Case $6$: ITC's Vocational Training Program

WORLD BUSINESS COUNCIL FOR SUSTAINABLE DEVELOPMENT

Company Background

ITC is a leading Indian multi$-$business conglomerate, established in $1910.$ Its portfolio of businesses spans fast$-$moving consumer goods, hotels, paperboards and packaging, agribusiness, and information technology. The Company employs about $30,000$ people in the country and its value chains provide livelihoods to around $6$ million people, mainly amongst the poorest in rural India.

The Skills Gap: Providing Skills and Improving Livelihood Opportunities for Millions Living in Rural Areas

It is estimated that about $12$ million people join the working age group in India every year. However, the formal economy is able to provide employment to only $2$ million. It is a matter of concern that this growing population of unemployed youth has high aspirations but lacks the right skills to enter the job market. This is despite the fact that there is demand for more resources in the formal sector. It is imperative, therefore, to train such unemployed youth and provide them with relevant skills. A baseline survey, carried out by ITC in ten locations where it has large operations, revealed that out of a total number of $470,000$ youth in the age group of $18$ to $35$ years, the majority did not possess skills relevant to the job market and were hence unemployed. Only around $145,000$ youths were employed in the formal sector, with $10$ percent being ITC employees $($about $14,000).$ The remaining $320,000$ youths were either unemployed or operated in the informal economy with jobs that lid not provide any security. For ITC, empowering the routh with relevant skills is important in order to improve roduction and increase benefits. ITC supports a number of nitiatives for providing vocational training to youth so as to

equip them with relevant skills and increase their employability in the market. ITC's training programs, however, have a larger purpose. It is the company's driving aspiration to empower rural communities by creating sustainable livelihood opportunities through various initiatives including vocational training, employment, and entrepreneurship. In almost every location where it operates, ITC sees itself among the foremost companies in terms of excellence in production and residential facilities. In such areas, the company sees virtually two different worlds coexisting $-$ one is the world of ITC with its factories and residential areas, and the other is the surrounding areas where communities are confronted with various challenges, especially at the level of social infrastructure. In this context, one of the challenges faced by the company is the unemployed youth who have high aspirations but not the opportunity to secure jobs to fulfill those desires.

ITC's Solution: A Vocational Training Program for the Rural Youth

In December $2013,$ ITC developed a vocational training program for the communities which aims at training about $10,000$ people every year. The program focuses on building relevant skills that the market demands and for which there are job opportunities. The objective is to impart the relevant job skills to job seekers and make them industry$-$ready and employable in the manufacturing or service sectors$.$ The program is also part of the company's affirmative action plan that focuses on the Scheduled Castes and the Scheduled Tribes $($SC$/$ST$),$ which are considered to be among the most socially and economically marginalized in India. The program offers training in trades including

ais case is not meant to reflect current events but is instead an illustration of past events for teaching purposes. @ Courtesy of the World Business puncil for Sustainable Development.