1. Alcan’s integrated supply chains and strategic partnerships with industrial customers Corporate social responsibility by optimizing supply chains World Environment Center - International Forum London, 22 October 2003 Jürg Gerber, Alcan

2. WEC CSR Alcan supply chain London 22 Oct 03 slide 1 1Alcan activities, presence and the global picture 2Alcan management system elements 3 Alcan EHS product stewardship and EU Directives 4Alcan supply chain example: automotive Structure

3. WEC CSR Alcan supply chain London 22 Oct 03 slide 2 Rolled Products Engineered Products Packaging Bauxite mining Alumina refining Aluminium smelting Alcan - a global leader in aluminium, packaging and recycling 2002 revenues: US $ 12.5 billion 54‘000 employees Active in 42 countries

4. WEC CSR Alcan supply chain London 22 Oct 03 slide 3 Alcan’s Presence  Bauxite, Alumina and Specialty Chemicals  Primary Metal  Rolled Products Europe  Rolled Products Americas and Asia  Engineered Products  Packaging  Corporate/Other Offices

5. WEC CSR Alcan supply chain London 22 Oct 03 slide 4 Aluminium life cycle - basis for sustainability

6. WEC CSR Alcan supply chain London 22 Oct 03 slide 5 The Alcan System allows to optimize material flows and maximize eco-efficiency as basis for sustainable development Aluminium a global life cycle Primary Metal - 26 mio tpy Alumina Production - 50 mio tpy Bauxite Mining -100 mio tpy (for metal production) Main Producers - Australia - Guinea - Jamaica - Brazil - India - China - Venezuela - Russia - others 2002

7. WEC CSR Alcan supply chain London 22 Oct 03 slide 6 77% of Hydropower for Primary Metal production is owned by Alcan 2002 Electricity Consumption for Primary Metal production 114.9 Mio GJ (31.93 Billion kWh) Alcan operates 16 aluminium smelters in 7 countries with a total capacity of 2.4 Mt per year Products: sheet ingot, extrusion billet, wire bar, rod, foundry and remelt ingots, ca 2.8Mio tons of products and parts Alcan primary aluminium production - Energy source

8. WEC CSR Alcan supply chain London 22 Oct 03 slide 7 Aluminium growth depends largely on the dynamics of growth of the different market sectors with different life times Source EAA 2002 TOTAL 10.3 Mio t (Rolled, Extruded, Castings) - West and central Europe (excl CIS) Aluminium use end markets Europe Primary Metal 4.6 Mio t Recycled Metal 3.6 Mio t Net Imports 2.1 Mio t

9. WEC CSR Alcan supply chain London 22 Oct 03 slide 8 1Alcan activities, presence and the global picture 2Alcan management system elements 3 Alcan EHS product stewardship and EU Directives 4Alcan supply chain example: automotive Structure

10. WEC CSR Alcan supply chain London 22 Oct 03 slide 9 Shareholder Experience / Expectations Stakeholder Expectations / Engagement Regulatory Requirements Environment, Health & Safety Standards Product Standards Corporate Reporting Requirements Awards e.g DJSI All play a role in determining corporate performance and “license to operate”. There has been a tendency to address demands in a silo fashion 9 Environmental disasters Corporate governance crisis Increasingly well-organized NGOs Increased public awareness Government activism Globalization of markets Information technology Demands on companies have intensified over recent years due to rapid economic, social, political, and environmental changes: Demands and expectations on companies

11. WEC CSR Alcan supply chain London 22 Oct 03 slide 10 A sustainable approach to business needs to be supported by integrated business systems that enhance the credibility of the enterprise through both and its performance and its products. Alcan has implemented EHS FIRST, as an integrated EHS management system that is part of Alcan’s overall integrated business model to achieve our governing objective of maximizing value. 10 Sustainability and integrated business model

12. WEC CSR Alcan supply chain London 22 Oct 03 slide 11 Improving Performance Stakeholder expectations Commitment Alcan’s sustainability framework integrates all activities

13. WEC CSR Alcan supply chain London 22 Oct 03 slide 12 Without such a strategy at the community level our long-term license to operate will be in jeopardy - risking long-term corporate value. By engaging our stakeholders, we increase our understanding of the economic, environmental and social dimensions of our business decisions, and develop strategies that create value for all those affected by our choices. 12 Building Alcan’s relationships

14. WEC CSR Alcan supply chain London 22 Oct 03 slide 13 >.... > Co-operate with customers to understand their needs and support their use of best EHS practices in the design and manufacture of safe and reliable products that take full advantage of our materials’ properties throughout their life cycles. Alcan is often known by its products –Working with customers ensures safe product use –Many products offer EHS advantages that contribute to Alcan’s prestige > Demonstrate leadership in EHS to reflect the superior and life- enhancing characteristics of our products for the benefit of all society. Life Cycle Assessment assists Alcan to improve EHS performance and encourage use of our products with less impact on society - Increased use of aluminium in automobiles reduces emissions of CO 2 - Improved packaging technology decreases the risk of product contamination >.... Alcan’s EHS Policy - 2 out of our 9 principles

15. WEC CSR Alcan supply chain London 22 Oct 03 slide 14 Global EHS Management System with key requirements, roles and responsibilities Line Management leadership Incorporates best practices, ISO 14001 and OHSAS 18001 Critical component of our commitment to corporate sustainability Helps safeguard our license to operate and grow Provides one of cornerstones of value-based company Reinforces stakeholder relations Delivers tools for prevention, which is highest value alternative Enables continual EHS improvement and value maximization Specific EHS FIRST programs have been developed in order to address the relevant EHS aspects of our production processes and products. On the environmental side these programs require every Alcan site to maintain an inventory of all resources and all process inputs and outputs, including potential environmental releases. Under these programs, all sites must set objectives and targets for minimizing resource use and for preventing or reducing process releases. These data are also needed for our EHS product stewardship process and LCA calculations. Alcan EHS FIRST overview

16. WEC CSR Alcan supply chain London 22 Oct 03 slide 15 1Alcan activities, presence and the global picture 2Alcan management system elements 3 Alcan EHS product stewardship and example EU Directives 4Alcan supply chain example: automotive Structure

17. WEC CSR Alcan supply chain London 22 Oct 03 slide 16 Alcan EHS Assessments Relevant input for Alcan sites Input for Alcan Business Units Input for Public Affairs and Associations Input for Public Relations Product related case studies Input to product related issues Product related EHS aspects Market related EHS information EHS product stewardship - main deliveries

18. WEC CSR Alcan supply chain London 22 Oct 03 slide 17 > The customers, significance of use phase and recycling > Alcan’s EHS Policy and commitment to sustainable development > Environmental Management Systems –ISO 14001: “The organisation shall establish and maintain a procedure to identify the environmental aspects of its activities...and of its products or services” > The authorities –Upcoming IPP (Integrated Product Policy) legislation of the EU –EU Directives on recycling, e. g. ELV ( End of life vehicles) Directive Definition. Life cycle assessment (LCA) LCA is a scientific tool for the evaluation of all the effects (both positive and negative) on the environment of a product or a service throughout its complete life cycle’from cradle to grave’. LCA thus looks at effects in the field of raw material extraction, fabrication, transportation, use, and recycling/disposal, as well as from energy and ancillary material supplies. EHS product stewardship - main drivers

19. WEC CSR Alcan supply chain London 22 Oct 03 slide 18 > We have to find out as early as possible... – where threats and opportunities for our products resulting from ecologically motivated customer decisions exist; – where the authorities interfere with our markets by new regulations and standards; – where risks of product liability exist; > We have to co-ordinate efforts to meet the challenges > We have to identify long-term market trends from EHS information on products EHS product stewardship - challenges

20. WEC CSR Alcan supply chain London 22 Oct 03 slide 19 Key factors which underline the need of the product dimension: the overall quantity of products is increasing, the variety of products and services is increasing, innovation constantly creates new types of products, products are traded globally, products are becoming more complex, the product can be designed perfectly, but inappropriate use and disposal will cause significant environmental impacts, products now involve a greater variety of actors throughout their life-cycle. Many open questions from our point of view e.g.: - how is IPP linked with other thematic strategies e.g. resource use, waste prevention and recycling etc - how to avoid ‘good and bad’ product lists etc, trend for product declarations - what about uniform national implementation plans - specific consequences for markets dealing with public procurement EU - integrated product policy IPP

21. WEC CSR Alcan supply chain London 22 Oct 03 slide 20 1Alcan activities, presence and the global picture 2Alcan management system elements 3 Alcan EHS product stewardship and EU Directives 4Alcan supply chain example: automotive Structure

22. WEC CSR Alcan supply chain London 22 Oct 03 slide 21 Kingston Ontario (3) (4) Dubuc, Quebec (2) Detroit, Michigan (4) Banbury, England (4) Neuhausen, Switzerland (4) Sierre, Switzerland (3) Gottmadingen, Germany (1) Rastatt, Germany (1) Nachterstedt, Germany (3) Dahenfeld, Germany (1) Strojmetal, Czechia (2) Markt Schwaben, Germany (2) Tomos, Slovenia (2) Singen, Germany (1) (4) (1) Structures & Design (2) Engineered Shaped Products (3) Autobody Sheet (4) R&D and Technology Alcan automotive locations

23. WEC CSR Alcan supply chain London 22 Oct 03 slide 22 Primary Ingot Sheet Products Engineered Shapes Structures & Design Market growth and value creation in four key markets Alcan automotive Business Units

24. WEC CSR Alcan supply chain London 22 Oct 03 slide 23 Assets & Capabilities Instrument Panel Supports Powertrain Components Bumper Beams Autobody Sheet Crash Managemen t Systems Structural Elements Supension Parts Composite Products Alcan automotive product portfolio

25. WEC CSR Alcan supply chain London 22 Oct 03 slide 24 > Environmental aspects – Replace steel by aluminium (1 kg Al saves 20 kg CO2!) – Contribute to improved design for weight saving and recycling – Alternative materials (plastics, magnesium, honeycomb materials) > Health and safety aspects – Forgings for suspension system – Bumpers and crash elements > EHS issue management and legislation – Lead restriction in casting alloys through ELV legislation – Exemption list in ELV legislation for machining alloys EHS product stewardship - Automotive main issues

26. WEC CSR Alcan supply chain London 22 Oct 03 slide 25 Jaguar XJ -- flagship vehicle First riv-bonded sheet monocoque “World class - Best in class” Safety - Performance - Technology - Refinement Example: Alcan and Jaguar

27. WEC CSR Alcan supply chain London 22 Oct 03 19821984198619881990199219941996 Basic Technology & Patents Metro Materials, Pretreatment and Lubricant development Performance of Adhesives (Durability Testing) Replicas and Concept Vehicles Structural Performance and Data Modelling and Design Structural Modelling Manufacturing Technology Key steps in technology development Jag X350 199820002002 Ford AIVs Jag XJ220 Milestones of aluminium vehicle technology (AVT) development

28. WEC CSR Alcan supply chain London 22 Oct 03 slide 27 Aluminium Structure Technology Understanding of Design Process Materials Knowledge Joint Design & Performance Real Time Experience on Stamping & Die Design A World-Class Supply Chain Alcan’s contribution to Jaguar

29. WEC CSR Alcan supply chain London 22 Oct 03 slide 28 Smelter GB Canada AluNorf Hot Mill (1 or 2) Remelt Latchford UK Smelter Elkem Norway Remelt Norf AluNorf Cold Mill 4 (1680-2200 mm) Nachterstedt Cold Mills (<1680 mm) Nachterstedt GLA Nachterstedt CTL 3 UK Warehouse Nachterstedt Shaped Blanks C B Press- Shop Jaguar Assembly & Finishing X350 aluminium sheet supply chain

30. WEC CSR Alcan supply chain London 22 Oct 03 slide 29 In addition to use of best environmental practices, a need for industry to work with stakeholders in addressing broader environmental concerns Through strong product stewardship an opportunity to promote the lifecycle benefits of our products (aluminum in particular) through greater recycling and more efficient consumer products, such as light- weight vehicles 29 Corporate commitment to environmental stewardship

31. WEC CSR Alcan supply chain London 22 Oct 03 slide 30 Aluminium is not consumed, it is used and re-used again and again alu Economic Social Environmental Aluminium is a strong driver for sustainable development