Mahindra commits to become carbon neutral company by 2040

Mahindra & Mahindra has announced an ambitious plan to become a carbon-neutral company by 2040, strengthening its focus on renewable energy, energy efficiency and climate-friendly business practices.

The Indian utility vehicle and farm equipment maker said it will work with the Environmental Defense Fund (EDF) to achieve the target. The company's strategy will focus first on reducing emissions through greater energy efficiency and increased use of renewable power. Any emissions that cannot be eliminated will be addressed through carbon sinks.

Mahindra Group Chairman Anand Mahindra, who was in San Francisco to co-chair the Global Climate Action Summit, said the company would use new technologies and its recently introduced internal carbon pricing mechanism to accelerate its transition towards carbon neutrality.

Mahindra & Mahindra has already taken several steps to reduce its carbon footprint. The company was the first in the world to join The Climate Group's EP100 initiative, committing to double energy productivity across its major businesses.

The company said its automotive business has already doubled energy productivity nearly 12 years ahead of its original schedule. Improvements have included the use of energy-efficient lighting, heating, ventilation and air-conditioning systems, motors and heat-recovery technologies.

Its farm equipment business is also progressing ahead of schedule and has achieved more than half of its energy productivity target.

Another key element of Mahindra's climate strategy is its internal carbon price. The company was the first Indian business to announce a carbon price of $10 per tonne of carbon emitted, with the funds intended to support investments in energy efficiency and renewable energy.

Mahindra said the carbon price was determined after considering international benchmarks and the investments required to meet its climate and energy goals.

The company also has more than a decade of experience in developing carbon sinks, which it plans to use to address emissions that cannot be eliminated through operational improvements. Such measures can include projects that absorb or store carbon dioxide from the atmosphere.

Mahindra is also a signatory to the Science Based Targets initiative, which encourages companies to establish emissions-reduction targets consistent with the objectives of the Paris Climate Agreement.

EDF Senior Director for Global Climate Richie Ahuja said Mahindra's commitment demonstrated that climate-focused investment could also support business growth by encouraging collaboration, innovation and new solutions.

The 2040 carbon-neutrality goal places Mahindra among Indian companies seeking to align long-term business strategies with global efforts to tackle climate change. Its approach combines direct emissions reduction with renewable energy and carbon removal, rather than relying solely on offsets.

With pressure growing on businesses worldwide to reduce greenhouse gas emissions, Mahindra's target also reflects the increasing importance of climate-related efficiency measures in India's manufacturing and automotive sectors.