Key challenges that a Global Corporation faces

Published: Last Edited:

This essay has been submitted by a student. This is not an example of the work written by our professional essay writers.

One of the key challenges that a Global Corporation faces is, that of management of sustainability (Dumphy, 2000). CEOs around the world are starting to see the shape of a new era of sustainability coming into view. In the face of rising global competition, technological change and the most serious economic downturn in nearly a century, corporate commitment to the principles of sustainability remains strong throughout the world: 93 percent of CEOs see sustainability as important to their company's future success (Lacy, Cooper, Hayward, Neuberger; June 2010)

Sustainability is a process which deals with the development of all aspects of human life affecting sustenance. It means resolving the conflict between the various competing goals, and involves the simultaneous pursuit of economic prosperity, environmental quality and social equity famously known as three dimensions (triple bottom line) with is the resultant vector being technology, hence it is a continually evolving process; the 'journey' (the process of achieving sustainability) is of course vitally important, but only as a means of getting to the destination (the desired future state). However, the 'destination' of sustainability is a set of wishful characteristics of a future system.

Monitoring System

How do we know that a strategy for sustainable development has been successful, or is on the right path? Not only do strategies have multiple objectives, but also strategy activities will change over time and so will social, economic and environmental conditions. This presents a considerable challenge for monitoring and evaluation, but one that must be met, since the whole point of a strategic approach is to learn and adapt. The central monitoring and evaluation requirement is, therefore, to track systematically the key variables and processes over time and space and see how they change as a result of strategy activities (Spellerberg 1991). To do this requires:

Measuring and analyzing sustainability;

Monitoring implementation of the strategy;

Evaluating the results of the strategy;

Reporting and dissemination of the above findings.

Measuring and analyzing sustainability is necessary to determine the state of the society, the economy and the environment, the main strengths and weaknesses, the issues for the strategy to address, and underlying factors. The most productive way to approach this is to undertake an indicator-based sustainability assessment, supplemented by spatial analysis and possibly other contributing measurements and analyses. The indicators chosen for the assessment need continued monitoring to identify trends, detect (and, if possible, anticipate) change and track progress.

Monitoring implementation of the strategy is necessary to ensure standard management oversight and accountability. Regular monitoring is needed of the following factors to assure that strategy activities are proceeding well:

Inputs in terms of financial, physical and human resources applied to the strategy and its related activities;

Process quality in terms of how strategy principles are satisfied (eg people-centred, participation, integration, commitment generation);

Outputs in terms of the generation of strategy products (goods, services and capacities) by agencies involved in the strategy;

Outcomes in terms of access to, use of, and satisfaction with strategy products (which are not necessarily under the control of agencies involved in the strategy);

The performance of individual strategy actors in implementing the strategy, in terms of the effectiveness and efficiency of their service provision and management.

Evaluating the results of the strategy is necessary to correlate actions with specific changes in human and environmental conditions, test the strategic hypotheses (choice of priority issues, analysis of underlying factors, and prescription of actions), assure accountability, capture lessons and develop capacity through learning.

Reporting and dissemination of the above findings is necessary to feed back key messages to key stakeholder groups, and thus enable them to continuously improve their behaviour, the strategy itself and its component activities.

A monitoring system can thus help in assessing the company's foray into handling sustainability related issues. (Ian Watson, and Paul Novelly).


Generally speaking, an indicator is anything that gives an indication to its reader of a key feature or state of a human or environmental system. Moreover, a good indicator provides information valuable in the making of important decisions. Most frequently, indicators of sustainability take the form of quantitative measures of key features of human or environmental systems that relate to the long-term viability of human communities. The goal of creating Indicators of Sustainable Development is often instrumental: to better inform consumers, citizens, public officials, scientists, or others (any stakeholder) who make decisions about aspects of sustainability so as to improve the choices they make.


ACC Limited is India's foremost manufacturer of cement with a countrywide network of factories and marketing offices. Established in 1936, ACC has been a pioneer and trend-setter in cement and concrete technology. It is one of the first companies in India to include commitment towards environment protection as a corporate objective, ACC has won accolades for environment friendly measures taken at its plants and mines, and has also been felicitated for its acts of good corporate citizenship. ACC's operations widely covers all areas of the country with 14 modern cement factories, more than 30 Ready mix concrete plants, 20 sales offices, and various small offices in small towns. It has a workforce of about 11,500 persons and a countrywide distribution network of over 9500 dealers. ACC has always been known for its innovations in the cement industry. Their research and development sector is also very efficient and effective in bringing modernization in cement industry. ACC, as a part of TATA group, has always made significant contributions to the nation building process by bringing out quality products, services and sharing its expertise. ACC is today closely associated with the Holcim Group of Switzerland.


Established in 1936, when ten existing cement companies came together under one umbrella in a historic merger - the country's first notable merger at a time when the term mergers and acquisitions was not even coined. The history of ACC spans a wide canvas beginning with the lonely struggle of its pioneer F E Dinshaw and other Indian entrepreneurs like him who founded the Indian cement industry. The company manufactures cement, refractories, cement plant and other heavy machineries including structural and fabrications. ACC has been a pioneer and trend-setter in cement and concrete technology. Their efforts to face competition for survival in a small but aggressive market mingled with the stirring of a country's nationalist pride that touched all walks of life - including trade, commerce and business. ACC's brand name is synonymous with cement and enjoys a high level of equity in the Indian market. ACC has issued 0.6 million shares other than cash in the equity market.

The company's various businesses are supported by a powerful, in-house research and technology backup facility - the only one of its kind in the Indian cement industry. This ensures not just consistency in product quality but also continuous improvements in products, processes, and application areas.

The first success came after the historic merger of ten companies to form the cement giant. These companies belonged to four prominent business groups - Tatas, Khataus, Killick Nixon and F E Dinshaw. ACC was formally established on August 1, 1936.

The formation of ACC represents a quest for the synergy of good business practices, values and shared objectives. The use of the plural in ACC's full name, The Associated Cement Companies Limited, itself indicates the company's origins from a merger. ACC has clearly stated guidelines concerning recruitment, termination, career advancement, performance appraisal, professional and employee ethics and code of conduct. The Company's personnel policies and processes enshrine equal opportunities to all and non-discrimination with regard to gender, caste, creed, ideology or other opinion, whether social, political or religious. Also ensured is a due process for employee consultation and participation in organizational development and policy formulation.

The corporate vision of the company is "to be one of the most respected companies in India; recognized for challenging conventions and delivering on our promises."


The sustainable dimensions are being practiced by the way a company balances its economic, social and environmental objectives while addressing stakeholder expectations and enhancing shareholder value (Hasha, 2007). The sustainable dimensions which are followed by ACC limited are

Environmental Dimension

Economic Dimension

Social Dimension

ENVIRONMENTAL DIMENSION- ACC has been a trendsetter in the industry with respect to its environment protection practices. There is evidence to show that quarry rehabilitation, tree plantation, a forestation, water management, pollution control and utilization of wastes were practiced many decades ago. The dimensions followed by ACC limited are:

Energy- ACC is engaged in making regular modifications in process and technology to adapt to best practices in energy savings on the usage of conventional energy and fuel sources. Efforts are on to seek viable renewable energy and non-fossil fuel sources.

Atmosphere Emissions Control- Sophisticated pollution control equipment and devices and a well equipped environmental laboratory provided at each plant help in the monitoring and measurement of environmental parameters.

Mineral Components- ACC has demonstrated rechanneling of industrial wastes such as fly ash and slag to make premium quality blended cement.

Waste Management- It is an important dimension for a cement company as there is so much waste when Cement is made. There should be a proper waste management system which can help the environment.

Mining and Quarry Rehabilitation- As limestone is used in cement; ACC pioneered a move to develop a procedure to mining of limestone in cement industry.

Greening- includes a forestation, reclamation and rehabilitation, top soil management, noise abatement and other visible measures such as tree plantation and water management. ACC has proudly showcased its successes with reclamation of lands abandoned as mines and quarries.

Water Management- Water conservation efforts have been noteworthy, with important contributions from nearly all our plants. The company maintains a norm of Zero Water Discharge at all cement units. Water is used in the plants as industrial cooling and the entire water is recycled through cooling towers, water ponds and tanks.

ECONOMIC DIMENSION- ACC is India's foremost manufacturer of cement and ready mix concrete with a countrywide network of factories and marketing offices. ACC's brand name enjoys a high level of equity in the Indian market. Below are the dimensions which ACC uses:

Developing Markets- At present there is a high competition in the cement industry as such ACC cement also has competitors such as Birla cements etc. Cement market is moving up very fast with more cement manufacturers coming in for competition.

Growth indicators- Leadership in cement requires new projects for capacity expansion to be taken up at regular intervals. Organic growth is preferred as it is faster and enables overall economies of scale. ACC is currently implementing expansion projects that will raise its cement capacity from 22.40 million tonnes in December 2007 to 30.40 million tonnes by the close of 2010.

Customers Relations- ACC's level of customer services has appreciably increased through the expansion of the sales network and sales force. Cement being a primary resource for construction, ACC has always strived towards having good customer relations.

Suppliers Relations- ACC's countrywide spread of cement plants consumes a wide spectrum of inputs - about 130,000 different items ranging from coal, gypsum, slag, packaging bags, refractory products, steel, grinding media, lubricants, electrodes, cables, bearings, conveyor belts, spares of various mechanical, electrical and mining equipment, explosives and instrumentation. A team of professionals at Corporate, Region and Plant Level manages the procurement function. The function is organized so as to derive maximum value for the company through economies of scale from central pooling and procurement of some inputs at the corporate level while meeting individual operational requirements at plant level.

Service Excellence- ACC's main motive is to develop their market and want to be the first of its kind in India to target individual home-builders in this way, the centre addresses the anxieties of home builders at all stages of planning, construction and provide the "expert" inputs needed for successful completion of the home building process.

SOCIAL DIMENSION- ACC demonstrates the practices of being a good corporate citizen and has a clearly stated policy in respect of its corporate social responsibility. ACC has pledged to uphold the principles of The Global Compact, the voluntary international corporate citizenship network initiated by the United Nations. The research was done in a participatory manner involving key stakeholders from the local community and others. Dimensions followed are:

Level of Education- ACC has taken steps in knowledge building through a special trust to people development, learning, sharing of knowledge and best practices.

Corporate citizenship- In this dimension the main objective is to build up a good relationship with the people around. Occupational Health & Safety (OH&S) is a vital part of ACC's journey towards Sustainable Development. There is a continuous effort to measure and improve Safety Management Systems to avoid accidents.

Training and Development- As per the CSR, the company has to train and develop their employees and managers as to help in the development of the company.

Health Care- It is one of the most talked about point in accordance with the society welfare. ACC has many health care centres in their townships and also the community around. ACC also provide ambulance and medical equipments for the health care centres.

HIV/AIDS- ACC volunteered to lend a hand in the national effort to combat the HIV/AIDS which is recognized as being one of the country's major public health issues.

Community Development- The rural community around many of ACC's plants comprises of the weakest sections of rural India with no access to basic amenities. Tribal people also form a part of the neighborhood. The company has a long history of undertaking a range of activities meant to raise the quality of life and living conditions of the under-privileged and backward classes in the vicinity of our plants and mines.

Stake Holder Engagement- Our business plan encourages close coordination with our principal stakeholders. All community initiatives are undertaken with the advice of selected representatives from the local community as well as local administration and other influencer groups. Each Plant has a team of such persons whose advice is invaluable in formulating and implementing development schemes.

Partnership- Company is actively seeking partnerships with NGOs, government and other agencies to help create synergies for our target community particularly by way of providing experience in micro-finance, capacity building and the creation of income generating employment.


To manage the different dimensions there are some indicators which can be developed by the ACC limited. They are in relation with social, economical and environmental performance of the company.

Environmental Indicators developed to monitor Environmental Dimensions are:

Energy Efficiency - The environment management organization has been strengthened at the corporate as well as plant level. The Environment and Energy Conservation Cell was formed in September 2007 with a clear road map to pursue emission and energy reduction. Earlier these functions were organized differently. Many projects are under implementation to control fugitive emissions and particulate emissions.

Going forward, the Company aims to pursue other sources of nonconventional energy such as wind power, waste heat recovery, solar PV energy, solar thermal energy and mini hydel power and build them as sustainable business models through the Clean Development Mechanism. ACC has managed to reduce the consumption of electrical energy upto 3.5% in 2008.

Emission Monitoring System: The Atmosphere emission control can be managed by the EMS (Environment Management System). Making substantial investments to monitor and measure the environmental performance in its plants in terms of emissions is termed as baseline monitoring.

Continuous Emission Monitoring Systems (CEMS) are being installed at all plants in a phased manner to facilitate continuous monitoring of emissions and ensure environment compliance within the standards. This helps in measuring the quantity of SOx, NOx and VOC in plants. Mineral Component Factors- ACC is the largest producer of blended cements in the country, offering two varieties of blended cements namely: Fly-ash based Portland Pozzolana Cement and Portland Slag Cement. The company has managed to reduce the clinker factor to 67.58% by utilizing other compatible industrial wastes like blast furnace slag and fly ash.

Co-processing- To provide waste management solutions through co-processing from all ACC plants to surrounding industries. Total waste co-processed was 0.4 million tonnes in 2008 including biomass, waste derived fuels, fuel rejects, industrial non hazardous and hazardous waste.ACC has been constantly installing infrastructure for co-processing and waste materials in all the plants, launch of Geo cycle brand for waste management services, recycling and reuse procedures.

Mining and Quarry Rehabilitation Method- Introducing mechanized method of opencast mining which uses shovel dumper for loading and transportation of limestone and overburden. With the help of Mining Safety, A forestation and Remote sensing agency rehabilitation can be done.

Bio Diversity- Among the most satisfying results of the company's horticulture, rehabilitation, and greening and afforestation activities is the opportunity that provides to enable natural life to flourish, to assess the impacts on the flora and fauna around plant and mines.

Water Treatment Plant management -Building a Bio-Tech Root Zone treatment Plant for managing domestic sewage and waste water using a natural process which is simple and cost-efficient and provide clean water for consumption.

Economic Indicators developed to monitor Economic Dimension are:

Backup Plan- Due to competitors the company has to monitor the segments in which it is the best and study the market development.

Genuine progress indicator- As seeing the growth of ACC there should be a genuine growth progress program which every time studies the growth and expansion of the company. New

Projects for capacity expansion to be taken up at regular intervals.

Customer Service Cell- Company has a regular practice of interacting with customers and end-users as well as members of our distribution channels such as dealers, sub-dealers and retailers. Through these interactions we build relationships and seek to educate them about cement, common complaints and pit-falls in usage and other aspects of construction. Customer service personnel are responsible to attend to customer complaints. There is a formal system in place for handling customer complaints at all sales offices.

Supplier Management- This relates to meeting the operative requirement in accordance with the procurement organization, Code of conduct, Procurement Manual, vendor management and the way of outlook towards the supplier.

Help Centre- This is described as the help for the self excellence as a guide to the home builder, which are relevant steps of house construction process. Steps from purchasing land, budgeting to choice of material and planning of the construction process are elaborated, step-by-step.

Social Indicators developed to monitor Social Dimensions are:

Education Centers-Education is imparted not only to children of ACC employees but also more importantly to children from rural areas who do not have access to any medium of information or education. ACC schools maintain high standards and are open to other children of the vicinity. Often these schools are the most preferred centres of learning in the district and adjoining areas. Wherever possible, ACC provides funds and infrastructure to help set up local schools, colleges and centres for learning and education.

Corporate Citizenship programs- These programs will help in the sustainability of the corporation which deals with the helping of people in and around the plant area. There are many programs carried out by ACC to help improve the health of the people in the rural areas. This also consists of hazards portfolio workshop which helps in the safety of the employees.

Performance Management System- Incorporates a process called Competency Assessment and Training and Developmental Needs wherein appraisers are specifically called upon to identify and assess training needs of employees at specific intervals that do not coincide with Performance appraisals. This is to assess training needs objectively. Training is imparted to take care of an individual's career development as well as functional and skill enhancement.

HIV/AIDS Workplace policy- ACC is desirous of playing a meaningful role in the nationwide effort to eradicate HIV/AIDS and has pledged to support the Confederation of Indian Industry in their initiative. ACC recognizes that a fundamental step in this respect involves a clear statement of the company's internal policy to deal with employees affected by HIV/AIDS. CII has framed a Code of Practice for Industry to guarantee and safeguard the rights of employees infected and affected by HIV/AIDS. This is ACC's internal workplace policy for HIV/AIDS. This also strengthens awareness programs at all plants and measure effectiveness & coverage. Anti retroviral centers are coming up for the HIV affected patients.

Welfare Community- Our community development activities revolve around the under-privileged community that lives in the immediate vicinity of our cement plants and is thus more dependent on us. The range of our activities begins with extending educational and medical facilities and goes on to cover vocational guidance and supporting employment-oriented and income-generation projects like agriculture, animal husbandry, cottage industries by developing local skills, using local raw materials and helping create marketing outlets. This includes sharing education and medical facilities, sports and recreation. Wherever possible we share access to Bore Wells, drinking water and the usage of colony roads.

Shareholder Analysis- A stakeholder analysis is being done afresh at each of our locations based on a format suggested. The exercise is done as a collaborative effort of different groups of people. It begins with drawing a stakeholder map that differentiates between primary and secondary stakeholders and their "proximity" to the company.

Partnership Development Program-With a view to attain overall development of the area, DA aims to synchronize our program with other development schemes planned and approved for the region. DA seeks to harness additional resources by forging alliances with local administration, state governments and other NGOs working in this territory to leverage their resources and programs. These are intended to felicitate designs for Sustainable Construction which means building in a manner that conserves resources and is socially, economically, environmentally, functionally and aesthetically balanced to meet today's needs without compromising the ability of future generations to meet their own needs.


The report highlights the current situation of ACC limited and indicates how to develop a sustainable monitoring system because by using this system ACC can utilize their employees' knowledge, capturing and making use of the environmental, social and economical dimension for sustainability. It is very useful for ACC Limited to view the indicators and create a monitoring system such as CSR, cells and many other effective programs in at which helps the people responsive, fluid and open to range of information which can build all the social, environmental and economic aspects for sustainability of ACC Limited in future.