Umicore’s Sustainable Cobalt Sourcing Approach Jan Tytgat & Jonas De Schaepmeester Raw Materials Conference 2017 – Break out Session : ‘Responsible Sourcing and mining for the energy transition’

Who we are A global materials technology and recycling group One of three global leaders in emission control catalysts for light-duty and heavy-duty vehicles and for all fuel types A leading supplier of key materials for rechargeable batteries used in portable electronics and hybrid & electric cars The world’s leading recycler of complex waste streams containing precious and other valuable metals Umicore - Sustainable Cobalt Sourcing Approach

Global leader in active materials for rechargeable batteries Umicore RBM has already produced enough cathode materials to… ….provide a smartphone to every person on this planet …power more then 1Million EV´s 1 out of 5 batteries ever made contains Umicore technology Over 15 years in the market 6 production sites Umicore - Sustainable Cobalt Sourcing Approach

Umicore's activities in cobalt Umicore has over 100 years of experience in Cobalt Umicore is active in all main Cobalt applications: Battery Materials Ceramics Super Alloys Animal Feed Catalysts Paints Tires Diamond Tools Umicore - Sustainable Cobalt Sourcing Approach

Material flow over RBM to End-Users Copper or Nickel mine & concentrator Supplier / mining company Umicore CSM Cobalt Refinery Umicore CSM: Battery cathode precursor Umicore RBM: Battery cathode Battery makers End-Users Umicore - Sustainable Cobalt Sourcing Approach

 Umicore - Sustainable Cobalt Sourcing Approach

Challenges in Cobalt Sourcing Health & Safety even as Social and Environmental Challenges Challenges inherently linked to Cobalt mining Social and Environmental Social standards should be respected during the cobalt supply chain (child protection, anti-slavery, anti-corruption…) Environmental standards are required to protect environment and communities Health & Safety Several Cobalt substances are CLP-classified as carcinogenic Inhalation of cobalt is linked to the prevalence of lung diseases Fatal accidents happen in unsafe working conditions Umicore - Sustainable Cobalt Sourcing Approach

Challenges in Cobalt Sourcing More than half of the world’s cobalt reserves originate in DRC Artisanal Small-scale Mining (ASM) represents approx. 20% of DRC’s Cobalt output Umicore currently does not accept ASM in its supply chain, on the basis of: Poor Safety and Health Conditions Health risks related to Cobalt Exposure Child Labor Human Right Abuses we do not want to ban DRC, it is important to stay engaged with sustainable partners in the country. we do not want to ban ASM as such, because we know that a lot of people depend on it for income. But the abuses that are still there make it currently impossible for us to source from ASM Amnesty Report (2016) mentions hazardous working conditions (illness, fatal accidents…), human right abuses, bribery… “110,000 to 150,000 artisanal miners in Katanga region … 40,000 children work in cobalt mines” Umicore - Sustainable Cobalt Sourcing Approach

Sustainable Procurement Framework for Cobalt The Framework was created to assure that all upstream practices are in line with Umicore’s Standards, as listed in the Umicore Sustainable Procurement Charter: no child or forced labour; business ethics and compliance to law; environmental impact; occupational health and safety Inspired by OECD’s 5-steps process Applied to all purchases of Cobalt in Umicore Umicore - Sustainable Cobalt Sourcing Approach

http://www.umicore.com/en/cases/sustainable-procurement- framework-for-cobalt/ Umicore - Sustainable Cobalt Sourcing Approach

Due diligence process for cobalt Risk Assessment Red Flags • Any form of torture, cruel, inhuman or degrading treatment or punishment; • Any form of forced or compulsory labour; • Any form of child labour; • Any form of bribery or corruption; • Hand-picking and/or artisanal mining (as primary source); • Supplier is not willing to accept the principles stated in the Umicore Charter.  Orange Flags • Hand-picking and/or artisanal mining (as secondary source); • Supplier does not have the minimum required legal permits and certificates; • Supplier does not have procedures in place to minimize environmental impact; • Supplier does not have procedures in place to ensure a healthy and safe working environment.  Umicore - Sustainable Cobalt Sourcing Approach

Third Party Assurance Umicore received as first company ever third-party validation for its cobalt due diligence practices PwC audit on reporting years 2015 and 2016 In line with five steps of OECD Due Diligence Guidance For the reporting year 2016, Umicore publicly shared the compliance report of the PwC audit via its annual report. Umicore shows a high level of transparency to its customers and stakeholders. this is really a level of transparency that was never seen before in industry - we are very much welcoming all feedback Umicore - Sustainable Cobalt Sourcing Approach

Path forward for Sustainable Cobalt Sourcing Umicore internal ambitious committed to continuous improvement on our own due diligence practices Umicore to stimulate recycling of batteries to recover more cobalt External initiatives Exploring how to contribute and share expertise to stimulate the development of sustainable cobalt sourcing practices Umicore - Sustainable Cobalt Sourcing Approach

Thank you! Contact: Jan.Tytgat@eu.umicore.com Jonas.DeSchaepmeester@eu.umicore.com www.umicore.com

Umicore in Cheonan, South Korea The largest cathode material production worldwide Umicore Rechargeable Battery Materials

Historical perspective RECHARGEABLE BATTERY MARKET (GWH) Portable Societal driver Electrification Regulatory driver Energy Storage System 2000 “More of the same” will no longer work Capital intensive Umicore Rechargeable Battery Materials

Unique integration in the value chain guaranteeing high speed to market, supply security, and responsiveness to customer needs Raw material Metal Product Application End use Portable electronics Recycling & intermediates Power tools (P) HEV / EV Li-ion rechargeable batteries residues Where do we stand in the value chain? There again we have a pretty unique position. Li-ion batteries are now serving a full set of applications, expanding everyday. As I mentioned earlier our direct customers, cell and batteries makers are mainly in Asia. Umicore is one of the few upstream integrated cathode materials producers. We source our metals, Co, Ni, Mn from long term contracts with suppliers but also via our internal refining and recycling activity. Therefore, whatever the market conditions are, we have a very competitive raw materials mix as a basis for production of cathode materials. Also, in these times of extreme growth and pressure on the supply side, having such a flexibility gives us a competitive edge E-bikes residues Stationary power Umicore closes the material loop by innovative recycling technologies