Stakeholders' Focus & Issues of Significance FY23

Stakeholders' Focus
and Issues of Significance

A crucial step in creating value is preserving and strengthening stakeholder trust, which calls for transparent and responsive stakeholder engagement. At Tata Power, we regularly connect with our stakeholders to understand their perspective, receive feedback, and ascertain issues important to them. Seamless dialogue, empathy and focus on value creation underpin our stakeholder engagement.

External Stakeholders

Why they are important	Engagement mechanisms	Stakeholder recommendations	Our response to stakeholder recommendations
Investors
Provide equity capital	Scheduled analyst meets Quarterly results call Participation in investor conferences, roadshows	Resolution of Mundra issues Focus on profitable renewable capacity growth despite competitive intensity Maintain healthy leverage levels even while significantly scaling up growth capacity	Engage with all procurers of Mundra for resolution Growing our green portfolio with healthy returns Undertaken various measures to enable a strong and wellcapitalised balance sheet to meet its growth aspirations Thrust on growing through energyefficient businesses

Lenders
Provide debt capital	Continuous engagement at all levels	Ability to maintain cashflows given the difficult financial status of Discoms Ability to maintain healthy leverage levels given the significant growth aspirations	GoI has been taking significant steps to improve the condition of the Discoms including privatisation The Company has undertaken various measures to enable a strong and well-capitalised balance sheet to meet its growth aspirations

Regulatory Authorities
Provide guidance for conducting business and resolving disputes	Scheduled meetings Regular liasoning Industry forums	Climate change related rules/regulations Optimal tariff to consumers Optimal utilisation of natural resources	Regular engagement, communications and advocacy with regulatory authorities Strict compliance with rules and regulations Tracking compliance

Customers
Ultimate recipient of our products and services	Customer satisfaction surveys Formal and informal feedback	Timely and high-quality completion of projects Quality and reliability of power supply Improved notifications of disruption, failures, or maintenance for customer transparency Integrated, smart and convenient power management solutions	Timely and high-quality completion of renewable projects Improvement of operational efficiency Reduction in forced outages Cost-effective energy solutions Regular safety awareness campaigns for customers Introduction of digitally-enabled solutions such as smart meters Offering bundled solutions to enhance customer convenience

Suppliers/Vendors
Help us develop our business ecosystem, support our sustainability initiatives, and create shared value	Regular supplier/vendor meets Contract revision and negotiation meetings	Formal supplier assessment to verify ESG performance Increased awareness to partner green initiatives	Evaluation of vendors/suppliers through ESG criteria Shared common vision through vendor meets Contractual clauses to reflect organisational expectations on ESG

Civil Society
Enable better implementation of our environment and social initiatives and give feedback	Project-based stakeholder meets Periodic meetings	Augmented community involvement Transparency in business practices and their impacts Responsible business conduct and commitment to sustainability	Robust internal and financial control system Emphasis on community development and affirmative action initiatives Collaborative initiatives for carbon mitigation

Local Community
Provide a better socio-economic context in our operating environment	Project-based stakeholder meets Participation in CSR activities	Increased infrastructure for training community members Safety and security of facilities as well as electricity supply	Training and skill development of contractors undertaken by Tata Power Skill Development Institute (TPSDI) Regular safety awareness campaigns undertaken for customers and other community stakeholders

Media
Plays a vital role in keeping our stakeholders informed of business developments, new products and services as well as the impact of our business operations	Media briefings Press releases Marketing communication	Increased transparency and clarity in shared information	Presence of a robust corporate communications team A strong media and communication strategy across the Company

Employee Unions
Help set standards for education, skill levels, wages, health, and employee benefits and working conditions of our employees	Scheduled meetings Dedicated surveys	Ethical and responsible business conduct Equal opportunities for all	Adherence to Tata Code of Conduct for all employees Continuous support of management to promote diversity Formulation and implementation of Human Rights policy Support for collective bargaining through union employees

Internal Stakeholders

Why they are important	Engagement mechanisms	Stakeholder recommendations	Tata Power’s response to stakeholder recommendations
Board of Directors and Leadership
Provide collective guidance and direction for the Company’s strategy and operations	Scheduled quarterly Board Meetings Strategy Board Meetings Scheduled Board Committee Meetings	Market leadership Maximise shareholder value Focus on sustainable businesses Focus on customer-centric policies and ethical business conduct Proactive interaction with investors for ESG initiatives and strategy Periodic review of perceived risks and mitigation strategy	Periodic review of business strategy and performance Greater emphasis on growth through non-fossil-based business ventures Increased focus towards ESG disclosures and clear communication on ESG aspirations Sustained focus on strengthening community collectives and local public institutions

Employees
Form the backbone of our business activities	Training and seminars Meetings and reviews HR programmes Employee engagement satisfaction surveys Departmental meetings Townhall meetings Quarterly management communication	Work-life balance Transparent appraisal and promotion policy Stability of internal policy Fair remuneration structure	Encourages a work culture which respects employees needs and aspirations Robust appraisal system and redressal process Benchmarking salary structure to be among the best in the industry

Materiality Assessment

In FY23, considering both internal and external stakeholders' concerns, we carried out a fresh and comprehensive materiality assessment. Through this assessment, we have derived 25 material issues significant to our value creation process.

Activity

Identifying material issues of industry peers and national and international frameworks and standards

Identification of internal and external stakeholders

Develop universe of material topics

Develop materiality assessment questionnaire for finalised topics

Finalise the questionnaire and float to stakeholders

Receive and map business objectives and risks

Data analysis for materiality assessment

Draft materiality matrix for management discussions, review and approval

Finalisation of materiality matrix

Stakeholders Covered for the Assessment Include

Internal stakeholders

Senior Management Team
Employees

External stakeholders

Investors
Supply Chain Partners
NGOs/Service Providers
Brand and Media
Customers and Consumers

The Material Issues Identified Are:

Environment

Climate strategy
Emissions management
Energy management
Affordable and green energy
Safeguarding biodiversity
Hazardous and toxic waste management
Water and effluent management

Social

Diversity and inclusion in workplace
Responsible employer
Employee retention, engagement and talent development
Occupational health & safety
Labour management
Human rights
Customer relationship management
Building sustainable communities
Responsible supply chain

Governance

Creating economic value
ESG governance
Risk management
Ethical business conduct
Transparency and accountability
Digitalisation and cybersecurity
Regulatory compliance
New business opportunities
Innovation and collaborations

Materiality Matrix

This was followed by an online materiality assessment survey was rolled out to all stakeholders. Data analysis of the input from survey was carried out and materiality matrix was developed.

Environment

Climate Strategy
Emissions Management
Energy Management
Continuous & Affordable Green Power
Safeguarding Biodiversity
Hazardous & Toxic Waste Management
Water and Effluent Management

Social

Diversity and Inclusion in workplace
Socially Responsible Employer
Employee Retention, Engagement and Talent Development
Occupational Health & Safety
Labour Management
Human Rights
Customer Relationship Management
Building Sustainable Communities
Responsible Supply Chain

Governance

Creating Economic Value
ESG Governance
Risk Management & BCDMP (Business Continuity & Disaster Management Plan)
Ethical Business Conduct
Transparency and Accountability
Digitalisation and Cybersecurity
Regulatory Compliance & Landscape
New Business Opportunities
Innovation and Collaborations

Material Issues and Their Mapping to SBOs and SDGs

We have clubbed our material issues under seven broad categories of:

Material Topics	Capitals Impacted	SBOs Mapped	Contribution to UN SDGs
Climate Change Management Climate strategy^* Emissions management Energy management Continuous and affordable green power^*

Environmental Stewardship Safeguarding biodiversity Hazardous and toxic waste management Water and effluent management

Workforce Wellbeing Diversity and inclusion in workplace Socially responsible employer Employee retention, engagement and Talent development Occupational health & safety Labour management

Social Responsibility Human rights Building sustainable communities

Customer Engagement Customer relationship management Digitalisation and cybersecurity

Future Readiness and Business-continuity Risk management and business Business Continuity & Disaster Management Plan (BCDMP) New business opportunities^* Innovation and collaborations Responsible supply chain^*

Corporate Governance Creating economic value ESG governance Ethical business conduct Regulatory compliance and landscape Transparency and accountability