The Mahindra Group’s social and environmental impact in FY21 was equivalent to about $4 billion as per preliminary calculations, group chairman Anand Mahindra said while virtually addressing shareholders at the company’s annual general meeting Friday
With ESG (environment, social and governance) investing and impact investing rapidly taking the centrestage globally, the Mahindra Group will now quantify and report its social impact in financial terms, Mahindra said.
“This is not just altruistic thinking – its good business. There is a quiet revolution taking place in the business world,” Mahindra said. “Stock markets are also beginning to prize companies that are purpose-driven. Social impact is becoming increasingly important to investors.”
The 66-year-old second-generation group promoter will take on the role of non-executive chairman from November this year following a diktat from markets regulator Sebi for the top 500 listed companies to separate the roles of non-executive chairman and the chief executive or managing director by April 2022.
ESG investing refers to the practice of investing in a company after evaluating its policies towards the environment, society and its governance practices. Impact investing considers the direct social and environmental impact that a company has.
The Mahindra Group has made commitments that include carbon neutrality, reducing waste going to landfills and every year planting 5 million trees, educating a million girls and supporting a million women to improve its environmental and social impact.
Mahindra himself is a part of a G7 task force that is developing methods to measure impact.
“This is clearly going to be the way the value of a company is going to be measured in the future,” he said. “The rules of the game have changed.”
On the financial side of the business, the group has segmented its businesses into core businesses, growth gems and new age businesses, Mahindra said. The core businesses were the profit centres of the group – the automotive, farm equipment and technology consulting businesses, among others.
The growth gems include nine businesses that the group thinks could soon be valued at over a billion dollars and be spun off into separate listed entities. New age businesses included those where the group would make strategic investments for future growth.
Total income for Q1 FY22 was recorded at INR 19,368 crore compared to INR 12,163 crore in Q1 FY21. Revenues from operations were at INR 19,171.9 crore as against INR 11,969 crore in the first quarter of FY21.