At Tata Communications, we have a robust risk management framework, allowing us to identify, assess, and reduce existing as well as emerging risks. Our risk management leads us to protect our business, while simultaneously strengthening our competitive position.
Given the complex competitive nature of our business, we face numerous threats and risks from internal and external sources.
Internal control systems and their adequacy
We have clearly defined risk management policies and procedures for identifying and assessing critical risks. We regularly discuss our key risks with members of the Risk Management Committee and the Board of Directors. The Risk Management Committee monitors and assesses significant risks to our performance and strategic execution. After identifying and assessing risks, we define controls aimed at reducing its potential impact. Our Global Management Committee (GMC), which consists of the CEO, CFO, and key business and operations managers, is responsible for the effective and efficient implementation and maintenance of risk management systems.
Enterprise Risk Management (ERM)
The Enterprise Risk Management (ERM) process, which is established by the Board of Directors, defines procedures and organisational rules to identify risks at an early stage, and take proactive steps to manage the risks inherent in any commercial activity. ERM Risk assessments serve as key inputs to the annual internal audit programme. Furthermore, we also conduct a detailed review and testing of the key internal controls related to financial reporting. This approach provides adequate assurance to the Management and the Audit Committee regarding the effectiveness of the internal control procedures defined and implemented by the Management.
Environment
Compliance
With rising awareness of environment related threats, it is our responsibility to protect the environment as it constitutes an important aspect of our business. We are also required to ensure continuous compliance with environmental laws and regulations to minimise any harm to the environment. This will require incurring additional costs to drive those initiatives and maintain the required guidelines set by the respective governing bodies.
Mitigation Strategy
Environmental stewardship forms an integral part of our strategy. We have implemented Environmental Management System (EMS) that is in conformance to ISO 14001:2015 standard. We undertake periodic reviews of EMS to validate that the certification ensures that our policy commitments are upheld in our operations with principles of continual improvement, and we are compliant with all relevant national and regional laws.
Climate
Change
Rising awareness of climate change associated risks has resulted in climate risk moving to the centre of policymaking around the world. The Impact of Information and Communications Technology (‘ICT’) industry on environment is slowly getting traction. Our inability to maintain our emissions below the regulated limit poses a risk of loss of business/reputation.
Mitigation Strategy
Our actions to combat climate change are governed by our Environment Policy, the Tata Code of Conduct and the Tata Group’s climate change policy. We are not only working towards reducing our carbon emissions and responding to climate change, but also helping our customers reduce their footprints as well. We are striving towards reducing our emission intensities, increasing our renewable energy share in our energy mix and developing low-carbon products and solutions as part of our endeavour to fight against climate change.
Acquisition & Retention
of Right People
Our inability to attract and retain relevant talent, who have specialised technical skills (e.g., sales, product development, data analytics, managed services, engineering, and so on) could negatively impact our ability to execute our business strategies. Further, in recent times, attrition and increase in lead times to onboard new and/or replacement of talent has added to the severity of this risk.
Mitigation Strategy
Given the technical knowledge and expertise needed in our industry space, we put significant efforts in recruiting and retaining the right employees who match our expectations. We strive to create a collaborative, inclusive and diverse environment that is employee friendly and provide professional and personal growth opportunities. We also train and nurture young minds to be leaders of tomorrow as a part of our succession planning practice.
Employee
Health & Safety
Pandemics such as COVID-19 pose significant risks to the health and safety of our employees and contractors. While Tata Communications takes all possible measures towards ensuring the health and safety of its employees and contractors, such pandemics may materially impact the health of our employees and contractors. This may restrict our ability to sustain quality operations and services.
Mitigation Strategy
Ensuring health, safety and wellbeing of our employees remains a priority for us at Tata Communications, especially in challenging times like pandemics. We remain proactive in ensuring not only physical wellbeing but also mental wellbeing of our employees. Further, our workplace is designed to ensure it is hazard-free and we maintain a healthy and conducive work environment by providing proper illumination, low noise levels, good ventilation systems, hygienic food and water. We have also made provisions for medical rooms, resting places and visiting doctors’ services, along with pantry, break areas and sports facilities at most of our facilities.
Business excellence
At Tata Communications, business excellence is focussed on developing and strengthening our organisation’s key management systems and processes to continuously improve our performance, and create greater value for our stakeholders. To achieve this, we leveraged the Tata Business Excellence Model (TBEM), which provides a framework to enhance our business processes related to leadership, strategy, customers, measurement, analytics, knowledge management, workforce, operations, and business outcomes. The TBEM framework emphasises the management of various quality management systems in an organisation, including TL9000, ISO27000, and CMMI. As part of the model, a rigorous assessment is carried out every two years to help achieve a higher level of excellence.
In 2021, we underwent simultaneous assessments for business excellence assessment using TBEM and Data Maturity using DATOM (Data and Analytics Target Operations Model). Tata Communications achieved a TBEM score of 605 points (an improvement of 30 points compared to 575 in 2018). DATOM assessment score of 3.17 (previous score of 2.86, maturity level ‘scaled’ in 2019 to ‘synergised’ in 2021), was largely driven by improvement in data quality and related processes for all products.