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Innovate to Operate Responsibly
Our ethos and culture of innovation is strongly reflected in our approach to operating responsibly. The emphasis on innovation is reflected at each stage of our business value chain. We believe, this will lead to better synergy, enable product sustainability value and yield long-term business benefits.
Marico initiated the product life cycle assessment (LCA) study in FY16 with our edible oil portfolio, with an objective to look for ways to reduce the environmental footprint of our products. Carrying forward our efforts, this year we completed the LCA study of our flagship brand Parachute Coconut Oil. The study was conducted in accordance with ISO 14040 (Principles and Framework) and ISO 14044 (Requirements and Guidelines) and helped us not only to evaluate the impact but also identify opportunities within the value chain. Instilling innovative and disruptive thinking, we are continuously working on interventions such as efficient packaging designs, process efficiency, logistic optimization, end disposal and recycling measures to improve our product sustainability value.
Product Development
Marico’s portfolio of brands has remained the preferred choice for consumers with continuous enhancement of its offerings. Our constant efforts to create and provide disruptive innovation has helped us evolve and respond to changing consumer needs. The drive to better serve growing consumer base with the launch of new products, adoption of new and improved technologies and strategies to connect to newer markets.
Research and Development (R&D)
Through our best in-class R&D facility established at Mumbai, we ensure that every product being developed meets the highest standards of quality. Resources to the tune of `31.48 Crore were invested in research and development activity this year supported by a strong dedicated team of 54 personnel.
OUR R&D EFFORTS ARE DIRECTED IN THE KEY AREAS OF
Hair
Nourishment
Edible Oils &
Healthy Foods
Male
Grooming
Premium
Packaging
We continue our endeavour towards technology absorption and adaptation by engaging with clinical research organisations, original equipment manufacturers and university experts to develop new products and deploy them at a faster rate. This approach has helped accelerate the rate of innovative product development.
To address the problem of hair greying, our in-house research led to the creation of an anti-greying product – True Roots Botanical Hair Tonic, a first of its kind product in India
Our R&D facility at Mumbai is recognised by the Department of Scientific and Industrial Research (DSIR)
Smart India Hackathon (SIH) 2019
Marico was part of Smart India Hackathon (SIH) 2019, the world’s largest open innovation initiative organized by the Ministry of Human Resource Development (MHRD), All India Council for Technical Education (AICTE), Inter Institutional Inclusive Innovation Centre (i4C), and Persistent Systems. Marico will be mentoring 25 student teams to deliver functional prototypes for 5 problem statements in areas related to Agriculture & Rural Development, Healthcare & Biomedical Devices and Food Technology.
Ingredients Transparency
We at Marico are committed to use safe and sustainable ingredients in our products and packaging and follow a stringent ingredient assessment policy for all our products.
Our ingredient assessment is in line with the prohibitions, restrictions and safety limits for individual ingredients from external databases such as Personal Care Products Council (PCPC) and European Economic Community (EEC)’s Cosmetic Ingredient and Substances (CosIng) database.
Although, we primarily operate in Asian, Middle Eastern and African markets, we are committed to meet the requirements of the European Union’s regulations of Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH) pertaining to Substances of Very High Concern (SVHC). Most of our products do not contain any SVHCs. It is also our commitment to minimise the chemicals of concern and find suitable alternatives from our products and packaging listed in the Substitute It Now (SIN) list.
Product Safety and Quality
As a respected consumer goods company, the safety and quality of our products is our top most priority. We have established well-defined systems and processes to ensure compliance to regulatory requirements. There’s a clear assessment of the health and safety effects of our products at each stage in the value chain. All our products are tested in accordance with the applicable regulations at laboratories conforming to ISO/IEC 17025 and are certified by National Accreditation Board for testing and Calibration (NABL).
MARICO PRODUCT SAFETY
New product
Development
Robust five stage process with gates at end of each stage to ensure complete first time right product prior to launch.
Procurement
Process control is laid down in Marico vendor quality assurance module. Supplier facility is audited for Food Safety and Quality parameters.
Manufacturing
Product safety risk assessment is done for physical, chemical and microbial hazards on Hazard Analysis and Critical Control Point (HACCP).
Distribution
Our depots and warehouses are covered under unique certification program and distributors are covered under 'Distribution Food Safety program.'
Marico has completed the 'Food Safety Training and Certification' (FoSTaC) mandated by FSSAI across all our manufacturing units and fifteen of our depots. Over 250 Marico members are trained and certified as 'Food Safety Supervisor.'
Marico is the first Indian company to cover all manufacturing plants and fifteen depots with FoSTaC certification training.
Sustainable Procurement
Procurement is a strategic function at Marico that helps achieve the objective of sustainable profitable growth for the business and drive the growth of the local economy. Our objective is to promote local procurement, reduce logistic complexities and minimise transportation.
In FY19, about 96% of our procurement spend in India was spent on domestic suppliers
INNOVATION TO FOSTER COLLABORATION IN PROCUREMENT
In procurement, 'Innovation' is not only an enabler in business excellence, but it also helps in fostering collaboration with both internal and external stakeholders. Through programs like 'Yugman', Marico’s suppliers showcase innovative solutions in areas of new product development and value management. This outside-in perspective is presented to a wider audience, including R&D and marketing teams.
Vendor On-boarding and Relationship
Identified suppliers are evaluated on commercial, technical and process compliance aspects as part of qualification process. An independent quality assessment conducted by Corporate Quality Assurance Team confirms the supplier qualification. Suppliers are then on-boarded and aligned to Marico’s Code of Business Ethics (MCoBE).
Once on board, Marico conducts regular performance reviews of its suppliers. Feedback is regularly shared with suppliers pertaining to quality, cost and service delivery. We also impart focused trainings to our suppliers to improve their performance capabilities and sustainability.
We recognise our suppliers' contribution in achieving superior business results through engagement programs like supplier meets and annual Supplier Quality Excellence (SQE) program.
Responsible Sourcing
Sourcing, whether material or service is an embedded sustainable business strategy across our critical business associates. This helps us foster innovation, meet evolving consumer preferences and achieve the goal of delivering sustainable profitable growth for all stakeholders. The Marico Responsible Sourcing (MARS) policy instituted in 2017 rests on three pillars of responsibilities – Ethical, Environmental and Social, with the engagement designed at three stages – Educate, Evaluate and Evolve. All our critical material and service providers are required to adhere to the principles of MARS.
MARICO RESPONSIBLE SOURCING (MARS)
Ethical Responsibility
- Legal & Regulatory Compliance
- Transparency & Accountability
- Anti-corruption & Anti-bribery
- Anti-competitive Behaviour
- Conflict of Interest
- Human Rights
Environmental Responsibility
- Energy Conservation
- Water Conservation
- Waste Management
- Responsible use of packaging material
- Quality Control
Social Responsibility
- Employee Health & Safety
- Employee Skill Development
- Local Community Development
This year, we identified critical associates encompassing our convertors (3Ps), packaging material vendors, logistics, depot and warehouse partners and completed the level 1 engagement i.e., Educate. Owing to this 5% of these critical associates have qualified for Level 1 certification. We aspire to cover all our critical material and service providers and complete 20% level 1 certification by 2022.
Lean And Green manufacturing
Our manufacturing plants are designed in line with international standards of GMP and Food safety systems. We undergo continuous certification of FSSC-22000, HACCP, ISO 14001, ISO 18001, ISO 50001, and ISO 22716 which ensures that the systems are robust and processes are in place to deliver high quality output. All our manufacturing units have a sophisticated state of art analytical and testing laboratory which is certified by the National Accreditation Board for Testing & Calibration Laboratories (NABL). Details of our manufacturing footprint and our presence can be referred from 'Our Presence' section of the integrated report.
Lean
We relentlessly work towards eliminating the inefficiencies in our manufacturing process through lean and associated concepts to deliver high quality products at lower costs. We focus on achieving continuous improvement by
- Reducing production losses
- Decreasing process cycle time
- Cost effective interventions
- Enhancing member capability
We have instituted an Operational Excellence function to support our manufacturing team in this journey of continuous improvement. The approach has yielded a future-ready manufacturing capability, which is capable of a quick and effective response to a VUCA business environment.
One of the key successes has been the evolution in our coconut oil operations. The automation interventions over the years have helped us in consolidating intermediate stand-alone operations by 41% from FY14 till date. This resulted in reducing the inbound and outbound logistics. Further, the number of bottles produced has shown a healthy CAGR of 8%. This has made us more agile and flexible to serve the market demand.
Creating a Competitive Edge with Manufacturing Intelligence
We have implemented the SAP Manufacturing Integration and Intelligence (SAP MII) software with the vision of making manufacturing a competitive advantage for Marico. Our factories are fast getting digitised with the help of sensors and analytics dashboards for monitoring and measurement that aids faster decision-making improving productivity and turnaround time. The process equipments were integrated to derive real-time actionable insights to drive improvement. This also helped in increasing data transparency and accuracy by reducing manual reporting.
ToolBox Talks
We launched 'ToolBox Talks', a knowledge management platform focused at providing foundation for technical learning in engineering and production knowhow. During the year, a total of 228 video modules were designed across 14 locations of Marico on topics of production.
KAIZENTHALON 4.0
'Kaizenthlon' part of Marico ACT NOW! journey, is a race of doing improvements. We have achieved over 3500 kaizens (improvements) over the last 3 years.
Green
We recognise that we owe a responsibility to the environment we operate in. Our approach is therefore aligned towards innovative ways to not only protect, but also positively impact the environment.
Environmental Management Systems
Marico strives to ensure compliance to all environmental laws and regulations while following the rule of the land and adopt the best environmental practices and protocols within the paradigm of our operations. The emission and waste generated from our operations are well within the permitted limits of the CPCB/SPCB.
Materials
Agro-based materials contribute significantly to our raw materials portfolio. As part of our business initiatives, we make efforts to procure the agro-materials that do no adversely impact the environment or the community.
| Raw Materials | Renewable / Non-Renewable | Consumption in FY19 (MT) (includes own as well as contract manufacturing units of Marico India operations) |
|---|---|---|
| Agro based | ||
| Edible oils | Renewable | 242756 |
| Natural extracts | Renewable | 1692 |
| Non-agro based | ||
| Additives and Mineral Oil | Non-renewable | 38982 |
Sustainable Packaging
Packaging plays an important role in maintaining the product integrity. The packaging design lends a signature identity to our brands. For us, innovative packaging aims to deliver the products in an eco-friendly manner and meet consumer expectations.
Sustainable packaging at Marico is envisaged through reduce, reuse, replace and recycle approach. The initiatives taken in FY19 have resulted in a reduction of overall packaging consumption by about 485MT. Our recyclable packaging portfolio is increasing each year. As of FY19, about 94% of our packaging material was recyclable by weight.
| Packaging Material | Renewable / Non-Renewable | Consumption in FY19 (MT) (includes own as well as contract manufacturing units of Marico India operations) |
|---|---|---|
| Paper based | Renewable | 15681 |
| Polymer based | Non-renewable | 18082 |
| Other multi‑materials, Glass and Tin | Non-renewable | 650 |
| Laminates and Labels | Non-renewable | 1927 |
SUSTAINABLE PACKAGING FOCUS
Optimise
weight
Improve
recyclability
Increase use of
recycled polymer
content
Replace with
environmentally
conscious material
Marico has long been minimizing the volume and weight of it's packaging. We strive to use minimum amount of packaging required to protect our products. This year we have lowered the polymer consumption by reducing the packaging weight in our Value Added Hair Oil bottles. This has led to savings of about 40 MT of polymer. Through design improvement initiatives, we have further reduced the wastage in release liner, shrink films and paper board by 408 MT.
Our Parachute Coconut Oil HDPE bottle and Hair Oils PET bottle continue to be ones with the lowest weight in the industry
We have made steady progress towards PVC free packaging. With a commitment to eliminate the use of PVC in our packaging, this year, we restricted the PVC consumption to 0.4% of the total packaging material used.
In FY19, a project was undertaken to replace PVC with PET in our hair oil products, leading to 38 MT of PVC being replaced
Sustainable Supply Chain (Logistics Optimisation)
At Marico, we aspire to create a supply chain system which is agile, cost competitive and sustainable leading to customer delight. Our logistics team drives various initiatives at each node to ensure that the distribution network is constantly evolving across – service, cost and sustainability. Through innovative measures taken in FY19, we have progressively improved our primary logistics performance in a sustainable and competitive manner.
Through key interventions taken this year, we have improved the load per trip in our primary transportation (factory to depot) by 3.6% from the previous year. The vehicle upsizing measures taken this year have increased the contribution of 21 Tonne truck and 32 ft container by 9% and 3% respectively. The GST led network changes have improved the primary average distance per trip (factory to depot) by 7.4%. All these initiatives have directly translated into reduction of fuel consumption by 1 litre per tonne of product transferred in our primary movements.
Achieved fuel reduction in primary transportation by 1 lt/tonne of product, translating to avoiding 675 tCO2e GHG emissions
INNOVATION IN NETWORK MAPPING
'Project Flash' was initiated this year to enhance our services through an agile supply chain. The objective was to ensure quick reach of the products to the destination by reducing the number of intermediate points. The initiative has shortened the distance travelled leading to 30% reduction in transit time, creating a sustainability edge for an agile supply chain
In our aspiration towards logistics optimization, we aim to incentivise our vendors who are able to provide us with better fuel efficient vehicles. We are also aspiring towards multi-modal logistics and have initiated rail tanker based movements for our raw material supplies.
Consumer Connect
Our partnership with consumers is blended with Marico’s purpose to add value to their lives in ways that are novel and delightful. We constantly look for disruptive ways to explore the unmet needs, insights and innovative offerings that can cement the bond further with our consumers.
Consumer Wellbeing
Marico is a keen proponent of healthy and active lifestyle. Our portfolio of brands stands for innovation and we take great pride in fostering consumer health and wellbeing. We have made disruptive efforts through our brand campaigns, outreach programme, trainings and associations with industry partners to promote food safety and nutritional intake leading to a healthy lifestyle of our consumers.
Heart Health
As part of our Saffolalife, we launched the campaign on 'Impact of belly fat on heart health' to build awareness and inspire consumers on heart health
Nutritious Food
'Safe and Nutritious Food', a campaign initiated along with FSSAI to educate school children. Covered 200 schools PAN India impacting over 80,000 kids
Eat Right India
Marico is associated with the 'Eat Right India' movement, a collective effort by FSSAI and other key stakeholders to spread the message to over 25,000 people
Consumer Engagement
Consumer's opinion is a valuable input for us. This is guiding force for our product quality and service processes. To facilitate this, we have a dedicated ISO 10002 certified Consumer Services Cell (CSC). The accreditation has equipped us with a systematic approach to consumer concerns. Consumer contact mechanisms are mentioned on all our product packs. Consumers can register their queries, grievances, suggestions on our toll free number and e-mail. All of these feedback are processed by our consumer services cell so that they may be resolved appropriately. Our team has a thorough mechanism to ensure all consumer feedbacks are suitably addressed with due diligence.
Marico bagged the special recognition for 'Customer Engagement and Satisfaction Practices' in the manufacturing stream at the sixth CII National Excellence Practice Competition 2018
Labelling and Information
All our product packs and labels include communication on aspects of health and safety. We provide fact based information on all our product packages to help consumers make informed choices. The labels accurately reflect the necessary statutory mandates of list of ingredients and nutrition information on the back panel.
Labelling at Marico follows a rigorous process routed through a system called 'Artwork Management System (AMS)'. This system ensures a smooth approval process of the artwork prior to final release for printing. Additionally, the AMS ensures speed to market delivery with minimum re-work on labels thus, creating efficiency.
Marico products and labels comply with the applicable regulations such as the Drugs and Cosmetics Act, Legal Metrology Act, AGMARK, Food Safety and Standards Act for labels and pack information
Safe Disposal
It is our responsibility to take great care of the waste generated from our operations. The plant personnel at all our manufacturing units are educated on handling hazardous and non-hazardous waste responsibly. All the waste generated at our manufacturing units are disposed through appropriate channels and approved vendors. All manufacturing plants are equipped with systems and procedures to verify the authorisation and licenses of agencies used for transporting and disposing hazardous waste in compliance with necessary regulations. We do not export, import or treat hazardous waste. Furthermore, there have been no significant spills during the year.
Being cognisant of the larger social and environmental issue created by plastic waste, Marico has taken measures to create awareness among various stakeholders through innovative ways to provide an end-of-life solution to plastic waste. We go beyond our operations towards collection and safe disposal of plastic waste generated from our product packaging. The company is aligned to the Plastic Waste Management (PWM) Rules. This year we completed the collection of 20% of post -consumer multi-layer packaging waste equivalent as part of our Extended Producer Responsibility (EPR) commitment. We are also working in collaboration with enterprises to enable the use of recycled plastic in our product packaging.