10 th Daimler Sustainability Dialogue Working Group Results. Stuttgart-Untertürkheim, November 8 th /9 th 2017

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1 10 th Daimler Sustainability Dialogue Working Group Results Stuttgart-Untertürkheim, November 8 th /9 th 2017

2 Environment Diesel Passenger Car NO x -Real Drive Emissions Euro 5 and Euro 6 Mercedes-Benz passenger cars are getting software updates reducing NO x -emission by 30 % under Real Drive Emission conditions New generation of passenger car Diesel engines OM 654 and OM 656 achieve NO x emissions values far below legal requirement under Real World Driving (RDE) conditions Electric Mobility - Daimler Strategy and Product Range Electric mobility is an integral and key part of Daimler s strategy to combat climate change The Daimler product range grows with more than 10 electric vehicles until 2022; besides passenger cars, also vans, busses and trucks are offered as electric vehicle models Charging Infrastructure Sufficient charging infrastructure is of critical importance for the uptake of electric mobility, many hurdles especially with respect to public charging and charge@home (grid issues) need to be addressed Participants support legislative and other initiatives regarding the build up of charging infrastructure

3 Employees Exponential Developments Talents New Work Methodologies We need to be more open for the Digital Transformation that is happening in exponential speed, based on developments around Social, Mobile, Millennials, AI, Big Data, IoT etc. We need to become exponential organizations and management needs to constantly learn & adjust processes Feedback, personal reflection and networking are a key tool kit of the future manager Corporates need to find the right mixture between safety and agility and increasingly offer purpose/meaning N=1! - career paths will become more individual instead of purely linear, therefore companies need to develop flexible structures Corporates need to apply a segmented view towards next gen talent Learning and development will become a pull not a push approach in the future Teams need to be set up multi-perspective instead of interdisciplinary Implementing agile organizational approaches requires overcoming the immune system of the existing organization; danger of getting stuck in the zombie agile world Established corporates need to re-evaluate internal processes and organization form considering the two developments above. One potential tool might be the adaptation of startup principles, like Agile, Minimum Viable Products, Customer Centricity, Build-Measure-Learn etc. Corporates need to become able to rapidly test, evaluate and adapt different methodologies to a individual fit.

4 Human Rights Human Rights Respect Own Entities Methodological adaptations after 2 nd Pilot of On-Site Risk Assessment confirmed Importance of focusing on human rights program implementation & roll-out to all entities stressed; will be the real measure of human rights due diligence Human Rights Respect Supply Chains Raw Materials & Services Supply Chains Supply Chains methodology confirmed as effective due diligence In high risk supply chains get started with implementation (mitigation) for selected risk materials/services; make those value chains transparent. Consider in parallel due diligence initiatives for selected part-blocks/local alliances Meaningful measures on identified risks will be the real measure for due diligence Don t work exclusively on Daimler risks, but work around general underlying challenges towards solutions (including approach to Micanite) Indicator-set for determination of high risk service commodities approved with adaptations from workshop, started testing indicators with operative units Overall: develop risk assessment concept(s) for high risk commodities operatively, through practice, not only theory

5 Data Protection Data Sovereignty The principle of introducing an exclusive, intangible right to data on the part of the beneficial owner was discussed predominantly critically. It is a fundamental legal question and not a specific one to mobility data. Concentrating an entirely new legal principle on mobility data would lead to a one-sided obstacle to the development of this market. The Customer View on Data Protection An internal study conducted by Daimler shows that customers have high expectations of manufacturers with respect to vehicle and mobility data. Trust in Daimler as a guarantor is key to the willingness to provide data. Therefore, privacy by design technologies, like pseudonymization, are key. Daimler will continue to develop the opportunities to create transparency and the range of options for customers. As part of a data governance program, Daimler will set out principles covering transparency and self-determination for the user as well as data security.

6 Community Relations Mobility concepts for employees Mobility concept for project Vaihingen Corporate Mobility Management 2.0 Foster de-centralized hubs for P&R areas to support long distance commuting Check feasibility to open plant UT for bikes Start pilot project for UT with new Daimler flinc App for ride-sharing of employees Enhance mobility culture as part of Leadership 2020 (e.g. public transport, ride-sharing) Expand condition packages for employees (e.g. mobility payment) Trigger new ideas: start mobility pilot - support through setting up mobility officer or mobility think tanks Traffic & mobility management: create platform of major companies (e.g. Allianz, Trelleborg) in surrounding area to encourage joint mobility cooperation Before starting relocation activities consider analysis of individual transport distances and mobility behavior of employees Push dialogue with local authorities about road infrastructure (e.g. enlarge Nord-Sued street) Adjust infrastructure to future challenges in the framework of IBA 2027 International Building Exhibition (e.g. P&R, mobility hubs) Use current urban areas for demonstration of new mobility concepts (e.g. Rosenstein area) Consider mobility managers in official institutions and agencies as well as in companies

7 Autonomous Driving Integrating Practical Ethics into the Design of Automated Vehicles Legal Aspects of Autonomous Driving and Artificial Intelligence Deep-learning is an important factor for automated decision-making processes. It was enlightening to see how basic scenarios in road traffic - like an automated vehicle approaching a pedestrian standing at a crosswalk - can demonstrate the complexity of AI and adequately programming AI. The methodology of product design introduced by Professor Gerdes showed, complex issues like this should be discussed through different perspectives. This includes technology, society, ethics and law and under consideration and balancing of different stakeholders, interests and values. We as Daimler intend to learn more about such innovative methodologies and include them into our product development processes. Legal personality of machines is already discussed by experts and might in future describe a possible solution for the legal capacity of artificial intelligence. Today s ethical and legal regulations primary refer to natural persons. Self-learning artificial intelligence in safety relevant machines (e.g. vehicles) has to be in line with established standards and laws in the field of product safety. The quality of data becomes increasingly important. Liability for incorrect, inconsistent, unprecise, manipulated or outdated data might tie up with new players like service providers, infrastructure providers etc. We are committed to participating in the ongoing dialogue between different stakeholders like policy makers, consumers, manufacturers to shape adequate and reasonable legal frameworks for the new technologies. With regard to data, we believe that transparency, self-determination and security should also be reflected in the context of intelligent mobility.

8 Social Responsibility Implementation of DaimlerWeCare Implementation of DaimlerWeCare has gained wide approval by the participants A broad consensus exists about the importance of measuring the social impact of funding projects and in this context the evaluation tool of Daimler received strong agreement Sustainable Development Goals (SDGs) Disaster Relief Trend is a strong orientation and support of SDGs by NGOs, since they take every relevant and global goals into account Daimler defined five SDGs for the core business but there is a broad agreement that in the context of Corporate Citizenship all SDGs need to be considered Corporate Citizenship reports should include references (indicators/sub-targets) to the SDGs (Natural-) disasters more and more become a global challenge and therefore new ways of disaster relief are necessary NGOs and sponsors need a proper network for a well coordinated procedure and to work more effective / core competences of NGOs need to be worked out Support also of new and innovative approaches of disaster relief

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