Materiality

Tata Steel prioritises stakeholders, using periodic materiality assessments to understand and address their needs and concerns effectively.

Since FY2012-13, Tata Steel has been conducting periodic materiality assessments every three years to understand key stakeholder issues and focus areas to prioritise the Company’s risks and opportunities. The last assessment was conducted in FY2022-23.

Materiality assessment is a detailed exercise that covers stakeholders from all operating geographies — India, Thailand, the Netherlands, and the UK — and the identified risks and opportunities help in developing the Company’s strategy over the short, medium, and long term. The assessment also facilitates deeper stakeholder engagement and incorporates their feedback on the Company’s roadmap, regularly reviewed by Tata Steel’s senior leadership and the Board of Directors.

The risks arising out of material issues are assessed as per the organisation’s Enterprise Risk Management process and framework.

In accordance with the AA1000 Stakeholder Engagement Standard, Tata Steel identifies the following as its stakeholders:

  • Senior Management
  • Investors (Debt & Equity)
  • Employees
  • Contractual Workforce
  • Community
  • Suppliers
  • Customers
  • Media
  • Regulatory Bodies
  • Industry Bodies
  • Non-government organisations

The last materiality assessment, conducted in FY2022-23, was undertaken on a consolidated basis through a structured stakeholder consultation by an independent agency, according to best-in-class international practices. It has helped Tata Steel identify the top 15 ESG issues, material to its business and is integral to its vision of being the global steel industry benchmark for Value Creation and Corporate Citizenship. The assessment is aligned with the guidance from International Standard Setting Bodies, including but not limited to Global Reporting Initiative (GRI), Sustainability Accounting Standards Board (SASB) and the Integrated Reporting <<IR>> Framework, covering both general standards and sector-specific standards related to iron and steel, and metals and mining industries. Material topics are further linked to the requirements of GRI, SASB, World Steel Association (WSA), Business Responsibility and Sustainability Reporting (BRSR), and World Economic Forum (WEF).

There are two aspects to Tata Steel’s materiality assessment:

  • Impact Materiality: Determined by the scale, scope, and irreversible nature of the impact, this factor considers the effects on both people and the environment.
  • Financial Materiality: Determined by the risks and opportunities, this factor considers the impact on the organisation’s financials.

The materiality assessment exercise is an 8-step process:

Step 1
Defining purpose and scope
Step 2
Identification of potential topics
Step 3
Categorisation of topics
Step 4
Identifying impacts
Step 5
Developing Materiality Assessment questionnaire (consisted of 28 topics)
Step 6
Analysis of responses
Step 7
Identification of high priority material topics
Step 8
Approval of material topics

High priority material issues based on independent analysis for Tata Steel on a consolidated basis are as follows:

Greenhouse Gas Emissions and Climate Change Management

1

Circular Economy/ Recycling of By-products

2

Water Consumption and Effluent Discharge

3

Energy Efficiency/ Energy Management

4

Air Pollution/Air Quality Management

5

Biodiversity

6

Occupational Health and Safety

7

Employee Well-being and Development

8

Community Support and Corporate Social Responsibility (CSR)/Building Thriving Communities

9

Research and Development/ Technology, Product and Process Innovation

10

Supply Chain Sustainability

11

Corporate Governance

12

Business Ethics, Integrity and Transparency

13

Stakeholder Engagement

14

Risk Management

15
Material issues Approach KPIs Capital linkages
1

Greenhouse Gas Emissions & Climate Change Management

Tata Steel has set an ambitious target to achieve Net Zero emissions by 2045. Tata Steel has published its strategy to mitigate climate change-related risks in its Climate Change Report as part of Tata Steel’s Integrated Report for FY2023-24.
  • Greenhouse Gas Emissions – Scope 1, Scope 2, and Scope 3
  • Emission intensity per tonne of crude steel
2

Circular Economy/ Recycling of By-products

Tata Steel is looking at two approaches for value creation from waste and by-products:

  1. Maximise the usage of scrap in steelmaking
  2. Maximise revenue from sale of by-products
  • Total steel scrap recycled (internal and external)
  • Total solid waste generated
  • Total solid waste utilised
3

Water Consumption and Effluent Discharge

The Company actively implements the 4R principle (Reduce, Reuse, Recycle and Replenish) to reduce its water footprint across multiple locations. Tata Steel is also exploring other sources of water to replace freshwater and remains dedicated to replenishing the water sources to strive to achieve Water Neutrality.
  • Total fresh water consumption
  • Total effluent discharge volume
4

Energy Efficiency/ Energy Management

Tata Steel is committed to energy conservation and enhancing energy efficiency in all its areas of operations by exploring and implementing best available technologies, and by deploying renewable energy projects.
  • Total energy consumption
  • Specific energy consumption
  • Renewable energy consumptions
5

Air Pollution/ Air Quality Management

Tata Steel is committed to identifying, assessing, and managing its air emissions to ensure healthy air quality, by investing in the upgradation of pollution control equipment.
  • Stack SOx emission
  • Stack NOx emission
  • Stack dust emission
6

Biodiversity

Tata Steel aims at integrating biodiversity into its business ecosystem by committing to conserve, enhance and restore biodiversity in all its operations and across the supply chain.
  • Total sites covered under Biodiversity Management Plans (BMP)
  • Total area covered under BMP
Material issues Approach KPIs Capital linkages
10

Research and Development/ Technology, Product and Process Innovation

Tata Steel aspires to be among the top 5 global technology leaders in the steel industry and has consistently used technology and innovation to build a rich portfolio of future-ready products and is actively engaged in the development and pilot of various low CO2 steelmaking technologies.
  • Total collaborations/ memberships of academia and technical institutes
  • Total number of patents filed and granted
  • Total number of new products developed
11

Supply Chain Sustainability

Tata Steel has formulated the Responsible Supply Chain Policy to address sustainability in supply chain and regularly assesses its supply chain partners on the policy and organises training and awareness sessions. Multiple initiatives have been taken between Procurement and Supply Chain to bring down Scope 3 emissions.
  • Scope 3 emissions, active supplier base, local suppliers – no. and volume
  • Affirmative Action suppliers – no. and volume
  • Supplier assessments, supplier awareness and training, no. of shipments using alternative fuels
12

Corporate Governance

Tata Steel has laid a strong corporate governance foundation which is led by an active, well informed and independent Board and supported by Board committees. This is well supported by the Company’s ethical governance framework and the Enterprise Risk Management practices of the Company.
  • Board/committee governance disclosures and reporting
  • Ethics and Compliance
  • Risk management
  • Succession planning and executive compensation
13

Business Ethics, Integrity, and Transparency

Tata Steel strives for global leadership in standards of ethics, based on the strong foundation of Tata values and the Tata Code of Conduct (TCoC) and its principles underpinned by a formalised Management of Business Ethics Framework and commitment to transparency.
  • Whistleblower cases closed
  • Sexual harassment cases closed
  • Trainings on TCoC for employees and business associates
14

Stakeholder Engagement

Tata Steel seeks to balance the needs, interests, and expectations of all stakeholders with those of the business through an integrated and inclusive process. Tata Steel also undertakes regular materiality assessment to understand key issues for various stakeholder groups and incorporates those in its broader strategy.
  • Stakeholder grievance management forums
  • Stakeholder grievances addressed during the year
15

Risk Management

Tata Steel has developed the Enterprise Risk Management framework and process derived from COSO (Committee of Sponsored Organisation), ISO 31000:2018 and various inputs from the best practices across industries. The process is uniformly deployed across the organisation and risks arising from the potential material issues are integrated with organisation’s ERM framework.
  • Risk Maturity Assessment score
  • Risk Management Committee reviews