CEMENT is arguably the single most important material in the world. It’s certainly the most widely used and, as the ancient Romans would attest 2,000 years after they originally built the Pantheon in Rome, it’s also one of the longest lasting.
United States has consumed over 82 million metric tons of cement in 2013. It certainly sounds like a lot. But, if you consider for a moment that, over the past 100 years, American’s gone through over 4.5 billion tons of the stuff, it’s actually been a quiet decade. And if you’re wondering about China right now, well, it’s laid over 6.6 billion tons of this material in the past three years alone.
In terms of sheer practicality, cement is arguably the single most important material in the world. It’s certainly the most widely used and, as the ancient Romans would attest 2,000 years after they originally built the Pantheon in Rome, it’s also one of the longest lasting.
Such vast production of any one material opens up major questions about sustainability, so TSB Review turned to global cement manufacturer, TITAN, to get some answers. It’s not the largest manufacturer in the world but, as we found out, its significant contribution to the sustainable production of mankind’s most abundantly used material is nothing short of inspiring. Let’s begin by taking a look at the company’s history and how this key player in the construction sector was affected by the recent global economic downturn.
TITAN has been in business for over 110 years, employing 5,400 people around the world, owning cement plants in nine countries and sells building materials to 36 countries. The company was founded in 1902, opening its first cement plant in the town of Elefsina, Greece. Some 10 years later, it was listed on the Athens stock exchange and around 15 years after that, it was a major contributor to the country’s gross domestic product (GDP). Even in the 1930s, TITAN was thinking ahead of the curve, offering Christmas and Easter holiday allowance for employees a full 20 years before it was made mandatory by the Greek government.
By the 60s and 70s, the company’s considerable success led to cement plants opening in Thessaloniki, Patras and Athens before it expanded overseas to the USA, Bulgaria, FYROM, Serbia, Egypt, Albania, Turkey and finally Kosovo. It went on to become the first company with its HQ in Greece to sign the UN Global Compact Pledge and is a key member of the World Business Council for Sustainable Development (WBCSD). And that was just the beginning of what would turn into an exemplary CSR track record.
The global recession has had major ramifications for most industries, with the construction sector taking a particularly serious hit. That said, it’s no surprise that a cement manufacturer enmeshed in multiple economies around the world had some hard times ahead leading up to the downturn. The recession saw the concurrent collapse of TITAN’s two most important markets, Greece and the United States. Group EBITDA decreased by more than half between 2006 and 2013, TITAN posted net losses in 2012 and suspended dividend for the first time since 1951.
But, with a century of experience spanning multiple recessions, TITAN was one Group that knew how to weather out a storm. By 2013, the diligence and hard work through the tough times started translating into notable improvements.
In spite of being in one of the worst affected verticals, solid management and capitalising responsibly on emerging markets combined with the 2012 beginning of the recovery in the US housing market and stubbornly persistent demand from Egypt, TITAN managed to increase sales, generate positive cash flow, and reduce its debt by an astonishing 50%. It expanded capacity by nearly 20% while reducing fixed costs by 16% and SG&A by 24%, all during a time when its home territory was suffering some of the worst economic difficulties ever witnessed by a developed country, and when construction in the US key market was at very low levels. While some companies were making excuses, TITAN was making progress.
In spite of the fact that experts believe the sheer longevity of the material usurps the initial carbon production in the long run, (and you can bet there will be modern concrete structures standing a lot longer than 2,000 years from now) a heavy environmental responsibility lands on TITAN’s shoulders. Fortunately for all of us, the critical nature of the Triple Bottom Line is not lost on this organisation.
The Cement Sustainability Initiative within the WBCSD is a solid pledge to the ethical governance the company pledged when it was first listed over 100 years ago. TITAN integrates its sustainability strategies with its approach to finding partners, readily sharing its hard-earned knowledge of best practices. One good example is of TITAN’s local engagement is the Local Advisory Board (LAB) in Kosovo. A local subsidiary established an Independent Local Advisory Board (ILAB) comprised of local stakeholders who evaluate community development programs to be funded and supported by the plant. The project was awarded the European CSR Award by the European Commission in 2013 and is just one example of a forward-thinking initiative. The future is something that TITAN certainly has its sights focused on.
We spoke with Maria Alexiou who is the Group Corporate Social Responsibility Senior Manager. As Alexiou points out, “globally, the greatest challenge is the implementation of sustainable development goals. This requires global partnerships for sustainable development and active engagement of governments, civil society, the private sector, and the United Nations…”
Alexandros Katsiamboulas, is Environment, Quality & Sustainable Development Senior Manager, Cement Division Greece was keen to have a say, too, stating that “the capacity to build consensus and engagement with key stakeholders is fundamental to turn current and future challenges into opportunities.” Wise words, and clear indication of a business ethos that takes accountability very seriously indeed.
TITAN has used this approach for many years and, while initiatives such as LAB in Kosovo attest to this fact, there are more examples besides. Improved water management systems, quarry rehabilitation practices that safeguard biodiversity, and actions focused to reduce the consumption of extracted non-renewable raw materials and fuels can be added to the list.
The Group monitors biodiversity trends, is an active participant in the European Cement Association (CEMBUREAU) and co-chairs the Biodiversity & Land Stewardship inside WBCSD. It even promotes the use of relevant KPI’s to determine what gets classified as areas with high biodiversity value in the first place, encouraging more stringent standards to ensure less ethical organisations don’t take advantage of this fledgling sector of legislation.
Sustainability inherently necessitates measures based on forward thinking. Mankind’s strive for progress has resulted in a lot of environmental damage over the past few hundred years, and measures such as these taken by TITAN are critical if we’re to catch up.
The idea of a “circular economy” is popular these days, and with good reason. High-street consumerism has very much caught up with us and the fact that it’s not okay to have an end-of-life stage of production that results in excessive dumping of waste is now all too obvious.
Cyclical processes have been adopted by a minority of more responsible companies in the technology sector, but few in the construction industry have caught on. Perhaps not surprisingly when you dig into the Group’s history, TITAN is one of them. A key tenet of the Group’s environmental policy is reusing and recycling materials, recovering energy and waste in cement production is facilitated by alternative raw materials and fuels to name just a couple of their strategies.
This approach is just one reason why TITAN was recently awarded the first Award in Greece in the Process category of the national leg in the 2013-2014 European Business Awards for as well as an award for the Biodiversity. TITAN genuinely takes sustainability initiatives to inspirational new heights. It’s an incredibly impressive organisation that contributes significantly to sustainability.
Over a century of operation, a long history of innovative thinking and a tireless commitment both to the environment and society have produced results from which we can all learn a great deal. TITAN doesn’t just produce the very substance upon which our society is built, it demonstrates a serious commitment to looking after it.
Researched by John Mills
Written by Susette Horspool
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