Environmental Management at Hilti

Environmental management at Hilti Yes, we care! Hilti. Outperform. Outlast.

Contents Contents “We build a better future”: Corporate responsibility at Hilti 3 Environmental management 4 Climate change requires international commitment 6 Reducing our CO emissions 7 2 Environmentally friendly disposal 10 Compliance with regulations worldwide 12 Environment and safety: partner and supplier requirements 13 Focus on Product Carbon Footprint (PCF) – Hilti sets the standard 17 Hilti shows leadership in Green Building 21 Using the power of the sun 22 Hilti in brief 23 2 Environmental management at Hilti

Corporate Responsibility “We build a better future”: Corporate Responsibility at Hilti The goal of our corporate strategy is to generate sustainable profitable growth. This also includes taking responsibility in areas affected by our business activities. Corporate responsibility (CR) is therefore an integral part of our business model. Our core purpose states “we build a better future”. This stands for our traditionally high sense of responsibility towards our team members, customers, partners and suppliers, society and the environment. The social and corporate responsibility (CR) goes back to the company’s founder, Professor Martin Hilti. Today, an interdisciplinary team creates the framework for strategic sustainability management in all areas. “We can only enjoy long- &RUSRUDWHUHVSRQVLELOLW\ term 昀椀nancial success if we take our corporate responsibilities, in terms of 7HDP 8VHUKHDOWK &RUSRUDWH (QYLURQPHQW %XVLQHVV PHPEHUV DQGVDIHW\ VRFLDO HWKLFV society, economy and the UHVSRQVLELOLW\ environment, seriously.” Bo Risberg, Chief Executive Of昀椀cer, Enthusing Offering solutions Contributing to Actively managing Ensuring respon- Hilti Corporation employees for for added safety sustainable social the effects on the sible, respectful Hilti and contrib - and productivity devel opment en vironment business dealings uting to their to our customers in all corporate development processes • Our corporate culture ensures that all team members show a high sense of responsibility. Our values of integrity, courage, teamwork and commitment are the foundation for the daily actions of our employees. • Rules of behavior for our team members and suppliers around the world are main- tained in our code of conduct. These rules regulate fair and cooperative interaction among all our company’s interest groups and are continuously monitored to ensure they are observed. • Company-wide standards for all business processes ensure that we always meet, or exceed, the legal regulations of the countries in which we operate. This applies to all areas of corporate responsibility. • We actively participate in international efforts aimed at improving ethical, social and ecological standards in business life. As a partner in agreements such as the UN Global Compact, the Partnering Against Corruption Initiative or the UN Caring for Climate initiative, our goal is to positively influence the economy with our values in mind. Environmental management at Hilti 3

Environmental management Environmental management “The pleasant indoor climate in the production area is noticed by everyone. We are all proud of our environ- mentally-correct workplace.” Jasmin Heigl, Production Assistant, Hilti Thüringen, Austria In its corporate Mission Statement Hilti claims “we build a better future.” This is a sentiment expressing a traditionally high amount of responsibility for society and the environment. Our management system focuses on sustainability, both through our environmental protection activities in production and product development. Our process management system contains all business processes and is valid world- wide. It has also created a framework for environmental topics that allows us to com- prehensively meet the demands of our corporate responsibilities. We want to contin- ue to improve the quality of our products, services and processes throughout the company, and this includes the topic of the environment. It goes without saying that this also embraces meeting the ISO 9001 and ISO 14001 international quality and en- vironmental standards. Our environmental commitment includes both ecological and economic perspectives. The knowledge that we acquire in this area will increasingly be used to develop new and innovative business fields. We are convinced that sustainable growth can only be achieved if we systematically incorporate the environment in our daily business. • When developing our processes we set ecological-oriented guidelines as the foun- dation for the careful selection of recyclable materials, including the usage of en- vironmentally-friendly materials in product packaging. • In 2007 we signed the UN Caring for Climate initiative. This initiative is dedicated to improving the environment and primarily focuses on climate change. By signing the initiative we are obligated to increase our energy efficiency while reducing our CO emissions relative to business development. All corporate decisions are made 2 after a thorough evaluation of the influence they will have on the environment. 4 Environmental management at Hilti

Environmental management • For example: the construction of an 11,000 square meter production and logistics CO emissions 2006 2 hall at our plant in Thüringen, Austria targeted the use of existing sources for heat- 5.37 tons per employee ing and cooling the new facility. Instead of using gas-fired boilers and electric-pow- ered cooling units, existing waste heat is deployed for both cooling and warming 2007 via an ecological energy-sharing system. 5.07 tons • We have a comprehensive supplier audit management system to ensure that the 2008 ecological and social standards defined in our code of conduct are also maintained 4.78 tons by our suppliers. 2009 This is how we organize and manage our environmental 4.54 tons responsibility 2010 The Environment is part of the Corporate Responsibility framework of Hilti, which is 4.30 tons managed via the CR core team led by Christoph Loos, member of the executive board responsible for HR, Finance and IT. The Corporate HSE (health, safety and en- vironment) department is responsible for the management and implementation of company wide environmental strategies, programs, processes and trainings. (QYLURQPHQWDO0DQDJHPHQW &5&RUH 7HDP &RUSRUWDWH+6()RUXP .H\7RSLFV 7UHQGV ,VVXHV0JPW 5RDG0DS &XVWRPHU 3ULRULWL]DWLRQ 3URMHFWV &RQVWUXFWLRQ 6WHHULQJ &RRUGLQDWLRQ 7HFKQRORJ\ 5HVRXUFH /HJDO ²  WLPHVSHU\HDU ²KRXUV 'HSDUWPHQWVIRUWRSGRZQLPSOHPHQWDWLRQDQGERWWRPXSPRQLWRULQJ Additionally, Hilti implemented a Corporate HSE Forum at the corporate level to dis- cuss and decide on company wide issues such as REACH, Product Carbon Footprint etc. One task of the forum is to detect trends in or affecting the construction industry coming from the customer, technology or from the legal side. Another task is to set the right environmental targets to steer the company in an ecologically and socially sustainable and economically profitable direction. The Corporate HSE Forum comprehends management functions of all Business Areas covering the large areas of development, supply chain and production. The de- partments are responsible for the implementation of decided projects and initiatives. Environmental management at Hilti 5

International commitment Climate Change requires international commitment Acting responsibly towards society and the environment is part of Hilti’s corporate culture. This is why membership in the UN Global Compact is consistent with wanting to have our societal commitment reflected more strongly to the external world. The principles of the UN Global Compact touch on a worldwide consensus derived from: • The general declaration of human rights, • The International Labor Organization declaration on fundamental principles and rights at work, • The Rio declaration on environment and development and • The United Nations convention against corruption. The UN Global Compact requires that companies acknowledge, support and imple- ment a catalog of basic values focusing on human rights, labor standards, environ- mental protection and anti-corruption in their respective areas of influence. We are facing up to future generations in this responsibility and are aware that our business activities, products and services have an influence on the environment. It is particularly important that we counter climate change. We therefore decided to sign the Caring for Climate initiative in 2007 and to become more involved in climate protection. UN Global Compact: the environment Principle 7: Business should support a precautionary approach to environmental challenges Principle 8: Undertake initiatives to promote greater environmental responsibility, and Principle 9: Encourage the development and diffusion of environmentally friendly technologies Our response: • Hilti has committed to introducing systematic sustainability ma nagement with corresponding responsibilities. (plus see page 4: Environmental management) • Hilti introduced a “Global Car Policy” with regional fuel caps plus safety training • Plant Thüringen (Austria): Benefits to the environment Each year approximately a million kilowatt hours can be saved with the ground collector and groundwater utilization alone. Put another way, this reduction in energy saves approximately 210,000 kilograms of carbon dioxide. That cor- responds to the CO emissions of an average car travelling approximately 2 1,300,000 kilometres per year. 6 Environmental management at Hilti

Reducing our CO emissions 2 Reducing our CO emissions 2 Corporate strategy and targets Hilti has developed a CO emission reduction strategy aiming to considerably reduce 2 the carbon footprint on the corporate level. Hilti will decouple planned economic growth in the next years from CO emissions by implementing a number of reduction 2 and substitution initiatives. The initiatives concern Hilti’s internal energy consumption in office buildings, factories, and car fleets in the market organisations around the globe. The CO emission reduction initiatives focus on absolute reductions targets for the in- 2 frastructure (office buildings & factories) and for the car fleets. Energy efficiency in Global Manufacturing A project on energy efficiency was started in our plant in Liechtenstein in 2009 to bat- tle the under-utilization of tools. The goal of the project is a prompt implementation of measures leading to a 5% reduction of energy consumption. The evaluation of this project proved the following four measures lead to the largest and fastest energy savings: 1. Optimization of information flow plant - utilities management 2. Clear responsibilities set for control of lighting 3. Systematic switch-off of machines after the working day 4. Air-pressure optimization Optimization of information flow plant- utilities management Working at weekends must be registered by Thursdays 12:00 a.m. If there is no prior notification, the heating, cooling and compressed air utilities will be shut down on Saturdays and Sundays. The improved communication between our plant and the utilities management will result in noticeable improvements of energy efficiency, es- pecially at times of under-utilization. Clear responsibilities set for control of lighting Hilti plans to put a system in place for lighting control, management coaches at each plant unit will be responsible for implementing a method ensuring all lights in the plant will be turned off. This will result in considerable energy savings as well as reductions in maintenance costs. Systematic switch-off of machines after the working day It was detected that 82% of the machinery in plants can be switched off! These ma- chines were labelled to make the switch-off functionality visible for everyone. Air-pressure optimization Labelled machines were checked for leakage. However, there were machines that leaked air when in off-mode as they had not been switched off correctly. The employ- ees in production in the plants were again reminded of the right way for switching off the machines. New machines will incorporate air pressure optimised solutions. Renewable energy We have noted that the purchase of electricity holds significant potential for reducing CO. We therefore purchase electricity at our locations in Austria largely from renew- 2 able sources (greater than 80%). Hilti keeps records of all the electricity that we pur- chase, and whenever possible we buy renewable energy from certified sources. Environmental management at Hilti 7

Reducing our CO emissions 2 Car Fleet The second main focus to reduce CO emissions is on Hilti’s car fleets in the market 2 organisations. A new car policy defines several environmental and safety issues in- cluding regional fuel caps leading to considerable savings in fuel consumption over the next 10 years. It is also planned to substitute established car technologies (gaso- line & diesel) by fully-electric cars as soon as possible. How do we measure and report our CO data? 2 &2 HPLVVLRQSHUHPSOR\HH  &2 LQWRQV                   Hilti uses the industry-recognised GreenHouse Gas (GHG) Protocol when we calcu- late and report our carbon footprint. The Protocol comprises three Scopes, of which Scopes 1 and 2 are mandatory to comply with Protocol standards. Scopes 1 and 2 cover direct greenhouse gas emissions and emissions from purchased electricity. Hilti reports on Scope 1 & 2 indicators fully compliant with the GHG Protocol. Scope 3 is an optional reporting category in which other indirect emissions, separate from those which originate from purchased electricity, may be reported. At the moment, Hilti does not report on Scope 3 indicators. Significant trend reversal for pollutant emissions: &2 HPLVVLRQLQWRQV  LQW &2 HTXLYDOHQWV                   Hilti’s 2010 CO emissions were reduced to 2005 levels. Beginning in 2011 one can 2 expect a slight increase in CO emissions as the effects of the foreseen increase in 2 sales cannot completely be compensated for through reduction measures. We con- tinue to analyze and look for additional potential to lower CO levels. 2 8 Environmental management at Hilti

Reducing our CO emissions 2 Examples of how to handle resources in an energy-saving way • Hilti Germany has switched from energy gained by burning fossil fuel to renewable resource energy. The country headquarters in Kaufering draws all of its heating from a communal biomass power plant that was constructed nearby. • Hilti Germany has installed 60 solar panels on top of its staff restaurant in Kaufer- ing. They will generate some 21,000 kWh of renewable energy and reduce CO2 emissions by 15 tons per year. Solar panels at the Kaufering, Germany canteen • Another focus in our plants in Kaufering, Schaan and Thüringen is on improved facility management to actively manage the control and feedback control systems (e.g. steering of lighting in production, temperature control, compressed air, installation of energy efficient pumps etc.). The stated measures result in energy reductions of around 5%. • Facilities and offices at the Kaufering production plant are cooled with groundwa- ter from a decommissioned well. This curtails energy consumption and mainte- nance. The water is then rerouted back into the nearby Lech River. Facilities cooled with ground water in Kaufering • Together with Liechtenstein Kraftwerke, a local power generator, Hilti has installed the country’s largest photovoltaic facility on top of the new Logistics Center in Nendeln. The panels provide about 40% of the energy produced by solar power in all of Liechtenstein. • Both the Logistics Center in Nendeln and the office building constructed at Hilti headquarters in 2006 utilize geothermal energy for heating and cooling purposes. Additionally, some 70% of waste heat from ventilation systems is recaptured, saving natural gas and reducing our CO emissions. 2 Logistic center in Nendeln uses geothermal energy and photovoltaik panels • Agreements with electricity providers for our production facility in Thüringen, Austria, ensure that 80% of the energy requirement is generated from renewable resources: hydroelectric, wind and biomass facilities. • In Thüringen Hilti is using an environmentally friendly system to regulate tempera- tures at the production facility. A total of 163 pipes, each of which is 63 meters in length, have been placed under the main plant building. The building is cooled in summer by air that circulates in the pipes. Conversely, cool air is inducted from outdoors and warmed to ground temperature in winter. • Our plant in Thüringen (Austria) is certified according to the German green building Our plant in Thüringen (Austria) is certi昀椀ed Standard DGNB as one of the first industrial buildings. This is another milestone in according to the German green building Hilti’s journey to become an entirely sustainable company. Standard DGNB Environmental management at Hilti 9

Environmentally friendly disposal Environmentally friendly disposal Most of the materials used in manufacturing Hilti products are recyclable. But it is equally important to correctly separate the various materials before they are trans- ferred for recycling purposes. In EU countries a person may return an old Hilti tool to a Hilti Center, to be recycled, at no charge. Hilti is responsible for the environmentally friendly disposal. According to the European guideline on waste of electrical and electronic equipement (WEEE) at least 70% of the weight volume of electric or electronic tools or appliances must be able to be recycled in the future. The reuse and recycling share must not be lower than 50% of the weight volume. Together with our recycling partners, suppliers and manufacturers of plastic components we continue to work on new approaches for recycling plastic. Hilti and external specialists have completely dismantled all our tools and analyzed how to dispose of the various parts. This analysis allows us to observe the European restriction of hazardous substances guideline (RoHS) that limit the usage of danger- ous materials such as lead or cadmium. Hilti tries to combine highest ergonomic standards for the customer with the usage of the most suitable environmentally friendly resources in the production and disposal of its tools. 10 Environmental management at Hilti

Environmentally friendly disposal The recyclable tool: the Hilti GX120 gas-driven fastening system The Hilti GX 120 gas-driven fastening system not only sets new benchmarks for di- rect fastening in drywall applications, but up to 96% of the materials used in its man- ufacture can either be reused or recycled. A residual amount of approximately 4% has to be disposed of. As opposed to earlier models, the Hilti GX120 gas canister has no dosage valve. In purely mathematical terms if we produce one million canisters this represents a re- duction of 22.4 tons of plastic, once again showing the significant effect small innova- tions can have. Hilti packaging is recyclable This is why one can also find the green point recycling symbol on all Hilti packaging. It is found on sales packaging in Germany and in 23 other European countries where the material is disposed of in a controlled process or recycled. Hilti places a great deal of emphasis on handling existing resources with care. In line with this, it goes without saying that we would ensure the recyclability of packaging. Hilti North America recycles 55,000 kilograms of material What happens to old tools when they are replaced by a new generation as part of Hilti’s Fleet Management* program? To meet its obligation to nature and the environment, Hilti’s North American market- ing organization found partners that recycle the older tools, reducing the level of waste. “We don’t want our customers to have to concern themselves with the disposal of tools. At the same time, we want them to know that we are doing what we can to pro- tect the environment”, says Harry Bucher, who helps market Fleet Management with Hilti North America. Beginning with electric cords, toolboxes and battery packs and now encompassing all tools, each individual component is carefully sorted in Hilti’s American and Canadian repair centers. The collected materials are then sent to vari- ous recycling companies. This includes batteries, which require particularly sensitive handling. These actions helped Hilti North America to recycle roughly 55,000 kilograms of ma- terial by the end of 2008. In terms of weight this corresponds to roughly 23 pickup trucks, or 67 passenger vehicles. Estimates from 2009 see the volume growing to some 125,000 kilograms. But the recycling program is only in the beginning stages according to Harry Bucher. “We plan on launching additional activities aimed at pro- tecting our environment.” * Hilti provides customers with a complete fleet of tools for a fixed monthly price. During the contracted period customers receive a single monthly invoice that covers all costs for all tools, including those for standard re- pairs. At the end of the period the fleet is replaced with the latest generation of Hilti tools. One of the advan- tages of Fleet Management is that the customers’ tools always meet the most up-to-date safety standards. Environmental management at Hilti 11

Compliance worldwide Compliance with regulations worldwide Hilti handles its corporate responsibility by closely monitoring new trends concerning health, safety and environment. To ensure health and safe workplaces on the one Hilti XXXXXXXXXXX Street nr zipcode city hand, and environmental protection on the other hand, is a must for Hilti and we de- www.hilti.com� Our reference: XXXXXXX T +XXXXXXXXXXXX F +XXXXXXXXXXX termined to continuously improve our relevant processes. Hilti ensures with the same E�[email protected] Page 1�of 2 D 02.06.2009 rigor also the environmental performance of its products to provide our customers REACH regulation (EC) 1907/2006 & RoHS (2002/95/EG) directive with safe and environmentally friendly products. Accordingly, Hilti complies with offi- Dear Madam, dear Sir, Thank you very much for your valued interest in our products. cial regulations and standards but has also introduced its own standards in business st The European chemicals regulation (EC)�1907/2006�REACH has entered into force on 1 of June 2007. All chemical substances that are either new or already on the European market will be registered with the European Chemicals Agency (EChA) in Finland in a multi-step process over a period of 11 years. with suppliers and concerning internal production. As a formulator of preparations Hilti is mostly a so-called downstream�user for the purpose of REACH. Unlike manufacturers and importers of chemical substances we are not under legal obligation to pre-register or register. However, we are constantly in close contact with our suppliers in order to ensure that they pre-register and register substances of concern for Hilti both in time and in compliance with REACH. We also make sure that the use(s) of our customers will be included as required by Art. 10 and Art. 37(2). For substances on their own, in preparations or in articles which are being imported by Hilti, we have contacted our suppliers in good time and clarified whether they, e.g. by appointing an only�representative�according to Art. 8, Hilti actively manages environmental legislation such REACH, RoHS, WEEE, PAH, will pre-register and register the respective substances. In those cases where our suppliers communicated they did not intend to pre-register or register, Hilti as the importer has done the pre-registration and will do the registration if necessary. DMF, PCF, EuP, GHS, several hazardous substances laws affecting transport, usage A continuity of supply of the products you source from us is therefore assured under REACH. Our current material safety data sheets are already in compliance with REACH Art. 31(6). Furthermore, our articles and their packaging materials do not contain substances included on the current candidate� list for and disposal, and occupational health and safety laws in general. authorization according to Art. 33 and 59(1, 10) in a concentration above 0.1 % weight by weight. The candidate list is monitored on a regular basis. In addition, our products currently do not contain substances subject to authorization or restriction (REACH Annexes XIV and XVII). A so-called extended�safety�data�sheet (eSDS) according to Art. 31(7) contains an exposure�scenario. The latter is primarily relevant for manufacturers/importers of dangerous substances according to directive 67/548/EEC or of so-called PBT or vPvB substances if the threshold of 10 t/yr is exceeded. It will be prepared in the course of substance registration by our suppliers if necessary. Should it be required to pass on new information obtained through an exposure scenario, Hilti will do so in an eSDS. For the time being the current safety data sheets remain valid. We hereby confirm that all the products we provide to you that are covered by the 2002/95/EG�(RoHS) directive, fundamentally meet the RoHS directive stipulations effective as of July 1, 2006. +LOWL·VSKDVHRXWSURFHVVRIXQZDQWHGVXEVWDQFHV With kind regards Hilti XXXXXXXXXXXXXXXXXXXX Signature 1 Signature 2 3KDVH 3KDVH 3KDVH 4UVEZ 4VCTUJUVUJPO 1IBTF
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PSJHJOBM QSPEVDUT The successful implementation of REACH, to take one example, is very important for Hilti to continuously provide its customers with safe and ecologically friendly prod- ucts at the highest level. The REACH directive deals with the Registration, Evaluation, Authorization and Restriction of Chemical substances, and entered into force on June 1, 2007. The aim of REACH is to further improve the protection of human health and the environment through the better and earlier identification of certain chemical sub- stances. It is legislation from the European Union, and applies to all suppliers (inside and outside Europe) that want to sell, import or manufacture chemicals and/or prod- ucts containing certain chemicals in the European Union. The Hilti Group supports the objective of REACH to further improve the European Union’s regulation on chemicals, including the aim to advance public health and safe- ty and to protect the environment. We have requested our chemicals suppliers to (pre)register the chemicals they supply us with, in order to ensure compliance and no interruption of the supply flow. The limited number of chemicals that we produce and import ourselves has been entered into the pre-registration process already. Addition- ally, we have requested our component or finished products suppliers to provide us information on the relevant chemicals in their supplied products. This enables us to provide our customers with a comprehensive compliance statement addressing all requirements of REACH. 12 Environmental management at Hilti

Supplier requirements Environment and safety: partner and supplier requirements Hilti has more than qualitative and economic criteria for production and sourcing. Suppliers are constantly monitored to see whether they observe our strict social and ecological standards. It goes without saying that Hilti production facilities and their suppliers have to main- tain all relevant national and international regulations. Bribery and payoffs are not tol- erated under any circumstances. Human rights must be respected and working con- ditions must be safe. In observing this code of conduct Hilti corresponds to the guidelines of the United Nations, the International Labor Organization, the International Chamber of Com- merce, the World Economic Forum and the UN Global Compact. The Hilti code of conduct for suppliers also represents our responsibilities towards the environment and prescribes certain guidelines, such as the handling of chemicals. Additionally, our suppliers are obligated to contribute to reducing waste and pollutant emissions into the air, ground and water. They must also ensure that they increase the degree of material and product recycling and to continue to improve the energy efficiency both in their production processes and in the handling and transport of goods. Each supplier must pledge, in writing, to observe our code of conduct. This helps to achieve a standard of behavior that is valid worldwide and meets, and sometimes exceeds, legal regulations. Hilti suppliers are regularly audited to ensure they meet these standards. If the audit results are negative Hilti declines to work with the parti- cular supplier. Environmental management at Hilti 13

Hilti code of conduct for suppliers Hilti code of conduct for suppliers Purpose and values “We passionately create enthusiastic customers and build a better future” is the core purpose of the Hilti Group. “Build a better future” means: • We develop win-win relationships with our partners and suppliers. • We carefully select our suppliers, and we support their development in order to build a win-win relationship. • We embrace our responsibility towards society and the environment. • We are convinced that sustainable growth can only be achieved by systematically incorporating environmental and social aspects in our business activities. Integrity, courage, teamwork, commitment are the core values of our corporate culture. The way we do things at Hilti is based on our strong value. We act with integrity in all we do; we demonstrate courage to go beyond the circle of habits; we outperform through teamwork; and we have commitment to personal and compa - ny growth. We measure ourselves by these core values. Therefore we expect our partners – con- tractors, suppliers, sub-suppliers and others – to conduct themselves with the utmost fairness and responsibility in all aspects of their business. The purpose of this code of conduct is to make our position clear and explain what we expect from our suppliers with regard to their environmental and social perfor- mance. This code of conduct is the minimum requirement we make for all of our sup- pliers and their sub-suppliers. In terms of social issues it is based on • The United Nations Universal Declaration of Human Rights • The United Nations Convention on the Rights of the Child • The ILO (International Labor Organization) Fundamental Principles and Rights at Work • The UN Global Compact and in terms of environmental issues is based on • The International Chamber of Commerce (ICC) Business Charter for Sustainable Development • The UN Global Compact and in terms of fighting corruption is based on • The World Economic Forum “Partnering Against Anti-Corruption Initiative (PACI)” • The UN Global Compact 14 Environmental management at Hilti

Hilti code of conduct for suppliers What the supplier can expect of Hilti • To be reliable. • To respect mutually-agreed commercial terms. • To pursue a zero-tolerance policy toward bribery and corruption in any form in line with the PACI principles. • To take a clear stand on working conditions. • To respect different cultures. • To embrace our responsibility towards society and the environment. • To comply with the same requirements imposed upon suppliers. • To clearly communicate the result of the assessment of suppliers and Hilti’s respective valuation. What Hilti expects of the supplier Supplying Hilti includes the following requirements concerning social and environ- mental responsibility and anti-corruption. They are to be followed without exception and include full responsibility for own suppliers, sub-suppliers, as well as their own employees, including freelancers and home workers. Legal requirements The supplier shall fully comply with all international and national legal requirements relevant to the conduct of its business. Commitment to anti-corruption The supplier shall commit to countering bribery and corruption. This means zero tol- erance on bribery and corruption in any form, in particular the elimination of facilita- tion payments. Social responsibility Hilti will do its best to ensure that no one working for Hilti in any form is deprived of his or her human rights, or suffers mental or bodily harm. Therefore Hilti expects the supplier to respect fundamental human rights and to treat its workforce fairly and with respect. More specifically, The supplier must: • Provide healthy and safe working conditions including fire safety. • Pay at least the minimum legal wage and compensate for overtime as per legal requirements. • If housing is provided, ensure reasonable privacy, fire safety, quietness and facili- ties for personal hygiene. The supplier must not: • Make use of child labor. • Make use of forced or bonded labor. • Discriminate. • Exceed the maximum legal working time. • Prevent workers from associating freely with any workers’ association or group of their choosing or collective bargaining. • Make use of any form of mental or physical disciplinary action including harassment. Environmental management at Hilti 15

Hilti code of conduct for suppliers Environmental responsibility Hilti manages environmental issues with the same rigor they do other aspects of the company. We strive to minimize any possible damaging effects to the environ- ment which may result as a consequence of our own or our suppliers’ activities. Therefore, Hilti and its suppliers shall continuously reduce the negative environ- mental impact of operations. More specifically, The supplier must: • Strive to minimize waste and emissions to air, ground and water • Handle chemicals in an environmentally-safe way • Handle, store and dispose of hazardous waste in an environmentally-safe manner • Contribute to the recycling and reuse of materials and products • Continuously improve energy efficiency in their production process, and in handling and transportation of goods • Fulfill the European Union Council Directive 76/769/EEC of July 27, 1976 relating to restrictions on the marketing and use of certain dangerous substanc- es and preparations and their amendments. Further substance prohibitions and regulations are listed on www.hilti.com/suppliers. Implementing and monitoring The supplier must: • Adhere to the Hilti code of conduct for suppliers. • Ensure that all measures required are implemented accordingly. • Effectively communicate and enforce the contents to all of their suppliers and sub- suppliers, as well as to their own employees, including freelancers and home work- ers. In case of non-acceptance by a supplier or a sub-supplier the Hilti supplier must immediately notify Hilti in writing. • Inform Hilti about where the production facilities are located that are relevant for Hilti. Hilti reserves the right to make visits and audit sites where people work direct- ly or indirectly for Hilti. Hilti will: • Assess all current and new suppliers regarding the requirements of the Hilti code of conduct for suppliers. • Clearly communicate the results of the assessment to the supplier. • Monitor compliance to the code of conduct through regular audits by Hilti itself or an independent organization authorized by Hilti. • Always reserve the right to check the current status of suppliers in order to ensure compliance with these requirements. Non-compliance Believing in long-term relationships, Hilti does not break off relations due to non- compliance, as long as there is a willingness to improve based on an agreed-to plan of action to comply with our requirements within an acceptable time frame. Repeated violations of these requirements will result in the termination of cooperation. Hilti is also prepared to take country or cultural differences and other relevant factors into consideration, but will not compromise on the fundamental requirements described in this code of conduct for suppliers. 16 Environmental management at Hilti

Product Carbon Footprint (PCF) Focus on Product Carbon Footprint (PCF) – Hilti sets the standard Hilti puts a strong focus on reducing the environmental impact of its products based on the full product lifecycle. Hilti started in 2009 with measuring the environmental impact of all products with life cycle assessments (LCA). We are dedicated to working closely with our customers and suppliers to reduce especially our carbon emissions. In working toward this target, we take into account all life cycles of a Hilti product starting with the material extraction/provision, internal production, transportation, product usage and end of life. All Hilti products will be analysed by using the Product Carbon Footprint methodology (PCF) for tools and by complete Life Cycle Assess- ments for built in construction products with the aim to reduce the environmental footprint of the next generation of Hilti products. Environment integrated in Hilti products: +HDOWKVDIHW\DQGHQYLURQPHQWLQWHJUDWHG LQ+LOWLSURGXFWV (QHUJ\HIILFLHQF\ &2 HPLVVLRQVUHGXFWLRQ  HQKDQFHPHQW ‡3&)UHGXFWLRQLQDOO ‡(QVXUHKLJKHVWVWDQGDUGV SKDVHV  LQGXUDELOLW\RISURGXFWV ‡5HQHZDEOHHQHUJ\ ‡8VHVWDWHRIWKHDUWGULYH WHFKQRORJ\WRDFKLHYH HIILFLHQWSHUIRUPDQFH 5HF\FODELOLW\LPSURYHPHQW ‡,QFUHDVHUHF\FODELOLW\RI SURGXFWVDQGSDFNDJLQJ 5HVRXUFHHIILFLHQF\ ‡'HVLJQIRUHDV\ LPSURYHPHQW GLVDVVHPEO\ ‡5HGXFHSURGXFWZHLJKW ‡,QFUHDVHVKDUHRIUHF\FOHG FRQWHQW +D]DUGRXVVXEVWDQFHV PDQDJHPHQW ‡5HGXFHXVHRIFULWLFDO VXEVWDQFHV ‡3URDFWLYHSURWHFWLRQRI  KXPDQKHDOWKDQGWKH HQYLURQPHQW By understanding the environmental impact of our products and getting full transpar- ency on major impact factors, Hilti will reduce especially the CO2 emissions of its products over the next years. We follow here existing standards (ISO 14040/44, PAS 2050 and first drafts of ISO 14067) and work closely together with an external partner in Germany. The provided LCA and PCF data is partly based on the databases GaBi and ecoinvent (e.g. Materials, production processes etc.). Additionally, Hilti partici- pates directly in crucial associations and conferences to ensure highest possible credibility of PCF data for customers. TE1000-AVR: Identifying sources of CO emissions and learning to reduce them! The total CO 2 emissions of the TE 1000-AVR are almost 200 kg. Looking at the 5 life 2 cycles (see illustration underneath) it becomes clear where the CO reduction poten- 2 tials are: Environmental management at Hilti 17

Product Carbon Footprint (PCF) • Material extraction/provision with 104 kg is responsible for more than half of the total CO emissions of the tool and offers consequently, the greatest reduction 2 potential • The usage phase of the tool is the second main source of CO emissions, however 2 the situation here is a bit more complex: The calculation basis for the 85 kg is tool performance (kWh) multiplied by tool usage time (in this case a standard time of 100 hours was used). Hilti tools have a very long lifetime; hence the PCF tends to be higher compared to competitors. However, competitor tools have to be substi- tuted by new tools including additional CO2 emissions. Therefore, Hilti tools out- perform competitor tools in reducing the product carbon footprints! 3URGXFW&DERQ)RRWSULQWRI7($95 (MPCBM
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Product Carbon Footprint (PCF) The efficiency improvement of the TE 70 compared to the TE 76 results energy reductions of 11 %. Energy reductions for the TE 1000-AVR compared to the TE 905-AVR are even more impressive with remarkable 26 %. This means that customers get the work done quicker while they use less energy! Our product development teams have been equipped with the first CO emission 2 reduction guidelines and tools to improve the next generation of products. Hilti is determined to reduce the carbon footprints of its products generation by generation. Recycling based on the Hilti TE70-ATC The weight and material information for the TE70-ATC is based on internal documen- tation that discusses the components used (parts list, drawings). The following illus- tration shows the composition of the materials for the Hilti combihammer based on an additional analysis of dismantled parts that were used to verify the EU’s waste of electrical and electronic equipment (WEEE) guideline and to determine the product- related CO emissions. 2 • Steel accounts for slightly more than 36% of the total weight of the new TE 70-ATC. The share of light metals is relatively high, at approximately 7%, due to the light manufacturing measures used to improve ergonomics. • The share of plastics is roughly 46%. The largest share of plastics consist of ther- moplastics (largely acrylintril-butadien-styrol-copolymerisat, abbreviated as ABS, having approximately 24% of the total tool weight). • The remaining weight consists of oils, grease and electronic components. 3ODVWLFV                    S   5 & & 4 3 $ 6 1$ 1" FTJO 1& 51 51 "# 17 16 1.." 163 1MBTUJDT 9999 1MBTUJD
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Product Carbon Footprint (PCF) In recycling, the tool components are separated into material recycling, energetic recycling and waste categories. • 100% of the tool’s metals can be utilized. This results in an energy and CO credit because of the savings on primary materials. 2 • The thermoplastic materials ABS, PA6-GF30 and TPE are also categorized as ma- terial recycling. This also results in additional energy and CO credits. 2 • The remaining polymer materials (thermoplasts, duroplasts, elastomers) are cate- gorized as energetic recycling. This results in an energy credit but also produces CO emissions. 2 The various recycling processes lead to a reduction in CO emissions for the 2 TE 70-ATC of approximately 17%. 0HWDOV  2WKHU                   U U    O  V V RQLF H H 2L %UDV 6WHHO HDV )HUULWH $OXPLQLXP&RSSH (ODVWRPHQDWXUDOILEHU(OHNWU(OHNWULF&HUDPLFV*U*UDSKLW 3DSHU New lead-free Clean-Tec cartridges No matter whether you’re fastening timber, form stops, insulation panels or drainage membranes, the new lead-free Clean-Tec cartridges for Hilti’s proven powder-actuat- ed DX tools make high-speed fastening on concrete or steel more environmentally- friendly than ever. Free from lead and other heavy metals, these new eco-friendly car- tridges available under the Clean-Tec logo combine ecological as well as cost-efficiency advantages for the user. Clean-Tec cartridges have no affect on the proven fastening quality achieved by Hilti DX tools however they do have a positive affect influence on tool life because they re- duce the buildup of residues in these tools by up to 30%. They are also more eco- nomical in use thanks to the number scale on the new strips. These numbers help the user ensure that all cartridges on the strip can be used up. This not only makes good economic sense, it also makes it easier to dispose of used cartridge strips on the job- site in accordance with regulations. Partly-used strips can be reinserted in the tool, easily advanced to the remaining cartridges and thus used up. The new Clean-Tec cartridges underline Hilti’s aspiration to take a leading role in bringing greater environmental awareness to the construction industry. These new cartridges are thus fully in line with the trend toward an increasing number of statuto- ry recommendations and regulations concerning green building and construction. 20 Environmental management at Hilti

Hilti and Green Building Hilti shows leadership in Green Building The building sector is one of the major contributors to increasing global CO2 emis- sions. Green building is one important means to meet the challenge of climate change while also being highly beneficial for building owners. Green building is a globally visible trend to increase the resource efficiency of buildings as well as the comfort and well-being for their occupants. Hilti assists you in achieving green building standards Hilti is a responsible company and therefore dedicated to reducing the environmental impact of its products and services. As one of the world’s largest manufacturers of power tools, high performance consumables (including state-of-the-art fire protection systems) and integrated services, Hilti recognizes the value of designing buildings to meet green building standards. A great number of Hilti products and services help to comply with certain green building standards around the globe such as BREEAM, HQE, DGNB and LEED. Hilti is aware of customer needs with respect to green building and proactively incor- porates green building performance criteria in its most valuable products. Therefore, a wide range of Hilti products provide the customer with an additional integrated ser- vice. To create enthusiastic customers it is essential to understand the customer needs in the first place. How Hilti products directly contribute Green Building certification: The Hilti foam and firestop systems as well as the full range of chemical anchors are VOC compliant and meet standards set forth by South Coast Air Quality Management District Rule 1168 and by ISO 16000. Coating and paints are applied on large areas where, in a short time massive quantities of organic compounds could be released in the workplaces and living rooms. Requirements must be set higher to minimize the quantities of VOCs inside buildings. Studies have proved that mostly poor indoor air quality is the reason for the so-called “sickbuilding- syndrome” (SBS) which may cause illness or headache to the building occupants in new or remodeled buildings. To avoid further contribution to organic compounds Hilti has formulated their paints and coatings with water-based polymers. In case, you need a specific VOC value for a Hilti product for your Green Building pro- ject, please do not hesitate and contact your local sales representative or consult our technical support. We are happy to provide you with VOC values compliant with LEED (USA) the Green Star (Australia), DGNB (Germany) and HQE (France). This is only one example that shows how Hilti products can directly contribute to a green building project. Your local Hilti partner is happy to show you further positive attributes of Hilti products in the context of green building. Environmental management at Hilti 21

Using the power of the sun Using the power of the sun The worldwide market for solar energy systems has been growing at an annual rate of about 40 percent since 2000, stronger than any other energy branch. Hilti is an in- ternationally acknowledged provider of services for PV mounting systems. In conforming with the corporate goal of “we create enthusiastic customers and build a better future,” Hilti offers solar customers innovative PV mounting systems with superior added value. In Spain alone, a leading worldwide producer of solar energy, some 600 solar customers install their photovoltaic modules on Hilti channel systems. The three largest solar parks on the Iberian peninsula were built with Hilti channel installation systems. Together they generate more than 50 megawatts of solar electricity. Hilti & Unirac – Powering the solar market The acquisition of Unirac, North America’s leader in manufacturing PV mounting systems, allows Hilti to create a comprehensive product offering for all relevant solar industry market segments. Leading by Example Hilti supports environmentally-friendly photovoltaic technology not only by providing channel PV mounting systems. We also make direct investments in photovoltaic facilities by increasingly deploying photovoltaic solutions at the company’s own pro- duction and logistic locations. 22 Environmental management at Hilti

Hilti in brief Hilti in brief Hilti provides leading-edge technology to the global construction industry. Hilti prod- ucts, systems and services offer the construction professional innovative solutions with outstanding added value. The headquarters of the Hilti Group are in Schaan in the Principality of Liechtenstein. Almost 20,000 employees, in more than 120 countries around the world, enthuse their customers and build a better future. The corporate culture is founded on integrity, courage, teamwork and commitment. Hilti excels through outstanding innovation, top quality, direct customer relations and effective marketing. Two-thirds of the employees work directly for the customer in sales organizations and in engineering, which means a total of more than 200,000 customer contacts every day. Hilti has its own production plants as well as research and development centers in Europe and Asia. Founded in 1941, the worldwide Hilti Group evolved from a small family company. Since 2000, the Martin Hilti Family Trust holds all shares and, since January 2008, all participation certificates of the Hilti Corporation. This safeguards the long-term sub- sequent development of company founder Martin Hilti’s life’s work. Hilti upholds a clear value orientation and pursues a policy of stakeholder value. Integrating the interests of all the company’s partners – customers, suppliers and employees – into its strategy and actively honoring its social and ecological responsi- bility creates the foundation of trust that makes possible the long-term success of the company. Environmental management at Hilti 23

Hilti = registered trademark of Hilti Corp., Schaan Hilti. Outperform. Outlast. Hilti (Gt. Britain) Limited I 1 Trafford Wharf Road I Trafford Park I Manchester M17 1BY Freephone: 0800 886 100 I Freefax: 0800 886 200 I www.hilti.co.uk/sustainability