Sustainability at OSRAM

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1 Sustainability at OSRAM

2 Sustainability at OSRAM We use the almost endless possibilities of light to improve the quality of life for individuals together with our customers. Dr. Olaf Berlien, CEO OSRAM Licht AG, on the role of light in the future and its contribution to society: For more than 100 years we have been turning light into quality of life. We are increasing safety, creating connectivity, boosting well-being and improving health. With the help of new technologies and the possibilities of digitalization, we are making light much more than illumination we are turning it into a lever for sustainable development. With our technologies we contribute significantly to tack ling global challenges such as urbanization, climate change and the shortage of resources. Along the OSRAM value chain we take care to use resources wisely, protect the environment, provide good working conditions and safety for everyone working for OSRAM. Furthermore, we actively communicate these values to our stakeholders. We have received several acknowledgements of our sustainability achievements: For more information go to our Sustainability Report: sustainabilityreport-2017

3 Our contribution Responsibility We take our overall responsibility seriously and are committed to strengthening society. Climate To protect our climate we are developing the latest technologies and pressing ahead with sustainable innovations. Light is sustainable Connection As a technology leader we offer digital and networked lighting solutions that connect people and even entire communities. Safety We are bringing greater visibility and protection to our everyday lives, thereby making us all safer. Well-being We use the effects of light to improve the health and wellbeing of us all. For stories and more information on these topics go to our Sustainability Magazine: light-is-sustainable

4 The path of light Our sustainability credentials can best be demonstrated along the value added chain.* UN Global Compact OSRAM has been a member of the UN Global Compact since 2005 and as such publishes annual progress reports on its sustainable processes and projects. Sustainable Development Goals OSRAM is committed to the 17 sustainable development goals of the United Nations which include concrete measures to be taken at global and local level by In FY 2017 we assessed the contribution that OSRAM can make to achieve the SDGs and what the business opportunities and risks would be for our company. Business Conduct and Compliance Compliance with current laws and corporate guidelines is a matter of course for OSRAM and is firmly anchored in the Group through our compliance system. 6,666 employees in face-to-face compliance training courses in FY Impact assessment In 2017 we set up the first pilot projects to record and assess the overall social costs and benefits of selected applications. * All figures relate to the businesses of OSRAM Licht AG in the fiscal year 2017 (FY 2017).

5 R & D** locations China, Germany, Hong Kong, India, Italy, Canada, Malaysia, Slovakia, USA Research & Development R & D successes Examples are the first broadband infrared LED e.g. for assessing the quality of food; further development of matrix and laser headlight technologies for better road safety; intelligent networked systems for street and building lighting combining energy savings and high comfort levels. Bosch Global Supplier of the Year 2017 In recognition of the excellent performance of the Specialty Lighting and Opto Semiconductors business units as reliable suppliers and valued development and innovation partners. 17,400 Patents and patent applications Commercial property rights such as patents, brands and knowhow are of particular importance in the lighting industry. The large number of patents reflects our ongoing powers of innovation. 2,600 employees are involved in R & D. That corresponds to almost 10 percent of all employees. 334 million was invested in R & D in FY 2017 which is equivalent to almost 9 percent of our turnover. ** Research & Development

6 RoHS Directive on the restriction of the use of certain hazardous substances OSRAM is committed to complying with this directive for systematically reducing hazardous substances such as lead, cadmium and mercury in its products. The aim is to protect employees and the environment and to make products easier to recycle. Conflict minerals Since FY 2017 OSRAM is a member of the Responsible Minerals Initiative (RMI), an initiative of the Responsible Business Alliance (RBA). Raw materials Rare earths research project White LEDs contain a large proportion of rare earth metals which are time-consuming and expensive to obtain and which have limited availability. The Opto Semiconductors business unit, together with experts from the Schwabmünchen plant, the University of Saarland and BASF, is conducting research into alternatives for these metals. The aim of the project is to find phosphors that are more affordable and more eco-friendly. Human rights In FY 2017 the focus was on a comprehensive Human Rights Assessment.

7 Code of Conduct for suppliers OSRAM has a Code of Conduct in compliance with international standards and conventions which has to be signed by all suppliers worldwide. CSR audits OSRAM carries out annual corporate social responsibility audits for a representative selection of suppliers. Suppliers in countries with heightened human rights risks are also asked for self-disclosure on corporate responsibility issues. 472 recently signed supplier codices OSRAM covers 98 percent of the procurement volume with these. Suppliers Supplier portal OSRAM places high requirements on all suppliers. These are defined for each material field and are checked as part of the tendering process. They are clearly presented on the OSRAM supplier portal. 15,000 suppliers worldwide

8 Certification Health and safety at work The Penang site was identified and honored by the Malaysian Ministry of Labor as a pioneer for systematic improvements in health and safety at work. Award OSRAM received the Yazaki North America s 2017 Environmental, Health, and Safety Award. ISO All production sites ISO All European production sites ISO 9001 All production and development sites ISO TS/IATF All sites that supply automotive customers will be certified according to IATF from Sept OHSAS Headquarters and Asian production sites; Italy: Bergamo SA8000 Plant in Chennai (India) Environment Award for OSRAM headlight lamps XENARC ULTRA LIFE and ULTRA LIFE were honored with the Partslife Environment Award as a special contribution. Production EHS guidelines Requirements governing health & safety at work are defined in OSRAM s EHS guidelines (Environmental Protection, Health and Safety) and are binding throughout the world. Ecological footprint OSRAM is committed to meeting the EU targets of achieving 20 percent savings in CO 2 emissions by OSRAM has set its own targets of this same order for water and waste.

9 120 countries in which OSRAM is active. Sales Employees 2,500 are active in sales, corresponding to almost 10 percent of all employees. Logistics OSRAM uses the EN method to calculate greenhouse gas emissions for transport logistics. The applied criteria must be fulfilled by all parties, and these parties are obliged to continually reduce their CO 2 emissions. All the recorded data is collated and published in monthly reports. Packaging Clear principles apply to the design and procurement of packaging at OSRAM. Packaging should be made exclusively from eco-friendly materials that can either be recycled or disposed of safely. Customer satisfaction With 82 percent OSRAM achieved a very high value for the newly introduced Customer Loyalty Index (CLI) in FY 2017.

10 Life Cycle Analysis (LCA) The energy consumption of our most important product groups is less than 4 percent for manufacture, distribution and disposal, and 96 percent of this can be ascribed to the usage phase. Improving energy efficiency is therefore a great lever for climate protection. According to the United Nations U4E initiative (United for Efficiency), in which OSRAM is a founding member, a worldwide switch to energy-efficient lighting would reduce CO 2 emissions by 390 million tonnes a year and save around 50 million US dollars. Recycling OSRAM achieves a high proportion of recyclable materials by paying attention to the concept of recycling right from the product development stage. Use & disposal Human Centric Lighting With human centric lighting we are improving the performance of top athletes, and supporting therapies for dementia sufferers. HCL has an important role to play in offices because there is clear evidence that lighting tailored to individual needs contributes to greater creativity and productivity.

11 2.6 million has been provided in FY 2017 by OSRAM to projects, initiatives, organizations and events through donations, sponsoring and memberships. Techfest Young talents in OSRAM s Expand your senses challenge used the latest sensors to research interactions between people and their environment and explore new ideas. Social responsibility Corporate Art Award OSRAM s LiO light art prize was a winner in the category Best art sponsorship program with reference to the core business of the company. German Red Cross Since 2016 as an official corporate partner of the Red Cross, OSRAM has been promoting an innovative approach for releasing humanitarian aid in advance of natural disasters. Forecast-based Financing (FbF) uses weather forecasts to identify regions at special risk so that targeted financial and humanitarian aid can be provided before the disaster strikes. FbF was praised as exemplary in 2017 in the Germany Land of Ideas innovation competition. Scholarship program OSRAM provides several scholarships at USM University in George Town, Malaysia.

12 OSRAM Licht AG Responsible Business & Sustainability CB RBS Marcel-Breuer-Straße Munich, Germany For more information on sustainability at OSRAM go to Contact: sustainability@osram.com Concept and layout: Nur Baute Berlin GmbH Publishing date: May 2018 Printed on RecyStar Polar. The paper is Blauer Engel, EU Ecolabel (EU flower), Nordic Swan and FSC certified.