The plans were set out in a message by managing director and chief executive officer S. N. Subrahmanyan to L&T’s employees on increased digitization, impact of climate change, aging global workforce and military and trade blocks that impact business decision making.

“While we are well attuned to identify and chase opportunities in our core areas, we need to be sharp and smart in areas that are relatively new to us like Green Energy, Data Centres, EduTech, and SuFin,” said Subrahmanyan in his New Year’s message.

“These businesses will stretch us immediately but have an immense future and we need to pursue the same with vigor,” he added.

L&T has about 50,000 employees.

The MD highlighted the global trends which were pivotal in business decision making and needed to be watched even now.

“Digital Disruption” and a shift to the Metaverse were among the “most pertinent” and along with that came the use of AI, IoT and cloud computing as business imperatives to enhance customer experience, boost employee efficiency and improve project outcomes.The launch of 5G is another factor that will see better outcomes in finance, manufacturing, education, healthcare, etc.

The L&T CEO sounded a note of caution about climate change and the need for sustainable energy but also noted the need for realism when it comes to curtailing “fossil fuels”.

“With COP27, the world has affirmed again that a sustainable and just energy transition is required. The commitments by US, China, EU to carbon neutrality by 2050 and the Paris Climate accord marks a significant move in the right direction,” he noted.

“In the background however, there is a hint of realism, with the limit there is to curtailing fossil fuels too much too fast. The world must pursue aggressive action on energy transition without adversely affecting short to medium term growth aspirations of nations,” he added.

He pointed out that just when the global supply chain disrupted by the pandemic was “limping back to normalcy”, it has been hit again by Russia’s war on Ukraine.

Geopolitical shifts were also crucial in decision making.

“On the larger geopolitical front, one needs to be aware of the new trade and military blocks being formed such as the Quad, AUKUS, I2U2 (India, Israel, USA, UAE), the China-led BRI, a revitalized NATO,etc.”

L&T’s head also flagged the talent supply chain gap which will get more acute because of an aging workforce.

“On one hand, the global economy requires a lot of new project professionals by 2030; on the other, it is hindered by aging populations and a pressing need to find new ways to alleviate worker shortage and close talent gaps,” he noted.

He said soaring prices of oil, gas and other vital commodities remain major concerns.The CEO said L&T has the highest ever order backlog, but will improve margins in infrastructure space and aims to become asset-light.

He said the company is on track to achieving water neutrality by 2035 and carbon neutrality by 2040.

“Going ahead, our focus will be to remain on green supply chain management, circular economy, biodiversity conservation, and the numbers are beginning to tell a story,” he said. The infrastructure major aims to up the diversity quotient .

“Traditionally the infrastructure and manufacturing space has witnessed lower participation by women. As leaders, we have the responsibility to change that. Today some of our key projects are led by women. We are encouraged to do more on this front,” said the MD.