Sustainability Report Full

Delivering Good Health through affordable medicines
and empathetic healthcare to patients whenever and

wherever they need it, is a commitment that we work
tirelessly on. This objective empowers us to leverage
cutting edge innovation and improve the quality of our
products, helping patients across the world.
Our presence is wide-spread across 26 countries, with

our global headquarter in Hyderabad, India. Our
manufacturing facilities are supported by four R&D
centres located in India, USA, UK and Netherlands.
ur Purpose
If you point to one Accelerate access to affordable and innovative medicines
because Good Health Can’t Wait.
single factor that made us

what we are today, it is
serving the poorest of the ur Promises
Our five Promises clarify what we do, what we offer and the
poor in this country. It has

commitments we make to our customers. Our patients trust
our medicines. We focus our energies on renewing this trust
every day. As we keep the interests of our patients at the
actually made us prosperous.

centre of all that we do, our Promises drive us to reach higher
levels of excellence.
Of course we didn’t stop Bringing expensive medicines within reach

Addressing unmet patient needs
there. And we continue to

Helping patients manage disease better
Enabling and helping our partners ensure that our medicines
bring affordable medicines

are available where needed
Working with partners to help them succeed
to people.
ur Values
Integrity and Transparency
Safety
Quality
- Dr. K. Anji Reddy Productivity
Respect for the individual
Collaboration and Teamwork
Sustainability
03 | Our Purpose, Our Promises, Our Values Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 04
ontents
Interaction with Dr. Reddy’s way Committed to Our sustainability
7 27 55 83
the CEO a better world performance
G V Prasad talks about Dr. Reddy’s approach Our commitment A snapshot of our
Dr. Reddy’s sustainability towards sustainability towards environment performance against
journey management key performance indicators
What we are today Delivering on our Building healthy Assurance statement
11 Our company profile and

value chain
43 promise: Good Health
Our efforts to ensure
availability and access to
63 communities
Our community
interventions and social
89 DNV GL’s assurance statement
for this report
affordable medicines responsibility initiatives
About this report Custodians of good Living our dreams GRI content index
19 Scope and boundary of

this report
49 health
How we ensure that our
medicines are safe and
71 People with diverse skills
working together for a
93 Alignment of this report
to the GRI G4 guidelines
effective common purpose on sustainability reporting
nteraction
with our CEO
We believe that ‘Delivering Good Health’ requires more
than just good products. Therefore, we endeavour to
build a robust business created with a long-term
mindset, driven by the best people around processes
that are class leading and assets that are of high-quality
What does sustainability mean Dr. Reddy’s has been publishing which is a noteworthy increase empowerment on the shop The other dimension of our further our innovation agenda;
to Dr. Reddy’s? sustainability reports for past 10 compared to the previous year. floor. This year, we extended growth strategy is our focus on increasing focus on biologics
years. How has sustainability at During the year our focus was the spread of SMTs to more of creating our own portfolio of and developing innovative
Sustainability means meeting Dr. Reddy’s evolved? on energy conservation across our existing facilities. internally conceptualized and proprietary products targeted
the needs of today without our business units which developed novel products to at unmet medical needs; and
compromising the ability of As a company we place a huge resulted in significant savings Our Corporate Social address unmet medical needs. continue to invest in
future generations to meet their emphasis on doing things the thereby demonstrating the Responsibility activities go well We now have a strong pipeline value-added services to
needs. It means protecting our right way - an approach that business case for sustainability. beyond that stipulated by the of novel products in various improve patient outcomes.
natural resources, reducing our permeates every aspect of our Water being critical to Government of India. We stages of development. I am
impact on the environment, business including our sustainability of our business primarily focus on three broad confident of our progress to We take a holistic approach and
using resources very efficiently commitment to the and the greatest means for areas – education, livelihood help patients in their journeys to look forward to a greener
and ensuring renewal of the environment. We take our survival of humanity at large, and healthcare. In FY2015-16, good health through innovative future where the combination
resources that we consume. It responsibility to the planet and we continue to deeply focus on more than 12,000 students in products. of our efforts in terms of energy
means reducing our carbon society very seriously. This enhancing the capacity of rural Telangana benefitted
footprint by using the minimal means that we are constantly rainwater harvest year on year, through our School
amount of energy, materials, finding ways to ensure that the making a positive impact on our Improvement Programme. We
In FY 2015-16, more than 12,000 students in rural
transport and not using way we develop, manufacture, planet through ground water trained over 7,000 young adults Telangana benefitted through our School
materials or generate wastes and market our products has recharge. to help them obtain secure Improvement Programme. We trained over 7,000
that have an impact on the minimal impact on the livelihood. Through the
environment. This is how we do Community Health Intervention
young adults to help them obtain secure
things to create a positive Programme (CHIP), we livelihood.
impact in the society through The SMT program is one of our leading conducted medical screening
the products we make. Our interventions that successfully drives meaningful camps that benefitted over Finally, of course, we are and water conservation,
products are designed and 7,500 people across 145 preparing for change. The reduced use of solvents, waste
developed to bring to life our
change and responsible empowerment on the villages. We celebrate the future of healthcare will be very recycling, engineering
belief that Good Health Can’t shop floor. Week of Giving, annually, in different from what we know it excellence and material
Wait. memory of our founder Dr. K as today. The industry is efficiency will ensure minimal
environment. We are constantly We have also made significant Anji Reddy, in which the entire changing at a rapid pace, and it impact on the planet as we
At Dr. Reddy’s, our commitment refining all our processes to do investments of time and organization participates across is reasonable to expect that the pursue our goal of accelerating
to delivering Good Health goes things more resource resources in strengthening the globe. traditional models as we know access to affordable and
beyond the products we make. efficiently, gradually reducing three foundational aspects of them today will get disrupted. innovative medicines.
It is really about our carbon footprint and operational excellence – What will it take for Dr. Reddy’s We are preparing for this new
institutionalizing a belief and a making our operations much People, Systems & Processes, to assume the leadership world by exploring and piloting G V Prasad
way of doing business. more sustainable. While this is a and Technology. We set out to position in India's concepts based on deep Co-Chairman & CEO
Sustainability therefore to us continuous journey, I am happy rewire our quality systems from pharmaceutical sector? Is there insights at both ends of the
also means focusing on building to say that sustainability is ground-up. This involved any particular message that you spectrum - from the Science to
a business which is robust, ingrained in the way we work. overhauling our Standard would want to highlight to your the patient experience. These
around processes that are Operating Procedures by stakeholders? are early days yet, but we
best-in-class, and with a What have been the key removing redundancies, expect that our focus on this
mindset that is long-term, while sustainability highlights of FY simplifying, creating better and Dr. Reddy’s today already has a area will prepare us for the
investing in high-quality assets 2015-16? more complete procedures, and strong core business with a future. Dr. Reddy’s has always
and the best people. Over the harmonising the entire system. valuable product portfolio and a prided itself in being a pioneer
years, we have consistently There are several position of relevance in several in the pharmaceutical industry.
focused on delivering good accomplishments that we are We made changes in our markets. Our current portfolio We will continue to explore the
health to those who need it, very happy about. For instance, organization design to focus on of complex generics and frontiers of our industry.
meeting the unmet needs of all our plants are designed for the quality of our products biosimilar is very valuable to
patients and thereby zero liquid discharge, which throughout their life cycle, patients across the world, What are the sustainability
accelerating access to much means that all the liquid waste while also providing vital because of the affordability and opportunities that you envisage
needed medicines. We are and effluent generated is integration between product access to expensive medicines Dr. Reddy’s to encounter over
building an organization on the treated within the premises and development, quality and that we provide. Our effort will next three years?
foundation of operational reused. We upcycle 86% of our manufacturing on an ongoing be to strengthen this important
excellence, with a strong organic waste by identifying basis. portfolio on one hand, while Our priorities over the next
innovative products pipeline and supplying it to other globalizing these assets to three years will be on: being the
and a sustainable business industries, who can use it as The SMT program is one of our maximize the reach of our first to market with
model that is value-accretive raw material. Today, we meet leading interventions that medicines to patients who need “tough-to-make” products and
for all our stakeholders. more than 13% of our energy successfully drives meaningful them around the world. differentiated formulations;
needs from renewable sources change and responsible globalizing R&D efforts to
09 | Interaction with our CEO Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 10
hat we are today
As a responsible player in the pharmaceutical industry, we have
made significant progress in ensuring good health and we recognise
our role in delivering good health to those who need it, and to
promote wellness among them.
Dr. Reddy's is a global organisation with offerings spanning the entire

pharmaceutical value chain. These include active pharmaceutical
ingredients, branded formulations, generic drugs, biologics and
specialty products. Our businesses are designed to deliver Good
Health by accelerating access to affordable and innovative
medicines.
Our businesses Biologics
Proprietary
Products
Custom
Pharmaceutical
Services
Patient centricity is core to our approach and we strive to build awareness Biologics, or biologically Our Proprietary Products We have one of the largest
among the practitioners, patients and their families to help them take right synthesised medicines, are business focusses on custom pharmaceutical
increasingly preferred for the developing differentiated services business in India. We
decisions and participate in their own care. We work tirelessly to create an treatment of diseases like formulations that present offer end-to-end product
environment of innovation and ensure that patients across the world gain cancer and auto-immune significantly enhanced benefits development, manufacturing
access to affordable medicines. We carefully design our product mix to offer disorders. Our biosimilar, in terms of efficacy, ease of use services and solutions to
generic equivalents of the and the resolution of unmet innovator companies. Our
solutions for unmet medical needs and create better access to medicines. innovator's biologics, offer patient needs. For instance, this clients have access to the best
affordable yet equally effective involves developing a new technologies and a global
alternatives. Dr Reddy’s leads dosage of a current drug or new delivery network. We have a
the industry with four biosimilar combinations of synergistic well-earned reputation of
products currently marketed medication. The aim is to bringing innovations to the
Over the Active and an extensive development improve the patient's holistic market quickly, efficiently and
Generics pipeline. experience with our medicines, economically
counter Ingredients
so as to strengthen compliance
with the therapeutic regimen
and ensure positive outcomes.
Our Generic Formulations We actively develop We began as an Active
business offers more than 200 appropriate over the counter Pharmaceutical Ingredients
high-quality generic versions of products that do not (API) manufacturer and have
expensive innovator medicines necessarily need a doctor's consistently built on our
at an affordable cost in over 20 prescription. We make and strengths in this area through
countries around the world. market Over the Counter (OTC) the years, becoming one of the
Generic Formulations, including medicines in the areas of pain top producers of APIs in the
tablets, capsules, injectable, management, dermatology and world. During this journey, we
and topical creams, is the allergy management areas, and have developed deep technical
largest part of our business gynaecology. In the coming strengths in the development of
portfolio, making products years, we will continue to complex APIs such as steroids,
across the major therapeutic explore offering OTC versions peptides, complex long chain
areas of gastrointestinal of our generic products as synthesis and oncology
ailments, cardiovascular regulations allow.
disease, pain management,
oncology, anti-infective,
paediatrics and dermatology.
13 | What we are today Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 14

Our therapeutic focus Anti-Diabetic Dermatology
Pain
Management
Going beyond the pill: Over the last three decades, we have evolved from a Dr. Reddy’s has a number of Dr Reddy’s has proven Dr. Reddy’s has a number of
established products like expertise to develop solutions established products – both
maker of active Ingredients to a patient-centric company with a global Metformin, Glimepiride, for health conditions such as generic and branded generic –
footprint. Our development efforts also focus on creating newer Glicazide and their Seborrheic Dermatitis, that address a wide range of
combinations as well as exploring new delivery mechanisms to improve combinations in its portfolio, to Psoriasis, pain conditions. Products such
ensure good health to diabetics. Corticosteroid-responsive as Nise, our brand of
patient comfort, convenience and efficacy. Many of our development Dermatoses, various types of Nimesulide, is one of the top
efforts focus on initiatives to Dermatitis, Actinic Keratosis, 300 brands in the Indian
help improve patient Rosacea, Warts and Acne. In pharmaceutical market, for
compliance. For example, we fact, some of our OTC products instance. Apart from
successfully developed a in the area of trichology and Nimesulide, we have a number
Gastro- Cardio- patient-friendly dosage form of hair regrowth are leading of other products including
Oncology
enterology vascular Metformin that was easily brands in their own right. Ketorolac and Hyaluronic acid
swallowed, and helped the that form a significant part of
patient stick to the prescribed our portfolio.
We have developed a broad Dr Reddy’s has developed a Changing lifestyles and dietary treatment regimen.
range of high-quality cancer broad portfolio of acid patterns are causing an
care medications. Across the suppressive medications to unprecedented surge in the
spectrum of cytotoxics, address Gastroesophageal incidence of cardiovascular
targeted therapies and reflux disease (heartburn), and diseases, including
supportive care, our range is other gastrointestinal disorders hypertension. Responding to
designed to effectively combat such as irritable bowel, these needs, we have
cancer and the side effects diarrhoea and constipation, developed a wide and varied
associated with the therapy. which are becoming widely portfolio of anti-hypertensive
Oncology is also the field prevalent worldwide. We have medicines to bring good health
where we’ve successfully recently ventured into to the millions affected by this
demonstrated our cutting-edge Hepatology segment to address condition.
research and development the patient needs of Hepatitis B
capabilities. and Hepatitis C, providing
affordable medications to more
people.

Our value chain Performance highlights
Research and
Development
6.3 %
412
Reduced
specific Social
energy impact
consumption investment INR million
increased to
Ingredients Product
sourcing manufacturing
Millions
impacted through programs
like
Green
Product Operating
SIP, CHIPS chemistry
packaging procedures Helped to reduce
and and order waste, use of
13.6%
Renewable
warehousing management energy toxic solvents and
usage across conserve water
Dr. Reddy’s
Patient
management
INR million 213
invested to reduce environmental
adversities from disposal of waste
and care

bout this report
We have spearheaded an integrated approach for measuring,
managing and disclosing our environmental, social and economic
impacts to our stakeholders.
About this report Engaging our stakeholders
Dr. Reddy’s has been at the forefront when it comes to disclosing information Stakeholder engagement is an important aspect of our sustainability journey
on its triple-bottom-line. We are the first Indian pharmaceutical company to and is carried out across our business through different functions and
be registered under Global Reporting Initiative (GRI) database. operations, as described in this report.
We published our first Safety, the report is sourced from our inputs on the report, please We firmly believe in an inclusive Engaging with these As a result of this dialogue, we
Health and Environment (SHE) various systems as well as from write to Mr. Alok Mehrotra at participatory approach that stakeholders helps us establish have been able to draw linkages
Report in 2001, and have been respective plant locations. alokm@drreddys.com to share values the voices of our and maintain an inclusive into defining the materiality
regularly publishing our Though we have presence in 26 your feedback. stakeholders. relationship with them. While assessment process for our
Sustainability Reports since countries, for the purpose of the inputs from our business. This helps us in
2004. With the guidance from this report, to describe our Our key stakeholder groups stakeholders help us putting the lens over issues of
our senior management, we endeavours and impacts of our The report has been include our patients, investors, understand their needs and importance to our business and
have gone for third party initiatives on environment and prepared in governments and regulators, expectations, addressing their to our stakeholders and
assurance for our Sustainability society, we have defined our employees, business partners, concerns help us to establish formulating our overall
Report of FY 2013-15 and we significant locations of
accordance with suppliers, local communities lasting partnerships based on sustainability strategy.
continue to do that in this operation as in and around our the guidelines of and health professionals. trust. We are striving to embed
FY 2015-16. manufacturing facilities located the Global their concerns while designing
primarily in Andhra Pradesh, our key sustainability focus
Since inception, we have Telangana and Himanchal
Reporting Initiative areas.
always operated in a safe and Pradesh. (GRI G4)
responsible manner, Framework’s ‘Core’
consistently demonstrating our There has been no significant
commitment to responsible change in our operations and
option.
corporate citizenship. Though supply chain in the FY 2015-16 Employees
inclusive growth, environmental in terms of location, closure or
stewardship and effective expansion. We recognise the
stakeholder engagement, we need to further strengthen our
Sustainability is not
new to us; and this Modes of engagement Topics and concerns
now focus on ensuring that measurement systems for
Good Health is delivered to our certain indicators and we are report represents Organisation Health Index Occupational health and
patients with clear and tangible currently establishing systems
sustainability benefits across to capture a wider set of
Dr. Reddy’s 10th formal Publications (in-house): safety
stakeholder groups, as metrics. Case studies have disclosure on our Around Dr. Reddy's (Monthly) Career planning and
| Elixir (Quarterly) development
described in sections of this been used to further illustrate non-financial Intranet (Round-the-year) Market based compensation,
report. our company’s approach to
sustainability.
performance and CEO & COO benefits and amenities
The scope of this report covers impact. Communications (Quarterly) Employee Welfare
our operations across India and We welcome your valuable 360◦ feedback Collective bargaining/
the reporting period considered Celebrations freedom of association
is from April 1, 2015 to March Sustainability focussed Diversity at workplace
31, 2016. Where possible we interviews and Focus Groups (gender, ethnicity, disability)
have provided comparative Circulation of sustainability Contract labour management
data from the previous report practices
reporting period. This report Employee satisfaction
has been developed with a surveys
commitment to disclose our Team building workshops
sustainability performance Capacity building and
transparently. training
Grievance redressal
The information represented in
mechanisms
21 | About this report Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 22

Patients Government & Regulators
Modes of engagement Topics and concerns Modes of engagement
Dr. Reddy's Foundation for Affordable medicines Face to face meetings with Compliance
Health Education (DRFHE) Access to healthcare ministries and regulators Energy & water consumption
meets Emergency medicines Structured engagements & conservation
Mobile Medical Van - Life At Cure of difficult diseases through audits Climate change impacts
Your Doorstep Participation in forums/ Socio-economic impacts
Living Well programmes in seminars Green growth
association with Art of Living Policy Advocacy Pollution prevention
Sparsh
Investors & Shareholders Communities & NGOs
Modes of engagement Topics and concerns Modes of engagement Topics and concerns
Investor and analyst meets Economic performance Direct engagement at facility Infrastructure development
Industry forums Sustainable wealth creation Dedicated CSR team Education & healthcare
Presentations Risk management Initiatives and healthcare Environmental protection
Annual / Sustainability report Responsible investment projects Employment opportunities
Emails on financial results Sustainability reporting and Visits and camps & Employability
Corporate website disclosures DRF - Creating Sustainable Human rights
Quarterly and annual results Investments in new products Livelihoods
publication and processes DRFHE
Earning calls with analysts Roundtables and workshops
and investors
Business Partners & Suppliers Healthcare Professionals
Modes of engagement Topics and concerns Modes of engagement Topics and concerns
Face to face interactions Economic growth DRFHE – PG Diploma in Employability and

Vendor meets Business ethics Health Management employment opportunity
Strategic business partner Transparency Case Manager's programme Career planning and
training and development Status of Compliance for cancer counselling development
Training and development of Inner Circle - relationship
partners and suppliers building programme
Environmental footprint of Abhilasha - nursing
operations efficiency
Social accountability Sarathi - doctor's assistant
programme
23 | About the report Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 24

Validating material issues Defining boundaries
We have adopted an approach to sustainability management, focusing on Going forward we will expand our materiality assessment process to include
materiality: identifying economic, social, environmental and governance a broader sample of both internal and external stakeholders, revisiting the
related issues that matter the most to our business and to our stakeholders. issues that may have a significant impact on our business.
We have adopted an approach issues that are rated as high by issues raised by the local
Sustainability Management Material GRI G4 Aspect
to sustainability management, most of them) community and key
Focus Area Approach Aspects Boundary
focusing on ‘materiality’, based expectations of the employees,
on the GRI G4 guidelines. We Conducting a brainstorming etc. Ensuring robust pipeline of Economic Internal and
understand materiality is about session on materiality with complex generics as well as our Performance, Indirect External
identifying economic, social, about 30 representatives of These inputs were then Affordable and new proprietary products for Economic Impacts
environmental and governance the middle management of consolidated and reviewed by Innovative medicines unmet medical needs; custom
pharmaceutical services
related issues that matter the different Formulations Plant the management to validate Dr.
most to our business and to our and API Manufacturing Reddy’s sustainability focus Safety, Health and Environment Energy, Water, Internal
stakeholders. locations at Hyderabad, areas as listed below. The Policy, ISO 14001 certification, Emissions, Effluent
Visakhapatnam and Baddi. The exercise has served as a guiding Environmental zero discharge facilities, and Wastes, Materials,
In FY 2015-16, we have session was conducted at Dr. tool for us to focus our Management and Programme to Achieve Cost and Overall
Capabilities Excellence (PACE);
validated the key focus areas Reddy’s corporate office and sustainability disclosure around Climate Change
increasing the renewable energy
based on the following: all the plant locations were these material topics and mix, recycling waste, carbon
connected through video strengthen our monitoring and reduction initiatives
Face to face interactions conferencing. The team reporting practices. Ìn
guided by a structured rated the universe of harmony with our six Code of Business Conduct and Employment, Ethics and Internal and
Ethics; using technology that Integrity, Occupational External
questionnaire with 17 sustainability issues as high, sustainability focus areas, we Being an Employer allows us to redeploy our Health and Safety,
representatives of senior medium, low against have identified nine pillars of of Choice human resources towards value Training and Education,
leadership and functional Dr. Reddy’s Business Success sustainable operations with added and more productive Diversity and Equal
heads (including the Factors (e.g. brand defined goals and clear targets, work; SMTs, expanding training Opportunity, Freedom of
chairman and co-chairman) value/reputation, cost aimed at securing positive and development initiatives. association & collective
bargaining, Child labour
at the corporate office who savings, access to new impacts across sustainability
also acted as proxies for our markets etc.) as perceived by parameters. Building an organisation on the Products and Internal and
external stakeholders them. foundation of operational Services, Economic External
–especially the patients, Product excellence to ensure product Performance
investors, and the Face to face interactions with Our material issues: Responsibility quality through structural changes
communities. The senior the plant or operations heads, across product life cycles by
providing vital integration
management interactions representatives of Human
were designed to elicit the Resource (HR) and CSR teams
Affordable and between product development,
quality and manufacturing
material aspects for the and employees from Innovative Medicines
organisation and how the management and Environmental Local sourcing and improving the Procurement practices, Internal and
aspects are impacting the non-management cadre (e.g. capacity and capabilities of local Supplier environmental External
Management and Sustainable producers; optimisation of the assessment, Freedom of
stakeholders within and Self-Managed Teams or
outside the organisation. SMTs) at different plant Climate Change Sourcing supply chain based on forecasting association & collective
– I^2 Intelligent Integration; bargaining, Child labour,
locations – API Being an Employer increase in sea shipments; Supplier human rights
Developing a universe of Manufacturing Unit 3, of Choice maintaining optimal safety stocks; assessment
sustainability issues and Formulations Plant 3, API
obtaining materiality scores Manufacturing-Special
Product Continued focus on three Local Communities, External
(high, medium, low) on all the Economic Zone (SEZ), Responsibility broad areas – education, livelihood Indirect Economic
Caring for and heath care; Other projects: Impacts
issues from 13 representatives Formulations Plant -7 to Sustainable Sourcing Communities CHIP, Livelihood Advancement
of the senior management to understand the material
finally arrive at issues of issues from day to day
Caring for Business School (LABS); and School
Improvement Program (SIP);
importance to Dr. Reddy’s (i.e., operations perspective, Communities Increased CSR spend.
25 | About this report Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 26

r. Reddy’s way
We continuously adapt to the evolving nature of societal
needs and remain committed to professional and ethical
business conduct.
Dr. Reddy’s way Our sustainability journey
At Dr. Reddy’s, we firmly believe that Good Health Can’t Wait. We are driven
by an imperative to accelerate access to affordable and innovative medicines
to people who need them. 2004 2005 2006 2007
Pioneering Balancing Internalising Translating
sustainability short-term sustainability principles into
reporting in the Indian profitability principles within actionable steps
With a strong presence in key the markets we serve, we focus We strive every day to pharmaceutical sector with long term the organization
generics markets globally, our our efforts in developing do what matters most sustainability
medicines and services are products to meet the unmet
available in North America, demand; and increase to patients —
Europe and the emerging affordability and accessibility accelerating access to
markets of Asia, Africa and with minimal impact on the affordable medicines
South America. This helps us environment. We remain 2011 2010 2009 2008
stay close to needs of patients, resilient to the needs of patients and finding intelligent
doctors, healthcare providers while creating healthy solutions for unmet Introspecting our Going beyond Crystallizing Integrating
and business partners, ecosystems and strong performance compliance sustainability into sustainability into
therapeutic needs. across key 6 focus areas business strategy
wherever they are. communities.
sustainability
Sustainability at Dr. Reddy’s is Our stakeholders have varied indicators
about creating value. It is about expectations that extend
changing the paradigm of how beyond financial goals and legal
we operate our business and requirements. Our efforts to
understand expectations of our integrate sustainability within
stakeholders, especially operations helps us create 2013 2014 2015
2012
patients. Driven by macro long-lasting value for our
trends and changing needs in stakeholders. Seeding a Triggering strategic Benchmarking Shifting gears from
‘sustainability by actions and operational incremental
design’ approach outcomes, evolving excellence with developments to
across all operations to ‘sustainability in sustainability gold accelerated actions
progress’ standards across 9 pillars of
sustainable
operations
2016
Deepening impact
through strategic
interventions across
sustainability metrics
29 | Dr. Reddy’s way Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 30

Sustainability
Governance
Sustainability
Strategy
Sustainability
Framework
Sustainability focus areas
The globalisation of challenges Demographic shifts including Sustainability is an expansive Environmental, social and governance metrics are managed through
is the signum of our age. They rising population, rise in the lens and it is important that we Dr. Reddy’s sustainability framework, which is implemented and monitored
may manifest themselves as a middle class and ageing identify our key priorities so under our sustainability strategy, driving the 9 pillars of sustainable
lack of security, wealth, health, population demand new that we can align time,
happiness, potable water, fresh directions in the delivery of resources and investment to operations. By tailoring our approach with specific operational goals,
air, or fertile soils at many healthcare. We align our actions deliver triple-bottom-line Dr. Reddy’s has woven the principles of sustainability into all our operations.
levels: personal, local, regional, taking into account these impact. We narrowed in on our This helps infuse ownership of our sustainability goals across all of our
and national. Defining these externalities and accordingly material sustainability issues
challenges and integrating them develop approaches to based on surveys, interviews operations.
into our governance model delivering good health while and desk research from our
makes it necessary to redefine minimising our impact on the patients, clients, employees,
our purpose and how we environment. We have crafted a regulators and NGOs.
measure success. We see the strategy “Dr. Reddy’s Way” to Affordable and Product responsibility Environmental management
evolution of corporate gradually deepen sustainability Our Sustainability Framework is innovative medicines and climate change
governance as vital to building thinking with our business defined by focus areas that are Patient-centricity is vital to our
sustained value by seamlessly philosophy. aligned with our principal By reducing costs through product responsibility We have institutionalised an
integrating environmental and business and operational risks, efficient use of resources and approach. To monitor the 'Environmental Commitment
social risks and opportunities Through this approach we seek informing our sustainability processes we strive to push efficacy, safety and stability of Statement' that articulates
into long-term business to build world-class, patient strategy. A solid review of down our product price. We our medicines, we have in place measurable targets for each key
strategy. centric operations that are a material sustainability issues have broadened our generics a competent environmental performance
source of competitive forms the basis of sound footprint by introducing new pharmacovigilance team indicators – energy, emissions
We have firmly embraced advantage to help us deliver on sustainability disclosure; and products, entering new markets responsible for detection and water and waste. Our
sustainability principles in our customer expectations, safety, we adjust the focus areas, as and penetrating deeper in prevention of any adverse environment stewardship
day to day operations by quality, cost and environment the external and business existing ones. We work towards effects of our products. All our extends beyond our premises
striving to strike a balance through highly engaged context changes, to ensure that enhancing the efficiency and products meet regulatory and and we actively educate and
between economic success, employees by leveraging it still works as a useful toolkit efficacy of medicine by safety standards and approvals, encourage, our vendors and
environment protection and technology. We have to help us manage our developing differentiated ensuring consistent quality partners to adopt environment
social responsibility. Over the transformed our business to sustainability agenda and formulations that facilitate easy from development and dispatch friendly practices.
years we have implemented infuse value across healthcare continuously improve our and calibrated dosages to to consumption.
policies and programs to ensure services – from the pill to the performance. enhance patient comfort. Caring for the communities
we remain focused on our core patient – helping people across Sustainable sourcing
objective of delivering good the world gain access to Our Sustainability Framework Being an employer of choice We pursue community care
health. affordable healthcare and get comprises 6 focus areas and From local sourcing and raising with the same efficiency and
back to good health. these are closely mapped with Every individual's effort is awareness to empowering them meticulousness with which we
our 9 pillars of sustainable valued, nurtured and rewarded. through training, from pursue our business. Our social
operations so that our An egalitarian ecosystem, equipping them with various responsibility begins right from
sustainability focus gets purpose-driven work culture, tools and technology to community engagement, need
reflected in our day to day cross-functional growth extending resource assistance. assessment, intervention
operational endeavours. opportunities, human dignity We proactively help our supply development, pilot run projects
and work-life balance are key chain partners to raise their and SOP definition, to scale-up
ingredients of our employee sustainability quotient. We and collaborations. We go
value proposition. We focus on strive to optimize our supply beyond philanthropic
identifying, selecting and chain to streamline costs, assistance to create real
nurturing talent from all groups helping us deliver affordable opportunities, building
including those disadvantaged healthcare solutions. This capabilities and empowering
and provide them with a canvas enhances their sustainability those who need them.
to shape their professional and performance and productivity.
personal goals.

The nine pillars
Environment Productivity Community
Fresh water consumption Standard manning number Community investment at INR

People Safety Quality reduced by 6.87% overall at derived for all processes based 412 million has doubled in
Dr. Reddy’s. on Manyard Operation FY 2015-16.
Sequence Technique (MOST) to
Hired 2500 talented rural youth Reported zero fatality for 2 In formulation plants: optimize human resource in
through Self Managed Team consecutive years. 27% decline in "waste to Formluations. Health: Community Health
(SMT) route transforming their Introduced closed loop landfill" in FY 2015-16. Intervention Programme
lives. operations. reached out to 145 villages, 0.2
Installed aerosol fire 368 manpower resources million population.
suppression systems at Invested INR 213 million for redeployed for productive
Over 100 leaders have formulation units for better fire Minimized operational errors advanced treatment and safe utilization in Formulations using
completed the New Horizon and safety management. by introdcution of recipe based disposal of waste. MOST. Livelihood: Supported 18,000
Leadership Development systems, automated cleaning. farmers with technology
Program (NHLP) since its through LABS for Farmers
inception in 2012. Advanced sprinkler systems Nearly 3,000 TPA of potassium Savings from yield (LABS-F) program.
implemented at API Total 34 quality improvement salt generated from improvement in Formulations-
manufacturing SEZ. projects implemented based on evaporation processes, is INR 240 million against a target
Over 1400 employees are "Define, Measure, Analyse, disposed to authorized of INR 150 million for Education: benefitted more
engaged in higher education Improve, Control" (DMAIC) recyclers to produce valuable FY 2015-16. than 12,000 students in rural
programs. Implemented safety across methodology. fertilizers. Telangana through the School
value chain from R&D till Improvement Programme.
product manufacturing,
Diversity at API manufacturing packaging and warehousing. In API manufacturing: 96.3% of the organic waste
increased from 7.6% to 10.3%. generated in API manufacturing Under the ageis of Swacch
Increased compliance through is used as auxiliary fuel in Bharat, conducted sanitation
Near miss reporting has implementation of IT cement plants. assessment in 167 schools and
Overall attrition reduced from significantly improved. innovations. deployed sanitation assistants
22% to 16% at API Implemented 31 energy in 59 schools.
manufacturing. at API manufacturing conservation projects & saved
from 707 in FY 2014-15 to 3263 INR 63.54 million.
in FY 2015-16
at Formulations
from 3674 in FY 2014-15 to
4208 in FY 2015-16.

Creating sustainable livelihoods
Availability Continous Engineering LABS was launched in 1999 to enable the aspirants to face the
address the needs of world confidently, they are also LABS is operational over
Improvement Excellence economically weaker and trained in various life skills such
socially constrained youth
(18-35 years) to enable them to
as positive thinking, self-esteem
communication, team building,
132 centers
New products launched from Total savings of INR 458 million Recipe management across India
formulations: Memantine, from yield improvement, waste implemented in Formulations gain a foothold in the decision-making, Strength,
Pramipexole, Pantaprozole elimination, green & black belt leading to avoidance of manual competitive job market. LABS is Weakness, Opportunities and
(China), Esomeprazole, projects in Formulations. errors, reduced physical aimed at vocational training and Threats (SWOT) analysis, goal In FY 2015-16, we trained
Rabeprazole (Australia). checks, robust data soft skills development in an setting, gender issues, time and
management. environment of interactive money management. As the 7,128 young people
INR 55.7 million savings learning and mentoring that ability to speak fluently in under LABS through our
Global Generics Intelligent realised from 120 improvement strengthens their inherent English is an important supported centers
Integration (i^2) project was a projects. Implemented Level 2 capabilities. Operational in over prerequisite at the workplace, a
recipient of SAP ACE award for Integration in Formulation 132 centers across India, this is ‘Communicative English’
supply chain excellence. business unit that facilitates one-of-its kind business school module has been designed to Since inception more than
Employees trained in Lean 6
Sigma at Global Manufacturing
direct data transfer from the
instrument to the operator
tells the collective success
story of tens of thousands of
give the aspirants practice in
public speaking and
290,000 young
marginalized youth across the
Reduction in average inventory Organization - 185 Green Belts, system which eliminates economically disadvantaged interpersonal communication
country graduated through
by 20 days. 578 Yellow Belts, 1237 White manual interventions. youth, and of their journey to techniques based on real-life
LABS with specialized skills and
Belts and 20 Black Belts. self-respect and financial situations. The aspirants are
are economically independent
independence. also put through a
Lower cost of supply chain Implemented direct Data comprehensive apprenticeship
operations by optimizing Launched Engineering Star Aquisition System in API LABS training courses are of training, which helps them
transportation, automation of Caps - additional responsibility manufacturing that has led to 3-4 months duration, in which experience real-life work
planning, execution & reporting allocated to a work team reduced human errors and the aspirants are given situations. In FY 2015-16, we
across the entire global supply member for a year in the area of optimised time of operation. technical inputs prepared in trained 7,128 young people
chain network. Engineering, as a part of broad consultation with industry under LABS through our
skilling and empowerment. experts and professionals. To supported centers.
Integrated preventive and
breakdown maintenance and
calibration in SAP leading to
increased compliance,
improved productivity in
Formulations.

Integrating the supply chain Mitigating environmental impacts
to deliver quality to deliver cleaner products
Traditionally companies Integration” project. By better characteristics such as sales Eslicarbazepine acetate is which by design, yielded a Focus on waste reduction,
maintain excess inventories or integrating the supply chain for value, demand variability and considered to be a second maximum of 50% conversion. operational efficiency
use firefighting options like air our Global Generics business at plant volume and system based generation drug to This process left behind almost improvements and carbon
freights & rush order Dr. Reddy’s, we are able to capacity planning. This has oxacarbazepine and a third the same quantity of material as footprint reduction
processing to react to optimize efficiencies and created complete viability generation drug to waste, along with a significant
fluctuations in customer needs provide our medicines where across the supply chain since all carbamazepine, meant for quantity of liquid and solid
or capitalize on unforeseen and when they are needed. demand inputs, supply treating epilepsy. As a pro drug effluents. We adopted an Implemented 31 energy
market opportunities. This constraints and material plans to (S)-licarbazepine, asymmetric reduction method, conservation projects across
approach entails high cost of Translating supply chain best are inbuilt into one system, Eslicarbazepine acetate is allowing for 80% yield. We also various business units, and
stocking inventory & practises into tangible business leading to faster and effective evolved in order to have avoided a significant amount of accrued savings of
63.54 million
operations, carrying the risk of success was realised by decision making to deliver on improved efficacy and safety waste. As a result, our
obsolete inventory write-off, leveraging technological our promise of Good Health preventing the formation of manufacturing process has
which are not viable to sustain capabilities, where end to end for all. toxic epoxide metabolite. Our become energy efficient. during the year
and thus there exists a struggle integrated planning solutions previously reported synthesis
to reach the desired supply like SAP Advanced Planning After the successful involved a resolution strategy,
Renewable energy usage
13.6%
chain optimization between and Optimization (SAP APO) & implementation of i^2, we have
customer service levels, cost & execution systems like SAP ERP been able to maintain a across
inventory. Well-designed Central Component (SAP ECC) customer On Time, In Full Dr. Reddy’s is
systems are essential to realise are embedded with the (OTIF) of 95%+ in key markets
seamless end-to-end supply differentiated pharma specific with a reduction in average
chain integration of planning & supply chain optimization logic inventory and lower cost of
execution. & business rules. Some of the supply chain operations by
key features of our integrated optimizing transportation &
To circumvent these challenges, system include – forward through automation of
we have leveraged demand projections based on planning, execution & reporting
technologies and tools through past consumption and market across the entire global supply
the “i^2 - Intelligent intelligence, mapping chain network.
Maintained a customer On
Time, In Full (OTIF) of 95%+
in key markets
Seamless end-to-end supply

chain integration of planning
& execution
Reduced inventory and

lower cost of supply chain
operations by optimizing
transportation & automation
of planning, execution &
reporting

Making an impact with a diverse Leveraging technology to deliver
and empowered workforce better quality
We at Dr. Reddy’s periodically
renew our HR strategy to better
significant shifts in their
development journey and the
policies such as flexible
working hours pre and post
We see digitization as a means
to our goal of affordable Reduction of total calibration
orders from 41225 to 21697 in
engage with people and drive organization is benefiting maternity, organizing regular medicine and accelerated
productivity across our through unique breakthrough health talks for work-life access. It helps improve
21,000-plus employees projects that have been balance, we were able to foster productivity, boost quality and
worldwide. Currently, our HR
Strategy is designed to place
undertaken. a working environment
conducive to women’s needs.
enhance safety, while reducing
costs. We have sped up digiti-
Formulations through digitization
our People Managers at the Dr. Reddy’s is an employer of zation across the entire value
heart of all our employee choice for women. We lay chain - be it drug discovery,
practices. In this, we have special emphasis on helping our clinical trials, preventive main-
Over 100 leaders have
stepped up our investments in women colleagues grow tenance and calibration, opera-
leadership development and
talent management programs.
professionally and personally as
a part of our strategy to attract
completed the New Horizon
Leadership Development
tions or distribution. To drive
these projects, a digitization
2784 log book reduction in
formulations through SOP
Program since its inception in
Our focus on leadership and retain the best talent in the project structure is in place.
2012.
development and talent industry. This year we made The structure comprises plant
management was further
strengthened this year. We
distinct progress in this area
and rolled out our enabling Attrition rate for women
teams, who report to the
Manufacturing Execution
harmonization
continue to invest in our policies and programs to help reduced from 11% to 7% this System Centre of Excellence
leadership development enhance gender diversity. By year. (MES CoE), which in turn
program (NHLP) which is built identifying potential roles for reports to the Central Steering
on the four tenets of ‘Lead Self, women, setting up on-site 12 female centric hiring drives Committee of Digitization
Lead Others, Lead Change and crèches, promoting visibility conducted at API Project Management Office.
Reduced ~6610 man-days

Lead Business’. The participants within the organization and manufacturing. These efforts are implemented
are beginning to show launching women-friendly through three significant
projects – Manufacturing
Execution System, Laboratory through mobile app for
Information Management
System and Learning Manage-
ment System.
preventive maintenance
Our innovation in the space of
development of mobile applica-
tion for preventive maintenance
and calibration activities in
Formulations has led to minimi-
zation of manual error, paper-
less operation, and reduced
man-days.

Corporate governance Risk
Management:
Risk
Prioritization:
Risk Appetite
Setting and
Monitoring:
We have incorporated policies and practices within our organisation to A Finance, Investment and Risk The ERM team focuses on The ERM team regularly
Management (FIRM) Council identification and prioritisation monitors risk exposure against
ensure that the highest levels of ethical conduct, by all employees and has been instituted to help the of key business, operational and a pre-determined risk appetite
management are adhered to. Enterprise Risk Management strategic risks. This is carried for key risks including
(ERM) team prioritise out through structured environmental, social ad
organisation-wide risks, review interviews, surveys, on-call governance parameters. Any
and steer mitigation efforts in discussions and incidents risk exposure or event that
Dr. Reddy’s is committed to Enterprise Risk Management mitigation with the senior line with our risk capacity and reporting. Risks are identified at exceeds threshold is brought to
ensuring that its operations are management and the board. appetite. The Chief Risk Officer the unit, function and the attention of the Board or the
carried out in an environment All businesses face uncertainty, provides periodic updates to organisation level and Management Risk Committee.
built upon fairness, and the challenge for Provides a framework to the FIRM Council and the Risk categorised into four risk For financial risks, the risk
transparency and management is to determine assess and monitor risk Committee of the Board, groups – Financial, Reputation, appetite is linked to the
accountability. We believe that how much uncertainty to capacity and risk appetite. including - Quarterly updates Regulatory and Safety & Company’s Earnings Before
fostering a culture of integrity accept as it strives to grow on the progress of mitigation of Environment. Finally, risks are Interest, Taxes, Depreciation
will help us build trust amongst shared value. Uncertainty Develop warning systems for key risks and specific ERM prioritised on the basis of their and Amortisation (EBITDA) and
our stakeholders. presents both risk and any breach of the defined initiatives carried out during likelihood, severity and velocity for operational risks such as
opportunity, with the potential risk level. the year. Safety/Health & Quality; it is
At Dr. Reddy’s the Board of to erode or enhance value. linked to pre-determined Lag
Directors provides direction, Enterprise Risk Management Provides an analysis that a Key Risk Indicators.
supervision, counsel and (ERM) enables us to effectively formal and focused risk
guidance towards defining the deal with uncertainty and management process is
Company’s long-term strategy. associated risk and opportunity, facilitating reduction in
The Board Committees focus enhancing the capacity to build residual risks.
on specific areas and make value. ERM demonstrates the
informed decisions within the company’s precautionary
authority delegated. Our approach towards operational
corporate governance report planning across the product We firmly believe that
can be found in the Annual value chain.
Report for FY 2015-16.
timely disclosures,
In India, the Securities and Dr. Reddy’s follows the transparent accounting
Exchange Board of India (SEBI) Committee of Sponsoring policies, rigorous
regulates corporate governance Organizations of the Treadway
for listed companies. Commission (COSO) ERM
internal control systems
framework to effectively and a strong and
Dr. Reddy’s is in full compliance manage risk across the independent Board go
with all the applicable organization. Risks are
provisions of the SEBI’s aggregated at the unit/function
a long way in
corporate governance norms. It and Organization level by risk preserving shareholder
is also in compliance with the groups bucketed into Strategic, trust while maximizing
appropriate corporate Operational, Financial and
governance standards of the Compliance categories.
shared value creation”
New York Stock Exchange
(NYSE). Objectives:
Our compliance report on Proactive identification and

corporate governance can be highlighting of risks to right
found in the Annual Report for stakeholders.
FY 2015-16, along with
'Management Discussion and Facilitates discussions
Analysis' and 'Additional around risk prioritization
Shareholder Information'. and risk

elivering on
our promise:
Good Health
We are in the business of treating diseases and
saving lives; and are driven by a vision to
accelerate access to affordable and innovative
medicines to people who need them.
The promise of Good Health
specialists have with their emotional stress that often
patients, we devised a overwhelms them.
mobile application called
Practice Aid for Cancer Metsmall – Putting patient
Treatment (PACT) to alleviate comfort first:
some of the problems that Making an effective
We are driven by an imperative to accelerate access to affordable and doctors aced, while treating medicine is not enough.
innovative medicines to people who need them. Our strong presence in key their patients. Every aspect about the drug
– the form, the size, and even
generics markets globally, helps us stay close to needs of patients, doctors, SAHYOG - Supporting the behaviours surrounding it
healthcare providers and business partners, wherever they are. prostate cancer patients: needs to be considered from
Prostate cancer can, at the patient’s point of view.
times, leave the patient Diabetes usually requires
stressed, overwhelmed or medication and a lot of
FY 2016 Filings and Launches confused. Sahyog is a patient patient care. Metformin is
support program intended to the first-in-line medicine for
13 Abbreviated New 50 Drug Master Filings 51 New Products extend information, support the treatment of patients
Drug Application were launched in and advice patients affected suffering from Type-2
(ANDA) Filings and 1 8 Drug Master Files FY 2015-16, of by prostate cancer. diabetes. Working together,
New Drug Application (DMF) were filed in which 3 are in our R&D, formulations, IP and
Liv Positive – ensuring robust marketing teams came up
(NDA) the US. NAG, 9 in EUG, 22 treatment of Hepatitis B with a new form of the
in Emerging patients: medicine, in a smaller pill but
As on March 31, 2016, As on March 31, 2016, markets and 17 in For patients diagnosed with with similar impact and
82 generic filings are there were 768 India. Hepatitis B, a lack of delivered it to market as
pending for approval. cumulative DMF awareness of the disease and quickly as possible.
filings. non-adherence to prescribed
therapy are among the most Redesigning drug packaging,
Of these 79 ANDAs, common cause for lapses in keeping patients’
52 are Para IV filings treatment and care. Liv convenience in mind:
and we believe, 18 to Positive is a patient support Our innovative
have ‘First-to-File’ and education program that patient-centric blister
status. aims to improve adherence packaging brings about
by sending out regular health significant advantages and
tips, lifestyle modification facilitates adherence to
inputs, dosage reminders, medicine and convenience
dos/don’ts, diet charts, for the patient. The new
Our patient centric approach Patient-centric interventions Cancer patients often counselling and diagnostic packaging features include:
experience significant stress support. Colour coded pack
Understanding patient and Making advanced cancer as a result of their diagnosis extension: helping patients
partner needs deeply and then diagnostics accessible: and treatment. Our lifestyle Committed to Help, Educate easily identify medicines
developing solutions to meet Non-Hodgkin’s lymphoma is support program for cancer and Encourage Renal Dosage matrix: recording
those needs is central to our a type of blood cancer, patients provides patients – educating Chronic prescriptions on pill pack
purpose. At Dr. Reddy’s, our where the right diagnosis is confidential counselling, Kidney Disease patients: White foil: to enable a
commitment to good health dependent on a complex and psychological and emotional Committed to Help, Educate clearer paper-like reading
goes far beyond molecules and difficult-to-find test called support services for patients and Encourage Renal experience
medicines. We help patients Immuno Histochemistry for to discuss their feelings, patients (CHEER) aims at 14 pills per pack: helping
manage their disease and CD 20.With the aim of needs, and concerns. improving adherence to patients move from a
health conditions through a improving access to this test, therapy for Chronic Kidney monthly to weekly buying
range of support and out-reach Dr. Reddy’s runs a program Practice Aid for Cancer Disease (CKD) patients. It patterns
programs and we are always which helps patients get Treatment - Using does this by helping patients
seeking new ways to improve tissue sample tested with a technology to aid decision better understand and
our products, packaging and renowned laboratory chain making: manage their condition.
services to enhance patient at a reduced cost. Appreciating the fact that Enrolled patients advocate
care. good health is a direct result positive lifestyle changes
Providing lifestyle support of the time and the quality of related to nutrition and diet,
to cancer patients: interaction that cancer to help them cope with
45 | Delivering on our promise: Good Health Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 46
Disease Management and condition, making awareness variety of natural sources - Expanding to emerging (Rabeprazole), among many
Awareness initiatives the first step towards human, animal, or markets others. The success of our
addressing diabetes and microorganism - and may be research organisation
ASSIST - Hair loss associated complications. produced by biotechnology Our Generic Formulations Over the years, these brands
awareness program: methods and other business addresses this urgent have established themselves as can be judged by the
Hair loss is a medical Save The Gen Next - cutting-edge technologies. need by offering more than 200 leaders in their respective fact that we have over
problem and correct Anti-tobacco drive: Biologics represent the high-quality generic versions of categories. Since 2006, we
treatment can only be sought
from a dermatologist. Assist
Save The Gen Next is an
awareness initiative
cutting-edge of biomedical
research and, in time, may offer
expensive innovator
medicines—at a fraction of the
have a successful track record
of commercialising 4 biosimilars 230 ANDAs,
is our endeavor to spread
awareness and educate
dedicated to fulfilling the
dream of a tobacco-free
the most effective means to
treat a variety of medical
cost—in over 20 countries
around the world. In many
in India and other emerging
markets. With a commercial 760 DMFs and
304 patents
patients about the various India. We reach out to young, illnesses and conditions that emerging markets, our presence across 26 countries,
facets of the problem, and impressionable children in presently have no other products are available under a we are looking to further
help them seek proper schools and adolescents in treatments available. We have brand name, such as Omez expand into emerging markets
treatment. colleges with the intent of four products in the market and (Omeprazole), Nise to provide affordable medical
making them torch bearers an industry-leading pipeline (Nimesulide), Ketorol (Ketorolac solutions for unmet healthcare
filed in the last five
Mitr - Lifestyle support to spread the message of spanning oncology, nephrology Thromethamine), Stamlo needs. years.
program for cancer patients: Tobacco-Free India. and autoimmune diseases. (Amlodipine Besylate), Razo
Mitr – a warm and caring
companion is a toll-free Awareness for Life - Lifestyle
helpline which is a diseases awareness program
confidential psychological / for corporates:
emotional support service A program for corporate Our revenues
program for cancer patients. India, Awareness for Life is
Vega Club - Education

program for Inflammatory
aimed at educating
corporates on the causes of
lifestyle diseases, early
INR 154 Billion
Bowel Disease patients: detection, prevention and
Inflammatory Bowel Disease timely treatment
(IBD) is a chronic medical interventions.
condition, which if left
untreated, may manifest into Difficult to produce medicines
more severe conditions.
Vega Club is a patient We focus our work on being Russia and other CIS
support initiative in which
gastroenterologists educate
and counsel ulcerative colitis
first to market with products
that are difficult to make. Why?
These tough-to-make products
9%
patients about the disease. are likely to be very expensive, Europe
11%
Participating patients also and our unique capabilities
share their experiences and allow us to improve North america
success stories, which accessibility to them. Similarly,
motivate participants to
adhere to ulcerative colitis
therapy.
our patient-centric approach
means we tend to focus on
developing differentiated
53%
products that best address
Roshni - Diabetes awareness unmet patient needs.
initiative: India
15%
Roshni aims to bring Biologics
undetected diabetics to light.
Many patients with type 2 Biologics (i.e. biological
diabetes are unaware of their products) are isolated from a
Rest of the world
11%
47 | Delivering on our promise: Good Health Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 48
ustodians of
Good Health
We have spearheaded an integrated approach for
measuring, managing and disclosing our environ-
mental, social and economic impacts to our stake-
holders.
Safety is our priority QbD - Quality by Design
Dr. Reddy’s has well defined Safety, Health & Environmental Policy and QbD is an approach, which we have championed, aimed at ensuring the
Principles in place to motivate our employees to achieve 'Goal Zero' - zero quality of medicines by employing statistical, analytical and risk management
incidents, zero harm to people and zero damage to the environment. methodologies in the design, development and manufacturing of medicines.
Safety forms an integral part of topics to enhance preventive improved and in FY 2015-16 we At Dr. Reddy’s, quality is inbred Today, QbD is spread across all As we advance our mission to
our Code of Business Conduct and precautionary attitudes have achieved an encouraging with care and infused through manufacturing facilities and is deliver Good Health, we are
and Ethics (COBE). Each of our ensuring that safety protocol performance with zero design and to deliver results in-built into our operational exploring new approaches to
employees signs up to the are followed. fatalities. beyond mere product framework. manufacturing that leverage
commitment towards safety, specifications. technologies such as- robotics,
health and environment, every We provide regular training to We have also done exceedingly We are embedding quality as a automation, real-time data
year. all employees on health and well in the space of near miss Our pledge towards continuous way of life by steering the capture and analytics - to
safety in order to safeguard reporting and the statistics improvement and business Quality Management System secure greater patient value
A number of programs and them from any injuries and show our consistent excellence drives us to work right from the top management, through the highest standards
initiatives, such as the ‘Safety accidents. Safety training improvement in this area over toward exceeding these seeding the principles of of quality.
Star Caps’ and ‘Parivartan’ have programs which are conducted the last three years. In this year, minimum standards. It ensures Quality by Design across
instilled a sense of deep for employees and workmen 7471 near miss incidents were consistency, increases operations, adopting global Quality as a way of life
ownership across all levels to are also extended to reported as compared to 4381 productivity, reduces costs and benchmarking
build an organisational attitude contractual employees. Our in the previous year cycle time, facilitates tools, institutionalizing a series Our approach to delivering
that places a high priority on safety statistics have constantly reproducibility, promises of self-checks and world-class products
safety, has zero tolerance greater shelf life, enhances incorporating corrective encompasses the following:
towards violations and drives Nearmiss Reporting (Numbers) audit readiness, and accelerates measures.
awareness at the shop floor. 8000 7471 the organisation's drive to Quality Management System
“Star Cap” is an additional ‘getting it right the first time’. (QMS)
responsibility a team member
7000
Ensuring product safety To deliver Good Health
undertakes in the work team as 6000 We continue to adopt and and quality is of utmost consistently and reliability, a
part of the empowerment master advanced tools such as well-conceived, rigorous
process. It is a transitionary role
5000 4381 Failure Mode Effect Analysis
importance and this Quality Management System
in which team members must 4000 (FMEA), Process Mapping, commitment is (QMS) is implemented across
spend at least a year, to Hazard Analysis and Critical engrained within our our operations. Our QMS
broad-skill themselves, before 3000
Control Points (HACCP), focuses on continual
moving to a Team Leader role. Hazard Operability Analysis
culture and embraced improvement aimed at
This 'broad-skilling' is the
2000
(HAZOP), Fault Tree Analysis by our entire streamlining production,
748
functional expertise the team 1000 (FTA) and Cause and Effect workforce. optimizing processes and
members build in any of the Analysis (CEA). eliminating non-value-adding
0
aspects - Safety, Quality, FY 14 FY 15 FY 16 efforts in production. These
Engineering, Delivery or People
Fire Prevention and Protection
depending which Star Cap role
they take on. In FY 2015-16 we have made significant progress in strengthening our
fire protection and prevention system.
Our safety approach has
evolved into a responsive In Formulations, we have adopted the approach of “mitigation of
framework from 'zero by fire risk at its initial stage” through implementation of aerosol fire
chance' to 'zero by design' suppression system, clean agent localized fire suppression system
through 'Project Parivartan', a and Dry Chemical Powder (DCP) modular fire suppression system.
safety culture transformation
journey. We organise regular In addition, a new fire water pump house has been installed in
Formulations Unit 2, and a Fire Station and Fire Tender have been
workshops and awareness
set up for our Bachupally Campus. An Emergency Response Team
sessions on various safety is available at the Emergency Control Center round the clock
across all Formulations Units.
51 | Custodians of Good Health Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 52

efforts are primarily directed forwarded to the respective a way of life at Dr. Reddy’s. Our approach to engineering excellence encompasses six pillars:
towards reducing variability Business Units (BU) Quality
in process and product Heads for further review and We actively promote Lean
quality characteristics. action. Updates on the Six Sigma Programme, from
contacts and actions taken process to productivity.
Structured governance are shared on a quarterly Digitization Automation Mechanisation
process is in place to ensure basis with the senior Focus on simplicity
that all important quality management. Converting information Automating tasks and Delegating laborious
metrics are reviewed at To ensure seamless into a digital format for processes to enhance tasks to machine, to
different frequencies at operations and minimise better data predictability and ensure dignity of labour
different hierarchical levels in Quality Culture non-value adding processes,
management, reliability production performance, & safety of workers.
the organization and we are simplifying various
and security reduce cost, and Plus, improve the
significant issues are To extend quality as way of tasks across our processes.
increase material and quality and efficacy of
escalated to highest level of life at Dr. Reddy’s, our By simplifying testing
management. employees are not only methodologies, we have not energy efficiency. processes and products
encouraged to follow quality only compressed timelines
Global Quality management guidelines but to also but also saved on carbon
team plays an integral role as consistently see others footprint by reducing the
part of the overarching QMS, taking quality-focused high use of solvents, while
providing end-to-end
management support and
actions, hear colleagues
talking about quality, and to
making man-power available
for more productive tasks.
Lean Predictive Equipment
oversight to ensure effective feel quality in the Manufacturing Maintenance Standardisation
and timely implementation of environment around them. Engineered for excellence
regulatory commitments and Optimising resource Identifying and Delegating laborious tasks
other critical Corrective & Our approach to human
consumption without any addressing issues to machine, to ensure
Preventive Actions (CAPAs) We have been creating resource development invests
loss in quality. before they manifest dignity of labour & safety
across all our operations. a culture in which our in developing our people’s
into unplanned of workers. Plus, improve
minds to unleash their innova-
Quality Compliance employees “live” quality tive potential, rather than breakdowns. the quality and efficacy of
Ombudsperson Process in all their actions. deploying them across mun- processes and products.
dane and routine tasks which
Protected disclosures can be are often better performed by
made through the Quality This grassroots, peer-driven machines. As a result, the
Compliance Ombudsperson approach has developed a benefits to operational excel-
Process. Through this culture of quality, resulting in lence due to improved produc- Automated closed loop systems
process any concerns, fewer mistakes—reducing tivity, better consistency in
events or observations the bandwidth required for quality and shorter turnaround We have upgraded several of our operational processes by leveraging modern innovations in auto-
where quality is corrective and remedial times are evident. mated closed looped systems. These systems provide greater benefits that include real time moni-
compromised can be action– with the aim of toring, enhanced productivity and product quality, minimum human interface, negating contamina-
brought to the attention of getting it right the first time. tion and securing employee safety.
By introducing modern
the senior management. The To this end, we have Automatic closed sample transfer system implemented in Formulations Plant 2 and 3: Transfers
Quality Compliance e-mail introduced behaviour change technologies across our
manufacturing raw materials and dosage samples from In Process Quality Assurance (IPQA) to
and a dedicated hotline is training programs, boot operations we seek to Quality Control Lab and vice-versa. This system can handle samples as well as documents. It has
accessible to all employees camps on quality, conducted replace muscle power reduced movement of people, saving time and ensures that samples are free from contamination.
across our facilities. All employee surveys and
concerns are recorded developed action plans to with machines.
Automatic solvent transfer systems implemented in Formulations Plant 2 and 3: Automatic closed
anonymously and are further strengthen quality as transfer of solvent from solvent yard to day storage, RM warehouse, dispensing area and for coating
machines during manufacturing. This technology handles solvents, measures and controls the rate of
flow and quantity. It provides multiple benefits by avoiding manual handling of solvents, saving time
and prevents manual exposure from hazardous chemicals.
Powder transfer system in manufacturing implemented in formulations plants 3, 6 & 8: Closed

powder transfer system in Granulation – RMG (Rapid Mixer Granulator) charging, FBD (Fluidized Bed
Drier) charging and compression charging. This technology handles bulk densities of powders,
transfers powder from IPC (Inter Process Communication) to machine and in few cases it makes
transfers from one process to another; reducing manual effort, preventing exposure to powders and
improving quality compliances.
53 | Custodians of Good Health Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 54

ommitted to
a better world
We are committed to have a positive impact on the
environment and the society we live in.
Environmental performance
significantly reduce our overall
environmental footprint in
terms of energy and water
consumption and waste
generation. Combining our
efforts in these areas, our total
At Dr. Reddy’s, we firmly believe in doing business responsibly without environmental investment for
taking anything away from the environment that we breathe in and the FY 2015-16 stands at INR 559
Million.
society that we thrive in.
Energy Management
We aim to reduce our specific

Dr. Reddy’s advocates the idea In the FY 2015-16 green energy use. In one of our
energy consumption by 5%
7 % increase in rainwater
of environmental stewardship efforts we actively engaged
every year so as to achieve 40%
and actively supports the Green harvesting with the State Pollution Control
reduction by 2020 (base
Industry Rating Programme of Board to include clean energy
year=FY 10) while specific
Confederation of Indian use as a means for power
energy consumption is
Industries (CII) that evaluates generation for all
calculated as the ratio of
companies on the basis of their In the FY 2015-16 manufacturing operations in the
energy consumed within the
environmental performance. states of Andhra Pradesh,
We have partnered with CII to
carry out a project on
55% ofwaste
the hazardous
generated
Telengana & Himachal Pradesh.
Indeed, this has now been
organisation per million sales.
At the same time, we strive to
increase the percentage share
inventorying product specific were sent for alternative use made a mandatory consent
of renewable energy by 25% in
greenhouse gases to showcase in cement and other condition for all manufacturing
industries our total energy profile by 2020
its relevance and significance operations in the state. In
(base year=FY 10). In FY
from the sectoral perspective. another instance, we have
2015-16, we have invested 91.35
A pilot has been implemented successfully engaged with the
In the FY 2015-16, specific million INR in energy
in one of our units (API Central Pollution Control Board
energy consumption has conservation activities leading 50 48 Specific energy consumption
Manufacturing Unit-2). The unit to obtain approval for (GJ/ Million Sales)
reduced by to savings of 63.54 million INR, 45
was assessed by CII for conducting trial usage of sludge
4.3 million units of electricity,
6.3
certification under the Green generated from our Effluent
Rating System and awarded
% compared to
FY 14-15 Treatment Plant (ETP) as an
1070 kilolitres of furnace oil and 40 39
36
265 kilolitres of high speed 33
Bronze Rating. alternative fuel in the nearby 31
diesel for captive power 30
cement plants. 30
generation. Initiatives include
We are actively engaging
In the FY 2015-16, renewable installation of Air-Operated
environmental regulators in the Our belief in environmental
energy share is Double Diaphragm pumps,
states where we operate to leadership is institutionalised in 20
elimination of vacuum pumps,
bring about policy changes to
put greater focus on cleaner
technologies, processes and
13.6 % as against 10.9%
in FY 14-15
our business strategy in terms
of the ambitious commitments
that we have taken to
use of pumps with lower Horse
Power, installation of energy 10
efficient lighting system (LED
lights with voltage stabilizer),
power savings on air curtains 0
FY 10 FY 11 FY 12 FY 13 FY 14 FY 15 FY 16
etc. across several operations
and merger of power sources of
Formulations Plant 1 and API
Manufacturing Unit 1.
57 | Commited to a better world Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 58

CO2 Emissions Reduction 15
Emissions intensity Water Management
(MT/ Million Sales)
As a combination of efforts in 12.3 Water is critical to
energy conservation and 12 manufacturing of pharma
10.7
increased renewable energy products. Keeping this in mind,
consumption, our overall target we have put up a rigorous,
is to reduce the carbon 9 real-time monitoring system for
emissions intensity by 40% by fresh water consumption at all
2020 - the target considers the our facilities. We have
6
projected business growth over implemented state of the art
the years and takes note of the Reverse Osmosis (RO)
predictions of climate science 3 technology at API
about rise of atmospheric Manufacturing Unit 5 for
temperature over the years. wastewater recycling. In all our
The energy conservation 0 manufacturing units we have
FY 15 FY 16
initiatives implemented in FY achieved zero waste water
2015-16 have led to 8211 tonnes discharge where the effluent
of CO2 savings in terms of generated in the facility is
scope 1 and scope 2 emissions. treated through primary,
As a significant achievement, secondary and tertiary
we have been able to reduce air processes and reused within
shipment by 8.3% with an the facility for various
Rain water havested Water management
increase in sea shipment by operations. (X1000 KL)
Waste water recycled
8.3% in Formulation Plants for
2500 Fresh water consumed
FY 2015-16. This is one of the This year we have augmented
183 256
reasons that led to 44% the capacity of rainwater 30
reduction in scope 3 emissions harvest and harvested 7% more 2000
from upstream transportation rainwater compared to the 828
and distribution. Overall, we previous year. With these 799 829
reduced our overall carbon efforts, not only we continue to 1500
footprint (combining Scope 1, 2 perform way beyond the
and 3 emissions) by 13% in FY statutory norms but we also
2015-16 compared to FY exceed our own target much 1000
2014-15. before the set timeline of 2020. 1360
1313 1267
In FY 2015-16, we have reduced 500
Other Air Emissions: 57% of our specific fresh water
consumption compared to the
At Dr. Reddy’s our aim is to base year FY 10 while our target 0
FY 14 FY 15 FY 16
excel beyond the limits set by was to reduce 40% by 2020.
the statute to ensure
environmental wellbeing.
Consequently, in addition to In the FY 2015-16, rainwater
COD COD and TDS load
carbon emissions, we take harvested was 20% against TDS (KG)
utmost care towards monitoring 13% in FY 2014-15 20000
and control of the ambient air
16602
quality beyond statutory
14825
compliance. With this drive, we In the FY 2015-16, Waste 15000
have invested INR 4 million at
our Bachupally Campus to water recycled is 65% 10918
11690
install a Continuous Ambient against 61% in FY 2014-15 9586 9308

10000
Air Quality Monitoring Station
for real time monitoring of key
air particles such as PM10, In the FY 2015-16, we have
5000
PM2.5, SOx, NOx, and Volatile consumed 6.87% less fesh
Organic Compounds. water compared to FY
2014-15
0
FY 14 FY 15 FY 16

Waste Management
Distribution of hazardous waste
At Dr.Reddy’s we continue to
enhance our waste Incineration
management practice with 4%
implementation of state of the
art processes and technologies. Salts recycled
We have invested INR 213 30%
Million this year only for
advanced treatment and safe
disposal of effluents and
TSDF
hazardous wastes. These 41%
initiatives have multiple benefits
in terms of reduced waste to
landfill, optimised chemical
load in the effluent discharge,
reduced sludge quantity and Cement plants
co-benefits such as energy 25%
efficiency, water conservation
and reduced noise level.
Across operations, especially in Hazardous waste to TSDF/ Landfill

the Formulation Plants, we have (Tonnes)
installed efficient dewatering 20000
systems such as Paddle dryer,
Belt press that has resulted in 15572
improved moisture extraction 14405
15000
and reduction in volume and
weight of waste to the landfill. 11639
These systems have co-benefits
in terms of energy 10000
conservation, reduced water
consumption and ambient noise Green Chemistry
reduction. In terms of reuse of
5000 We have been researching in While manufacturing green process adopted for
high calorific value waste we
have so far successfully the area of green chemistry for Fexofenadine, a non-sedating production of Sumatriptan, a
completed trial burn of 1000 the past few years to evolve antihistamine for treatment of drug used for treatment of
tonnes of landfill waste (mixed 0 chemical processes in seasonal allergic rhinitis, in FY migraine, has led to simplified
salts and sludge from Effluent FY 14 FY 15 FY 16 manufacturing of pharma 2015-16, as a green measure, steps, reduced waste
Treatment Plant) in different products with an objective to we have been able to adopt a generation, optimised water
cement plants. As a result of simplify the steps, optimise telescoped process that helps usage and elimination of use of
our continued efforts, there has manual interventions, reduce to reduce the number of steps chloroform.
been a gradual decline in waste generation, minimise use and unit operations involved in
quantity of waste to landfill/ of toxic solvents. This has the entire process and eliminate All our endeavours towards
Transport, Storage and Disposal helped us in achieving usage of a few toxic solvents solvent recovery, elimination of
Facilities (TSDF). Similar trend
environmental wellbeing and while improving the overall chemical use, waste reduction
is observed in the chemical and
also reduced human exposure yield. Similarly, the current and reuse have led to efficient
biological load of the effluent
discharged. to harmful chemicals. material consumption.
In terms of the hazardous

waste, we have been able to
send 55% of the waste for
alternative use in cement plants
and other industrial processes
such as in soap industries.

uilding healthy
communities
We encourage the communities around our operations to
become a part of our growth story.
Our CSR approach
Dr. Reddy’s Foundation conditions. DRFHE was We also contribute employee
conceived with the aim of time and financial resources to
Set up in 1996, Dr. Reddy's bridging the communication local villages, rural enterprises
Foundation (DRF) acts as a gap in healthcare. DRFHE and schools in supporting the
catalyst of change, driven by its works primarily in two areas: standard of living, health &
'Empathy' and 'dynamism' are the two guiding principles that define all our belief in the inherent motivation training initiatives that enhance hygiene, wellbeing and stability
and capacity of humankind for interpersonal skills of various to further develop social
intentions, actions and decisions. While 'empathy' helps us learn about and progress. DRF continuously healthcare stakeholders; and capital. All of our social impact
act upon the needs of the communities, 'dynamism' drives us to seed redefines its efforts to cover awareness initiatives that create projects are systematically
community interventions with business-like speed, precision, innovation and large groups of disadvantaged awareness about disease reviewed and monitored using
populations. DRF is mandated programs amongst employees appropriate evaluation tools to
aggression. This pronged approach enables us to address core needs and to undertake interventions, of corporation. measure impact and assimilate
widen outreach at a faster pace. conducting programs for the feedback.
benefit of the marginalized
communities and urban poor,
focusing in the areas education
Dr. Reddy’s CSR Policy, EDUCATION and livelihoods.
All of our social impact projects are
formulated in 2014, supported 12,000 students Along with our systematically reviewed and monitored using
provides an overview of partners, we engage in Dr. Reddy’s Foundation for appropriate evaluation tools to measure
key CSR programmes Health and Education
our social impact strategy, impact and assimilate feedback.
CSR programmes and LIVELIHOODS in, access to quality
Efficient healthcare delivery is
focus areas as: secured for 7,000 education, livelihoods not only about managing
young adults for the youth and the ailments, but also about Till date DRF has Our social impact
differently abled, effective communication delivered impact to investment
Promote scientific for FY 2015-16
temper to encourage primary, maternal and between the provider and the
increased to INR
HEALTHCARE child health, and the patient. The patient wants to be
socially relevant service provided to heard, understood and treated
innovation in society
development of social
as an individual. Good 150542 343349
75,000 villagers change agents. communication from caregiver
Empower the empowers the patient to take
an active role in managing his or Children Youth 412
community by her wellness and health
creating urban and
rural livelihoods, and 9227 77448 milllion
in particular enhancing
skills and employability
Differently- Households
Support specific abled
initiatives based on
Through our Presently the SIP
need, relevance and support centres works in
capability in healthcare we have trained
and hygiene
Government
Improve access to high 59 schools
quality education in 4544 640
schools
Supporting
Young Differently-
Promoting employee people abled youth
volunteering
25250 Students
65 | Building healthy communities Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 66

Education and Sanitation. opportunities in urban and rural
Initiated in 2011, SIP supports India to enhance their LABS – empowering growth and changing lives
Dr. Reddy’s firmly believes that 59 government schools employability. Dr. Reddy’s runs
access to a good education and surrounding Dr. Reddy’s a number of programs in line Though Rahul completed his senior secondary schooling in Burari,
schooling is every child’s right. manufacturing units in six with this objective. Delhi, due to financial constraints he was unable to pursue higher
Through its Foundation, Dr. districts that cover nearly 150 studies and further develop his skill set. It is during this period that
the door-to-door mobilisation team at DRF-LABS connected with
Reddy’s works with schools, villages and support more than Livelihood Advancement
him. With a little counselling, Rahul was convinced that the
communities and other 25,000 students. Business School opportunity would allow him to achieve his aspirations and he joined
stakeholders apart from the programme.
developing strategies to bring Teach for India The LABS program targets
children of all age groups into youth between the ages of 18 Initially it was hard for him, as he felt insecure and lacked
mainstream education. The Teach for India is a project that and 30, who lack opportunities confidence. However, after a couple of sessions he began to open up
various education initiatives is spearheaded by a leading due to inadequate skill sets. To and feel comfortable with his class mates, motivated by Pawan
include: media conglomerate in India. enable them, LABS equips Kumar, his facilitator who actively encouraged him to believe in
Dr. Reddy’s supports the Teach provides learning and himself and to strive for excellence. Apart from learning computer
Pudami Schools for India program by assisting development opportunities for applications and English language skills, Rahul found the Life Skills
their Fellows who teach in job-specific skills, soft skills, classes valuable.
Pudami Schools were classrooms of low-income Basic English, computer skills
On completing the LABS programme, Rahul was appointed by TATA
established in 2007 to make schools in Hyderabad and the and placement linkages. Westside as a Sales Associate. Today he earns a decent salary with a
quality English training available surrounding area. Trained performance based incentives. He has not only started supporting
for medium education to Fellows connect with local Today, the Dr. Reddy’s his family but is currently pursuing higher studies. Rahul continues his
children from all walks of life, children, providing a fun and Foundation has partnered with association with LABS and regularly visits the center. He has
with special focus on children rewarding education. The 5 social impact organizations delivered two guest lectures, so far and enjoys sharing the story of
from low-income communities. Teach for India Project and runs close to 85 centers in his transformational journey with other aspirants.
In addition to the academics, a strengthens the bond between more than 22 states. Of the
number of co-curricular Dr. Reddy’s Foundation and youth covered by this program,
activities and exciting Pudami schools. The program nearly 73% successfully Healthcare Community Health
Rural livelihoods – LABS for
inter-cluster and inter-school harnesses the energy and obtained entry-level jobs. Intervention Program
Farmers
competitions give the students capabilities of Dr. Reddy’s The delivery of healthcare is
an opportunity to showcase employees for educating and LABS for People with largely dependent on The Community Health
Along with urban livelihoods,
their talent and learning. 24 motivating the children. Disabilities developing a robust ecosystem Intervention Program is
Dr. Reddy’s Foundation also
Pudami schools are educating We supported 70 fellows in 27 capable of bringing good health designed to improve the rate of
runs programs that help
more than 9,668 students. schools reaching out to 2,519 Modelled on the lines of LABS, to every member of the survival of infants and children
farmers enhance their income.
students by implementing the LABS for People with community. However, there are in more than 145 villages
Called LABS-F, this program
School Improvement Program quality education initiatives in Disabilities (LABS-PwD) yet unmet needs – especially in covering three districts
uses technology and
government and low income program specifically targets rural India – where (Nalgonda, Vizanagaram &
methodology interventions with
School Improvement Programs schools through Teach for India people with disabilities, infrastructural problems Srikakulam) in rural India. The
farmers to increase
are designed to help schools fellowship program. preparing them for employment prevent delivery of healthcare. program improves basic
productivity, decrease input
and students in various and integration into mainstream Dr. Reddy’s runs a number of support for ante- and post-natal
cost and increase their income.
academic and non-academic Livelihoods society. The program is run programs designed to make care, safe delivery and infant
aspects such as Remedial across 24 centers. basic healthcare available in care, primary immunization of
Skilling Rural Youth
support, Scholarships, Dr. Reddy’s works with sections these communities. children by the age of one and
Computer Skills, Sports, Water of society that lack economic safe motherhood. The program
SkillinRural Youth program is
part of our rural program for leverages well-trained ANM,
enhancing rural employment GNMs and Nursing Midwives in
KARV College: The Kallam Anji Reddy Vocational (KARV) addition to two mobile
generation. This is a 10-day
College is a model Pudami school that caters to overall 2,020 ambulances, to deliver
capacity building program that
students. KARV trains students who have completed Class X in focuses on soft skills and linking healthcare to these villages.
two-year vocational courses preparing them for employment. youth with local employment Additionally, the program also
The college offers courses in the domains of Health, Automobile opportunities entails a Fixed Day Health Care
Engineering, Customer Relations, Nursing, Diagnostics Services, Service (FDHS), where
Computer courses, Pre-primary and Hotel Operations. healthcare staff conduct regular
Established in 2002, the college trains 500 students each year, screening and attend to basic
for exciting job opportunities ahead. Since its inception, the health issues on fixed days,
college has successfully put thousands of low-income youths on twice each week in each
village.
promising career paths.

Centre for Social Initiative and Social Infrastructure
Management -Hyderabad
Voice of a CHIP’s beneficiary
(CSIM-H) Dr. Reddy’s continues to
“I am a hypertension patient, often bedridden due to age related support and fund projects that
illness. I cannot walk on my own and I am dependent on others for my Through its support to CSIM – strengthen social infrastructure,
mobility. I saw a ray of hope when the nurses of NICE Foundation H, Dr Reddy’s offers an including services that benefit
visited my house with a medical kit. On each visit they tested my BP opportunity to aspiring and address core social needs.
and gave me appropriate medicines. individuals to transform their
ideas and interests into e-Panchayat
Prior to this intervention, I had to rely on a local RMP for treatment and initiatives. Today, CSIM alumni
would spend a considerable money for it. Now I get free treatment are generating social benefits in Leveraging the power of
right at my door step with no effort. The nurses have educated me on diverse fields such as rural technology, we developed an
lifestyle changes and are providing me with guidance on medication.” development, education, 'e-Panchayat' platform at
livelihoods, health, water and Bollaram. A unique
G. Asirodu, a project beneficiary from sanitation, disability, child e-governance initiative, this
Kammasigadam village in Andhra Pradesh protection, old-age homes, and new Panchayat is an IT-enabled
orphanages office with six workstations and
a cabin. Fully equipped with a
Impact created by a CISM-H robust computer system
Community Health Change-makers and social
change-maker: including a
Intervention Program has catalysts
printer-cum-scanner, the
been implemented in over e-Panchayat offers efficient,
Enabling like-minded people The Founder and President of
145 villages who are working on similar an NGO (ARPF - Animal Rescue people-centric services, better
& Protection Force) has access to resources and
social themes and equipping
completed CSIM Course on improved management
15 RO water plants them with the right tools is an
Social Entrepreneurship, runs enablers.
benefiting 70,000 families effective way to achieve
impact. By enabling these an animal & wildlife protection
were established. organisation. He believes that Hygiene and sanitation
change makers, we ensure that
our own efforts are multiplied his confidence grew due to this
12 free psychiatric camps course, and has already taken Aligned with the governments
and the effects of social change
his NGO to serve challenging 'Swachh Bharat Abhiyan', we
are conducted through are widespread, inclusive and
situations like rescue, and continued to build public toilets
Roshni Counselling Centre. long lasting.
rehabilitation of rare species; through a public- private-
The patients are provided partnership model and are
In FY 2015-16, we trained 41 alongside regular educative
free psychiatric consultation, Impact created by an Acumen sessions at zoos. ARFP has operated on self-sustaining
free medicines and budding social change agents
fellow: received awards from models.
and NGO staff on
counselling International biodiversity
entrepreneurial and leadership
Bodhi Tree Skills, a Tamil committee, and Andhra Other infrastructural
skills through Centre for Social
Nadu-based social venture that Pradesh Forest Department. He development projects
Initiatives and Management
(CSIM) – Hyderabad. Besides trains, supports and mentors has been appointed to serve as
rural college graduates so they Curator of Indore Zoo which Laying village roads, road
20 social agents were trained
can access better career makes him the youngest in the safety, wall paintings, stopper
through Acumen. These efforts
opportunities. Bodhi has country. boards, signage boards etc.
resulted in social delivery
projects relevant to community trained 800 college students
needs. to date.
Acumen India Fellows Program
Beginning in 2014, with support are creating impact through

from Dr. Reddy’s, Acumen affordable education programs,
launched India-focused innovative mobile healthcare
Leadership Program – the technologies, and inclusive
Acumen India Fellows Program. credit solutions, inspiring slum
The programme focuses on soccer programs, and liberating
supporting social change programs for rural farmers.
leaders from across India who

iving our dreams
We believe that when people with diverse skills are bound
together by a common purpose and value system, they can make
dreams come true.
With more than 21,669 Our people culture
employees worldwide and a
commercial presence in The values that define us – empathy and dynamism in approach, ethical and
resolute in our actions, and caring towards each other – are deeply ingrained
26 countries, we know the in the company.
importance of working At Dr Reddy’s, people are at the Dr. Reddy’s Employee Value Proposition
together with our employees,

heart of our business. We
believe that given the right As a value-driven, employee-friendly corporate, our focus is on
environment and opportunities, three key themes - ensuring consistent and quality
communities and partners to

individuals can aspire to better engagement with our employees; retaining high performing
their lives, defining paradigms talent, and providing better opportunities to potential talent.
to create new realities. Our Our people are guaranteed this unique set of offerings that
identify issues that matter to

culture is one of empowerment define our Employee Value Proposition.
and we work together to unlock
each other’s full potential.
us all. We focus on delivering good

health and thereby inculcate
Make the world a healthier place - Every day, patients
across the world trust us with their health. We have earned
this trust through personal integrity, product quality and
empathy for patients in every organizational transparency.
employee and provide an
enabling environment that
inspires individual talent and Become part of a team that cares - We are committed to
teamwork. We also take pride in each other's safety and well-being. In each of our plants,
being innovative and agile in all work sites, offices and out in the field, our people believe
of our endeavours, which is the in taking care of each other. And collectively we are
result of a vibrant workforce committed to taking care of the communities where we
capable of responding operate.
progressively to changing
market dynamics.
Enjoy professional freedom to create impact - We will
provide the space and freedom for you to experiment,
innovate and put your talents to work. All our people have
the opportunity to unleash their potential and create impact
in their roles.
Learn continually, excel and grow - We work at the frontiers

of knowledge and our people are exposed to some of the
finest thinking in the world. We actively support their
development and provide access to leading-edge learning
resources.
Expect to be treated with respect - We believe in respecting

every individual, regardless of position. All employees have
the opportunity to express their opinion and have the
freedom to interact with any of our leaders. All our people
are expected to be equally accessible and respectful at all
times.
73 | Living our dreams Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 74

Empowering employees
New Horizons Supporting
Leadership Between the period Higher
Development 2012 & 2016, Education
Program approximately 100 Programs
leaders from various
Opportunities for personal and professional growth Leadership is an “aspiration” BU’s were covered in We have tied up with a few top
that includes a sense of level universities for the contin-
purpose, excellence and
the 10 month long uous education of our employ-
influence. It involves being the program. ees, providing them relevant
Our employees are an intrinsic stages in their careers are best you can be and helping education to prepare them for
part of our identity and we exposed to relevant skill and We firmly believe that others be their best. The New Through this program, we the specialized roles of the
develop and implement policies knowledge upgrade programs Horizons Leadership Program want to: organization. Higher education
and programs that empower and from time to time. This has
it is people-enabled (NHLP) was launched in Strengthen leadership opportunities for the various
nurture our people, allowing allowed our employees to leadership that will December 2012 to raise the capability to drive business levels of our employees are
talent to thrive, and for expand their capabilities and help us stand by our effectiveness of each individual impact & change across a provided through partnerships
excellence to become a way climb the career ladder, taking and build their leadership wide range of situations with Tata Institute of Social
of life. on greater responsibilities and
mission of Good ability. Enhance personal Sciences (TISS), Birla Institute
roles. As a result, a major share Health and we pride effectiveness, empathy and of Technology and Science
Recognizing the central role of of our managerial vacancies are ourselves on the We believe that personal dynamism (BITS), Indian Institute of
our employees, we address their filled internally. transformation, which is the Lead significant business Chemical Engineers (IIChE) etc.
need to achieve their individual
autonomy and space crux of the program, invariably impact through Break The qualifications earned
dreams by providing avenues for we provide for people leads to organizational Through Projects (BTPs) through these opportunities are
professional growth and to grow and to create transformation. It is through industry recognized and enable
development. Employees at all personal transformation that we Over the years, NHLP has individuals to take on higher
an impact at work. aspire to build a culture wherein grown to be Dr Reddy’s flagship roles and greater responsibili-
our brand values of ‘empathy’ leadership development ties.
and ‘dynamism’ are lived. program.
Hired 2,500 talented rural youth through "SMT route" transforming their
lives by providing opportunities that strengthen careers.

Promoting health & wellness
Occupational
Employee Work - life
health and
well-being balance
safety
At Dr. Reddy’s, occupational system to manage and monitor productivity and increase
health is addressed at the health and safety. retention.
design stage; beginning with
R&D of our products. A Our employees undergo regular At Dr. Reddy's, we
comprehensive toxicological comprehensive health check up acknowledge that people need
risk assessment is done at the to ensure early detection and work-life balance in order to be
time of product selection & prevention of potential illnesses productive, to be healthy and to
appropriate controls are & ailments. We recognize that not suffer from burnout and
implemented to prevent any employee wellbeing is much stress. Providing flexibility in
kind of exposure during R& D more than people’s medical work ensures that our
and commercial manufacturing. health. To align with our employees lead a balanced,
company’s mission “Good stress-free and fulfilling life.
The objective is primarily to Health Can’t wait”, we design &
ensure that the products we execute various wellness & To this end, we have
craft are safe for the patients; fitness campaigns all across the implemented policies such as
and that our operations do not organization for better health of flexible work timings, sabbatical
present any health risks to our employees. leave, part-time work, extended
employees, community, paternity and maternity leave
environment or customers. We While we offer medical support (including for those adopting a
subscribe to the precautionary through health check-ups and child).
Unlocking minds by leveraging Apart from operational benefits religion, age, nationality or any principles with a philosophy of medical insurance, we also
modern technologies such as efficiency other factor. prevention to ensure zero work provide flexibility in work, to
improvement, cost reduction, related illnesses. We have ensure that our employees lead
Moving ahead with times, we safety enhancement and Enhancing diversity in our corporate standards, a balanced, stress-free and
have been modernizing our energy conservation, a key workforce is crucial to procedures and an fulfilling life. This helps enhance
operations leveraging the value advantage is the elimination or facilitating the interplay of occupational health governance employee loyalty, improve
provided by new technological reduction of human different modes of thinking to
solutions such as intervention across process, broaden the length and breadth
mechanisation, automation, where machines replace men to of imagination, innovative ideas
robotics and digitization. All our perform repetitive tasks. and creativity. We do this by
new plants are next-generation Shifting from muscles to amplifying our global talent
manufacturing blueprints and machines, reduces the number pool, inducting young and fresh
our existing plants are being of employees working on talent, employing
gradually migrated to smarter manual tasks and we are able to differently-abled individuals, or
technologies. These repurpose our human resources increasing the ratio of female
technologies increase workers’ towards productive avenues, employees.
safety and dignity, enhance unleashing their minds and
quality, productivity and freeing ingenuity for innovation. Beyond these parameters, we
availability of our products, also focus on assimilating
drive optimum use of natural Embracing diversity people with varied educational
resources, propel greater background, knowledge
engineering prowess and We celebrate our differences domain, functional expertise,
extend continuous and capitalize on the intrinsic industry excellence and
improvement down to the shop values of a diverse workforce, international experience, both
floor. including gender, race, colour, on the management board as
well as on the execution team.

The SMT way Ten pillars of SMT
‘The SMT Way’ of working aspirants from the lower In our experience, SMT recruits
focuses on creating a socio-economic groups to be stand apart from their industry
“wholesome employee recruited in the firm, continuing peers and deliver high quality
The SMT framework consisted of the four foundational elements and
engagement model”, where their education until output. ‘The SMT Way’ as we ten pillars.
team members share the vision post-graduation while earning call it, is a cultural shift calling
of the organization and work as and supporting their families. for change not only in work
empowered team members The programme helps them practices, but also in the
across levels. We are one of the develop skills to grow as thinking process
first and few within the highly professionals and become a
regulated Pharma industry to part of the company’s This year, we extended the
O
implement this successfully. management based on their spread of Self-Managed Teams
RG LEA
10 1
O D
performance. (SMTs) to more of our existing
A RN
SI E
N I
VI AR
N
The framework provides an facilities. Workplace Organisation
IS N
SH
Design
AT G
opportunity to undergraduate improvement
IO
N
9 2
“I have been associated with Dr. Reddy’s Skill based
Scientific
Selection
since last 14 years. I started my career progression
after my 10+2 qualification as an Area system
leader (SMT) in Quality Control

department. It has been a great pleasure
to work with Dr. Reddy’s. Now I look after
the stability management section at
Formulation Plant 7, Quality Control
8 SMT 3
Continuous
Way
Recognition &
department. Celebrations
Learning
I enjoy working at Dr. Reddy’s for the

following:
Learning is made engaging and fun 4

7
Healthy competition among peers Community
Performance Living
Opportunity to pursue higher Scorecard
education
Helps strengthen financial security
EG
T
EN
6
A 5
LI
M
It is a great opportunity for young people TA
ER
Human Value
Communications
RI
W
who want to work hard, having Action Team
A
PO
(HVAT)
enthusiasm to learn and expose their N
IS
EM
learnings in practice.” M
- S Chamundeswari

Capacity building framework
Our current focus is on the Communication
following:
This is the key to success in any
“Initially we resisted
Organization Design SMT model where ongoing contributing towards
engagement, update and team scorecard
(Work-teams on shop-floor) improvement is driven through
An SMT driven organization is regular channels of
parameters like Kaizen
essentially lean; and has few communication. There are but that changed
layers in its structure, to ensure various modes of completely. Now
it is responsive and enables communication that are used to
smooth flow of communication sharing information effectively,
teams recognize its
across levels. Every plant is including - Shift Assembly value with respect to Safety Quality
divided into small “work-teams’; Meeting (SAM), Fortnightly productivity/
and there are 160 plus teams Team Meeting, Monthly
now. Each team consist of a Communication Meets (Open
simplification and
financial impact. We
Broad skilling
Team Leaders and about 20 house), Visual Display Boards
team members. etc. voluntarily come Delivery Engineering
Continuous Learning Skill Based Progression

forward with ideas
System during teams meeting Propagate
Specific functional and and brain storming
behavioural modules are Skill-based-progression-system
designed and woven together is a model that enables an
sessions”
where the emphasis is on organization to build a Starcap
learning-by-doing. Continuous multi-skilled and flexible Satyavathi Mudundi,
Learning starts from a rigorous workforce. Every employee has Multi-skilling
induction plan followed by opportunity learn new skills or
Quality Assurance – Excel
On-the-Job-Training which deepen one skills basis his
focuses on technical domains interest and organisation need.
like Manufacturing, Packing, There is also opportunity
Quality and other support
functions. After they have spent
broaden skills through
“Star-Cap” that helps in
L L L L
one year in the programme, acquiring capability for next
they are enrolled for a higher level roles traditionally held by Execute
Deep skilling
education program for which
they may earn a Bachelor’s
supervisors.
E E E E
degree.
Team Scorecard and

Workplace Improvement E E E E
Learn
Every work-team has a
scorecard consisting with four
parameters - Safety, Quality,
Delivery and Team Health-
P P P P
which is derived from the
factory scorecard. These
parameters are reviewed on an Skill Families
ongoing basis through Shift
Team Meetings, Monthly
Quality control
Reviews at department and
Ointments &
Engineering
Warehouse
plant level. The teams also
production
production
production
Injectables
Packaging
assurance
Oral solid
compete with each other to win
‘Team of the Month’, ‘Team of
dosage
creams
Quality
the Quarter’ and ‘Team of the
Year’ awards.

ur sustainability
performance
Our sustainability performance
Indicator Unit 2013 -14 2014 -15 2015 -16 Indicator Unit 2013 -14 2014 -15 2015 -16
Economic performance GHG emissions
Revenue INR Million 132170 148190 154708 Direct GHG emissions

tCO 2-e 160953 177841 135140
(Scope 1)
Operating cost INR Million 49769 59117 62662 Source of Emission Factor: Combined emission factors of CO2, CH4 and N2O are considered
for all the fuels (coal, diesel oil and furnace oil) used by the company as per average values
Employee wages & benefits INR Million 24936 28967 31174 mentioned in Intergovernmental Panel on Climate Change 2006.
Payments to provider of Indirect G HG emissions

INR Million 1274 1092 826 tCO 2-e 243206 254563 335254
capital (Scope 2)
Source of emission factor: Combined emission factor of grid electricity (Central Electricity
Payment to Govt. (tax) INR Million 5094 5984 7127 Authority Database Version 11, April 2016).
Community investment INR Million 198.6 291.7 412 Water
Economic Value Retained Total water withdrawal KL 1312800 1360106 1266609

INR Million 21500 22180 20000
(PAT)
Financial assistance received • Groundwater Kl 399279 479327 450322

INR Million 0 0 0 • Municipality Kl 237226 281260 274240
from Govt.
• Surface Water Kl 676295 599518 542047
Materials
Total water recycled KL (%) 798591 (60.8) 828200 (60.9) 848367(66.9)
API – Raw Materials (Top 10
Kgs 361749 354786 476978
used for formulations) Waste
Excipients – Raw Materials

Kgs 3465061 3982699 4240126 Hazardous waste generated MT 20133 22277 26247
(Top 10)
Hazardous waste disposed
Energy use & efficiency MT 14405 15572 11639
(to landfill/TSDF/incineration )
Fuel consumption –Non - Hazardous waste

GJ 1429259 1666006 1424248
renewable sources reused/recycled (to cement MT 5726 6705 6657
plants & others)
Fuel consumption –
GJ 264690 339716 250386
Renewable sources Non -Hazardous waste
generated (E.g.: Food waste, MT 19015 21861 22750
Direct energy consumption GJ 1693949 2005721 1752639 PPE waste etc.)
Indirect energy consumption GJ 1008213 1107857 1122647
85 | Our sustainability performance Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 86

Our sustainability performance
Indicator Unit 2013 -14 2014 -15 2015 -16 Indicator Unit 2013 -14 2014 -15 2015 -16
Air quality Employee departures – gender wise
Suspended Particulate Matter Tons/yr. 42 61 81 Total attrition Nos 3025 3818 3692
Male %age 83% 86% 84%
NOx Tons/yr. 2611 2674 2646
Female %age 17% 14% 16%
SOx Tons/yr. 1193 1221 1191

Employee departures – age wise
Environmental expenditure Tracked from

<30 %age 66.9% 57%
FY 14 -15
Environmental expenditure Million INR 327.73 621.134 559
Tracked from
30 -50 %age 32.4% 46%
FY 14 -15
Total workforce -gender type
Tracked from
Tracked from >50 %age 0.7% 1%
Male %age 91.7% 91% FY 14 -15
FY 14 -15
Parental leave
Tracked from
Female %age 8.3% 9%
FY 14 -15
Employees availing parental Tracked from Male -653 Male -722
Nos.
leave FY 14 -15 Female -103 Female - 95
Total workforce -age type
Employees returning to work Tracked from Tracked from Male -722
Tracked from Nos.
<30 %age 54% 45% after the leave period FY 15 -16 FY 15 -16 Female - 71
FY 14 -15
Safety performance
Tracked from
30 -50 %age 44% 53%
FY 14 -15
Reportable Injuries
26
(Employees) - Numbers 15 19
Tracked from
>50 %age 2% 2% (LTI+MTI+RWC)
FY 14 -15
Lost days Tracked from Tracked from
Total workforce -employment type Numbers 3786
(Employees) FY 15 -16 FY 15 -16
Tracked from Fatalities

Management Nos (%age) 15847(91.4) 17913 ( 93.3) Numbers 0 0 0
FY 14 -15 (Employees)
Tracked from Reportable Injuries

Workers Nos (%age) 809 ( 4.7) 790 (4.1) Numbers 36 19 25
FY 14 -15 (Contractual workforce)
Tracked from This is tracked at unit level but not consolidated

Contractual Nos (%age) 686(4.0) 493 ( 2.6) Lost days
FY 14 -15 Numbers at c orporate level as on date. We plan to
(Contractual workforce)
consolidate and report this from next year.
Tracked from
New employee hires Numbers 4316 4563
FY 14 -15 Fatalities
Numbers 2 0 0
(Contractual workforce)
New employee hires who Tracked from
Numbers 539 170
have left during FY 2015 -16 FY 14 -15
87 | Our sustainability performance Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 88

Independent Assurance Statement (FTOs) in Hyderabad, Visakhapatnam and Baddi (CTO-4, CTO-5, CTO-6, FTO-2, FTO-3, FTO-6 and
FTO-7) and its Corporate Office in Hyderabad. We undertook the following activities:
Scope and Approach  Review of Dr. Reddy’s approach to stakeholder engagement and recent outputs. We did not
have any direct engagement with external stakeholders;
Dr. Reddy’s Laboratories Limited (‘Dr. Reddy’s’ or ‘the Company’) commissioned DNV GL Business
 Review of information provided to us by Dr. Reddy’s on its reporting and management
Assurance India Private Limited (‘DNV GL’) to undertake an independent assurance of Dr. Reddy’s
processes relating to the Principles;
Corporate Sustainability Report 2015-16 (the ‘Report’) in its printed format. The intended user of this
assurance statement is the management of the Company. Our assurance engagement was planned  Interviews with selected senior managers responsible for management of sustainability issues
and carried out in June – September 2016 for the financial year ending 31st March 2016. and review of selected evidence to support issues discussed at the sites we visited. We were
free to choose interviewees and interviewed those with overall responsibility to deliver the
We performed our work using DNV GL’s assurance methodology VeriSustainTM1, which is based on our
Company’s sustainability objectives;
professional experience, international assurance best practice including International Standard on
Assurance Engagements 3000 (ISAE 3000) and the Global Reporting Initiative (GRI) Sustainability  Site visits to the CTOs and FTOs in Hyderabad, Visakhapatnam and Baddi to review processes
Reporting Guidelines. and systems for preparing site level sustainability data and implementation of sustainability
strategy. We were free to choose sites we visited and it was selected on the basis of their
We evaluated the performance data presented in the Report using the reliability principle, together
materiality;
with Dr. Reddy’s data protocols for how the data is measured, recorded and reported. The
performance data in the agreed scope of work included the qualitative and quantitative information on  Review of supporting evidence for key claims and data in the Report. Our verification processes
sustainability performance disclosed in the Report prepared by Dr. Reddy’s based on GRI G4 in line were prioritised according to materiality and we based our prioritisation on the materiality of
with its ‘in accordance’ – Core option, and covering economic, environmental and social performance issues at a consolidated corporate level;
for the activities undertaken by the Company over the reporting period 1 st April 2015 to 31st March
2016.  Review of the processes for gathering and consolidating the specified performance data and,
for a sample, checking the data consolidation. The reported data on economic performance and
The reporting Aspect boundary of sustainability performance is based on a process of materiality other financial data are based on audited financial statements issued by the Company’s
assessment covering Dr. Reddy’s operations and identifying concerns of key internal and external statutory auditors;
stakeholders, as set out it in the Report in the section “About this Report” and covers the sustainability
performance of significant locations of its operation, i.e., manufacturing facilities located primarily in  An independent assessment of the Company’s reporting against the Global Reporting Initiative
Andhra Pradesh, Telangana and Himanchal Pradesh. The boundary excludes subsidiaries in India, two (GRI) G4 Guidelines and the reporting requirements for its ‘in accordance’ – Core option.
warehouses owned by Dr. Reddy’s (i.e. CTO central warehouse at Hyderabad & GDC-Ghaziabad), and During the assurance process, we did not come across limitations to the scope of the agreed assurance
factory locations and Research and Development facilities outside India. engagement.
We understand that the reported financial data and information are based on data from Dr. Reddy’s
Annual Report and Accounts 2015-16, which are subject to a separate independent audit process. The Opinion
review of financial data taken from the Annual Report and Accounts is not within the scope of our
work. On the basis of the work undertaken, nothing came to our attention to suggest that the Report does
not properly describe Dr. Reddy’s adherence to the GRI G4 Principles for Defining Report Content
We planned and performed our work to obtain the evidence we considered necessary to provide a basis Principles, General StandardDisclosures and Specific Standard Disclosures for the ‘in accordance’ – Core
for our assurance opinion. We are providing a moderate level of assurance based on VeriSustain. No option of reporting as below:
external stakeholders were interviewed as part of this assurance engagement.
 General Standard Disclosures: The reported information on General Standard Disclosure
generally meets the disclosure requirements for the ‘in accordance’ – Core option.
Responsibilities of the Management of Dr. Reddy’s and of the Assurance
 Specific Standard Disclosures: The Report describes the generic Disclosures on
Providers
Management Approach (DMA) and Performance Indicators for identified material Aspects as
The management of Dr. Reddy’s Laboratories Limited has the sole responsibility for the preparation of below. The Internal processes are in place for monitoring, managing and reporting on these
the Report as well as the processes for collecting, analysing and reporting the information presented in material Aspects and focus areas on a continual basis to ensure long term organizational
the Report. In performing our assurance work, our responsibility is to the management of the sustainability:
Company; however our statement represents our independent opinion and is intended to inform the
outcome of our assurance to the stakeholders of Dr. Reddy’s. DNV GL was not involved in the Economic Social
preparation of any statements or data included in the Report except for this Assurance Statement. DNV  Economic Performance– G4-EC1; Labour Practices and Decent Work
GL provides a range of other services to Dr. Reddy’s, none of which constitute a conflict of interest with  Indirect Economic Impacts – G4-EC8;  Employment – G4-LA1, G4-LA2;
this assurance work.  Procurement Practices – G4-EC9;  Occupational Health and Safety – G4-LA6*;
Environment  Diversity and Equal Opportunity – G4-LA12;
DNV GL’s assurance engagements are based on the assumption that the data and information provided  Materials – G4-EN1; Human Rights
by the client to us as part of our review have been provided in good faith. We were not involved in the  Energy – G4-EN3 , G4-EN5, G4-EN6;  Freedom of Association and Collective
preparation of any statements or data included in the Report except for this Assurance Statement. DNV  Water – G4-EN8, G4-10; Bargaining - G4-HR4;
GL expressly disclaims any liability or co-responsibility for any decision a person or an entity may make  Emissions – G4-EN15, G4-EN16, G4-EN18, G4-  Child Labour – G4-HR5;
EN21;  Supplier Human Rights Assessment – G4-
based on this Assurance Statement.
 Effluents and Waste – G4-EN22, G4-EN23; HR10, G4-HR11;
 Products and Services – G4-EN27; Society
Basis of our Opinion  Overall – G4-EN31;  Local Communities – G4-SO1.
 Supplier Environmental Assessment – G4-EN32;
A multi-disciplinary team of sustainability and assurance specialists performed work at Dr. Reddy’s *Absenteeism and lost days are not aggregated and
operations in India, ie. Chemical Technical Operations (CTOs) and Formulations Technical Operations reported, and reason for omission has been
explained.
1
The VeriSustain protocol is available on www.dnvgl.com
89 | Assurance statement Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 90

Observations Opportunities for Improvement
Without affecting our assurance opinion we also provide the following observations. We have evaluated The following is an excerpt from the observations and opportunities for improvement reported to the
the Report’s adherence to the following principles on a scale of ‘Good’, ‘Acceptable’ and ‘Needs management of the Company and are not considered for drawing our conclusions on the Report;
Improvement’: however they are generally consistent with the management’s objectives:
Stakeholder Inclusiveness  Dr. Reddy’s may extend its boundary of reporting to include all subsidiaries and other entities
The participation of stakeholders in developing and achieving an accountable and strategic response to over which it has operational control to further improve on the completeness of its reporting.
sustainability.
 A process of review and periodic validation of sustainability related performance and data may
The Company has an ongoing and continuous process of stakeholder engagement in place involving its be carried out to further improve on the quality and reliability of reported sustainability data.
key stakeholders. The outcomes of this process are fairly brought out within the Report as stakeholder
concerns, and these concerns are taken into consideration while identifying the Company’s material
aspects and issues. In our opinion, the level at which the Report adheres to this principle is
For and on behalf of DNV GL Business Assurance India Private Limited
‘Acceptable’.
Bengaluru, India
Materiality
12 September 2016
The process of determining the issues that is most relevant to an organization and its stakeholders.
Dr. Reddy’s has reviewed its key sustainability issues and focus areas through internal reviews by the
top and middle management, and has concluded that there are no change in sustainability focus areas
from the previous reporting period. Nothing has come to our attention to suggest that DRL has missed
out any significant material issues based on its selected reporting boundary. In our opinion, the level at
which the Report adheres to this principle is ‘Good’.
Responsiveness KIRAN RADHAKRISHNAN VADAKEPATTH NANDKUMAR

The extent to which an organization responds to stakeholder issues. Lead Verifier Assurance Reviewer
DNV GL Business Assurance India Private Regional Sustainability Manager - Region India
The Report brings out responses with respect to identified key sustainability issues and focus areas
Limited, India & Middle East, India
within the reporting boundary, however the Report does not bring out the short, medium and long
DNV GL Business Assurance India Private
term targets for its identified material Aspects across its supply chain i.e. key sustainability issues and
focus areas. In our opinion, the level at which the Report adheres to this principle is ‘Acceptable’. Limited
Reliability -------------------------------------------------------------------------------------------------
DNV GL Business Assurance India Private Limited is part of DNV GL – Business Assurance, a global provider
The accuracy and comparability of information presented in the report, as well as the quality of
of certification, verification, assessment and training services, helping customers to build sustainable
underlying data management systems. business performance. www.dnvgl.com
The robustness of the data management and aggregation systems was evaluated, and the majority of
the data and information verified at the CTOs and FTOs were found to be fairly reliable. Nothing has
come to our attention to suggest that reported data has not been properly collated from information
reported at operational level, nor that the assumptions used were inappropriate. Some of the data
inaccuracies identified during the verification process were found to be attributable to transcription,
interpretation and aggregation errors and the errors have been communicated for correction. In our
opinion, the level at which the Report adheres to this principle is “Good”.
Completeness
How much of all the information that has been identified as material to the organisation and its
stakeholders is reported
The Report has fairly reported the General and Specific Standard Disclosures including the
management approach, monitoring systems and sustainability performance indicator against GRI G4
requirements for its ‘in accordance’ – Core option within its identified reporting boundary. The
reporting of sustainability performance needs to identify and bring out material issues across the
Company covering all significant entities such as subsidiaries, warehouses and facilities outside India
included in its financial statements. In our opinion, the level at which the Report adheres to this
principle is “Acceptable”.
Neutrality
The extent to which a report provides a balanced account of an organization’s performance, delivered
in a neutral tone.
The disclosures related to sustainability issues and performances are reported in a neutral tone, in
terms of content and presentation. The Report may further bring out the Company’s responses to
challenges faced at various geo-locations of its operations during the reporting period. In our opinion,
the level at which the Report adheres to the principle of Neutrality is “Acceptable”.
91 | Assurance statement Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 92

GRI Content Index
GENERAL STANDARD DISCLOSURES GENERAL STANDARD DISCLOSURES
General General
Page Number (or Link) External Page Number (or Link) External
Standard Standard
Assurance Assurance
Disclosures Disclosures
STRATEGY AND ANALYSIS STAKEHOLDER ENGAGEMENT
G4-1 3, 4 Yes G4-24 9-10 Yes
ORGANIZATIONAL PROFILE G4-25 8 Yes
G4-3 1 Yes G4-26 8-11 Yes
G4-4 5, 6 Yes G4-27 9-10 Yes
G4-5 1 Yes REPORT PROFILE
G4-6 1 Yes G4-28 8 Yes
G4-7 Annual Report FY 15 -16; pg 22 -27, 30 Yes G4-29 8 Yes
G4-8 Annual Report pg 30 Yes G4-30 8 Yes
G4-9 1, 5, 6, 27; Annual Report FY 15 -16 pg 7 -9 Yes G4-31 8 Yes
G4-10 41, 47, 48 Yes G4-32 8 Yes
G4-11 16 Yes G4-33 Assurance Statement Yes
G4-12 16, 19 ; Annual Report FY 15 -16 pg 19 Yes GOVERNANCE
G4-13 8 Yes G4-34 14, 21; Annual Report FY15 -16 pg . 54-69 Yes
G4-14 22, 29, 43 Yes ETHICS AND INTEGRITY
G4-15 Carbon Disclosure Project (CDP) Yes G4-56 1, 16, 28 Yes
G4-16 32 Yes
IDENTIFIED MATERIAL ASPECTS AND BOUNDARIES
G4-17 Annual Report FY15 -16 pg 41, 50, 89 -91 Yes
G4-18 8-12 Yes
G4-19 11 -12 Yes
G4-20 11 -12 Yes
G4-21 10-12 Yes
G4-22 No Change Yes
G4-23 No Change Yes
93 | GRI Content Index Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 94

GRI Content Index
SPECIFIC STANDARD DISCLOSURES SPECIFIC STANDARD DISCLOSURES
DMA and Identified Reason(s) for External DMA and Identified Reason(s) for External
Page Number (or Link) Page Number (or Link)
Indicators Omission(s) Om ission(s) Assurance Indicators Omission(s) Om ission(s) Assurance
CATEGORY: ECONOMIC MATERIAL ASPECT: EMISSIONS
MATERIAL ASPECT: ECONOMIC PERFORMANCE G4-EN16 46 Yes

Annual Report FY15 -16
G4-DMA Yes G4-EN18 33 Yes
pg. 2 -6
G4-EC1 46 Yes G4-EN21 33 Yes
MATERIAL ASPECT: INDIRECT ECONOMIC IMPACTS MATERIAL ASPECT: EFFLUENTS AND WASTE
G4-DMA 23, 36 -40 Yes G4-DMA 34-35 Yes
G4-EC8 19, 27, 36 -40 Yes G4-EN22 3, 34-35 Yes
MATERIAL ASPECT: PROCUREMENT PRACTICES G4-EN23 35, 47 Yes
G4-DMA 12, 16 Yes MATERIAL ASPECT: PRODUCTS AND SERVICES
G4-EC9 16 Yes G4-DMA 32-35 Yes
CATEGORY: ENVIRONMENTAL G4-EN27 32-35, 47 Yes
MATERIAL ASPECT: MATERIALS MATERIAL ASPECT: OVERALL
G4-EN1 46 Yes G4-DMA 32-35 Yes
MATERIAL ASPECT: ENERGY G4-EN31 47 Yes
G4-DMA 32-33 Yes MATERIAL ASPECT: SUPPLIER ENVIRONMENTAL ASSESSMENT
G4-EN3 33, 46 Yes G4-DMA 16 Yes
G4-EN5 32-33 Yes G4-EN32 16 Yes
G4-EN6 32-33 Yes CATEGORY: SOCIAL
MATERIAL ASPECT: WATER SUB -CATEGORY: LABOR PRACTICES AND DECENT WORK
G4-DMA 34 Yes MATERIAL ASPECT: EMPLOYMENT
G4-EN8 34, 46, 47 Yes G4-DMA 41 -45 Yes
G4-EN10 34, 47 Yes G4-LA1 47, 48 Yes

Annual Report FY15 -16
MATERIAL ASPECT: EMISSIONS G4-LA2 Yes
pg. 156
G4-DMA 33 Yes G4-LA3 48 Yes
G4-EN15 46 Yes

GRI Content Index
SPECIFIC STANDARD DISCLOSURES SPECIFIC STANDARD DISCLOSURES
DMA and Identified Reason(s) for External DMA and Identified Reason(s) for External
Page Number (or Link) Page Number (or Link)
Indicators Omission(s) Om ission(s) Assurance Indicators Omission(s) Om ission(s) Assurance
MATERIAL ASPECT: OCCUPATIONAL HEALTH AND SAFETY SUB -CATEGORY: SOCIETY
G4-DMA 18, 28-29 Yes MATERIAL ASPECT: LOCAL COMMUNITIES

This is tracked
G4-DMA 16, 36 -40 Yes
at unit level but
not consolidated
Lost days for G4-SO1 36-40 Yes
at corporate
G4-LA6 17, 48 contractual Yes
level as on date.
workforce
This is planned
to be reported
from next year.
MATERIAL ASPECT: TRAINING AND EDUCATION
G4-DMA 41-42 Yes
G4-LA10 41-42 Yes
MATERIAL ASPECT: DIVERSITY AND EQUAL OPPORTUNITY
G4-DMA 43 Yes
47 ; Annual Report FY15 -
G4-LA12 Yes
16 pg. 22 -27
SUB -CATEGORY: HUMAN RIGHTS
MATERIAL ASPECT: FREEDOM OF ASSOCIATION AND COLLECTIVE BARGAINING
G4-DMA 16 Yes
G4-HR4 10, 16 Yes
MATERIAL ASPECT: CHILD LABOR
G4-DMA 16 Yes
G4-HR5 16 Yes
MATERIAL ASPECT: SUPPLIER HUMAN RIGHTS ASSESSMENT
G4-DMA 16 Yes
G4-HR10 16 Yes
G4-HR11 16 Yes

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Delivering Good Health through affordable medicines

and empathetic healthcare to patients whenever and

Our presence is wide-spread across 26 countries, with

single factor that made us

poor in this country. It has

actually made us prosperous.

Of course we didn’t stop Bringing expensive medicines within reach

there. And we continue to

bring affordable medicines

Interaction with Dr. Reddy’s way Committed to Our sustainability

What we are today Delivering on our Building healthy Assurance statement

11 Our company profile and

19 Scope and boundary of

Dr. Reddy's is a global organisation with offerings spanning the entire

13 | What we are today Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 14

15 | What we are today Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 16

17 | What we are today Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 18

21 | About this report Dr. Reddy’s Corporate Sustainability Report 2015-2016 | 22

Modes of engagement Topics and concerns Modes of engagement

Investors & Shareholders Communities & NGOs

Business Partners & Suppliers Healthcare Professionals

 Face to face interactions  Economic growth  DRFHE – PG Diploma in  Employability and

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Fresh water consumption Standard manning number Community investment at INR

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Seamless end-to-end supply

Reduced inventory and

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Reduced ~6610 man-days

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Our compliance report on  Proactive identification and

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 Vega Club - Education

Rest of the world

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Powder transfer system in manufacturing implemented in formulations plants 3, 6 & 8: Closed

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We aim to reduce our specific

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install a Continuous Ambient against 61% in FY 2014-15 9586 9308

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Across operations, especially in Hazardous waste to TSDF/ Landfill

In terms of the hazardous

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Acumen India Fellows Program

Beginning in 2014, with support are creating impact through

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26 countries, we know the in the company.

together with our employees,

communities and partners to

identify issues that matter to

us all. We focus on delivering good

 Learn continually, excel and grow - We work at the frontiers

Face to face interactions Economic growth DRFHE – PG Diploma in Employability and

Our compliance report on Proactive identification and

Vega Club - Education

Learn continually, excel and grow - We work at the frontiers

Expect to be treated with respect - We believe in respecting

Learning is made engaging and fun 4