Sustainability-Green Leadership Paul Campbell, Director International Home & Housewares Show

2 Home Appliances Home Services Consumer Electronics/ Lighting Energy Management Supply Chain KCD Brands SYW/Online/ Social Media Increase education/awareness of ES- GL initiatives/successes for our members/customers/associates at every touch point Optimize strategic partnerships with industry leaders and solidify our market leadership Translate successful program attributes across all SHC formats Provide platform for launching emerging technology initiatives Protect and enhance SHC and partners’ brands Mitigate business risk Team Objectives Positive Impact Across SHC

3 Priorities Sustainability:  Resource Management: Energy Consumption Reduction/Waste Management  Associate Engagement: Networks/Community/Industry Collaboration  Emerging Technologies: Electric Vehicle/Propane fueled service vans/Home Energy Management  Reporting/External Benchmarking: Corporate Sustainability Report/Carbon Disclosure Project/Climate Change Policy/EPA/Newsweek Green Ranking Green Leadership:  Rebate/Incentive Promotion: Best in Class Program Execution  In store Collaborative Partnerships: Green Product & Service Display/Educational Workshops  Co-branded Marketing Campaigns: Utilities/Manufacturers/Store/Community  Shop Your Way Utility Partnerships

4 S/GL Accomplishments EPA ENERGY STAR 2012 Corporate Commitment Award EPA Energy Star Retail Partner of the Year: 2010/11/12/13 EPA Energy Star 2012 Energy Management Partner of the Year EPA WasteWise 2012/3 Honorable Mention: Avg. 73% total waste diversion EPA Energy Leaders: Kmart 2012 Award Winner, >10% energy reduction across all buildings EPA Battle of the Buildings: 2010 Runner Up, 2011 Top 10%, properties competing (6 in top 50 at mid point out of 3100 total) Launched 27 Propane Fueled Home Service Vans In Seattle Market Pacific Gas & Electric: 2012 SHC Partners In Transformation Retail Excellence Award SLS 2012 SmartWay Transportation Award Winner 2012 Newsweek Green Ranking: 104/500, Top Ten for retailers (9/42)

5 Optimizing Network Engagement In Store Execution: -Utility event/waste + energy reduction/community outreach -Continuous education/awareness -Leverage all tools available S/GL Field Champions: -Leverage all communication channels -Network for identifying new opportunities/translate -Reputation as trusted expert to the team/customer

6 Collaboration EPA- Battle of the Buildings Kilowatt Challenge-Process/Behavior Translation Utility Partnerships Solar Arrays Demonstration Facilities: 2013/4 Pilot

7 In Store Green Displays

8 Supplier Sustainability Survey & Scorecard An efficient and effective means to request information from suppliers and score them based on their environmental sustainability and efforts SHC is acting consistently with consumer trends around demanding visibility and accountability for a company’s supply chain Currently rolled-out to select suppliers in Auto, HA, L&G, Footwear, and CE Survey notification, registration, submission, and review are all done via web portal The survey consists of conditional questions in 7 sections: Greenhouse Gas, Energy & Resources Environmental Compliance Waste Management & Recycling Internal Programs & Policies Product Stewardship Water Innovation

9 Supplier Sustainability Survey & Scorecard

10 Responsible Appliance Disposal October 2007: SHC first retailer member Environmental Protection Agency- Committed to improving the environment through Responsible Appliance Disposal. SHC recycles over 1.5M units/yr

11 Responsible Appliance Disposal De-manufacturing Process Catalog units (type, size, vintage, etc.) Remove shelves and crispers Place on line conveyor belt Evacuate purified oils and refrigerant – Recycle oils – Destroy refrigerant (CFC-12) Remove possible hazmats – PCB starting devices – Mercury switches and thermostats Discern type of insulation (drill core sample) Record harvested materials (refrigerant type and quantity, oils quantity, presence of hazmats)

12 Sears Holdings Corporation Thank You