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Case Study Short answer question

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1. Discuss in what ways the Economic Doughnut model applies to businesses. Analyze how

Mahindra uses the principles of regenerative enterprise, giving examples from the case.

Raworth, (2017) was the first to propose the Economic Doughnut model, which presents

a holistic framework that offers a change in the economic model in response to human

challenges aimed at reducing the world's poverty with the help of the available limited natural

resources within the planet. It was initially designed for governments and societies, but it is

highly applicable to businesses with much emphasis on sustainability, corporate social

responsibility, and regenerative practices. By rethinking our systems, both national and global

economies can be changed by not only increasing Gross Domestic Product (GDP) but also

creating a society that can provide enough resources for the world's population while at the same

time not endangering future security and prosperity. In this model, a visualized doughnut has two

distinct boundaries; the inner boundary represents a social foundation, which stipulates the

minimum living standards every individual should access, and the outer boundary represents an

ecological ceiling (Raworth, 2017). The external boundary defines the planet's resources and

ecosystems, ensuring that human activities do not over-exploit these resources, leading to

irreversible damage, such as climate change, deforestation, and biodiversity (Gupta, 2007).

This model applies to business through social corporate responsibility. Businesses can

utilize this model to assess if their operations contribute to the social foundations through fair

compensation, a good working environment, and access to quality healthcare and education for

their employees and the community in which they operate (Wahlund & Hansen, 2022). Also, it

applies to businesses by ensuring their operations are environmentally sustainable. This includes

reducing carbon emissions, waste reduction, and resource consumption while adopting

renewable energy sources. This model also encourages businesses to innovate in improving
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social well-being and protecting the environment (Wahlund & Hansen, 2022). This involves

producing eco-friendly products, collaborating with other businesses, governments, and NGOs to

address common challenges, and investing in sustainable technologies.

Adopting regenerative enterprise and aligning its goals and objectives vis-à-vis Doughnut

Economics, Mahindra, as a multinational conglomerate, has embraced regenerative enterprise to

achieve its goals. Mahindra follows a radical new way to accomplish sustainable development.

Farm divisions adopt regenerative agriculture, and Mahindra is actively promoting and

implementing regenerative agriculture methods to enhance productivity and make agricultural

practices more sustainable. The company has adopted zero-tillage farming practices that reduce

soil erosion significantly and try to keep the moisture content intact, improving the soil quality.

Incorporating tillage practices and organic fertilizers enables farmers to maintain soil fertility

naturally rather than heavily relying on chemical inputs, which are the best examples of this

Doughnut model.

On top of that, Mahindra's strong commitment to sustainability is evident in its vast

investments in renewable energy sources and the manufacturing of eco-friendly vehicles and

machines. The company has ventured into several initiatives to reduce its carbon footprint

through renewable energy solutions in its processes and operations (Gorti et al., 2022). Ever

since, as part of its commitment to sustainable farm machinery and equipment, Mahindra has

made and continues to make several investments in the production of fuel-efficient and eco-

friendly farm equipment that has significantly reduced the adverse effect on the environment

compared to conventionally fueled transportation systems. Mahindra's action of creating rural

communities' empowerment programs aligns more with the Doughnut model's social foundation.

In this regard, Mahindra has several initiatives to improve rural communities' living standards;
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e.g., healthcare access, education, and skills development programs. By considering all these

empowerment programs, Mahindra has made a significant contribution to societal well-being,

which largely resembles the Doughnut model.

2. How was Mahindra unwittingly addressing planetary boundaries and the social

foundation of the Economic Doughnut model through its agribusiness and farm

equipment divisions?

A variety of initiatives implemented by Mahindra in its farm equipment division,

although not explicitly intended to address planetary boundaries and the social foundation of the

Economic Doughnut model, did contribute to these. Nevertheless, primarily business-driven

rather than conscious efforts to adopt sustainability, some of these initiatives turned out to have a

positive impact on society and the environment. One such way through which the company

contributed to addressing planetary boundaries was through sustainable agricultural practices

(Gorti et al., 2022). According to Gorti et al., (2022) the company encouraged the farmers to

follow precision farming, organic fertilizers, and zero tillage for farming, which is an indirect

part of the planetary boundaries. This therefore resulted in soil health conservation, soil erosion

control, and agricultural footprint. For example, zero tillage ensures that the soil disturbance is

minimal, so less carbon is released; thus, it helps to conserve soil carbon that directly impacts

climate change. Another example is that in order to tackle climate change, Mahindra started the

journey of building eco-friendly farm machinery. In this case, too, it reflects that Mahindra has

taken the initiative to combat climate change.

The corporation addressed various components of the social foundation of the Economic

Doughnut model. Through the firm's farm equipment division, it was able to address social

inequality in various ways. One of these ways was ensuring farmers could access modern and
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efficient equipment, improving productivity (Gorti et al., 2022). This improved productivity

impacted farmers' income and, thus, their ability to earn a livelihood. Hence, it was a way of

empowering social inclusion and economic well-being among rural communities. Also, the firm

addressed social inequality through knowledge exchange. This means that the company could

disseminate knowledge on sustainable farming practices, which formed a part of the social

foundation (Gorti et al., 2022). The company successfully transferred knowledge through

conducting training programs and workshops. The company's agribusiness and farming

equipment operations directly created employment opportunities for rural communities.

Establishing manufacturing facilities and service centers in these regions led to job creation and

improved economic activities, which ensured enhanced social welfare within these communities.

These economic empowerment programs indirectly addressed the social foundation in the

Doughnut model through poverty reduction and livelihood improvement.

3. Why is climate change a particular cause of concern for India? How are rural

communities in India vulnerable to climate change?

Climate change poses a threat not only to India but also to the world. This is due to the

myriad of human activities that have depleted the available natural resources and increased the

incidence of natural disasters. It has become a significant concern for India due to the ubiquitous

profound effects that spread through various sectors of the country's socioeconomic framework.

Due to the country's heavy dependence on agriculture as the main driver of the economy and

means of subsistence for many of the population, the country is badly exposed to the impacts of

climate change (Sathaye et al., 2006). Gorti et al. (2022) reported that the irregular distribution of

the available water, the increase in the temperatures experienced in the region, the

inconsistencies in the monsoon patterns, and the increase in the severance of weather
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occurrences have all had an impact on crop yields and the production of the agricultural sector.

This, therefore, threatens food security in the country and the long-term viability of farming and,

in turn, puts the nation's economic stability as well as its well-being at risk. Agriculture being the

backbone of the nation's economy means that a decline in output would cause a ripple effect. For

instance, it would cause inconsistent income generation for many people as it would mean few

job opportunities in the country. This would cause social and economic strains on India, whose

population largely depends on farming for their survival.

There are many ways in which rural Indian populations are acutely vulnerable to the

impacts of climate change. One of the significant concerns for these populations is the increasing

water shortage, precisely due to climate-induced changes in the rainfall patterns and the rise in

sea level because of the melting of arctic ice (Gorti et al., 2022). Rural populations are the worst

affected by increasing water stress, which severely impacts various aspects of dwelling, limiting

agricultural operations, limiting safe drinking water availability, and endangering overall

livelihood. Nonetheless, the increasing temperatures also result in faster rates of water

evaporation, which are responsible for draining the moisture from the soil at a rapid speed, and a

decline in the ground level water, which in rural areas results in setting up of severe irrigation

problems, reducing the agricultural output that makes the farming community go harder under

the severe water short.

In addition, the increasing unpredictability and high intensity of weather conditions due

to climate change are making the rural communities of India more susceptible. The area is highly

affected by floods, storms, cyclones, long spells of droughts that cause extensive infrastructure

damage, forced population relocation, lives and livestock losses, and disruption of livelihoods

(Gorti et al., 2022). The lack of infrastructure and the high intensity of these weather conditions
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make rural communities more prone to be affected by the negative consequences of climate

change events due to inefficient preparation. Moreover, the effects of climate change are far-

reaching, touching upon not only ecological and economic parts but also public health and

perpetuating the economic, social, and geographical imbalance of the rural community,

specifically in India. As an illustration, a change in temperature and rainfall patterns dramatically

contributes to the rise in the spread of vector-borne diseases such as dengue and malaria and

food-borne diseases induced by unsafe drinking water, which is exceedingly risky for people

residing in rural areas.

4. In your opinion, what are the traits of a regenerative business?

Regenerative businesses are holistic practices that go beyond the sustainability that a

company puts in place. Sustainable practices such as using eco-friendly or green energy sources

and reducing waste and emissions are significant and valuable, but more is needed. For a

business to be regenerative, it must strive beyond doing less harm and move towards the

proactive pursuit of doing more good. A regenerative business can be identified by many distinct

characteristics that denote its commitment to environmental conservation, economic

sustainability, and social accountability. It is indispensable for an enterprise to put ecological

regeneration and conservation in its operation first. An enterprise should not only aim at

reducing environmental damage but should participate in activities that restore and renew the

ecosystem; for example, the regenerative agricultural practices that cover the use of agroforestry,

soil conservation and regenerative technologies, and crop rotation in order to improve soil health

and the increases of biodiversity and strengthening the resilience of the ecosystem.

Moreover, to be regenerative, a business must support the concept of circularity and the

use of natural resources. Regenerative businesses will incorporate principles of circular economy
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to lessen waste through re-use, recycling, or upcycling during the manufacturing process of

materials. Additionally, regenerative businesses will minimize environmental impact and

improve resource efficiency by reducing waste and maximizing resources, promoting a

sustainable and resource-efficient economy. Also, to achieve sustainability, a business must

emphasize social and community outcomes, meaning companies must actively work with

communities. This includes regenerative companies promoting the community's well-being,

stakeholders, and workers. This includes equitable work policies, allocation of resources towards

community development, improvement of local economies, and the exclusion and minimization

of vulnerable groups. This, in turn, allows businesses to contribute to socially resilient and

prosperous communities actively.

Furthermore, a regenerative company needs to look forward to what they can become and

how they can grow even more than they are at a particular time. The process involves

implementing new practices and funding extensive research and development to improve the

viability of sustainable technologies, procedures, and goods for the benefit of future users.

Businesses will conserve their regenerative purpose because of their dedication to their

environment and many economic and social issues. In order for a business to be considered

regenerative, it must contain two things: accountability and transparency. A corporation must

hold itself accountable by setting standards, tracking its progress, and reporting environmental

issues. A business is only regenerative if it regenerates and works with other regenerative

businesses, thus making a more significant impact. Partnering with governments, NGOs,

industry peers, and even academics can significantly affect reaching sustainability goals. The

involvement of these various actors is required to share information, resources, and expertise
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needed to promote the scale-up of regenerative practices on a national and global scale, a

requirement to enable transformative change to occur.

5. What are the opportunities for creating a circular economy within Mahindra’s

Agribusiness and Farm Equipment divisions? Consider the business opportunities that lie

hidden in resource savings. Refer to Exhibit 5, which depicts the various opportunities for

agriculture and food

in a circular economy.

Creating a circular economy within Mahindra's Agribusiness and Farm Equipment

division provides numerous commercial benefits with resource saving. Adopting sustainable

methods, for instance, precision farming and nutrient loops created by biofertilizers gives

Mahindra a chance to meet consumers' need for eco-friendly farm inputs while conserving

resources (Gorti et al., 2022). Mahindra can set itself apart from the competition and cater to the

changing demands of its customers for eco-friendly agricultural inputs by allocating resources

towards research and development aimed at developing these sustainable farming techniques.

Also, minimizing food wastage through the intelligent integration of supply chains and digital

analytics may result in considerable cost savings. The company can maximize its profits by

reducing inefficiencies, improving inventory management, and changing competitive advantage

through logistical optimization.

Cascading bio-refineries allow the company to repurpose agricultural waste streams and

by-products, providing alternative revenue streams. The company can turn these by-products into

valuable products that can be used in many ways, providing other revenue streams. This reduces

the waste and establishes the company as a champion for environmentally friendly raw materials

for other industries such as biofuels, chemicals, and plastics. With the implementation of this
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strategy, it has the potential to open up new market niches, therefore generating innovative

income streams and putting Mahindra as a pioneer in sustainable collaborations.

The company will benefit significantly from implementing circular packaging by

investing in biodegradable polymers and creating technology-based solutions to recover plastic

waste. Mahindra will have a competitive edge with this strategy as it will use environmentally

friendly packaging appealing to consumers who care about the environment. Furthermore,

innovative ways to recover waste products might help preserve the environment and result in

prospects for patenting or licensing, eventually resulting in new income streams via intellectual

property. In addition, another opportunity that Mahindra can tap into is food management

platforms, and this model presents the company with numerous opportunities for creating a

circular economy. Innovations, like pay-per-use food delivery and repurposing of unsold or

unconsumed food, reduce waste and help the company tap into the burgeoning market trends. By

leveraging these trends and consumer preferences for sustainable consumption, the company can

establish itself as the leader in promoting circular economy principles and cement its position as

a champion for sustainable and ethical corporate practices.

6. Write one paragraph on why companies should focus on stakeholder value creation rather

than shareholder value creation.

Two different approaches exist that companies adopt in order to determine their priorities

and objectives, which are stakeholder value creation and shareholder value creation. The

traditional view of corporate purpose is shareholder value, emphasizing maximizing financial

returns and increasing stock prices and dividends for shareholders (Freudenreich et al., 2019).

Compared to stakeholder value creation, it considers the much broader view of stakeholders

beyond shareholders, such as suppliers, customers, communities, the environment, and

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employees (Freudenreich et al., 2019). It takes cognizance of the needs and contributions of

different stakeholders and generates value benefits for the whole ecosystem of the company it

affects. Companies have, therefore, to concentrate on stakeholder value creation rather than only

shareholder value creation because of the current business dynamics. By prioritizing

stakeholders, a company recognizes the interconnectedness of various groups that impact the

company's operations, future success, and reputation. Businesses can build a more resilient and

sustainable ecosystem, which mitigates the risks associated with fluctuating financial markets,

regulatory changes, and consumer choices. Also, the stakeholders-oriented approach perfectly

aligns with the community expectations and essential ethics, contributing to increased brand

trust, innovation, and social responsibility through various perspectives and collaborations. A

more all-rounded and inclusive business strategy prioritizing stakeholder value generation

improves the company's relevance and flexibility in a dynamic global marketplace by ensuring

beneficial social impact and financial success.

7. How was the Mahindra Group creating value for the various stakeholder groups through

its proactive thinking related to climate change in the context of the Agribusiness and

Farm Equipment divisions? Short answers and you can use dot point responses for each

stakeholder group: (farmers, employees, vendors, rural communities, industry and

competitors, government, customers, and environment.

 Farmers- Farmers are the leading stakeholders who reaped numerous benefits from

Mahindra's proactive climate change measures by supplying vital resources and

assistance. Farmers can navigate climate-related difficulties through these initiatives and

increase production, especially water-intensive crops like rice and wheat. Innovative

agricultural methods empower farmers economically by providing methods that ensure

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they can adapt to the changing climate conditions and improve their earnings and farm

output.

 Employees- Mahindra's approach towards being a sustainable company and being

proactive on climate change allowed the company to foster a culture of environmental

awareness among its employees. This strategy increased its efficiency in eco-friendly

processes and engendered a feeling of employee responsibility. The company ensured

staff members were actively involved in sustainable projects, contributing to the larger

sustainable projects and the broader vision of climate change and encouraging an eco-

friendly workplace.

 Vendors- Mahindra adopted sustainable practices through its vendor network as part of

its proactive approach to mitigating climate change. Eco-friendly products and

procedures were pushed throughout the supply chain network, highlighting sustainability

as a common objective. The company promoted an ecologically friendly supply chain

and changed its operational standards to encourage its suppliers to adopt sustainable

practices.

 Rural communities- The Company invested substantially in developing rural

communities via proactive climate change programs. The company's initiatives improved

the quality of life in rural communities, including infrastructure, healthcare, and

education. Through enhancing infrastructure and facilitating access to the needed

services, Mahindra reinforced local livelihoods, thereby improving the communities'

ability to withstand the adverse effects of climate change.

 Industry and Competitors: The company's policies benchmarked the competitors towards

achieving sustainable practices. Mahindra set the bar for the industry by showcasing
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sustainable, innovative methods. This prompted competitors to adopt these eco-friendly

methods, therefore propelling sustainability across the industry. This created a healthy

competition based on environmental stewardship and helped shape the industry

standards.

 Government: Mahindra Group's climate change advocacy has significantly impacted

government relations by promoting sustainability policies. The company worked with

various government agencies to advance regulations and support eco-friendly practices

and sustainable agriculture through lobbying other initiatives.

 Customers: Through walking the talk with climate change issues and providing goods

and services that fostered sustainability, the company's customer base grew enormously.

Customers could make eco-friendly purchases after learning about sustainable farming

practices and tools. In addition to meeting customers' needs, the company helped bring

attention to the issue of sustainable consumption and promoted a change in customer

behavior by providing eco-friendly solutions.

 Environment: By reducing its carbon footprint and increasing biodiversity, the company

enormously contributed to environmental protection through its proactive climate change

practices. The company produces machines that are energy efficient and promote

sustainable agricultural techniques. Aligning with its commercial operations to preserve

the environment, the company contributed significantly to biodiversity preservation and

soil regeneration by lowering emissions and increasing soil health. This method helped

the business and, at the same time, the environment, leading to greater ecological

sustainability.
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References

Freudenreich, B., Lüdeke‐Freund, F., & Schaltegger, S. (2019). A Stakeholder Theory

Perspective on Business Models: Value Creation for Sustainability. Journal of Business

Ethics, 166(1), 3–18. https://doi.org/10.1007/s10551-019-04112-z

Gorti, S., Mahanti, A., Seshadri, D. V. R., Javadekar, P., & Rao, S. (2022). RURAL

PROSPERITY IN THE FACE OF CLIMATE CHANGE: MAHINDRA STRIVES FOR

SUSTAINABLE STRATEGIES. Indian School of Business.

Gupta, A. D. (2007). Social responsibility in India towards global compact approach.

International Journal of Social Economics, 34(9), 637–663.

https://doi.org/10.1108/03068290710778642

Raworth, K. (2017). Why it’s time for Doughnut Economics. IPPR Progressive Review, 24(3),

216–222. https://doi.org/10.1111/newe.12058

Sathaye, J., Shukla, P., & Ravindranath, N. H. (2006). Climate change, sustainable development

and India: Global and national concerns. Current Science, 90(3), 314–325.

http://eprints.iisc.ac.in/31799/

Wahlund, M., & Hansen, T. (2022). Exploring alternative economic pathways: a comparison of

foundational economy and Doughnut economics. Sustainability : Science, Practice and

Policy, 18(1), 171–186. https://doi.org/10.1080/15487733.2022.2030280