Building a sustainable future: Our agenda and our contribution Launch of the Corporate Sustainable Development Report 2007 June 2, 2008 © 2008 Holcim Ltd/Switzerland Sustainable Development is a continuous journey 2002 2007 2003 2005 Our SD journey started decades ago and is an integral part of our business strategy © 2008 Holcim Ltd/Switzerland Sustainable Development Report 2007 - Facts Reduction of CO2 and other atmospheric emissions On track to reach 2010 target Partnerships with IUCN on biodiversity (new) GTZ on AFR (continued) OH&S performance Improvements, yet further efforts needed CSR and stakeholder engagement Community spending and Community Advisory Panels increased External assurance and broad external recognition © 2008 Holcim Ltd/Switzerland Vision, strategy and corporate governance Vision, strategy & governance The business place Environmental performance Social performance © 2008 Holcim Ltd/Switzerland Sustainable Development: A part of our mission Vision, strategy & governance The business place Vision: We want to provide foundations for society's future Environmental performance Social performance Mission: We want to be the world's most respected and attractive company in our industry – creating value for all our stakeholders Holcim Strategy House: Working within the triple bottom line © 2008 Holcim Ltd/Switzerland Corporate Governance Vision, strategy & governance The business place Environmental performance Social performance High standards of Corporate Governance and Code of Conduct implemented Governance structure and committees set up External assurance of the CSDR 2007 and CO2 data Audit Committee (all members independent) Governance, Nomination & Compensation Committee (all members independent) Assessment of Board, Committees and CEO Single share: one share = one vote Policy landscape and directives Business Risk Management Internal Audit Corporate Governance Reporting Corporate Sustainable Development Report © 2008 Holcim Ltd/Switzerland The business place Vision, strategy & governance The business place Environmental performance Social performance © 2008 Holcim Ltd/Switzerland Value creation Vision, strategy & governance The business place Environmental performance Social performance Value creation for Holcim and our stakeholders CHF 4.6 billion to employees CHF 2.0 billion to shareholders and creditors CHF 1.2 billion to governments © 2008 Holcim Ltd/Switzerland Population growth and urbanization Vision, strategy & governance The business place Environmental performance Social performance World population to increase to more than billion by 2030 World is facing the largest mass migration in history Sustainable construction will be key to securing long-term environmental, economic and social viability London Moscow Istanbul New York Beijing Tokyo Delhi Seoul Osaka Cairo Karachi Shanghai Dhaka Mumbai Kolkata Manila Lagos Los Angeles Mexico City Jakarta Rio de Janeiro São Paulo Buenos Aires Served by Holcim today Cities with over 10 million inhabitants © 2008 Holcim Ltd/Switzerland The ecological footprint Vision, strategy & governance Worldwide, buildings account for up to … The business place Environmental performance Social performance 17% Fresh water consumption 25% Wood harvest Source: World Green Building Council, The ecological footprint © 2008 Holcim Ltd/Switzerland 33% CO2 emissions 30 – 40% 40 – 50% Energy use Raw material use 10 Innovation potential along the value chain Vision, strategy & governance The business place Environmental performance Social performance Process innovation: Waste derived fuels an important source of energy Product innovation: Eco-efficient product range: Composite cement share increased from 30% (1990) to over 75% (2007) Use of recycled products for our aggregates activities is growing 2007 1990 Ordinary Portland cement 30% Composite cement Ordinary Portland cement 75% Composite cement 12 © 2008 Holcim Ltd/Switzerland Holcim Foundation for Sustainable Construction Platform to promote sustainable construction Activities include: Holcim Awards competitions, Holcim Forum, seed funding for building initiatives and research 2nd Awards cycle: 5,000 ideas to build a sustainable future 13 © 2008 Holcim Ltd/Switzerland Holcim Awards: from idea to reality Venezuela South Africa Spain Germany Italy USA China Philippines 14 © 2008 Holcim Ltd/Switzerland Environmental performance Vision, strategy & governance The business place Environmental performance Social performance 15 © 2008 Holcim Ltd/Switzerland Successfully reducing CO2 emissions Vision, strategy & governance The business place Environmental performance Social performance Since 1990: 103% increase of our total cement production – absolute CO2 emissions increased by only 70% 16.3% reduction in net CO2 emissions per tonne cementitious material Voluntary target of 20% reduction per tonne by 2010 within reach 16 © 2008 Holcim Ltd/Switzerland Drivers of CO2 reduction Vision, strategy & governance The business place Environmental performance Social performance Lowering the clinker factor is one of the best approaches for reducing CO2 emissions The use of alternative fuels contribute to decrease fossil fuel use and costs Indonesia: Rice husks offer an important source of biofuel energy 17 © 2008 Holcim Ltd/Switzerland Controlling other atmospheric emissions Vision, strategy & governance The business place Environmental performance Social performance Our target is to reduce specific NOx, SO2 and dust emissions by 20% by 2010 compared to 2004 levels Ongoing investments in plant equipment and training Results: SO2 target already achieved On track to reach dust targets Further measures taken to reach NOx target 18 © 2008 Holcim Ltd/Switzerland Conserving ecosystems and biodiversity Vision, strategy & governance The business place Environmental performance Social performance Production of cement and aggregates depends on access to raw materials Commitment to quarry rehabilitation and biodiversity conservation Collaboration with IUCN extends and builds on our efforts 19 © 2008 Holcim Ltd/Switzerland Social commitment Vision, strategy & governance The business place Environmental performance Social performance 20 © 2008 Holcim Ltd/Switzerland Safety at work is of paramount importance Vision, strategy & governance The business place Environmental performance Social performance Health and safety are vital to business success Despite improvement in Lost Time Injury Frequency Rate (LTIFR), overall performance is unsatisfactory Improving the safety record remains a high priority 21 © 2008 Holcim Ltd/Switzerland Safety awareness initiatives Vision, strategy & governance Example Holcim Ecuador: ¡para y piensa en mi! The business place Environmental performance Social performance 22 © 2008 Holcim Ltd/Switzerland Effective social commitment Vision, strategy & governance The business place Environmental performance Social performance Holcim CSR approach is strategic, not philanthropic Education, building infrastructure and community development are our focus areas Community spending of CHF 48 million in 2007 equaling 1% of net income before tax increase of 33% from 2006 23 © 2008 Holcim Ltd/Switzerland Stakeholder engagement Vision, strategy & governance The business place Environmental performance Social performance At local level: Half of all Group companies have community advisory panels out of 10 conduct stakeholder dialogue A majority involve stakeholders in CSR planning Our alliances with the WBCSD and the UN Global Compact help to make step changes 24 © 2008 Holcim Ltd/Switzerland Commitment across the Group Awards won by Group companies are evidence of this commitment SD reports of local Group companies are available on www.holcim.com SD performance continues to be widely recognized 25 © 2008 Holcim Ltd/Switzerland Strength Performance Passion © 2008 Holcim Ltd/Switzerland .. .Sustainable Development is a continuous journey 20 02 20 07 20 03 20 05 Our SD journey started decades ago and is an integral part of our business strategy © 20 08 Holcim Ltd/ Switzerland Sustainable. .. 20 08 Holcim Ltd/ Switzerland Vision, strategy and corporate governance Vision, strategy & governance The business place Environmental performance Social performance © 20 08 Holcim Ltd/ Switzerland Sustainable. .. line © 20 08 Holcim Ltd/ Switzerland Corporate Governance Vision, strategy & governance The business place Environmental performance Social performance High standards of Corporate Governance and Code