Material matters are those that have an impact on our ability to create value on our stakeholders. We proactively analyze various economic, environmental, social, and governance issues, and accordingly define the strategic priorities and mitigating actions to make our business more resilient in the long run.
We have conducted a materiality assessment to identify priority issues for the Company and its internal and external stakeholders. As the first assessment of material concerns this year, we have classified the material issues based on risks and opportunities. We have arrived at these keeping in mind the GRI Standard principles of materiality, identifying technology trends, benchmarking with industry peers and engaging with stakeholders.
Happiest Minds has a presence across multiple geographies, industries, services, and products. The universe of our material concerns is complex and multi-layered, one that is deeply intertwined with the decisions we implement and the value we seek to create through our business. Our materiality analysis demonstrates areas of focus on issues that are truly critical to achieving the Company’s goals, strengthening the business model and managing the impact on the environment and society.
Strong corporate governance that considers stakeholder concerns, engenders trust, oversees business strategies, and ensures fiscal accountability, ethical corporate behavior, and fairness to all stakeholders is core to achieving our longer-term mission.
We work with a wide range of customer data which is leading to increased regulatory scrutiny globally. Cloud-based software and IT services also raise concerns about potential access to user data by governments.
Effective management in this area is important to reduce regulatory and reputational risks which can impact revenues, and market share, and lead to regulatory actions involving potential fines and other legal costs.
Rising instances of cyber-attacks and social engineering puts our data and that of our customers at risk.
Inadequate prevention, detection, and remediation of data security threats can damage our reputation and thus influence customer acquisition and retention, resulting in decreased market share and lower demand for our products.
It can also result in increased expenses, due to remediation efforts such as identity protection offerings and employee training on data protection. New and emerging data security standards and regulations further lead to increased costs of compliance.
Climate change poses significant physical and transition risks to our business. It can also impact the wellbeing of Happiest Minds and customers as well as our strategy and financial resources. It also offers opportunities arising from innovations in energy efficiency and renewable energy.
IT companies spend a significant proportion of their revenues on IP protection. While IP protection is inherent to the business model of some companies, it is also an important driver of innovation, and restricting competition from accessing its benefits can be a contentious societal issue.
Programming errors or server downtime have the potential to generate systemic risks, such as computing and data storage functions to the cloud. The risks are heightened for sensitive sectors, such as financial institutions or utilities, which are critical to national infrastructure.
Investments in improving the reliability and quality of IT infrastructure and services are therefore critical.
Our people are the key contributors to value creation. Recruiting qualified employees to fill the relevant positions and training them adequately in including niche skills is key to servicing our clients and driving future growth. It also enables us to provide a quality differentiator.
The health and safety of our teams as well as their physical, emotional, and mental wellbeing is critical to keeping them motivated, driving their productivity, and influencing their retention.
Diversity and Inclusion is essential as it helps in bringing diverse talent within the organization and thus drives a thriving and innovative culture. It also helps us understand the needs of our diverse and global customer base.
Business must be rooted in community and be aligned with its larger interests. Any adversarial relationship can hurt our ability to create long-term value.