Sustainability And Social Responsibility Are A Global Trend Particularly with COP21 Agreement Coming Through

Tell us something about your sustainability strategy and the activities that you undertake?

Sustainability is at the core of our business. There are two key reasons that drive our sustainability strategy. First, the energy consumption for a rail is far lower than other transportation systems such as cars and buses. For instance, the carbon emission of a train is 35 grams per kilometre as compared to 120 grams per kilometre of a car. Thus, our rail systems will enable companies and governments to meet CO2 emission targets.

Secondly, rapid urbanisation has created a scarcity of space in public areas leaving little for transportation. Given that urbanisation is taking place at a faster pace in emerging economies space becomes important and scarcity proves a major hindrance to smooth movement of transport. Metro rail network obviates this. They cater to a passenger flow of 50,000 passengers per hour. If you compare that to an efficient bus system, the passenger flow would be around 2,000-3,000 passengers per hour. The nature of our business helps us focus on sustainability issues at a global scale. Even though other players in the same business would also focus on sustainability, we wish to do it differently and on a much larger scale.

There are many ways in which we cater to sustainability. We focus on energy efficiency to reduce CO2 emissions. The way we deliver it and the scale at which we deliver it is appreciated by our customers. This is achieved through building more efficient motors, using permanent magnet motors to reduce friction, using silicon carbide for improved traction systems of high speed trains, improved architecture of high speed trains that offer lesser aerodynamic resistance, and more. We set up an ambitious target in 2014 to reduce CO2 consumption by 20 % by 2020. We have made rapid progress and the CO2 consumption in our systems is already down by 11%. We have also focused extensively on end of life solutions. We now use 97% recyclable materials, water solutions for painting and work with global institutions to remove chemical products that are not eco-friendly from our trains.

One interesting innovation is our reversible substation solution called HESOP which is an advanced reversible power substation with a single converter operating as both rectifier and inverter for DC networks. It provides dynamic voltage regulation to optimise power use intraction mode, leading to recovery of over 99% of the energy generated during braking of the rail.

Since you cover the entire Asia-Pacific region, do you notice any significant differences between regions?

At the APAC level, we have had similar experiences. We promote sustainability in every country that we operate in. We try to raise awareness of sustainability issues amongst our customers, regulatory authorities, public decision makers and suppliers. This helps them account for sustainability issues at the planning stage itself. All our rail solutions are built on global standards meeting sustainability requirements. As a principle, we would never compromise our quality because we operate in a competitive market. Of course, there will be needs to : customise wherever is required and we do make modifications. For instance, in India we try to have as much Indian content as possible.

We had a customer in Asia who wanted the Indian factory and suppliers to operate at global standards. At Alstom, one cannot differentiate as to where the inputs have been manufactured. They would be the same almost everywhere indicating our uniform standards. About a year later the customer visited our factory in India and was extremely impressed to see the operations at international standards.

To maintain these standards we develop local suppliers and apply global standards to them. There have been instances where local suppliers have been uncomfortable with our requirements. But once they start operating they realise that it was not so difficult as they begin to experience the benefits.

Of course, there are minor differences among countries but that is a function of weightages that are assigned to energy efficiency, CO2 emission and the CSR activities. In some tenders, energy consumption tends to be focussed upon strongly. For instance, Delhi Metro put significant emphasis on energy consumption. Of course, there is a trade-off to be made regarding cost versus sustainability but in most cases the balance is struck quite well. Even at our end we spend considerable amount of time and effort to build R&D in our journey toward reduction of energy consumption and recyclability.

Tell us something about your CSR activities?

Alstom takes corporate social responsibility very seriously. The Alstom Foundation is a testimony to this. It spends about one million euros on CSR activities. Around 20% of this amount is dedicated to India. We have more than 150 projects ongoing in about 50 countries. The fact that the Chairman of Alstom is also the Chairman of Alstom Foundation signals the kind of importance that we give to our CSR activities. We focus on two key areas: healthcare and education. Most of the projects are planned independently by us but we take the help of NGOs in implementing them. We work in the areas where our factories and our suppliers are located.

We have a plant in Madhepura in Bihar. We have started our CSR activities there. This was not only in our interest but the government was very supportive and looked at the development of Madhepura. Here we work through Pragya a Gurgaon based NGO. For this project seven villages have been provided land.

At Madhepura, we focus on areas of health and education. Under health programme, we provide a mobile clinic with a medical officer and a compounder who visits each village and provides consultation and generic medicines for free. Two para-teachers have been trained in community health who in turn will educate over 20 health workers providing a breadth for health outreach. The education outreach consists of delivering mobile education twice a week to children. We have two para-teachers who train more than 35 primary school teachers on improving pedagogy and using innovative teaching methods. We have also provided two well-trained vocational trainers cum counsellors who will develop the vocational training resource centre.

How do you look at the future?

As we look at the future we believe that sustainability and social responsibility are a global trend particularly with COP21 agreement coming through. These trends will continue to grow both on the market front as well as social front. I do not foresee much change in the way that we operate. The only thing that may change is the speed at which we will progress. We hope that markets keep feeling concerned about these issues and incorporate them in network planning, procurement and operations. As I look ahead there is so much more to be done both on sustainability and CSR.

In conversation with Mr. Jean-Francois Beaudoin, Senior Vice President of Alstom Asia Pacific. (Original Post)