How Sustainability is Revolutionizing the Manufacturing Industry

Today, one-fifth of the world's carbon emissions and more than 50 percent of global energy consumption are attributed to the manufacturing and production sector. Adopting eco-friendly practices is the only way to reduce energy consumption, minimize waste, and lower greenhouse gas emissions. According to a study by the World Economic Forum, sustainable manufacturing practices, such as implementing green packaging, could result in a 90 percent decrease in water use and a 40 percent decrease in energy consumption. However, manufacturers face a few challenges in shifting towards sustainability and green manufacturing. Initial investments can be high, with adopting eco-friendly practices requiring substantial capital. More than 60 percent of manufacturers cite cost as a barrier. Furthermore, revamping existing processes and integrating green technologies poses logistical and operational challenges.

Industry Outlook organized a webinar on Sustainability in Manufacturing to understand the challenges manufacturers face in shifting towards sustainability and green manufacturing and how these can be addressed. On the panel, we had some esteemed guests from different industries who shared their views on the importance of sustainability in manufacturing.

Adopting Sustainable Practices in the Construction Industry

Sumit Bidani, CEO at Knauf India

So, firstly, let us look at Knauf. Knauf is a German company that started in 1932. We are a building material company, basically gypsum-oriented building materials. And this is our history, basically, in Germany. This company started in India as USG Boral in 2008.

However, it was acquired by Knauf in 2020. So, we are part of Knauf since 2021. But we have been there in India before in a different avatar of USG Boral since 2008. We have some experience in building materials, which is primarily plasterboard components.

Knauf is a company that has a roughly 15.4 billion-euro turnover with around 41,000 plus employees, and we have 300 plants. We are present in more than 90 countries. Let us look at the insight as to who we are and why we are so concerned about sustainability. Our purpose is to "Make tomorrow a home for all of us." It's future-oriented and about leaving something to our future generations and the whole feeling of being at home; that is what we are. We are a company not led by one CEO; we have three general partners. And what's our core value? We have three values in English and one in German. So, we can see very clearly what partnership, commitment, and entrepreneurship mean. However, Menschlichkeit is an interesting one. It is closest to the word humanity and what we stand for. And that's where, right from our values and purpose, we are very linked to giving a good planet to our future generations.

When we look at our kind of construction, the big challenge for us is changing the existing practices. Therefore, we have a strong focus on upskilling. People who can fix and use our materials, therefore, not just with raw materials but also promote sustainability for the construction industry.

In terms of some key wins - many of the projects we have won over the last few years include the Vanijya Bhavan, the Google office, the ITPO complex, and the new parliament house.

The material we use to make plasterboard is now being enhanced across key projects in India. Again, returning to upskilling, we have partnered with an NGO linked with Skill India. Therefore, it's not just about getting more people to fix plasterboards, but it is also a social need. In terms of ensuring people who are apprentices from the villages can do a 45-day course, which we support, and then get into the industry as people who are workers in the industry where they can use their skills in plasterboard fixing facility. So, they get a job because of this, and we also benefit because more people are coming into the industry who know how to fix this material. So that is a win-win.

We also have semi-skilled people in the market who may not know the latest technologies, and challenges could have come without proper training. We have a separate division for the apprentice. On the other hand, we have people around the training facility with a mock-up facility to train people near the place of work. One of the important innovations is the Knauf Safeboard. If you see x-ray rooms, typically, you have led-clad walls, which are used for protection from the X-rays. We are promoting Knauf's safe board in X-ray and diagnostic rooms.

We are very committed to reducing carbon dioxide emissions. We use recyclable packaging. We look at raw materials that have a lot of recyclable content. We have goals to achieve net zero carbon emissions.

Integrating Sustainability into Product Development

Avantika Shastri, Manager, Center for Sustainability - Innovation Center, Eaton India

Eaton is an intelligent power management company. Our main markets and our main segments are basically in the electrical segment, where we have a lot of power distributions and protection, power quality backup, and products such as UPSs, panels, switches, switchgear and products from wires and cables, control and automation for a building like lighting automation, harsh and hazardous solutions.

Let us look at why sustainability is important to us. For us, sustainability is a big tailwind because power management is at the heart of sustainability. So, for several years now, our leadership team has recognized this. This is a statement from Craig Arnold, our CEO and chairman - "Every time you hear sustainability, climate change, or resiliency, these are the growth opportunities for us.

We are fortunate to be in the right time and place, and it's critical for us. For our future, sustainability is not just a part of the journey; it is not just something we do, but it's why we exist from a marketplace perspective. A few years back, we put in place oversight and leadership to ensure sustainability would be part of our journey. So, an executive council was formed, which has the topmost leadership in the company. The commission sets up the direction, but even above the council, we have the board of directors, and we did name our first chief sustainability officer in 2021 because this role was deemed critical to integrating all of the different activities within the company.

We set up our sustainability strategy centered on our mission statement. Our mission statement is to improve the quality of life and environment through intelligent power management solutions. And we have been carrying this quality of life and environment for several years. So, back in 2016, this was formulated, and we also had a set of aspirational goals that went beyond the financial goals and targets we committed to our investors.

Therefore, this shows what we do. Our mission and our aspirations were channelled into our sustainability strategy, which consists of four pillars. The first one is creating sustainable solutions, which is important for our customers. So, what are the other clean technologies for addressing climate change, material use, resource optimization, and managing all these new renewable powers?

Second is reducing our footprint, which is focused on our operations and ensuring we leave a clean environment for future generations. We reduce our daily operations' footprint and harmful impact and, importantly, around employees and communities. Doing business right is a fundamental part of our ethics, which is all about doing business right and transparently.

So now, converting these high-level goals into tangible ones is important. Back in 2020, we came up with a set of goals for 2030, and here are a couple of examples. The company said it would invest $3 billion in R&D over the next ten years. This R&D has to be focused on solutions that would improve sustainability in the world.

The framework is as follows. Concerning greenhouse gas emissions, we committed to 15% reductions in our scope three, our value chain emissions, and a 50% reduction in our operations. And the key is that we went for ambitious goals because these are basically in line with a 1.5-degree threshold for managing the world's temperature rise. This is also an approved target by the Science Based Target Institute. So now, armed with these goals from the top level, we can see how we operationalized it. We also have important goals around zero waste to landfill in our major manufacturing sites.

Overall, the webinar gave attendees insights into the challenges manufacturers face in shifting towards sustainability and green manufacturing and how these can be addressed. It also guided them in charting a path to overcome the challenges specific to their respective sectors.