Yes, our Responsible Partner Policy (RPP) sets out the requirements that all our suppliers must meet to do business with us. RPP and its fundamental principles embody our commitment to responsible, transparent and sustainable business. This commitment is at the core of our sustainable business strategy, which sets out how we will deliver superior performance by being a purpose-led, future-fit business. In addition to RPP, our Sustainable Agriculture Code is a collection of good practices that aim to codify key sustainability aspects in sourcing. We are building on its long-term commitment to sustainable sourcing by focusing on the agricultural crops to create a positive impact on nature.

We believe that certification is one of the important ways to drive positive change in agricultural supply chains. We are India's largest tea business and a founding member of trustea (https://trustea.org/partners/), the Indian tea industry collaboration on sustainability. By 2023, we are committed to achieving a deforestation-free supply chain by ensuring our raw materials come from verified deforestation and conversion free places.

RPP and Sustainable Agriculture Code are hosted on our website at https://www.hul.co.in/investor-relations/corporate-governance/hul-policies/ and https://www.hul.co.in/planet-and-society/protect-and-regenerate-nature/

Around 43%* of our key crops are sourced sustainably under the Sustainable Agriculture Code. This includes tea, palm oil, paper and board, cereal, sugar, dairy, cocoa, coconut oil, soy, starches and vegetables & herbs, which make up more than two-third of our agricultural raw material volumes. We are working to reach 100% sustainable sourcing of our key crops. Through focused programs, we have achieved sustainable sourcing for 95% of our total paper and board, 82% of our total tomatoes and 69% of our total tea procured during the Calendar Year 2022.

* This indicator is assured for Calendar Year 2022 which consists of percentage of inputs sourced sustainably for 12 key crops identified by HUL.

There are mainly two categories of material that are reclaimed:

(a) Damaged and expired finished goods: There is comprehensive standard operating procedure (SOP) for safe handling and disposal of expired/damaged stocks returned from market and depots. These goods are either safely disposed off or recycled.

(b) Plastic waste as part of Extended Producer Responsibility (EPR): We collect plastic waste under EPR across India. The plastic waste is collected and safely disposed in an environment-friendly manner or recycled depending upon its category and quality, as per applicable rules and regulations.

Yes, EPR is applicable and it aligns with the plan submitted to the Central Pollution Control Board. EPR plan is executed through tie-ups with waste management agencies. Our plastic waste collection is brand-agnostic. Collection network spans across 36 States and Union Territories of India, with a coverage across urban and rural locations in the country. We have been collecting and processing more plastic packaging waste from across India than the plastic used in the packaging of our finished products in Calendar Year 2021 and 2022. Over 1,00,000 tonnes of plastic waste have been collected and safely disposed across the country with the help of the collection partners in 2022.

Our products are covered by Life Cycle Assessments (LCA) conducted by our Parent Company (Unilever PLC). Unilever conducts LCAs compliant with ISO 14040, either internally with in-house LCA experts or using external partners. LCA involves studying the environmental impacts of a product - from the sourcing of raw materials to product manufacture, distribution, consumer use and safe disposal. Unilever applies internationally accepted impact assessment methods, such as harmonised life cycle impact assessment method (ReCiPe) and the European International Reference Life Cycle Data System (ILCD 2011) midpoint methods. Unilever is currently co-funding a second LCA on sustainable palm oil and the World Foods Life Cycle Database Initiative. Unilever is sponsor of the United Nations Environment Programme (UNEP) Life Cycle Initiative (LCI) that aims to support the application of LCA for policymaking and decision-making.

Unilever also conducts an annual simplified LCA exercise on representative products across 14 countries, including India. The methodology is consistent with ISO 14040 and was recognised by the UNEP as one of the finest examples of an organisational LCA.

In 2022, we used a simplified LCA to map the carbon footprint of our products. The analysis was conducted to understand the key challenges in our ambition to achieve Net Zero emissions for all our products from sourcing to point of sale by 2039. A key area of focus was the raw material footprint (Scope 3 emissions - purchased goods), which are related to the emissions from our suppliers and their corresponding feedstocks. We have also included the impact of packaging, inbound and outbound logistics (including retail-related emissions) and disposal of the products (post-consumer use i.e., biodegradation of chemicals and incineration of plastic packaging).

We have undertaken a detailed exercise to identify ESG risks considering issues that impact our business and are also important to our stakeholders. Some of the key risks inter alia are climate change, water, packaging & waste, and sustainable sourcing.

LCA approaches have identified that Scope 3 emissions are a significant contributor to our emission footprint.

Raw material sourcing and production represents a significant contribution to the total life cycle impact of our products and therefore, we are committed to a deforestation-free supply chain in palm oil, paper & board, tea, soy, and cocoa by 2023. In addition, we will contribute to the Unilever ambition to help protect and regenerate 1.5 million hectares of land, forests, and oceans by 2030 and achieve 100% sustainable sourcing of our key agricultural crops.
We are asking our existing suppliers to adopt carbon reduction targets to cut their emissions and we're prioritising partnerships with new suppliers, who already have science-based emissions targets in place. One example of this is the work we are doing to support a subset of suppliers whose materials have been assessed as having the most significant impact on climate. Within this group of 300 suppliers, we have detected a range of climate capabilities and will offer hands-on guidance and access to tools and resources to support those that need it.
In our Home Care business, we are committed to reducing the use of virgin fossil carbon in the products by using renewable and recycled carbon sources. For example, we are partnering with Tuticorin Alkali Chemicals and Fertilisers Ltd (TFL) and Carbon Clean Solutions (CCSL) who have developed cutting-edge technologies, to capture the CO₂ from use of energy in their production processes and turn it into soda ash (Sodium Carbonate). The soda ash from this partnership is an important ingredient in our detergents products like Rin, Wheel, Surf and Vim (Unilever Partners with Purpose Awards 2020 winners - http://www.unilever.com/files/2f92f941-e4cb-417e-b481-dd2c04bb5722/UPWP%20Awards%202020%20 winners.pdf)

Sustainable palm: Today, soap bar manufacturers mainly use palm oils as the source of fatty acids, and these are grown in Southeast Asia, Central & West Africa, and Central America. Palm oil plantations are under increasing scrutiny for their effects on the environment, including deforestation, leading to loss of carbon-sequestering, biodiverse forest land as well as use of peat land for cultivation releasing large quantities of GHG into the atmosphere. There is also concern over displacement and disruption of human & animal populations and exploitation of indigenous populations due to palm oil cultivation. Unilever has pioneered the sustainable sourcing and production of palm oil and is committed to moving to NDPE Palm [NDPE refers to No Deforestation, No Expansion on Peat, and No Exploitation] by the end of 2023, which is a significant commitment to sustainability.

Soaps: Soap bars comprising more than 80% soap molecules (>70% TFM - Total Fatty Matter) account for a large part of the palm footprint in non-edible usage. Ensuring availability and managing the environmental impacts of increased oil consumption are challenges faced by the soap industry today. Unilever R&D is committed to and is already developing novel technologies to manufacture soap bars that meet the desired functionality, while reducing the palm footprint significantly, and helping address climate change through lower greenhouse gas emissions/carbon footprint products. Further, from a consumer point of view, these products will potentially allow for better affordability and sensory properties, which are desired by consumers.

Water: With regard to use of water in life cycle of our products, consumer use phase represents majority of our product's water footprint for instance in the case of detergent products. One of our recent innovations involves the launch of detergent products (e.g, Surf excel Quick wash powder) that are designed to address the quantum of water requirement in the consumer use phase. The breakthrough product technology allows automatic foam reduction during the rinse stage of the hand washing process, thereby reducing amount of water required for rinsing.

Plastic circularity: Plastic packaging needs to be recycled in environmentally friendly ways to build a circular economy. Therefore, we have set ambitious targets to ramp up the use of recycled plastic and only use reusable, recyclable or compostable plastic packaging (https://www.hul.co.in/planet-and-society/waste-free-world/). We have achieved plastic neutrality in Calendar Year 2021 and 2022, i.e., collecting back more plastic packaging than we send to market by maintaining industry-leading standards for balanced pan-India collection. We currently use post-consumer recycled (PCR) plastic in the packaging for many of our brands (e.g., Surf Excel, Comfort, Vim Dishwash Liquid, etc.), and have eliminated plastic from all the soap cartons. We have also installed 'Smart fill' stations in a few locations to enable consumers to refill their plastic bottles with our Home Care liquid products.

Plastic packaging needs to be recycled in environmentally friendly ways to build a circular economy. We have set ambitious targets to ramp up the use of recycled plastic and only use reusable, recyclable or compostable plastic packaging (https://www.hul.co.in/planet-and-society/waste-free-world/). By 2025, we aim to reduce the amount of virgin plastic we use in our packaging and use 15% recycled plastic.