IUCN - Giving Citizens a Voice in Environmental Management in Industry

Giving Citizens a Voice in Environmental Management in Industry

29 March 2011 | News story

IUCN Thailand and TATA Steel (Thailand) PLC are working together to identify stakeholders and their concerns relating to the environmental impact of the mini blast furnace plant operated by NTS Steel Group PLC, a subsidiary of TATA Steel Thailand, at the Hemaraj Industrial Estate in Bor Win, Chonburi province.

TATA Steel Thailand has two other subsidiaries besides NTS, namely, the Siam Iron and Steel Co. Ltd and the Siam Construction Steel Co. Ltd. All three are major producers of rebar, wire rods and small steel sections in Thailand. The company’s major shareholder is TATA Steel Global Holdings Pte Ltd, itself wholly owned by Tata Steel Limited, the world’s seventh-largest steel company.
A better understanding of its stakeholders is expected to help TATA Steel organise a full and effective public consultation process for the ongoing Environmental Health Impact Assessment (EHIA) of its plant at Bor Win. IUCN will use this process to work towards influencing the ongoing changes in public participation in environmental decision making in Thailand’s industrial sector.

IUCN will use its local-to-global reach and convening power to draw on its wide base of specialists and members in support of this initiative. It is hoped that this work will contribute to developing environmental standards for the steel industry, and to making sector-wide changes both in Thailand and in the region as a whole.

TATA Steel Thailand sees potential in this engagement to build its reputation as a socially and environmentally conscious company, and to strengthen its internal capacity and understanding through collaborating with IUCN.

During the stakeholder analysis, IUCN will collate and review relevant secondary documents on TATA Steel Thailand, the plant at Chonburi, and the history and outcomes of any past engagement by the company with outside stakeholders. It will design, plan and undertake a participatory and inclusive stakeholder assessment to identify, map and prioritise stakeholders according to their power and influence, and will provide clear information on the concerns, interests and needs of key stakeholder groups.

Building on the analysis, IUCN will help to facilitate a dialogue between stakeholders and TATA Steel if required, and will identify and recommend options for TATA Steel to further develop and strengthen its social and environmental programmes.

In keeping with IUCN’s Private Sector Strategy and the associated 2009 Operational Guidelines for Private Sector Engagement, a due diligence was undertaken in order to assess the risks and opportunities that engagement with Tata Steel (Thailand) PLC poses to IUCN.

The Due Diligence conducted on the Tata Group which is headquartered in India has revealed that environmental/social policies are integrated into the Group's operations. The TATA Group has maintained ethical business operations under the framework of its good governance highest standard: the TATA Code of Conduct. It is mandatory for Group companies to have a vision and mission statement that explicitly states its policy on environmental management; define a corporate environment policy and communicate to all its employees.

Comparatively speaking, the Tata Group is doing excellent work in the CSR area and could be seen as leaders in the field in the Asia region. Commitments to external processes and standards are high. Some articles on the Tata website indicate that what are quite clearly commercially driven developments are done primarily for environmental and community purposes. The creation of ‘Tata cities’ and their social and environmental credentials must have an impact on local villages. No supply chain policies could be sourced. It should be noted that not many companies in India produce sustainability reports. Some Tata Companies, like Tata Steel, are amongst the few that do. The Dhamra Port Development Project of the Dhamra Port Company Limited (DPCL), a subsidiary company of Tata Steel in India in partnership with Larsen & Toubro Ltd is an issue that has been constantly addressed by IUCN.

The risk of partnership failure due to an intrinsic problem with Tata Steel (Thailand) seems small. Overall it appears that engagement with Tata Steel Thailand would represent a positive opportunity for IUCN.