November 4, 2011

Dr. Alexander Nick

CORPORATE SUSTAINABILITY AT THE BMW GROUP.

SRI CAPITAL MARKETS DAY.
CORPORATE SUSTAINABILITY
AT THE BMW GROUP.

Sustainability Ambition and Drivers

Corporate Sustainability Strategy & Management at BMW Group

Implementation and Best Practice of Corporate Sustainability within the BMW Group
CORPORATE SUSTAINABILITY
AT THE BMW GROUP.

Sustainability Ambition and Drivers

Corporate Sustainability Strategy & Management at BMW Group

Implementation and Best Practice of Corporate Sustainability within the BMW Group
CONFERENCE CALL REPORT ON 3 NOVEMBER 2011.
DR. NORBERT REITHOFER ON SUSTAINABLE MOBILITY.

“ The BMW Group is on track for success.

Our strategy is paying off and is our guideline
for successful and profitable development
within a volatile business environment. […]
I’m convinced that truly sustainable mobility
can only arise from a holistic approach.
This is an inherent part of our premium claim.
And this will keep us in the forefront as the
leading premium car company in our
industry.”
BMW GROUP.
STRATEGIC OBJECTIVE.

The BMW Group is the leading

provider of premium products
and premium services for
individual mobility.
CURRENT DEVELOPMENT AND DRIVERS.
7 BILLION ON 31 OCTOBER 2011.
CURRENT DEVELOPMENT AND DRIVERS.
CLEAR TREND TOWARDS MORE SUSTAINABILITY.

Shortage of resources •Sustainability in actions and products

is a basic requirement

Tighter legislation •Social and environmental compatibility of products is

essential for future success

Environment/ •Stringent action program against Climate

Climate Change Change is required

•Different mobility types and needs

Urbanization /
population growth •Diverse product offering necessary

Changing values • Sustainable mobility as part of a modern urban

lifestyle. Change as an opportunity
CURRENT DEVELOPMENT AND DRIVERS.
CUSTOMER NEEDS.

Customer needs are changing, but cognitive dissonance remains …

This is how I imagine … and this is my own.

own.
the car of the future…
future…
BMW GROUP AUTOMOBILES.
THREE AUTHENTIC PREMIUM BRANDS.

Sheer driving The world’s most The pinnacle of

pleasure exciting premium automobile luxury
small car brand
CORPORATE SUSTAINABILITY
AT THE BMW GROUP.

Sustainability Ambition and Drivers

Corporate Sustainability Strategy & Management at BMW Group

Implementation and Best Practice of Corporate Sustainability within the BMW Group
CORPORATE SUSTAINABILITY HAS A LONG HISTORY
AT THE BMW GROUP.

1973: First Environmental Officer in the Automotive Industry

2000: Executive Board Resolution: “Sustainability is the guiding principle of the BMW
Group corporate strategy.”
2009: Establishment of Sustainability Circle and Board, Corporate Sustainability is
established as a corporate target.

1997 2001 2007 2008 2011

Dr. Norbert Reithofer, Chairman of the Board of Management :

„In the future, premium will also be defined by sustainability.“

Dr. Norbert Reithofer, Vorsitzender des Vorstands der BMW Group
THE BMW GROUP’S SUSTAINABILITY STRATEGY
SUSTAINABILITY IS INTEGRAL PART OF THE
CORPORATE NUMBER ONE STRATEGY.

Sustainability strategy
 THE BMW GROUP’S UNDERSTANDING AND STRATEGY
OF CORPORATE SUSTAINABILITY.

Vision

BMW
Group The BMW Group is the most sustainable company in the automotive industry.
Objective
Ecology Economy Society
Sustainable Mobility Shareholder Value Responsibility for Employees
Concepts

Key Issues Product Responsibility Risk Management Value Orientation in the

Efficient Dynamics Supply Chain

Environmental Protection Corporate Governance &

Clean Production Compliance Societal Commitment
Sustainability Environmental Sustainability-based Evaluation of the
Communication
management Radar Decisions Value Chain

We regard sustainability as a lasting and positive contribution towards the economic success of the company. This is the basis
Basic
of our ecological and social responsibility.
principles

We consider awareness of social responsibility an inseparable part of our corporate self-conception.
THE BMW GROUP’S UNDERSTANDING AND STRATEGY
OF CORPORATE SUSTAINABILITY.

BSC
BMW Group Corporate Sustainability is
Perspektive / Strategische Stoßrichtung

F inanz en
Anspruch

Unternehmenswert steigern
Messgröße
(Langfristige Steuerung)

Total Shareholder Return

Shareholder Value Added
PKW : Operatives Ergebnis - Abweichung zur
5%-Linie
Motorrad: Operatives Ergebnis -
Abweichung zur 5%-Linie
Korrespondierende kurzfristige Messgröße;
L ink zu jahrlichem ZMP (bei Abweichun g von
langfristiger Messgröße siehe Klammer)
Ziellenker / Zielnehmer

established as a corporate target and

anchored in the Group Balanced
Wach st um Sh are ho lde r Valu e Pro du kt ivität
SF: Ergebnis vor Steuern Abweichung zur
Fin an zen 10%-Linie Abbildung in Geschäftsfeldern
Free Cashflow
Kun de n
RoCE Konzern
Ge sch äft s- PKW : ROCE
pr oz esse
Hohe Rentabilität erreichen Motorrad: ROCE
Le rn en &
Entw icklu ng SF: RoE
Softlab: Ums atzrendite Abbildung in Geschäftsfeldern
Minimalen Kapitaleinsatz erreichen Investitionsquote

BMW Arbeitskos ten im Vergleich zum

Scorecard.
Abbildung in Geschäftsfeldern
Lernen & Entwicklung Wettbewerb (Index )
Wettbewerbsfähigen Personalaufwand Erfolgsabhängige Vergütung (%-Anteil am
erreichen Abbildung in Geschäftsfeldern
Personalaufwand)
W achstum Shareholder Va lue Produktivitä t Flexible Personalkapazität (%-Anteil an
Abbildung in Geschäftsfeldern
Finanzen
Ges amtk apazität auf Group Ebene)
Bedarfsgerechte Kompetenzen Zu definieren: Fes tlegung im Rahmen der
Abbildung in Geschäftsfeldern
bereits tellen Initiative 24
Kunden

Zu definieren: Fes tlegung im Rahmen der

Ex zellente Führung s ic hers tellen Abbildung in Geschäftsfeldern
Ges chäfts- Initiative 25
prozesse
Als attraktiver Arbeitgeber betrachtet ESI Abbildung in Geschäftsfeldern
Lernen & werden Attraktivität am Arbeits markt Abbildung in Geschäftsfeldern
Entw icklung
Rangplatz in Imageumfragen AK
Gesellschaftlich geschätzter Partner sein
Erfüllungsgrad des BMW Group Profils AK
Meinungsführerschaft AK

pays into…

Division Targets Division Targets Division Targets

Agreed objectives and Agreed objectives and Agreed objectives and

packages of packages of packages of
sustainability measures sustainability measures sustainability measures

Sustainability Every project is required to be assessed in terms of sustainability.

This involves measuring the consumption of resources,
Due Diligence emissions and also the social and socio-political impacts.
MATERIALITY ANALYSIS.
IMPORTANT SUSTAINABILITY ISSUES FOR OUR
STAKEHOLDERS AND FOR THE BMW GROUP.
 PROGRESS 2010 AND GOALS 2011FF.
Progress 2010 Goals

Sustainability − Sustainability is now a purchasing criterion in the − Integration of sustainability in all divisions by the end of
Management selection of suppliers 2012
− Further integration of sustainability in our − Establish sustainable business practices along the entire
functional strategies value chain by the end of 2012

Products − 30% reduction in CO2 emissions from our new − Reduce CO2 emissions from our global fleet of new vehicles
vehicles in Europe (EU-27) by 2010 (compared to by at least 25% by 2020 (compared to 2008)
1995) − Launch BMW Active E; Develop BMW i3 & BMW i8 to
− MINI E test fleet has been successful, with 600 market standard by 2013
vehicles clocking up more than 15 million km in − Develop new mobility services; one million DriveNow users
Europe, the U.S., and Asia since mid-2009. by 2020
− Develop car-to-car communications to reduce congestion
and emissions by 2011/2012

Production − 5% less water, process wastewater, waste and − Achieve 30% less energy, VOCs, water, process
VOCs per vehicle produced from 2009 to 2010 wastewater and waste per vehicle produced between
− 4,8 % less energy consumption 2006 and 2012

Employees − Introduced „Today for Tomorrow“ pilot project for − Train 100% of our management staff on sustainability by
age-appropriate working conditions end of 2012
− Large number of flexitime models offered − Group wide roll-out of „Today for tomorrow“ in 2012
− New Young talent retention programmes − Group wide roll-out of Health Management 2020
launched programme
EMPLOYEE QUALIFACTION ON SUSTAINABILITY.

„Sustainability „In Zukunft wird Premium durch

Nachhaltigkeit definiert.“ ca. 2.500 employees (2009-2010)
on Tour“

Discussions with
Joschka Fischer and ca. 2.000 management staff (2009-2010)
Madeleine Albright

Leadership
Trainings
ca. 2.800 management staff (2010-2011)

Trainees ca. 700 trainees (2009-2011)

Environmental
protection training
ca. 350 employees in 2010
for select groups

Seite 17
BMW EFFICIENT DYNAMICS.
ACEA VOLUNTARY COMMITMENT.
240

220
BMW Group, 1995 - 2010: approx. - 30%
200

180

160

ACEA, 1995-2009: approx. -25%

140

EU fleet
120
emissions
(g CO2/km)
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

BMW Group ACEA Competitors

 BMW EFFICIENT DYNAMICS.
BMW GROUP FLEET EMISSIONS SIGNIFICANTLY
LOWER THAN COMPETITORS’.
Carbon emissions of new cars registered in Germany and EU in 2010
g CO2/km
200

190

180

170 173,4 173,2

160
* Average: * 158,1
151,5 g CO2/km 150 157
154 150
149,1 148
140

130
131,6
120 2009 2010
BMW Group BMW Mini MB Audi Lexus VW BMW BMW
Group Group Group
[kW] 133 139 89 124 127 181 95 Source: German Motor Transport Authority;
[PS] ~180 ~188 ~121 ~169 ~172 ~246 ~129 European Federation for Transport and
Environment
EXTERNAL RECOGNITION.
THE BMW GROUP IS THE INDUSTRY LEADER.

- Dow Jones Sustainability Indexes/Dow Jones STOXX Sustainability Indexes: Industry leader since
2005, the only automotive company continuously listed since 1999.
- FTSE4Good: listed in FTSE4Good, FTSE4Good Environmental Index.
- Carbon Disclosure Project: Inclusion in the Carbon Disclosure Leadership Index 2011 and in the Carbon
Performance Leadership Index 2011.
- Oekom: Corporate Responsibility Rating oekom 2009, Status Prime.
- Sustainalytics: 1st place in "DAX 30 Nachhaltigkeitsrating” in 2009.
- ÖKOTREND: certificate for outstanding corporate responsibility
(most points in the automotive industry).
CORPORATE SUSTAINABILITY
AT THE BMW GROUP.

Sustainability Ambition and Drivers

Corporate Sustainability Strategy & Management at BMW Group

Implementation and Best Practice of Corporate Sustainability within the BMW Group
IMPLEMENTATION OF CORPORATE SUSTAINABILITY
THROUGHOUT THE VEHICLE LIFECYCLE.

Research and
Development
Alternative Drive Concepts
Design for Recycling
Efficient Dynamics

Design for Environment / Life

Cycle Engineering

Recycling Concepts
Clean Production

Recycling Production
End-of-Life Recovery Sustainability Standards
for Suppliers

Environmentally-friendly
Logistic Concepts

Traffic Management Fuel Efficiency

Concepts Concepts

Pruduct Utilization
SUSTAINABLE MOBILITY. THE BMW GROUP‘S VISION.
EFFICIENT DYNAMICS IN THREE PHASES.

tomorrow/
future hydrogen
& electric

– Hybrid
today/ – Improved Efficient Dynamics
tomorrow
Engine improvements:
– Combustion engines
today – Aerodynamics
– Lightweight construction
– Intelligent energy management, e.g.:
– Auto Start Stop function
– Brake Energy Regeneration
> 2008 > 2020
BMW GROUP ROADMAP FOR E-MOBILITY.
THE MEGACITY VEHICLE IS MORE THAN AN ELECTRIC
VEHICLE.
Megacity Vehicle
Functionality and customer benefits.

BMW Concept ActiveE -Tailor-made services

-Interconnectivity
-Sustainable materials and
recycling
-Lightweight materials
MINI E -Unique emotional design

2009 2011 2013

EXAMPLES CLEAN PRODUCTION.
SUSTAINABILITY BEING VIGOROUSLY IMPLEMENTED.

Use of near-surface groundwater to cool Methane gas project,

buildings, R&D center Munich Spartanburg

Einsparungen 2008

Axle gear assembly, Inorganic core manufacturing,

Dingolfing Landshut
EXAMPLES CLEAN PRODUCTION.
SUSTAINABILITY BEING VIGOROUSLY IMPLEMENTED.

Use of near-surface groundwater to cool Methane gas project,

buildings, R&D center Munich Spartanburg
Environmental impact: Environmental impact:
Electricity: - 10.000 MWh/a Natural gas: - 400.000 MWh/a
CO2 emissions: - 6.300 t/a CO2 emissions: - 92.000 t/a
Einsparungen 2008
Financial impact: Financial impact:
One-time investment: 6 Mio. € One-time investment: + 8,6 Mio. €
Reduction of energy costs by 1 Mio. €/a. Reduction of energy costs by 5 Mio. €/a.

Axle gear assembly, Inorganic core manufacturing,

Dingolfing Landshut
Environmental impact: Environmental impact:
Energy usage: -20% Electricity: - 2.600.000 kWh/a
Financial impact: Natural gas: - 1.900.000 m3/a
One-time investment: 20 Mio. € Emissions reduction: 98%
Reduction of manufacturing costs by 20%
Financial impact:
Lower defect rate, lower abseenteism,
productivity increase Reduction of ernergy costs by 743.400 €/a
 IMPLEMENTATION OF CORPORATE SUSTAINABILITY.
ENVIRONMENTAL DATA 1990 - 2010.

Energy consumption CO2 emissions per VOC emissions per

per vehicle produced vehicle produced vehicle produced
in MWh/E in t/E in kg/E
1,47 8,85
4,50 4,27 1,50 1,40 9,00
4,03
4,00 1,30 7,00
5,51
3,50 3,16 1,04
2,94 1,10 0,99 5,00
3,00 2,75 3,21
0,86
2,50 0,90 3,00 2,07
1,60
2,00 0,70 1,00

Water consumption per Process wastewater per Waste for disposal per
vehicle produced vehicle produced vehicle produced
in m3/E in m3/E in kg/E
5,85 1,50 85,60
6,00 1,36
80
4,01
4,00 1,20 1,04
60
2,60 40,51
2,31 0,76
0,58
40 26,37
2,00 0,70
20 12,56 10,09

0,00 0,20 0

Die Schwankungen resultieren aus

2000 - 2006: 10 plants / ab 2007: 17 plants den Änderungen des Abfallrechts
CORPORATE SUSTAINABILITY PAYS OFF.
EFFICIENT USE OF RESOURCES.

Profitability and resource efficiency – Savings from 2009 to 2010:

Water: 370.000 m³ 0,5 Mio. Euro
Energy: 380.000 MWh 20,0 Mio. Euro
Waste: 5,1 % 0,1 Mio. Euro
----------------
~20 Mio. Euro in savings
(2009: ~10 Mio. Euro)
CORPORATE SUSTAINABILITY AT THE BMW GROUP.
MORE INFORMATIONEN ONLINE.

- Responsibility:
www.bmwgroup.com/responsibility
- Sustainable Value Report 2008:
www.bmwgroup.com/sustainability
- BMW EfficientDynamics:
www.bmw.de/efficientdynamics
- Production:
www.bmwgroup.com/production
- Recycling:
www.bmwgroup.com/recycling
- Social Commitment:
http://www.bmwgroup.com/socialcommitment
- BMW i:
www.bmw-i.de/
THANK YOU!