 2017 : 6,735 m3/yr

0Water Intensity (2016-17) (m3/MT) : 14.02Target for 2017 : 13.27

14.02Effluent water discharged (2016-17) (m3) :19,589 m3

Target for 2017 : 30,000 m3

19,589 mEffluent water discharged (2016-17) (m19,589 mEffluent water discharged (2016-17) (m

3

PTE’s water source is the Jatiluhur Lake. There is no water scarcity in the region due to abundant rainfall. We have a Saskatchewan Irrigation Projects Association (SIPA) agreement with Perum Jasa Tirta-I, the Water Supply Authority for water intake. The withdrawal limit is set at 80,000 m3/month. Our spinning process is a dry process and hence water is not directly used in production of yarn. However, we use water in utilities such as humidification units, air-conditioning system, cooling towers, and for domestic purposes at our housing colony.

PTE has a water treatment plant for treatment of intake water before use.

In Indonesia, there are strong regulations in place regarding water discharge quality and it is monitored on a monthly basis by government agencies. Thus, managing water responsibly and more efficiently is beneficial to us and to the society at large.

Water & Effluents

Water & Effluents Mission

WaterStewardship & Environment

Policies

ISO 14001, Oeko-tex,Higg Index

Wash Pledge


We were consuming 1,886 m3 of municipal water per day in 2015-16. In 2016-17, we improved the same to 1,808 m3/day. Our major requirement of water used is for non-production purposes viz. sanitation and hygiene. Hence, maintaining best quality of water for plant and domestic level along with our effluent quality at discharge is of prime importance.

We have taken a target of consuming 6,735 m3/year of rainwater by setting up a rainwater harvesting system that will reduce stress on the lake water.

We are withdrawing 1,808 m3 of water from Jatiluhur Lake per day.. Out of this:

• 200-300 m3/day loss in cooling towers.• 885-950 m3/day in Air Washers evaporation loss.• 450 m3/day used in gardening & cleaning goes in soil• 250-300 m3/day used as sanitation in toilets collecting in septic tank which is cleaned by govt. approved vendors.• 60-65 m3/day (approx. 3%) used for washbasin and bathing is discharged outside to open drains.

Quantity of Water Withdrawn in consecutive years(in m3)

Source: Jatiluhur Lake

Total volume of water reused & Recycled (in m3)

764,064

-

673,474 652,978

600 600

2014 2015-16 2016-17


COD mg/l

pH

BOD mg/l

TSS mg/l

35 25 17.6

7 6.57

11

9

9 7.1

36 12.8

2014-15 2015-16 2016-17

As an environmental steward, PTE is committed to treating waste water and maintaining the quality within prescribed limits.

PTE is discharging approx. 3% of its intake water, 57 m3/day. The quality of treated water discharged is checked by government authorities. It is being maintained well within norms.

Waste Water Destination of Water Discharged Open Drains

Waste Water Quality:


BiodiversityWe have conducted IBAT point-based intersection report identifies the Legally Protected Areas, Internationally Recognized Areas and Priority Sites for Biodiversity that are located within 1 km, 10 km and 50 km of the location. We also provide an indication of the potential biodiversity-related features close to the location.

Taxonomic group: Invertebrates Near Threatened species- 143Vulnerable species-155Endangered species- 11DD species- 74Critically Endangered species- 1

Taxonomic group: MammalsNear Threatened species- 4Vulnerable species-9Endangered species- 4DD species- 19

Taxonomic group: ReptilesVulnerable species-2Endangered species- 01DD species- 06

Taxonomic group: AmphibiansNear Threatened species- 1Vulnerable species-1

Taxonomic group: Plants Near Threatened species- 1DD species- 02

Taxonomic group: Fishes Near Threatened species- 22Vulnerable species-28Endangered species- 05DD species- 34Critically Endangered species- 01

Taxonomic group: Birds Near Threatened species- 15Vulnerable species-6Endangered species- 01DD species- 01Critically Endangered species- 03

Features

Within 1 Km

Within 10 Km

Within 50 Km

25 ha

no features

23,630 ha

18 ha

Muara AngkeTriggers: VU, endemic

no features

Muara Gembong-Tanjung SedariTriggers: VU, migratory birds/congregations

Pulau RambutTriggers: CR/EN, VU, migratory birds/congregations

155

19

6

1

2

34

06

15

74

9

2

44

1

13

51

1

1 1

143

11

1

22

28

The following are the threatened species that are potentially found close to the area of interest:


Waste Management

Quantity of Reuse & Recycle (MT)- Process/Unusable & Packing Waste going External (2016-17): 1,253 MTTarget for 2017 : 1,041.54 MT

1,253Raw materials waste intensity as % of of total raw materials(2016-17): 2.01%Target for 2017 : 1.92%

2.01%Quantity of hazardous waste(used oil) Generated(2016-17) : 2,800 litresTarget for 2017 : 1,800 litres

2,800Quantity of hazardous 2,800Quantity of hazardous Recycled / Renewable Material

in Packaging (2016-17): 2,846 MTTarget for 2017 : 337.5 MT

2,846Recycled / Renewable Material 2,846Recycled / Renewable Material

As we move towards a highly differentiated market with speciality yarns, our primary raw materials will continue to be polyester staple fibre, viscose staple fibre, combined with speciality fibres such as flame retardant, modal etc.

This is in keeping with our material management policy, which ensures conservation, use of renewable, recovered and recycled materials with speciality fibres. We aim to gradually lower our environmental foot print. There is also a focus on increasing the Value Added Products year on year.

Materials & Waste Materials

Environment &Product

Stewardship Policies

ISO 14000, Oekotex,

Higg Index

Waste Management

Mission


We strive hard and put our best efforts to improve our material use efficiency. Our focus has been to improve the yield of our spinning process by focusing on process waste reductions.

During the reporting period, we have reduced hard waste, a waste produced in the winding process by 18 % (from 257.71 MT to 210.62 MT) by upgrading equipment software and better management. Sweeping waste has increased by 9.5 % (from 134 MT to 148 MT) in the reporting period.

134108

17,624

1802,481

31,67629,797

200373 2,571

2,502

29,258

174

15,36015,540

Non renewable Materials (in MT)

Non renewable Materials (in MT)

Renewable Materials (in MT)

Recycled Materials (in MT)

Renewable Materials (in MT)

Raw Materials

Packaging

Solid Waste Management Indonesia relies on landfill for disposal of waste There are more than 200 TPA’s [final disposal sites] catering to 69% of waste going to landfill, but only 10 percent of the total number of sites are as per standards. The Environment and Forestry Ministry of Indonesia considers waste management to be a serious problem. Hence, we take our waste management very seriously and aim to reduce the waste burden

produced from our unit through segregating our waste for recycling and reuse.

We look at waste as a responsibility and an opportunity. We work in complete adherence to our waste management policy and provide a structured approach to waste collection, handling, storage and disposal of different types of waste generated in PTE.

The waste we generate has a direct impact on the triple bottom line. If handled properly, it reduces environmental foot print, improves our societal relations, and adds to economic value through reduction in disposal costs and savings through material efficiency.

Wherever waste is handed over to authorised waste handlers, we ensure that the certificate and evidence for treatment and disposal is provided. This also enables us to track, monitor and manage the waste.

Our hazardous waste includes used oil which accounts to 2,800 litres in the reporting period.

Legend: 2016-172014 2015-16


Our waste increased by 11% in the reporting period.There are no significant spills during the reporting period.

In the reporting period, there has been no significant environmental impacts due to transportation of goods for organisation’s operation and transporting members of workforce.

We do not transport, import, export or treat any hazardous waste, which can be classified under terms of Basel Convention, and no waste is being shipped internationally.

ReuseNon-Hazardous Waste

RecyclingNon-Hazardous Waste

946

306

1,051

376

1,064

222

Legend: 2016-172014 2015-16


Health & Safety

Absentee Rate (2016-17): 1.24Target for 2017 : 0

1.24WASH Pledge Score (2016-17) : 90%Target for 2017 : 90%

90%Higg Index score % Facility(Env Module) : (2016-17) 86

Facility Social & labour module

Target for 2017 : 90Target for 2017 : 90

83 | 86Higg Index score % Facility(Env 83 | 86Higg Index score % Facility(Env

82

By its ratification of International Labour Organisation (hereinafter ‘ILO’) Convention No. 187, the Government of Indonesia reinforces its commitment to achieve sustained and continuous improvement of occupational safety and health to prevent occupational injuries, diseases and deaths, in consultation with the social partners.

As a promotional framework providing for the coherent and systematic approach to occupational safety and health issues, Convention No. 187 calls on ratifying member States to take active steps in consultation with the social partners, to progressively achieve a safe and healthy working environment in a cohesive and concerted manner, through the development of a national policy, a national system and a national programme on occupational safety and health .

Ensuring the health and safety of every employee is the first and foremost responsibility, as they are the most important resource and every process depends on them. Any incidents of accidents, injuries or lost days due to occupational hazards damages our employee well-being, cause business disruptions and damage our reputation.

Health & Safety

Health & SafetyPolicies

OSHAS 18001, Oeko-Tex,

Higg Index, Wash Pledge

Health & Safety

Mission


In order to ensure adherence to continual improvement and total employee involvement in addressing the challenge of safety and occupational health, we have implemented management systems as per OHSAS 18001 standards.

We continue to conduct Occupational Health and Safety aspect – impact analysis on an annual basis. Risk assessments are conducted once in 6 months by an external agency.

Our commitment to WASH pledge and periodic internal audits to check adherence to the pledge are the main levers for maintaining health and hygiene in the work place. Post integration of the Wash Pledge module with Enablon, our performance is tracked at a unit level and also at a business level which is reviewed during our Apex Council meetings. Our score was 1.77 out of 2 in 2015-16, which has improved to 1.8 out of 2 in 2016-17. Our commitment to health also extends to customer and ultimate user of our products. Oeko-tex certification of our products and periodic evaluation of Higg Index score ensures that this commitment is adhered to in our operations.

Safety Council members consist of representatives from different functions and meet on a quarterly basis. Inclusion of more workers in safety committees and improved awareness and training to our workers employed by contractors are also some factors that contributed to improvement of our safety performance.

The following actions were undertaken by the Council in the reporting period:.

• making safety boards every mill (to display safety rules)• evacuation routes were displayed from entry to factory• new safety permit (hot work and cold work permits are started)• basic safety training for civil contractors was taken up• electrical safety training for technicians was given as per Govt.

regulations• constrained space training was initiated

In addition to this Central committee, there are four Unit level sub committees (1) Mill-1 (2) Mill-2 (3) Mill-3 and (4) Stores and Godown

These sub-committees have representation from workers in respective divisions.

Mr. N.K.Singh Works Head

Richo Erwansyah MaulandSafety Officer

Pak ParyadiSafety Officer

Ibu LiaWCM

Mr. P. KanagarajEngineering

Mr. Hemant CEngineering

Mr. B.D.SharmaProduction Mill-1

Mr. Dilip Kumar TiwariProduction Mill-2

Mr. Ajeet Singh ChauhanProduction Mill-3

Mr. Deepak GuptaMaintenance

Mr. Mukesh JainFinance & Commercial

Mr. Dody MulyantoStore

Mr. MujiGodown

Mr. Sathish KumarEngineering

Mr. TurimanEngineering

Mr. TarwinEngineering

Mr. Dadang Jaya LaksanaPersonnel

Ms. Sri HertatyHRD

Mr Eko Aris SudirmanTraining

Health & Safety Committee


Workforce Representation:Number of health & safety committees

Number of workers represented in safety committees as a percentage of total workforce numbers

5100%

We have conducted an audit during the reporting period to assess the work areas that have high risk of negative occupational health risk and found no such area in our manufacturing operations. We have included occupational health and safety in our agreements with the worker unions.


Chemical Management

COD (mg/l)

35

2117.6

COD (mg/l) of Effluent (2016-17) : 17.6 mg/lTarget for 2017 : <25 mg/l

17.6 mg/lCOD (mg/l) of Effluent 17.6 mg/lCOD (mg/l) of Effluent (2016-17)17.6 mg/l

(2016-17)Compliance with IFC & regulatory standards of Effluent (2016-17) : 100Target for 2017 : 100%

100%

Chemicals management is an important aspect for safe operations, maintaining quality of effluent and most importantly customer health and safety. At PTE, we manage chemicals through our Environment Management System, following ISO standards and REACH requirements.

During the reporting period and two years prior to that, there were no significant spills in our operations.

We avoid known/identified toxic, harmful and bio-accumulative chemicals and substances. We comply with REACH requirements fully.Our diligent chemical use is monitored by the level of COD in our effluents.

Chemical Management

Legend: 2016-172014 2015-16

Chemicals Management

Mission

Environment, Health,Safety and Product Stewardship

Policies

SA 8000, Oekotek


35

21

Caring and Sharing Our employees are critical to our business and its sustainability, more so in a challenging business environment wherein continuous innovation is critical. We are committed to creating a fair, healthy, safe and a rewarding work environment that balances work and life.

We provide equal treatment to all workers in employment, training, promotion and remuneration on the basis of their capability to perform the jobs regardless of race, caste, national origin, religion, disability, gender, sexual orientation, union membership, political affiliations or age. We create an enabling environment for diverse groups, made our premises disabled friendly and also improved the environment during the reporting period.

Company does not tolerate child labour, forced labour at work place or in the supply chain. We provide wages and benefits more than that is stipulated by the regulations. Company promotes structured employee recognition, reward, promotion system and the team rewards and individual rewards.

We have arranged health awareness programs for employees to increase their awareness on basic health. In addition we are arranging training on emergency evacuation, fire mock drills once every year by an external party. We also strengthened the recruitment process by enforcing all new recruits to undergo basic health screening and to cover health risks assessment. We have included occupational health and safety in our agreements with the worker unions.

We conform to the WASH pledge in order to improve our performance on water, waste water, sanitation, hygiene and health. We have been implementing Higg Index’s Environmental Module, Social & Labour Module and Brand Module to improve our sustainability practices along the value chain.

Mr. Vinod Singh Head, HR


We adhere to fair Employment practices against all externalities resulting in more technology intensive and innovation driven industry. We aspire to become an equal opportunity employer and do not tolerate child, forced or compulsory labour at the work place and in supply chain in adherence to ILO Conventions 29(Abolition of Child Labour), 105 (Abolition of Forced Labour) and 111(Non discrimination towards employment opportunities). We provide timely wages and benefits as stipulated by the regulations and follow ILO Conventions 100 to ensure equal remuneration to male and female workers as per their seniority, qualification and skill expertise.

We make best efforts to create enabling environment for diverse groups. Our organization is disable friendly and in the reporting period we have employed 3 disabled people.

Labour Management RelationsMaintaining a good relationship with our employees and workers is critical to maintain workplace harmony and productivity. Our Collective Bargaining Agreement (CLA) is negotiated and agreed upon once every two years. We enjoy the support of our union- SPSIN, and to the credit of all, no time have been lost due to any dispute in the reporting period. The contract will be renewed in October 2017.

All the employees are covered in the bargaining agreement.

Our company policy allows employees to take a maternal leave of 3 months. Post return from maternity leave, they are reinstated to their original role thus reducing any opportunity for dissatisfy action. However we take care of our employees on their return by providing them roles that would be of less strain, less hazard prone and accident prone.

The traditional joint family system still continues in Indonesia, thus

Social & Labour Fair Employment Practices

Average Training Hours (2016-17): 26.74Target for 2017 : 21.8

26.74

Community Social Investment (2016-17): 15,236 USDTarget for 2017 : 10,000 USD/yr

15,236Community Social Investment (2016-17): 15,236Community Social Investment (2016-17):

Social & Labor

Mission

Social Accountability

Policy

SA 8000,Higg Index


allowing for women to work, as children are taken care of by In-laws. Again as a social practice, women seek to work and remain financially independent. We provide prayer rooms in our workplace in different zones to enable the devoted religious people to pursue their religious beliefs and requirements and practices. Appropriate dress codes have also been adapted to suit the culture. In addition to this we are providing scholarships to children of permanent employees who are loyal to the company having worked more than 5 years.

New employee hire and employee turn-over

Compensation and Benefits Entry level wage, basic salary and remuneration

2015-16

3.70%4%1 x basic salaryMealsHousing / Mess

3.70%4%1 x basic salaryMeals Housing/mess

Benefits offered to permanent employees:

• Employment Insurance (BPJS)• Medical Insurance (BPJS)• Eid Mubarak Bonus• Allowance• Others

Benefits offered to temporary/part-time/contract employees:

• Employment Insurance (BPJS)• Medical Insurance (BPJS)• Eid Mubarak Bonus• Allowance• Others

2016-17



WestJava149

WestJava126

EastJava 1

EastJava 0

Others1

Others5

Cent

ral

Java

12 Cent

ral

Java

8

159

203

4

31

6

40

0

0

0

6

133

108

Under 30 Years

Under 30 Years

30-50 Years Old

30-50 Years Old

Above 50 Years

Above 50 YearsNew employees hired by age group:

Employee turnover by age group:

New employees hired by gender:

New employees hired by region:

Employee turnover by gender:

05

21

158

182

124

139

15

15

Male

Male

Female

Female

Legend:

2016-17

2015-16


WestJava156

WestJava137

Cent

ral

Java

55 Ce

ntra

lJa

va 2

EastJava 6

Others

21Others

13

Legend: 2016-172015-16

Workforce diversity and inclusion is a key driver of innovation and adaptability. Indonesia has ratified the two core ILO conventions addressing discrimination in respect to employment and occupation.

Driving diversity is relevant to our organization for cross cultural management, engaging people to achieve business objectives, and expand demographics of employees to suit operational assignments. Employed workers as well as job applicants are not subjected to discrimination.

Retention rate after parental leave

421

762

49

287

49

282

801

412

30

85

30

77

2015-16

1183

336

331

2016-17

1213

115

107

Total number of employees that were entitled to parental leave

Total number of employees that took parental leave

Total number of employees that returned to work after parental leave ended

Since women form the majority in the workforce, PTE continues to empower more women to craft their career path. PTE has three departments headed by women as head of department (HOD) position.

1. Ibu Evie - Finance Function 2. Ibu Lia - WCM 3. Ibu Hartati - HRD

18% of the management positions in PTE are held by female employees.We have employed 3 disabled people during the reporting period and are looking forward to setting up disability friendly infrastructure in the coming years to help them adapt to the work environment around them.

Employee Diversity

New employees turnover by region:


Legend: 2016-172015-16

Diversity for employees

in 2015-16 in 2016-17

Total Employees by gender:

Total Employees by minority groups:

Total Employees by region:

13 16Christian ChristianHindu HinduOthers Others

- -- -

WestJava1406

WestJava1373

CentralJava22

CentralJava25

EastJava20

EastJava28

Others

217Others

225

Legend: 2016-172015-16

952 689 712 24 21918

Under 30 Years 30-50 Years Old Above 50 Years

Total employees by age group:

423 423 1,2231,228

Male Female


Indonesia has ratified various human rights treaties and ILO Conventions and therefore, we have a responsibility to make sure that we are not complicit in human rights abuses. International norms, such as the United Nations Guiding Principles on Business and Human Rights recognize that companies should undertake “human rights due diligence” measures to ensure their operations respect human rights and do not contribute to human rights abuses.

ABG is a signatory to the United Nations Global Compact, an international forum that operates under the aegis of the United Nations and ascribes to the human rights policy of the United Nations Global Compact.

Our approach to human rights is aligned with universally accepted human rights standards and we support the human right issues included in the Universal Declaration of Human Rights.

Our human rights policy addresses key aspects such as non-discrimination of any form, prohibition of child and forced labour, and freedom of association and the right to engage in collective bargaining. The same is applicable to every employee.

In upholding human rights the company provides equal opportunities to all workers irrespective of gender, religion and disability. We have not identified any violations during the reporting period.

We have included human rights clauses in our contracts such as labour and supplier contracts. Contractor’s employees can also contact us directly in case of any grievance. Our approach to detect any violations in fair employment practices and human rights is through periodic internal audits, grievance and whistle blower mechanisms. We will also be implementing the SA 8000 standard in the reporting period 2017-18.

Human Rights

Total number of agreements and contracts that contain clauses on human rights

Percentage of employees who received training on human rights policies or procedures

Total number of security personnel employed

Is the training also provided to third party organizations providing security personnel?

Total number of security personnel receiving formal training in the organization’s human rights policies or specific procedures and their application to security

Total number of hours devoted to employee training on human rights policies or procedures

Investments2016-17

Training

Security Practices

3

100%

2500Yes

1,547


Nurturing TalentAccording to the World Bank’s Indonesia development policy review in 2014, the textile sector finds it “very difficult” to fill skilled professional-level positions (engineers), citing insufficient graduates as the reason. Thus, going forward, Indonesia has to focus on equipping graduates and workers with the right technical and employer-valued behavioral skills (discipline, reliability, teamwork and leadership) to support/enable large investments in key sectors. The Indonesian government is now focusing on developing sector specific Bachelors and Masters Courses so that industry requirements can be met.

Training, building knowledge and re-skilling our workforce continues to form an important part of organizational development at PTE.

Trainings are delivered by the HRD in a classroom form. We also arrange for external trainings that are organized by Business HR (BHR).

We have also developed a skill matrix framework to identify competency levels, skills and qualities of employees vis-a-vis skills required to improve on the job performance. Based on such mapping, we develop the training calendar for all employees, and ensure progress in their career. We undertake skill mapping bi-annually, and based on this a development plan is made.

Training & Development

Talent Segmentation

Talent Assessment

Talent Review

My Development Plan (MDP) -Implementation & Tracking


We plan to achieve increase in training man hours by expanding our training portfolio to include the following modules:a. Website sustainability training for staff- Enablonb. SAP assessment questionnairec. Energy and carbond. External training for electrical safetye. Training for confined space

Training Man-Hours Mapping our training hours

A number of training programs were included in the reporting period, which has resulted in an increase in the number of training hours.• Just-In-Time• Work Culture • Work Ethics -

Motivation and Discipline

• Customer Service• HIV• TBC

• Dengue• QC• Automation• Basic Condition

Evaluation• Ergonomics• Waste management

2.0 21.82.7 28.54.7 38.3

Some of the activities conducted by third party trainers include SA 8000, ISO 9001:2015, ISO 14001:2015, ISO 50001, OHSAS 18001, and Risk management, First aid, IT, Fire fighting and emergency preparation, family planning, supplier training, technical training for engineering and maintenance.

Legend: 2016-172014 2015-16

A number of training programs were included in the reporting period, which has resulted in an increase in the number of training hours.

268

0

672

290

9,144

5,450 5,222

5,388

5,302

5,196

580

5,450

5,678

5,868

9,144


Career DevelopmentStaff and workers on the shop - floor receive in-house trainings, to groom them for senior positions as available as well as chances for higher education, for the following levels such as:

• Group Head• Supervisor• Local manager

Workers are also identified in the talent pool based on attendance, attitude, capability, responsibility, initiative, cooperation, punctuality, health condition, discipline, performance, job knowledge and creativity for further promotions to supervisory as well as managerial levels.

Workshop on Excellence in Execution & Innovation was undertaken in the reporting period to improve the managerial skills of supervisory staff and local managers at external location.

Our appraisal process helps us to understand our employee’s challenges, strengths and areas where they seek improvement. In the process we, identify areas that require improvements in our training module and accordingly adjust the calendar by increasing training hours for a subject or adding new training subjects as demanded by employees based on availability of resources. We provide opportunities for employees to improve their performance through retraining exercises. In 2017-18, we expect to improve effectiveness of training and development and cover more employees on the basis of skill index.

Performance Evaluation:All employees including workers, long term contract workers and staff excepting new trainees are evaluated annually by the HR and concerned manager. The grading system is based on the following attributes: absenteeism, attitude, discipline, responsibility, job knowledge, capability, leadership, creativity, cooperation, obedience, health condition, and self-improvement.

Step

Trainingneed/

Identified

TrainingPlan

Training

TrainingRecord

TrainingEvaluation

Description PersonInvolved

Superiorand HRD

Trainer

HOD,Superior

Coordination

H R D

H R D

with HRD

H R D

HOD,

Position need

Individual

Course need by employee

Annual Master plan

Training by Department

Actual Training

Individual Record

Department PlanAction Plan

Actual Training Course

Training PlanActual

Training need & Actual

Summary Report

Training TypeTraining by Course

Trainer

Feedback Form

Evaluation of effectiveness

Flow Process Of Training Need Identification



With stricter labor and industry regulations in Indonesia, it is imperative to work with our suppliers on all sustainability aspects to continue to operate without supply chain disruptions. We are working with reputed companies for our critical supplies and communicate our code of conduct and SCM policies, so that our suppliers also follow the same in true spirit. Our vendor assessment system also includes human rights clauses.

Our regular stakeholders’ meeting with our suppliers include discussions not only about price, but also about the general market environment, market forecast, general economic forecast, exchange rate fluctuations, oil price estimations, supply chain sustenance, geo - political risks, anti-dumping practices and such critical aspects that could affect our performance and that of the value chain. This helps us to predict and fine tune our budget numbers and take necessary actions.

We encourage our suppliers to establish various management systems as mentioned in our supplier evaluation criteria. We are implementing social accountability standard SA 8000 in our operations and will soon extend relevant requirements in the supply chain.

Mr. Mukesh JainGeneral Manager, Finance & Commercial

Supply Chain


Supply Chain

Procurement from local suppliers (%) (2016-17) : 84%Target for 2017 : 90%

84%% paid as per contract on time (2016-17) : 100%Target for 2017 : 100%

100%


Indonesian regulations on labour, environment, human rights, and safety have become stringent and the Government is taking serious actions including closure of companies not complying with these regulations. Hence, it is essential that its suppliers comply with these laws in letter and in spirit.

In 2017, we will initiate the screening of new and existing key suppliers using such criteria, analyse their performance on these counts and conduct an impact (such as environmental, labour practices, human rights and society) assessment and create an action plan for improvement in areas of concern.

In the coming years, we are looking to strengthen our supplier assessment by incorporating environmental and social elements based on certifications and evidences from our suppliers. We look forward to collaborating with our suppliers to understand, share and imbibe sustainability learnings.

Percentage of the procurement budget used for significant locations of operation spent on suppliers local to that operation

60%

73%84%

Legend: 2016-172014 2015-16


Mission

Supply Chain Policy,Supplier Code of Conduct, Procurement

Policy

ISO 14001, SA 8000,ISO 9001,

Higg Index


Responsibility to Customer

Dear Stakeholders,

Our vision is “to provide better, safer & environment friendly products to our customers”. We operate in over 50 countries worldwide, compete with different competitors in different markets, and work with more than 1,000 customers having different end uses, using different kinds of machines and other complexities.

Customer centricity is our motto, which is executed through excellent customer service, customization of products through our wide range of specialty yarns and superior customer connect. Continuing our journey of servicing our customers in the best possible ways in last one year and also in line with group’s customer centricity approach, we initiated various new activities at unit level.

We are closely working with customers to cater to many new products and customisations. In close association with our product development team, we are developing new products and product grades for new applications. The share of VAP in total sales in increasing annually.We provide adequate information to our customers regarding our products. We provide necessary information on how to safely handle them. There were many initiatives taken for the customer engagement

• Mission Happiness• Customer Centricity• Continuous communication through emails, phone calls, mutual

factory visits and exhibitions, trade fairs etc.

We have completed life cycle analysis for most of our product grades and all of our products are Oeko-Tex certified and REACH compliant. Our customer satisfaction survey forms have been reviewed to include sustainability criteria which will include feedback from the customer on critical issues and consequently help us improve our performances.

Mr. Kapil Kumar AgrawalChief Marketing Officer


Market DynamicsWe are in a business where supply is more than demand. The customer expects better products with complete solution/ services with competitive prices and shorter lead time and minimum quality/ service related issues with amicable resolutions. Therefore, customer management has become an important area to take care of, to run the business and sustain it in this typical business scenario.

In view of those conditions, apart from maintaining the best quality of our existing products which are well accepted in the market, we are also in a spree of new product development in order to achieve the highest value application and stay ahead of the competition. We are having three strategic directions for product development. Our state of the art technology supports us to produce best quality products in the most cost effective way.

Over capacity builds up across various industry segments. Margins in commodity products are going to remain under tremendous pressure for some time to come. Therefore, product differentiation through a higher Value Added product (VAP) portfolio seems to be the only sustainable way forward for such of our businesses. However, the success factors for a speciality player are very different from a commodity player. Therefore, this shift in business strategy will require a change in mind-set, value inculcation, and working styles. We are constantly analysing our business, yarn performance and benchmarking ourselves against industry players.

Product : Injected Slub Yarn

This fancy yarn is produced with special injected slub-attachments on ring frames. In this yarn structure there are two components with different dyeing property. One component is called base which runs continuously to form the yarn body and second component is called injection which runs intermittently as per the signal from electronic device and laid down program made as per requirement of customer. This yarn is normally used in knitting for apparel and after dyeing of any one components, the effect of fancy effect is visible on the fabric. In this yarn thickness and length of injection portion may be tailor made as per customers’ choice. The base and effect strand fibre components may be selected suitably for variety of effects.

Potential Application: Circular Knitting for fancy ladies top wear.Potential Opportunity: As injected slub technology is new, opportunity of capturing market on this is quite good.Fibre Details: Base: 1.2Dx44mm Rayon or Polyester or Cotton: Effect : 1.2Dx44mm Rayon or Polyester or CottonMarket Size: Growing market with customers in Europe, Turkey, Korea, USA

Product Development 3 strategic years

1. Product development for immediate market need-already existing to others are new to us

3. Product from branding fibres & Tie-ups with branded fibre manufactures to leverage on their brand value

2. Building “VALUE” around commodity & developing differentiated / engineeered products by targeting applications on different functional platforms and branding


We provide information related to certifications, yarn count, blend percentage, and ply of yarn. Additionally, customers provide their labelling requirements on an as-need basis., Kamafil, one of our customers demanded that all cones should carry customised labels as per the standard design provided by them.

During the reporting period, there were no cases registered related to non-compliance concerning product information and labelling.

Our product development today considers utilisation of both natural and man-made fibres. We understand the impacts that fibres have across its life cycle. Hence, we have included 100% recycled polyester blends in our product basket. We have a pilot plant and a Centre of Excellence (COE), where we undertake both product sampling as well as knitting, dyeing and garmenting to showcase products to our customers. We have a product display studio where we showcase our products as well as those developed in collaboration with our customers.

Product Stewardship

Higg Index score %(Env Module) : (2015-16) 83 | (2016-17) - 86Target for 2017 : 90

83 | 86Higg Index score %(Env Module) : 83 | 86Higg Index score %(Env Module) :

Facility - Social & labour module: 76 | 82Target for 2017 : 90

76 | 82Facility - Social & labour module: 76 | 82Facility - Social & labour module:

Product labelling

Research & DevelopmentProduct Stewardship

Policy

ISO 9001, Oeko-Tex

Product Stewardship

PTE has conducted Life Cycle Assessment of Rayon Yarn. This assessment is based on ISO 14040/44 standard and is developed for communication to the stakeholders. One outcome of the study is identification of hotspots along the value chain (raw materials, manufacturing, transport, packaging material, use stage impacts and end of life) across the varios identified environmental impacts.

For comparability purposes, we have chosen the functional unit as: • 1 kg of packed rayon yarn (Cradle to gate system boundary)

Managing Impacts in Life Cycle


• 25 time’s use of a garment (blouse) made from 70% viscose, 25% nylon and 5% elastane (Cradle to grave life cycle).

We have also compared our performance across the life cycle with that of Defra Study for 1 kg of viscose fabric manufacturing & Textile Exchange Study for 1 kg of viscose and TENCEL fabric manufacturing (both undyed and unfinished fabric) and identified improvement areas in the manufacturing as also in other parts of supply chain. We as a spinner in the value chain cause a small

fraction of the total environmental impact in the value chain and to reduce impacts along the life cycle of the products we have to make appropriate and pragmatic choices.


All our products are Oeko-Tex certified and comply with product health and safety regulatory requirements. In all countries of export, we showcase our global good practices of product stewardship.

Name of UnitCertificate No.Product ClassExpiry DateMaterials Covered

Covered Since

PT.ELEGANT TEXTILE INDUSTRY

17521

Class I

27.08.2016

Ring spun yarn (Rayon, Polyester, T/R

blends and Flame retardant Fibers)

2007

Product Health & Safety

PTE has conducted Life Cycle Assessment of Rayon Yarn. This assessment is based on ISO 14040/44 standard and is developed for communication to the stakeholders. One outcome of the study is identification of hotspots along the value chain (raw materials, manufacturing, transport, packaging material, use stage impacts and end of life) across the varios identified environmental impacts. For comparability purposes, we have chosen the functional unit as:

1. 1 kg of packed rayon yarn (Cradle to gate system boundary)2. 25 time’s use of a garment (blouse) made from 70% viscose, 25%

nylon and 5% elastane (Cradle to grave life cycle).

Managing Impacts in Life CycleAbout ABY GreenpolyRecycle Polyester is a sustainable fibre. It offsets use of crude oil, conserving precious natural resources and energy. REPREVE is a brand of recycled fiber that is made from recycled materials, including used plastic bottles. The process of converting PET into recycled polyester requires much less energy than in the case of normal polyester. It takes approx 30-40% less energy. The product which is 100% recycle polyester, blends with other fibres like regular cotton, BCI cotton, viscose, etc and finds application in all kinds of sustainable apparel end uses.

• Greenpoly provides the following benefits• Environment friendly Sustainable fibre• Reduced dependence on petroleum as the raw material• Less requirement of water and energy during fibre

manufacturing • Properties similar to virgin grade polyester, can be dyed and

finished for all kinds of applications

BCI Cotton Blended Products ABYTM is committed to sustainable textile manufacturing. As a step in this direction, very soon ABYTM is going to offer BCI Cotton Blended products from its PT. Sunrise Bumi Textile plant

RECYCLE POLY with OPTICAL BRIGHTIs a part of Green initiative ABYTM is already offering sustainable yarns like Recycle polyester – 100% as well as with blends through all the 3 spinning technology (RS, OE, and Vortex) in the yarn count range of Ne 6/1 to 40/1.



No. of stakeholder meetings (2016-17) : 13Target for 2017 : 12

13NPS Score (2016-17): 25%Target for 2017 : 40

25%Supplier, community and employee satisfaction score (2016-17): - (Supplier) | 96.17 (Employee) | 89.34 (Customer)Target for 2017 : 90%

95.57 (Supplier) | 96.17 (Employee) | 89.34 (Customer)

StakeholderEngagement

AA 1000 guidance

Stakeholder engagement

policy and other policies Stakeholder

EngagementMission


At OSB we believe that “The Customer is the focus of everything we do”. The attributes such as nearness to the markets, a long-term relationship with customers, unique customer technical support services, quick complaint resolution and strategy of product customization to improve customers’ productivity has helped us to develop loyal & regular customers and has given us a competitive advantage.

The more detailed knowledge of customer & market needs and the expectation of customers’ in the entire value chain have helped in increasing the brand image of our yarn. Our long term approach is oriented towards developing customers as business partners.

Our Customer Relationship Management is process-driven and is focused at creating higher value for the customer. Further, as a standard practice, we share the market information that we have with our customers, including future market trends to enable customers to take timely business decisions and take maximum advantage of the market situations.

Customer EngagementSTAKEHOLDERS

1. Suppliers

3. Employees

4. Local Community

5. Banker

2. Customers

Mode of communication and Concerns, Frequency of meeting

Regular Meetings

Meetings, Seminars, Web lectures

Meetings,

Meetings, Mails

Meetings, smart phones applications, phones, emails, fax, customer visiting us, surveys both internal and external

Concerns : Payment terms, new business, market dynamics, forecasts

Concerns : Increments, promotions, amenities, work satisfaction, safety, training, performance

Concerns : Employment for locals, expansion of CSR activities, environmental impacts

Concerns : New loan off take, financing cost, market information, risk mitigation, business strategy, company performance

Concerns : Timely delivery, product quality, value-added products, service quality

The Customer Technical Service Head (CTSH) also has a fixed schedule, whereby he interacts with customers in different regions every quarter with the purpose of understanding customer requirements and product performance. He also interacts with domestic customers once in a month. Our work heads also meet customers bi-annually. The CMO meets customers once in a quarter and the CEO also meets selected customers periodically.

Value Creation Engine (VCE) team who interacts with customers on a regular basis and show case products. As demonstrated, we are keen to continually collaborate with our customers in the value chain which will enhance the production of value added products which and help us to expand our product offerings


OSB conducts customer satisfaction surveys every alternate year to determine the level of satisfaction. The survey form is sent to all our regular customers, covering about 70% of the volume across the globe segments by e-mail/ fax. The survey forms are analysed and the results obtained from the survey are communicated to the marketing department and further discussions are held in the review meetings.

Customer Satisfaction

Customer Centricity

We have a unique system of serving our customer’s customers. Under this system we help fabric manufacturers in improving their product processing efficiency. We have helped many of them to improve their capacity utilization and maintain full plant operation on their premises by providing them our expertise. We also connected them with our network of yarn buyers in different countries, thus increasing our customer’s production for their domestic and export markets as well as our sales.

Customer Grievance Mechanism

Approach & Deployment

OSB Units have a structured process of Customer Complaint Handling and the system is inbuilt to handle the complaint. For each process the responsibility and measurement is fixed so that the customers’ complaints are used as a good relationship building measure and for areas of improvement. OSB encourages customers to share their entire problem so that minor issues are also brought to light helping us to proactively avoid any major deviation.

Assessment & Refinement

Customer complaint reports are treated as learning and circulated across the units for further improvement and avoiding recurrence of complaints of similar type.

Evidence Available

Customers complaint reports

Customer centricity is about continuously listening closely to customers, gaining insights and designing and offering better solutions and experiences at every important touch point, consistently.

Customer Centricity business in ABG is a culture, process, strategic stance and execution centered in a deep, continuous understanding and agile response to the customer’s demand to deliver faster growth and achieve greater profitability than our competition. Many initiatives are taken for improving the customer centricity such as:

a. Hello Bosstomer, where we drive more for new ideas for the development in the customer engagementb. Customer Technical Services helping in improving performance at the customer end.

We are also planning on few other projects like Mission Happiness, Quantum Jump Project in the coming years for development in the customer engagement. We have customer data controls with IT Policy and Code of Conduct.

There were no breaches of private customer information in the reporting period.


We have recorded 157 Grievances in the reporting period. All of these have been resolved.

1. Acknowledgement of complaint / feedback2. Reply from plant post routine investigation3. Analysis of samples received from customers4. Analysis of fabric samples received from

customer with assistance from ADC5. Analysis of fabric samples from outside

agencies6. Claim resolution for critical complaints

Complaint feedback and resolution process

24 hours3 days7 days15 days

30 days

90 days

Time Taken


Employee EngagementPTE acknowledges that creating an open environment of continuous engagement is vital to maintaining motivation and efficiency levels of its employees..The ABY units across Indonesia also organize welfare activities such as company picnics for the employees and their families. Similarly, during the annual Id-ul Fitri celebrations, employees including contract workers and their families are provided to and fro transportation to their native places to celebrate the festival along with their families.

We also annually celebrate Halal Bi-Halal jointly within the company campus. We organize sports events every year on 17th August to mark the independence of our country. On this day families of employees come together to have a morning walk which is followed by the sports events at our housing colony, that include volleyball, badminton, football, chess to name a few.

We organize picnics every year, organize competitions related to quiz, cooking, slogan composition, poster making and participate in various technical competitions within the company and within the group as a whole on topics like Kaizen, 5S, Why-why analysis, one point lesson, quality circle and poka yoke. The Vibes Survey conducted in the reporting period focused on two themes: a. Enterprise themesb. Business Themes

Supplier EngagementDuring our structured meetings with our suppliers, we discuss not onlyabout short and medium term concerns that suppliers may have, butalso about the general market environment, market forecast, generaleconomic forecast, exchange rate fluctuations, oil price estimations,supply chain sustenance, geo - political risks, anti-dumping practicesand such critical aspects that could affect our performance and thatof the value chain. This helps us to predict and fine tune our budgetnumbers and take necessary actions.

We constantly work with our key local suppliers on improving thequality of products. Joint improvement projects such as improving thequality at supplier end and testing this sample at our end and at ourcustomers’ end, using this knowledge to further improve the quality ofproduct of our supplier is being done continuously.

In the reporting period we have formed a CPC(Central Purchase Committee).

Our actions include:-

Supplier Grievance MechanismThere were no supplier grievances in the reporting period. We understand that grievance redressal is a sensitive issue to this stakeholder. Our supplier grievance mechanism is taken care through our sustainability portal.

• Identification of a supplier for making bricks from cotton dust which will be later consumed as briquettes in boilers.

• Negotiation with local suppliers for installation of solar panels at our rooftops.

• Redesign the packing layers from 5 ply to 3 ply • Direct procurement of cotton from ginning factory as a

sustainable sourcing initiative• Negotiation with suppliers to reduce weight of paper

cones. They have reduced weight from 45 to 38 g. Now it is a target to reduce to 35 gm


Enterprise Themesa. Engagement Index1. Pride2. Advocacy3. Intent to stay4. Energy

b. Agility1. Anticipating change2. Leading change

c. Alignment1. Clear goals2. Aligned with vision

d. Workplace Themes1. Employee brand2. Values3. Workplace engagement

4. Performance culture5. Development and learning6. career

Business Themes· Growth Quality Focused· Low cost leadership· Solution based· Innovation· Continuous improvement· Cultural centricity· Business Transformation

We received an overall score of 77.8 % for employee satisfaction and recommending the business as a great place to work, 96.17% of our employees are proud to work with us. Driving higher team engagement will be the primary objective of Managers, Business units and the Business.


We received an overall score of 77.8 % for employee satisfaction througn VIBE Survey and recommending the business as a great place to work,. Driving higher team engagement will be the primary objective of Managers, Business units and the Business.

Employee Grievance Mechanism During the reporting period we have put in place a grievance box to address employee grievances received anonymously. In the reporting period we received 11 grievances from our employees, out of which all grievances have been addressed and 10 have been resolved.

If any dispute/grievance arises, both management and the union proactively engage to arrive at a solution. Both parties meet together as required to discuss and solve issues related to productivity, quality, and discipline. A lot of effort is invested by all to settle our biennial bipartite agreement.

Community EngagementEngaging with the community on a regular basis is crucial in helping us identify their real concerns and also participating in the solutions. CSR coordinators periodically meet with representatives of society & government officials like the, Mayor, village administrative officer (Lurah), the District Leader (Chamat), the District Magistrate (Bupathy), Police, and Military representatives and the Municipal Corporation.

PTE has adopted neighboring villages and has implemented various community development programmes. and will continue working harmoniously with government authorities and the communities. Some of the community initiatives in the reporting period are:

a. Investment of USD 12,121 for construction of mass prayer room for the communityb. Distribution of Books & stationery to 613 children in nearby schools. c. Renovation of Employee Housing facility at Ashramad. Maintenance of local mosques on PTE campuse. Sponsoring and awarding children of employeesf. Celebration of Id Mubarak with the community by distributing 200 gift packets.g. Donating funds to Balaji Temple


Our sustainability portal http://oneabgtextiles-sustainability.com/ facilitates internal and external stakeholder engagement. On this portal, our stakeholders can record their grievances, queries and suggestions. Besides, the forum also has an option which includes discussions amongst stakeholders further leading to collaboration and co creation projects. Through this forum, our businesses will share sustainability success stories, advances, performance on a continuous basis. From now on, our sustainability report would be culmination of our continuous engagement and disclosures



STRATEGIC STAKE HOLDER ENGAGEMENT & FUTURE PROOFING To understand the external changes that will inevitably impact our company in the future, we build strong relationships with our stakeholders and key technical experts on climate change, water and waste management, developments in human rights legislation, safety standards, health impacts and the like. We embed sustainability trends into our strategic business plans to minimise the risks and find new opportunities that will be presented by the requirements of a sustainable planet and society by 2030 and 2050 respectively and make our businesses sustainable.


As a part of Responsible Stewardship, all entities of ABG textiles, are engaging with stakeholders through different modes on a regular basis. A stakeholder engagement platform is operational online to record stakeholder concerns and suggestions.

The purpose of strategic stakeholder engagement conducted for PTE during June 2016, was to feed into future proofing of the business.

Strategic Stakeholder Engagement, the second component of ABG Sustainability Framework is defined as: ̀Horizontal scanning and megatrend analysis to gain knowledge of how, and how fast externalities will change usually by disruptions’. The goal of Stakeholder Engagement as per the ABG framework is to build strong relationships with our stakeholders and key technical experts on climate change, water and waste management, demographic changes, developments in human rights legislation, safety standards, health impacts, technology changes and the like. By doing so ABG expects to learn what are the trends that will most likely affect ABG textile businesses in the future and how they are likely to change:

In order to do so ABG Textiles is conducting this strategic stakeholder engagement ABG engages with industry experts, regional and sectoral experts along with key players along the value chain who would deliberate on: environmental, social, economic, technological, and business trends that would impact the business’ operations and products in the next 3-5 years, visualisation of threats and opportunities

Understand stakeholder perspectives on issues of significance, Response strategy development (SHs to comment on possible business responses, suggest lead collaboration and co-creation opportunities.)

The invitees to the engagement will contribute to: Horizontal scanning

Understanding the megatrends that contribute to shaping national and global responses to these changes.

Visualize future threats and opportunities to the business and develop strategies to gain an advantage.

Scenario Planning

Taking inputs from the strategic stakeholder engagements, arrive at key driving forces by understanding social, economic and environmental trends that are certain to occur and combine this with future proofing factors (uncertainties) such as unprecedented shift in regulations, changing needs of stakeholders and business environment, thus developing a possible scenarios and responses.

Methodology and Limitations

Identify stakeholders as given in guidance notes circulated

Circulate a draft on Mega trends and queries around it to stakeholders Call a meeting of internal and external stakeholders for 6 hours Conduct brainstorming to identify trends of some relevance and attempt convergence around relevance and impact contour of such trends to business and possible responses

Summarise the outcome, if another round of (off line dialogue) is not required.

However, PTE felt that a meeting of strategic stakeholders at one venue or video conference call will not be practical. Hence individual meetings of external stakeholders along with relevant internal stakeholders were planned. Also, notes on discussion points were not circulated apriori.

Strategic Stakeholder Engagement and Future Proofing


Demographics & Associated Changes(De) Population

Protectionism-Fragmentation of Global markets

Demographics of Indonesia and increasing skill levels of the population would result in work force (skilled) availability easier

While some stakeholders felt growing fragmentation – reversal of globalization- is temporary, many felt that forms of protectionism in commerce, trade and migration would continue.

Government is driving skill development in Indonesia and hence skilled labor availability will increase

Protectionism in markets would also grow…….could be beyond non-tariff trade barriers of environment and social aspect related. Opinions were divided and uncertain on how it will affect the access to ultimate markets

Increase in wages is given and labour union unrest will be minimal due to government interventions to safeguard labour rights

Regional groupings in trade will be new form of globalization

Future markets in Asia will be facilitated further by FTA

Indonesia will grow as a market

Present developing countries in Asia and Africa will witness faster market growth for end products

However nature of markets will be driven by brands more than demographics

Immigration will become more difficult and hence local employment at all levels will have to increase

Regulations on immigration, worker rights and safety will be more structured and stricter

There is an ageing population in developed countries, and in some markets a younger population is prevalent. But fashion is becoming more uniform and hence will not impact markets for yarn and fabrics

Labour

Structural Changes

Labour unions will be more accommodative and government mediation and intervention will be positive

Size and Efficiency is not enough. Agility and innovation(differentiation) is necessary to survive

Equal Pay for Equal Work will be the norm

Indonesia will witness higher rates of growth

Labour unions will demand safety and health


Consumer as fashion engineerCitizens are becoming ‘fashion engineers’ enabled by the web and open source platforms and this trend is likely to increase.

Consumers can also purchase online ”fashion kits” and use them to make outfits and accessories out of locally available materials.

3D Printing could be adopted earlier in apparels

Clothing Care & Sustainable Consumption

Customers will prefer minimal clothing care, including cost for care-minimal care schedules, electricity, water etc.

Customers may also be happy if the cloth at the time of disposal does not harm environment or is recyclable or is made out of renewable material or with least life cycle impacts

Will recycling apparels/fabrics and recovery of fibre/fabric be a significant economic activity in the next decade? Such signs are already seen by brands asking for supplies from recycled materials and technology for recycling has overcome many separation barriers.

Instances of Japanese customers enquiring for recyclability of products are reported

Climate ChangeGHG Mitigation & Energy Constraints

Adapting to Climate Change

Restrictions due to GHG mitigation related regulatory requirements addressing this sector is likely, voluntarily reducing emissions and disclosing the same will give first mover advantage

In Indonesia energy prices are not likely to increase out of pace with past trends. Some felt that the prices will increase as the government withdraws subsidies and invests in renewables. Voluntarily adopting renewable energy and continued efforts in energy efficiency will have reputational advantage. Government in Indonesia is promoting energy efficiency.

Indonesia has committed for 41% decrease in GHG intensity of the economy by 2020 over 2005 and is also aligned with market mechanism of Japan

Manufacturing locations are more likely to face the effects of extreme weather events

Climate change impact on markets (risks and opportunities) could not be ascertained

Consumer preferences, customers and regulations will require GHG foot print information


Fresh Water AvailabilityWater Resource Risk

Water resource risk (fresh water availability and effluent discharge) is faced by customers and will become severe. Significant water resource risk is faced by customers in Indonesia located around Batum

Water resource risk is not very significant in manufacturing except at PTE

Information Technology & Smart/Functional FabricsInformation Management

Management of information related to manufacturing, inventory etc. will become essential to address flexible demands of customers

Information management of Products to demonstrate traceability to customers

Information Technology - 3D Printing

3D printing or any other similar technology will not eliminate spinning. Fiber to fabric applications will be limited to industrial applications

Robotics

Automation may increase significantly in the face of labour shortages, demand for quality and smaller batch sizes

In near future very few operations may be amenable for robotic handling

IT application in controls will increase

Though regulators may not encourage robotics, application of robotics in unsafe tasks and transportation within manufacturing will happen

Smart/Functional Fabrics

Smart fabrics and their applications can rise in some specific segments, such as medical, sports etc.

Smart fabrics would require incorporation of smartness at the stage of spinning

More importantly, demand for functional/function enhancing fabrics, such as medical and sports would grow

R&D and Innovation

R&D Innovation will be the absolute ingredient of business success in future

Regulatory EnvironmentShareholders

Shareholders expectation on disclosures is increasing

Companies will be expected to contribute to local economy


Labour & Immigration

Regulations related to work conditions and wages will be more stringent

Regulations on immigration /work visas etc. will be more stringent

Regulations related to employing/ non-discrimination of differently abled personnel

Diversity related regulations for boards and executives

Environment

Regulations related to product responsibility & related disclosures will increase in developed countries and also in developing country markets

Climate mitigation regulations will be applicable for manufacturing but disclosures will be required in product declarations

Regulations will continuously increase in rigor

Regulations on recyclability and textile (synthetic/non-renewable) waste disposal will become stringent

Customers will face significant rigor in environmental regulations

Future ProofingDEMOGRAPHICS

• Modernization/Automation, including robotics, wherever feasible may be adopted

• Workplace improvements to attract and retain talent• Transition to significant share of Indonesians in supervisory and

managerial workforce• Prepare for rigorous and structured immigration regulations• Continue efforts to overcome non-tariff trade barriers in developing

countries • Asian markets – focus….observe FTA progress and detail • Safe & Healthy work place will continue to be a priority with unsafe

work being automated • Ensure equal pay for equal work for all including expats/migrants • Organisational culture has to be built around to be agile, responsive

and innovative.

CONSUMER AS FASHION ENGINEER

• Be prepared for customisation…..larger machines with flexibility for smaller batches

• Explore opportunities and threats if 3D printing in apparels becomes a material fraction of the market

CLOTHING CARE AND SUSTAINABLE CONSUMPTION

• Product development suitable for being…anti-bacterial, dust repelling, wrinkle free, requiring less chemicals and water in washing, durability

• Product development suitable for recyclability and improve share of products from recycled materials

• Prepare for product information management and disclosures and systems to demonstrate traceability to customers (e.g., to demonstrate source of viscose fibre from sustainably managed


forests or carbon/energy/water footprint in a specific product)• Explore possibility of ABY becoming top 10 brands for Yarn made

from recycled material

CLIMATE CHANGE

• Continue with efforts in GHG Mitigation/Energy Efficiency and Renewable Energy and its disclosure

• Continue GHG foot printing assessments and disclosures for select products

• Assess whether the risk alleviation is adequate in the face of climate change at the manufacturing locations

FRESH WATER AVAILABILITY

• Continue with efforts in water conservation as the region faces fresh water availability risk and all industries may face risk of water resource allocation

• Product innovation to alleviate customer risk in water resources and effluents

• Keep information/assessment of customers that are likely to face water resource risk

• Information Technology & Smart/Functional Fabrics

INFORMATION MANAGEMENT

• Integrated (Supply Chain, Manufacturing, Customer) real time information management

• Traceability through information management is to be managed • Continue focus on automation and explore robotic applications

in operations with risk of safety and occupational health and for transportation within manufacturing

• Explore developing yarn products for Functional/Function enhancing fabrics in health care and sport applications

• Prudent, participatory and collaborative (along the value chain) investments in R&D

• Innovation across all functions and levels is to be promoted

REGULATORY ENVIRONMENT

• Wage advantages are only short term. Prepare for improved automation and productivity

• Management composition to change to include significant proportion of Indonesians

• Disclosures to shareholders be on par with listed entities• Improved efforts to contribute to local economy• Aggressive continuation of positive compliance in manufacturing • Increase products under product stewardship performance and

disclosures • Identify and watch significant customers and suppliers with high

environmental compliance risk


CSO’s EpilogueCommitment to Results

Dear Stakeholders,

We have returned to you with full account of our sustainability performance during the reporting period this year is 01st April 2016 to 31st March 2017. As you would appreciate, this is our third sustainability report following GRI G4 guidelines and there has been no significant change in the entity boundary. Our product portfolio varies and across reporting periods and accordingly, we have redefined our productivity measure to ensure comparability across the reporting periods. We continue with our commitment by contributing to UNGC and SDGs and have elaborated the same in this report.

As you have noticed, Sustainability Initiatives at PTE are guided by Sustainability Apex. Through Apex Council, entities belonging to Aditya Birla Group in Acrylic Fiber, Textiles and Yarn business work together, exchange experiences and traverse the sustainability path. We are also advised by an external advisory council, consists of experts in various sustainability areas from different countries of our operation.

Based on the foundation of ABG framework and our policies, technical and management standards aligned to international standards as defined by the IFC, OECD, UNGC, Oeko-Tex, REACH, ISO and OHSAS, we addressed the challenges of being responsible steward. Our Ten Mission teams having members from all three businesses address the challenges and it is used as a learning & sharing platform for sustainability across all our units. Our policies, management frameworks and performance is internally and externally audited at least once in two years.

As you have noticed, we have made significant strides in our performance and in many cases exceeded our targets for 2017. Much of it is made possible by our recent technological modernization, collective efforts (with other ABG companies) in R&D, product development, branding and marketing. Besides performance improvement in many sustainability KPIs, we note with pride that


our approach and efforts in hygiene, health and safety are yielding significant results. This year, we have assessed our product life cycle impacts and made efforts to determine science based GHG emission reduction targets. We have begun using recycled raw materials in some of our products, contributing to circular economy, in a modest way.

We have strengthened our stakeholder engagement with communities, regulators, suppliers, customers and employees. We have supplemented engagement media through our portal www.MyABGTextiles.com. We have targeted to achieve co-creation projects with suppliers, customers and communities by 2017.

We have been successful in integrating, to a significant extent, sustainability in business decision making. We are sure that this will be reinforced through our focus on strategic stakeholder engagement and future proofing. We will continue to have strong focus on the stakeholder engagement along the value chain to deliver long term stakeholder value.

This report is a critical part of our accountability to stakeholders. We hope we have addressed your concerns and expectations. Requests for additional information and feedback on this Sustainability Report may be sent to me.

Dr. Jagadish BarikChief Sustainability Officer


Assurance PolicyWe believe that independent assurance leads to quality and process improvements, and reassures readers and our management that the information we publish is accurate and material, and therefore contributes to building trust and credibility with key interest groups.We engage professional assurance providers who combine the strengths of non-financial assurance experience with technical competency in environmental and social standards. This report has

been assured by Bureau Veritas, third party assurance provider.

Assurance



CEO Letter

Organization NamePrimary brands, products and servicesHeadquarters locationWhere the organization operatesNature of ownership and legal formMarkets servedScale of the organizationTotal number of employees by typeCollective bargaining agreementsSupply clahin descriptionOrganizational changes during the reporting periodPrecautionary PrincipleExternal charters, principles or other initiativesMembership Associations

Entities included in financial statementsProcess for defining report boundaries and contentMaterial aspects included in the reportDescriptions of material aspect boundaries within the organizationDescriptions of material aspect boundaries outside the organizationRestatementsChanges from previous reports in terms of scope and/or boundaries

Stakeholder groups

GRI IndexGeneral Standard Disclosures

Strategy & Analysis

Organizational Profile

Identified Material Aspects & Boundaries


Fully

FullyFullyFullyFullyFullyFullyFullyFullyFullyFullyFullyFullyFullyFully

FullyFullyFullyFullyFullyFullyFully

Fully

Vision and Approach

Company ProfileProduct PortfolioOperations & ProductsOperations & ProductsOperations & ProductsOperations & ProductsOperations & ProductsEmployee DiversitySocial & LabourResponsible Supply ChainOperations and ProductsGovernanceVision and ApproachOperations & Products

Scope and BoundaryReporting PrinciplesMaterial IssuesMaterial IssuesMaterial IssuesCSO MessageCSO Message


4

Cover9888888, 454451818518

915**72-7372-73

58

G4-1

G4-3G4-4G4-5G4-6G4-7G4-8G4-9G4-10G4-11G4-12G4-13G4-14G4-15G4-16

G4-17G4-18G4-19G4-20G4-21G4-22G4-23

G4-24

Disclosures Coverage Section Pg. No.

*Supplier, customer and transport are included from outside organisation boundary. Rest all material indicators are in single location


Pg. No.

General Standard Disclosures


Report Profile

Governance

Ethics & Integrity

FullyFullyFully

FullyFullyFullyFullyFullyFully

Fully

Fully

Fully

FullyPartiallyFullyFullyFully

FullyNAFullyFully

Fully

Stakeholder Engagement Stakeholder EngagementStakeholder Engagement

CSO MessageCSO MessageCSO MessageFeedbackGRI Index, AssuranceAssurance



Policies & Management Framework

Economic PerformanceClimate RisksSocial & LabourEconomic PerformanceEntry level wage, basic salay and remunerationLocal EmploymentIndirect Economic ImpactsIndirect economic impacts Responsible Supply Chain

Materials & Waste

5857-6357-63

72-7372-7372-7383 (back cover)76-8074-75

17-20

17

21

2468452445

24242424, 51

34, 36

G4-25G4-26G4-27

G4-28G4-29G4-30G4-31G4-32G4-33

G4-34

G4-56

G4-DMA

G4-EC1G4-EC2 G4-EC3G4-EC4G4-EC5

G4-EC6G4-EC7G4-EC8G4-EC9

G4-EN1


How stakeholders were identifiedApproach to stakeholder engagementTopics raised during stakeholder engagements

Reporting PeriodDate of most recent reportReporting CycleReport Conflict“In accordance” option, GRI Index and report assurancePolicy regarding report assurance

Governance structure of the organization

Code of Conduct

Disclosures on management approach(DMA)

Economic ValueClimate change risksBenefit plan coverageFinancial assistance from the governmentRatio of entry level wage to local minimum wage

Proportion of senior management hired from local communityInfrastructure investmentsIndirect economic impactsLocal suppliers

Materials by weight or volume

Economic

Environment



EnvironmentFullyFullyFullyFullyFullyNAFullyFullyFullyNANAFullyFullyFullyFullyFullyFullyFullyFullyFullyFullyFullyFullyFullyNAPartiallyFullyFullyFully

FullyFullyFullyFully

Materials & WasteEnergy & Carbon-Energy & CarbonEnergy & Carbon-Water & EffluentsNo impactWater & EffluentsBiodiversityBiodiversityBiodiversityBiodiversityEnergy & CarbonEnergy & CarbonEnergy & CarbonEnergy & CarbonEnergy & Carbon Energy & CarbonEnergy & CarbonWater & EffluentsMaterials & WasteMaterials & WasteMaterials & WasteProducts and ServicesProducts and ServicesMaterials & WasteComplianceEnergy & Carbon

Environmental ExpendituresResponsible Supply ChainResponsible Supply ChainGrievance Redressal Mechanism

3628-2929-32333333333333292929292929293334-3634-3634-36-56362528

24515163

G4-EN2G4-EN3G4-EN4G4-EN5G4-EN6G4-EN7G4-EN8G4-EN9G4-EN10G4-EN11G4-EN12G4-EN13G4-EN14G4-EN15G4-EN16G4-EN17G4-EN18G4-EN19G4-EN20G4-EN21G4-EN22G4-EN23G4-EN24G4-EN25G4-EN26G4-EN27G4-EN28G4-EN29G4-EN30

G4-EN31G4-EN32G4-EN33G4-EN34


Recycled input materialsEnergy consumption within organizationEnergy consumption outside organizationEnergy intensityEnergy reductionsEnergy reductions in products & servicesWater withdrawals by sourceWater sources affected by withdrawalsWater recycled and reusedFacilities in or near areas of high diversityImpacts on biodiversityHabitals protected or restoredIUCN Red list speciesGHG emissions(Scope1)GHG emissions(Scope 2)GHG emissions(Scope 3)GHG emissions intensityReduction of GHG emissionsOzone-depleting substances(ODS)Nox, SOx and other emissionsWater dischargeWaste by type and disposal methodSignificant spillsHazardous wasteBiodiversity affected by runoffMitigation of environment impacts of products and servicesProducts and packaging materials reclaimedEnvironmental fines and sanctionsEnvironmental impacts from product distribution and employee travelEnvironmental investmentsNew suppliers screened using environmental criteriaSupply chain environmental impactsEnvironmental grievances


Pg. No.General Standard Disclosures

Social - Labour PracticesFullyFullyFullyFullyFullyPartially

FullyFullyFullyN.A.FullyFullyFullyFullyFullyFully

Fully

FullyFullyFullyFullyFully

FullyNAFullyNot CoveredFullyFully

Social & LabourSocial & LabourSocial & LabourLabour Management RelationsHealth & SafetyHealth & Safety

Health & SafetyLabour Management RelationsSocial & Labour-Social & LabourGovernance & ManagementResponsible Supply ChainResponsible Supply ChainGrievance Redressal MechanismsGrievance Redressal Mechanisms

Human Rights

Human RightsHuman RightsHuman RightsHuman Rights

Human Rights-Human RightsResponsible Supply ChainResponsible Supply ChainGrievance Redressal Mechanisms

454546423839

37-394244, 49-5119-2051514646

46

46-4746-474646

46

46515146

G4-LA1G4-LA2G4-LA3G4-LA4G4-LA5G4-LA6

G4-LA7G4-LA8G4-LA9G4-LA10G4-LA11G4-LA12G4-LA13 G4-LA14 G4-LA15G4-LA16

G4-HR1

G4-HR2 G4-HR3G4-HR4 G4-HR5 G4-HR6 G4-HR7 G4-HR8G4-HR9G4-HR10G4-HR11G4-HR12


Number and rate of new employee hires and turnoverBenefits provided to full time employeesReturn to work and retention rates after parental leaveNotice periods regarding operational changesWorkforce represented in health and safety committeesRates of injury, occupational disease, lost days, absenteeism and work related fatalitiesWorkers with high incidence risk of diseasesHealth and safety topics covered in agreements with trade unionsAverage hours of training for employeesPrograms for skills management managing career endingsEmployees receiving performance and career development reviewsComposition of governance bodies and employeesRatio of basic salary and remuneration of women to menNew suppliers that were screened using labor practices criteriaNegative impacts for labor practices in the supply chainGrievances about labor practices

Investment agreements and contracts that include human rights clauses or underwent screeningEmployee training on human rightsIncidents of discriminationSignificant risk of freedom of association in operations and suppliersSignificant risk of child labor in operations and suppliersSignificant risk of forced or compulsory labor in operations and suppliersSecurity personnel trained in the organization’s human rights policiesIncidents of violations involving rights of indigenous peopleOperations that have been subjected to human rights assessmentsNew suppliers screened for human rightsHuman rights impacts in the supply chainGrievances about human rights impacts

Social - Human Rights



Social - SocialFullyFullyFullyFullyFullyFullyFullyFullyPartiallyFullyFully

FullyFully

FullyFully

FullyNAFully

Fully

Fully

Investing into CommunitiesInvesting into CommunitiesAnti- corruptionAnti- corruption Anti- corruption NilNilCompliance & Risk ManagementResponsible Supply ChainResponsible Supply ChainGrievance Redressal Mechanisms

Health & SafetyHealth & Safety

Product StewardshipProduct Stewardship

Customer Engagement-Product Stewardship

Product Stewardship

Product Stewardship

6262171717--25515148,63.64,68

3939

5454

61-54

54

54

G4-SO1G4-SO2G4-SO3G4-SO4G4-SO5G4-SO6G4-SO7G4-SO8G4-SO9G4-SO10G4-SO11

G4-PR1G4-PR2

G4-PR3 G4-PR4

G4-PR5 G4-PR6 G4-PR7 G4-PR8

G4-PR9


Local community engagement, impact assessmentsNegative impacts on local communitiesRisks related to corruptionCommunications and training on anti-corruptionConfirmed incidents of corruptionPolitical ContributionsAnti-competitive behaviorFines for non-compliance with lawsNew suppliers screened for impacts on societyNegative impacts oon society in the supply chainGrievances about impacts on society

Health and safety impact assessments of products and servicesNon-compliance concerning the health and safety impacts of products and servicesProduct and service information required for labellingNon-compliance with regulations concerning product and service labelingSurveys measuring customer satisfactionSale of banned or disputed productsNon-compliance with regulations concerning marketing communicationsComplaints regarding breaches of customer privacy and losses of customer dataFines for non-compliance with laws and regulations concerning products and services

Social - Product Responsibility

UNGC* - Our performance as per the UN Global Compact’s ten principles


Pg. No.

Contribution to UN SDG

3GOOD HEALTH AND WELL-BEING

6CLEAN

WATER ANDSANITATION

7AFFORDABLEAND CLEANENERGY 8

DECENT WORKAND ECONOMIC

GROWTH

9

INDUSTRY,INNOVATION AND

INFRASTRUCTURE

10

REDUCEDINEQUALITIES

12

RESPONSIBLECONSUMPTION

AND PRODUCTION

13

CLIMATEACTION

7.3ENER GYEFFICIENC Y

8.8

SAFE ANDHEALTHY

WORKSP ACE

9.2

INDUSTR YAND SUST AINABL E

INDUSTRIALISATION

9.4

CLIMATE CHANGEADAP TATION FO

INDUSTRIAGROWTH

10.3

EQUAL OPPURTUNITY WITH APPROPRIATE REGULATION, LEGISLATION, POLICIES AND ACTION

12.2

EFFICIENTMATERIAL USE

12.4

HAZARDOUS WASTE GENERATION

12.5

MATERIAL

RATE

CLIMATECHANGE MITIGATION

3.9

POLLUTIONPREVENTIO N

6.3IMPROVED

WATER AVAILABILITY

6.4WATER USEEFFICIENCY

13.2

RECYCLING

PG 37

PG 37

PG 29

PG 48

PG 33-34

PG 35 PG 25

PG 40-41

PG 55

PG 47

PG 25

PG 36


Definitions & AcronymsCoE: Centre of Excellence

Compliance: It means conforming to a rule, such as a specification, policy, standard or law.

CTS: Customer Satisfaction

CTS: Customer Technical Service

DfE: Design for Environment

EHS: Environment, Health and Safety

GHGs: Greenhouse Gases

GRI: Global Reporting Initiative

Higg Index: It is an apparel and footwear industry self-assessment standard for assessing environmental and social sustainability throughout the supply chain.

KPIs: Key Performance Indicators

ODS: Ozone Depleting Substances

OEKO-TEX: OEKO-TEX examines all stages of production and tests for harmful substances used in production systems to ensure customer safety

OHS: Occupational, Health and Safety

PTE: PT. Elegant Textile

QC: Quality Circles

Scope 1 Emissions: These are direct GHG emissions from sources that are owned or controlled by the entity

Scope 2 Emissions: Indirect GHG emissions from consumption of purchased electricity, heat or steam

Scope 3 Emissions: Other indirect emissions, such as the extraction and production of purchased materials and fuels, transport-related activities in vehicles not owned or controlled by the reporting entity, electricity-related activities (e.g. T&D losses) not covered in Scope 2, outsourced activities, waste disposal etc.

Stakeholders: A person, group or organization that has interest or concern in an organization. Stakeholders can affect or be affected by the organization’s actions, objectives and policies.

Stewardship: It is an ethic that embodies the responsible planning and management of resources.

Sustainability: Sustainability is meeting the needs of the present without compromising the ability of future generations to meet their own needs.

Whistleblower: Anyone who has and reports insider knowledge of illegal activities occurring in an organization


SUSTAINABLEVALUE

We welcome your feedback on ourSustainability Report 2016-17.

For any additional information, or toprovide feedback on this report,

please write to:

[email protected]@adityabirla.com

PT ELEGANT

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