sustainable development at holcim integrating sustainability into ongoing business activity swiss sustainability leaders sri conference 4 october 2013 holcim ltd strength performance passion

Strength. Performance. Passion.
© 2013 Holcim Ltd
Sustainable Development at Holcim -
Integrating sustainability into ongoing business activity
IFZ - MAS Corporate Finance 20_10 – Funding
December 7, 2012, 14.10 – 17.50
2013-06-27
© 2013 Holcim Ltd
Swiss Sustainability Leaders SRI Conference; 4 October 2013
© 2013 Holcim Ltd
Agenda
2
Energy and Climate Protection, 2013-07-31
Holcim at a glance and our impacts
Managing SD and determining material issues
Managing key impacts: OH&S
Managing key impacts: Energy and carbon emissions
Managing key impacts: Sustainable Procurement
Managing key impacts: Other environmental impacts
Managing key impacts: Social responsibility approach
Managing key impacts: Human Rights Impact assessments
© 2013 Holcim Ltd
Holcim at a glance – product segments and net sales
Cement
Aggregates
Net sales CHF 21.5 billion
Cement Clinker
Product segments 2012 Net sales per segment 2012
 217.5 million tonnes
production capacity
 147 cement and

grinding plants
 Sales: 148.0 million
tonnes
 470 aggregates
plants
 Sales: 159.7 million
tonnes
 1,286 RMX plants
 99 asphalt plants
 Sales of ready-mix
concrete: 46.9 million
m
3
 Sales of asphalt: 9.1
million tonnes
Aggregates
Other construction
materials & services
10.4%
58.0%
31.6%
Op. EBITDA per segment 2012
Op. EBITDA CHF 4.0 billion
3.4%
86.5%
10.1%
Other Construction
Materials and Services
3
© 2013 Holcim Ltd

4
Holcim at a glance – well balanced global portfolio
Africa Middle East
Europe
Asia Pacific
North America
Latin America
Net sales per region 2012
14.7%
26.1%
39.2%
4.3%
15.7%
Europe
Sales volumes per region 2012
North America
Latin America
Africa Middle East
Asia Pacific
(million t or m
3
)
Net sales CHF 21.5 billion
Op. EBITDA per region 2012
Op. EBITDA CHF 4.0 billion
11.4%
14.9%
44.4%
6.6%
22.7%

• Cement 79.2
• Aggregates 27.8
• Ready-mix concrete 12.8
• Cement 24.9
• Aggregates 14.0
• Ready-mix concrete 10.2
• Cement 26.3
• Aggregates 74.3
• Ready-mix concrete 14.7
• Cement 12.0
• Aggregates 41.3
• Ready-mix concrete 8.1
• Cement 8.4
• Aggregates 2.3
• Ready-mix concrete 1.1
© 2013 Holcim Ltd
5
Our commercial success means that Holcim has a
significant footprint on the planet…
WATER
• Water consumption: 140 Mm
3
/y
• Sufficient to supply the city of Paris or Berlin for one year
RAW MATERIALS
• Raw materials extraction: 360 Mt/y
• One 55t truck every 5 seconds
CLIMATE CHANGE
• Climate change: 100 Mt of CO
2

/y
• Equivalent to 0.3% of worldwide carbon emissions
• Equivalent to the total carbon emissions of Belgium in a year (but GDP of
Belgium = 20 x Holcim revenues)
POWER
• Annual electricity consumption of 17.5 TWh
• Sufficient to cover yearly demand of more than 4 Millions households
© 2013 Holcim Ltd
Managing our impacts - Sustainable Development: A part of
our mission
6
Optional footer entry, 2013-02-11
Vision: We want to provide foundations for society's future.
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
© 2013 Holcim Ltd
C O M P E T I T I V E A D V A N T A G E
7
Optional footer entry, 2013-02-11
The driver is clear - sustainable development makes
business sense
Regulatory
compliance,
legal license to
operate
Societal license to
operate,

recognition by
regulators and
engage
Identifying and
avoiding risk,
identifying
opportunities,
providing societal
value
Brand differentiation,
new markets,
products & services
outperforming competitors,
maximizing societal and
shareholder value
Compliance
Integration into
business
Risk
Mitigation
Reputation
Management
„Some of the greatest opportunities in the 21st century will be turning waste (inefficiency, underutilization,
energy waste) into profit“
Source: Michael Braungart and William McDonough, „Cradle to Cradle: Remaking the Way we Make Things“; 2002
© 2013 Holcim Ltd
Agenda
8
Energy and Climate Protection, 2013-07-31
Holcim at a glance and our impacts

Managing SD and determining material issues
Managing key impacts: OH&S
Managing key impacts: Energy and carbon emissions
Managing key impacts: Sustainable Procurement
Managing key impacts: Other environmental impacts
Managing key impacts: Social responsibility approach
Managing key impacts: Human Rights Impact assessments
© 2013 Holcim Ltd
9
Optional footer entry, 2013-02-11
• Managing these issues makes good business
sense
 Mitigating risk and leveraging opportunity
 Maintain our license to operate
 Reduce operating costs and increase
revenues
 Ability to attract and retain employees
 Improve access to capital
 A seat at the regulators table
Key SD issues - determined with SD materiality review.
External report
review panel:
© 2013 Holcim Ltd
Agenda
10
Energy and Climate Protection, 2013-07-31
Holcim at a glance and our impacts
Managing SD and determining material issues
Managing key impacts: OH&S
Managing key impacts: Energy and carbon emissions

Managing key impacts: Sustainable Procurement
Managing key impacts: Other environmental impacts
Managing key impacts: Social responsibility approach
Managing key impacts: Human Rights Impact assessments
© 2013 Holcim Ltd
Safety is our first priority
11
• Lost-Time Injury Frequency Rate
(LTIFR) for own and subcontracted
employees has dropped to 1.3
• Aim to improve even further – want
to achieve <1 by 2013
• Our long term vision remains “Zero
Harm to People”
• Fatalities remain a grave concern
Holcim CEO Summertalk 2013, 2013-06-21
Target < 1
© 2013 Holcim Ltd
Agenda
12
Energy and Climate Protection, 2013-07-31
Holcim at a glance and our impacts
Managing SD and determining material issues
Managing key impacts: OH&S
Managing key impacts: Energy and carbon emissions
Managing key impacts: Sustainable Procurement
Managing key impacts: Other environmental impacts
Managing key impacts: Social responsibility approach
Managing key impacts: Human Rights Impact assessments
© 2013 Holcim Ltd

13
Energy and Climate Protection, 2013-07-31
Concrete and cement are essential elements in
infrastructure, residential and commercial buildings
© 2013 Holcim Ltd
14
Energy and Climate Protection, 2013-07-31
Concrete and cement have low embedded CO
2
compared to
other industrial materials
• On a specific level, CO
2
embedded
in cement is half, respectively one
third, of that of steel and
aluminum
• The low price of cement
determines the high financial
exposure of the industry to CO
2
(high CO
2
emissions per unit of
revenue)
CO
2
and financial intensity of commodities
0
2

4
6
8
10
12
1,5
2,5
0,0
1,0
2,0
0,5
3,0
kgCO2/$revenue
tCO2/t product
Concrete AluminiumSteelCement
Financial intensity [kgCO2/$ revenue]
CO2 intensity [tCO2/tProd]
Source: Holcim estimates
© 2013 Holcim Ltd
15
Energy and Climate Protection, 2013-07-31
The production of clinker – the key component of cement –
relies on energy and is the main source of CO
2
Clinker production
Quarry - extraction
Raw meal grinding
Concrete productionCement grinding
Cement distribution
© 2013 Holcim Ltd

16
Energy and Climate Protection, 2013-07-31
Since 1990, Holcim took actions to improve energy efficiency
and to reduce CO2 emissions per unit of product
500
550
600
650
700
750
800
-30
-25
-20
-15
-10
-5
0
% improvement
20152012
579
2011
584
2010
594
2005
634
2000
685
1990

757
kgCO2/t cem
Sector average emissions (WBCSD-GNR database)
% improvement
Specific net CO2 emissions
Holcim specific CO2 emissionsHolcim production and energy consumption
0
50
100
150
200
500.000
400.000
300.000
200.000
100.000
0
2010200520001990
Mt
TJ
+117%
+25%
20122011
Cement prod
Traditional
Energy from waste
Biomass
Power
Source: Holcim
© 2013 Holcim Ltd

17
Energy and Climate Protection, 2013-07-31
Holcim successfully develops new products that can be
manufactured more efficiently…
Actions on energy and climate change go beyond efficiency in operations
6% 29% 31% 18% 4% 12%
Industry Buildings Transportation Waste OtherCement Industry
Direct and indirect sources; excluding emissions from forestry and agriculture
Source: IPCC
Sources of Green House Gas emissions
© 2013 Holcim Ltd
18
Energy and Climate Protection, 2013-07-31
…and valorizes waste as alternative fuel and material
Efficient for economic, social and environmental reasons
6% 29% 31% 18% 4% 12%
Industry Buildings Transportation Waste OtherCement Industry
Direct and indirect sources; excluding emissions from forestry and agriculture
Source: IPCC
Sources of Green House Gas emissions
© 2013 Holcim Ltd
19
Energy and Climate Protection, 2013-07-31
Product transparency is key, as customers choice can
reduce energy and climate change challenges
Gold Silver Bronze Innovation
Green labels
Product Carbon Footprint
Environmental Product Declaration
Increase customers awareness of efficient solutions

© 2013 Holcim Ltd
20
Energy and Climate Protection, 2013-07-31
The next step change is bringing solutions to reduce energy
and emissions during the life of a building…
Ecoterm® Ready-mix
0
100
200
300
400
kWh/ym2
-25%
EcotermConcrete
Blocks
Regular
concrete
Energy needs
6% 29% 31% 18% 4% 12%
Industry Buildings Transportation Waste OtherCement Industry
Direct and indirect sources; excluding emissions from forestry and agriculture
Source: IPCC
Sources of Green House Gas emissions
© 2013 Holcim Ltd
21
Energy and Climate Protection, 2013-07-31
…and to reduce emissions on the infrastructure
Industry Buildings Transportation Waste Other
29% 31% 18% 4% 12%
Cement Industry

6%
Direct and indirect sources; excluding emissions from forestry and agriculture
Source: IPCC
Sources of Green House Gas emissions
Partnerships and innovation along the value chain are fundamental
© 2013 Holcim Ltd
Agenda
22
Energy and Climate Protection, 2013-07-31
Holcim at a glance and our impacts
Managing SD and determining material issues
Managing key impacts: OH&S
Managing key impacts: Energy and carbon emissions
Managing key impacts: Sustainable Procurement
Managing key impacts: Other environmental impacts
Managing key impacts: Social responsibility approach
Managing key impacts: Human Rights Impact assessments
© 2013 Holcim Ltd
Managing supply chain risks - A pragmatic approach has been
developed
 The initial scope is to manage the risk derived from doing business with
suppliers that do not uphold standards in OH&S, social responsibility and
environment
Tools and methodologies are developed and it is expected that Holcim
Group Companies use them to manage their risk
Managing Supplier Risk
Partnering with
suppliers to
maximize benefits
Procuring

sustainable
products
United Nations Global Compact Principles
Reputation &
Supply assurance
Human rights
and Labor
Occupational
Health & Safety
Environment
Bribery and
Corruption
© 2013 Holcim Ltd
The approach to implement the SPI across the Holcim
supplier base consists of 5 steps
1. Supplier Code of Conduct
Supplier Code of Conduct approved by Holcim EXCO and communicated to all
suppliers and Group Companies
2. Supplier prioritization
High risk suppliers to be prioritized by Group Companies and Corporate
Procurement based on their judgment of local conditions
3. Risk assessment
Continuous evaluation of risk exposure through self-assessment / fact finding
/ verification, as determined by Group Companies
4. Risk mitigation
Supplier development or replacement, as determined by Group
Companies
5. Scorecard
Continuous performance tracking for the Holcim Corporate
Sustainable Development Report as in the past

© 2013 Holcim Ltd
Agenda
25
Energy and Climate Protection, 2013-07-31
Holcim at a glance and our impacts
Managing SD and determining material issues
Managing key impacts: OH&S
Managing key impacts: Energy and carbon emissions
Managing key impacts: Sustainable Procurement
Managing key impacts: Other environmental impacts
Managing key impacts: Social responsibility approach
Managing key impacts: Human Rights Impact assessments