1. 6 March 2013 Best Corporate Responsibility Practices – Cases Dr. Thomas Streiff, Head Engagement Team and Andrea Gaeumann, Sustainability Expert

2. 2 Part A 1.Methods and criteria for the evaluation of corporate responsibility 2.Best corporate practices – examples Part B 3.Good – Bad Corporate Responsibility Practices: instruction and criteria grid for workshop Overview

3. 3 Methods and criteria for the evaluation of corporate responsibility Most common methodologies (often in combination) Questionnaires (e.g. Dow Jones Sustainability Index) Surveys with consultation of experts (e.g. GlobeScan) Analysis of annual and sustainability reports and other information concerning the integration of corporate responsibility principles and practices published by the company (e.g. Fondation Guilé, Inrate) Systematic review of third-party information (e.g. RepRisk Tool) Interviews (mainly for verification of assessment results) Useful links: Dow Jones Sustainability Index: www.sustainability-index.com GlobeScan: www.globscan.com Fondation Guilé: www.guile.org Inrate: www.inrate.com RepRisk: www.reprisk.com

4. 4 Methods and criteria for the evaluation of corporate responsibility Conceptual framework (1/3) Source: Fondation Guilé / T. Streiff Differentiation Corporate philosophy: values and mission Corporate governance Best practice Compliance & (sector specific) good practice Corporate Responsibility Obligation Regulation & standards Stakeholder expectations

5. 5 Differentiation concerning image, products, markets Protection of opportunities and reputation Prevention of damages and claims Legal requirements Good Practice Best Practice Compliance Development Methods and criteria for the evaluation of corporate responsibility Conceptual framework (2/3) Source: Fondation Guilé / T. Streiff

6. 6 Company planning Controlling Vision Company strategy Mission Communication strategy Strategic goals and measures (BSC) and management guidelines Individual agreement on objectives (MbO) Values Charta / Code Methods and criteria for the evaluation of corporate responsibility Conceptual framework (3/3)

7. 7 Source: Fondation Guilé / T. Streiff Methods and criteria for the evaluation of corporate responsibility Assessment aspects A) „Normative“ approach Rating of depth of the ESG* criteria consideration in corporate reporting B) „Systemic“ approach Rating of the consideration of corporate responsibility criteria in -Vision, value and strategy -Management systems, organisation und processes -Products and services -Resource and environment management -Stakeholder management -Communication and reporting

8. 8 1.Vision, values and strategy Example of Novo Nordisk Every year, the Board of Directors reviews the company’s long-term strategy and outlook. (…)The strategy is characterized by a strong focus on a few diseases, five core capabilities and a deeply rooted values based management system. The Board remains confident that these strategic choices provide a solid basis for a continued positive development for Novo Nordisk in the coming years. Novo Nordisk Annual Report 2012, p. 1

9. 9 All of these investments serve one purpose: To help patients live better lives. That is what drives us. We know there are millions of people with diabetes who could be living their lives in full if only they got the necessary medical treatment and care, and we are determined to contribute to closing that gap. We have set an ambition that by 2020 we will provide medical treatment to an estimated 40 million patients.. In such difficult times, it is crucial that we – industry, politicians and payers – rethink the approach to managing diabetes and other chronic diseases, ensuring more sustainable healthcare solutions. Novo Nordisk Annual Report 2012, p. 2 Novo Nordisk 1.Vision, values and strategy Example of Novo Nordisk

10. 10 BT Sustainability Review 2011, p. 20 2.Management systems, organization and processes: Example of British Telecom Key indicators

11. 11 Samsung Sustainability Report 2011, p. 45 2.Management systems, organization and processes: Example of Samsung Samsung Objectives and monitoring

12. 12 Data collection Samsung Sustainability Report 2011, p. 45-78 2.Management systems, organization and processes: Example of Samsung

13. 13 3.Products and services Example of Philips www.lighting-a-greener-future.com

14. 14 4.Resource and environmental management Example of Swiss Re Swiss Re CR Report 2011, p. 39

15. 15 5.Stakeholder management Example of Unilever India: Creating rural entrepreneurs Rojamma is a single parent living in Kurumurthy (…). When her husband left her, she earned a few rupees working in her mother's field but found it difficult to support her two daughters. Then she joined a women's self-help group and found out about Project Shakti. "From that moment my life changed", recalls Rojamma. To expand its markets, the challenge for Hindustan Lever (Unilever's business in India) was how to reach millions of potential consumers in small remote villages where there is no retail distribution network, no advertising coverage, and poor roads and transport. The solution was Project Shakti, launched in 2000 in partnership with non governmental organisations, banks and government. Women in self-help groups across India are invited to become direct-to-consumer sales distributors for Hindustan Lever’s soaps and shampoos. The company provides training in selling, commercial knowledge and bookkeeping to help them become micro-entrepreneurs. http://www.unilever.com/sustainable-living

16. 16 Unilever Sustainable Living Plan, Progress Report 2011, p. 35 5.Stakeholder management Example of Unilever

17. 17 6.Communication and reporting Example of Telefónica Our reporting model has evolved this year under the perspective of the triple results account – the economic, environmental and social dimension. With the new scheme, in the Corporate Sustainability Report for 2011 we have responded integrally to the Dow Jones Sustainability Index or DJSI and to the indicators included in the GRI A+ guide. http://www.crandsustainability.telefonica.com/en/transparency_dialogue/cr_report.php

18. 18 Principles for defining report quality: -Balance -Comparability -Accuracy -Timeliness -Clarity -Reliability / assurance According to AA1000 (APS) -Inclusivity -Materiality -Responsiveness Telefónica 2011 Sustainability Report, p. 9 Telefónica 6.Communication and reporting Example of Telefónica

19. 19 Telefónica 2011 Sustainability Report, p. 9 Telefónica 6.Communication and reporting Example of Telefónica

20. Good – Bad Corporate Responsibility Practices: Exercise 20 Methodological instruction for assessment All 6 main assessment components are equally weighted (each 16.6 %) For the ranking of the individual criteria the following scores will be applied: 0 = no information found: aspect / criteria seems not to be of relevance for company 1 = general information found: unclear if aspect / criteria is of relevance for company 2 = comprehensive information found: aspect / criteria seems to be of relevance for company Max scoring: 72

21. Assessment component 1: Vision, values and strategy 21

22. Assessment component 2: Management systems, organi­za­tion and processes 22

23. Assessment component 3: Products and services 23

24. Assessment component 4: Resource and environmental management 24

25. Assessment component 5: Stakeholder management (internal & external) 25

26. Assessment component 6: Communication and reporting 26