© Siemens AG All rights reserved Confidential Corruption and its Prevention - Shared Responsibility For internal use only / Copyright © Siemens AG All rights reserved. The Compliance Program of Siemens and affiliated Companies in Czech Republic Jürgen Schmidt Regional Compliance Officer Prague, November 12th, 2008
© Siemens AG All rights reserved Compliance is an important component of our company culture and our values!
Page 3CC © Siemens AG All rights reserved Our values Our Values – for a global business Committed to ethical and responsible actionsResponsible Achieving high performance and excellent results Excellent Being innovative to create sustainable valueInnovative Highest performance meets highest ethical standards
Page 4CC © Siemens AG All rights reserved Responsible Our principles for being responsible Responsible We respect the dignity of all people We conduct business in a truthful and transparent manner We foster health and safety We obey the law We are fully engaged and empowered to achieve the best results We are committed to good corporate citizenship We strive for the protection of the environment We respect property We honor commitments We are fair in our relationships with competitors and stakeholders
Page 5CC © Siemens AG All rights reserved Compliance at Siemens Compliance at Siemens means that business activities are based on observation of the laws and relevant internal regulations. Siemens expects all management and employees to obey the law and will not tolerate any violations. Siemens has no tolerance for non-compliant behavior!
© Siemens AG All rights reserved Public prosecutors and other government authorities in jurisdictions around the world are conducting investigations of Siemens AG and its consolidated subsidiaries and certain of its current and former employees regarding allegations of public corruption, including criminal breaches of fiduciary duty including embezzlement, as well as bribery, money laundering and tax evasion, among others. Siemens has mandated Debevoise & Plimpton LLP, an external law firm, to conduct an independent and comprehensive investigation to determine whether anti-corruption regulations have been violated and to conduct an independent and comprehensive assessment of the compliance and control systems of Siemens. Debevoise is informing SEC and DOJ on a regular basis throughout the investigation. Current Situation Strengthening of Siemens Compliance Program
Page 7CC © Siemens AG All rights reserved Prevent… … through clear rules, training programs, communication and clear responsibilities Detect… … compliance violations through audits, reviews and monitoring Act… Compliance is the top priority … with rigorous and appropriate measures in cases of compliance violations Uniform, seamless and mutually complementary legal, compliance and audit processes worldwide Compliance must be part of our company culture and firmly anchored in all business processes Unlimited commitment to integrity and responsible action A business based on the highest ethical principles – at all times and everywhere in the world
Page 8CC © Siemens AG All rights reserved Compliance – Progress Report (Q3 FY 2008) 1) Cumulative 2) “Ask us” started Sept. 07 3) Individuals who haven’t replied despite multiple inquiries Source: Compliance Organization, CC CC Detect Handeln New internal compliance investigation Prevent Amnesty program Compliance Personal weltweit "Tell us" & Ombudsman "Ask us" Helpdesk 3,077 questions (cumulative, status ) 3) Collective action against corruption June 2008: To help companies fight back against the insidious impact of corruption, a practical guide and a comprehensive web portal were launched. The portal outlines proven methods of fighting marketplace corruption through the collective action of businesses and other stakeholders. The initiative comprises NGOs and MNCs incl. UN Global Compact, Transparency International, Global Advice Network, CIPE, Grant Thornton and Siemens. Respond Implementation of anti- corruption compliance program Q3 FY 08Q1 FY 08Q2 FY 08 Compliance staff worldwide FY 2006Feb 08 ~490 Oct 08 Implemented (incl. 160 high-risk/ most important entities) Implementation ongoing Amnesty requests In progress Not necessary OthersAmnesty rejected Amnesty granted 198 2) Q4 FY Q1 FY Q2 FY08 1,142 Q3 FY08 Training Participation in-person training 1) Participation web-based training 1) Target: ~ Target: ~ ~18,000 Q3 FY 07 ~31,000 Q4 FY07 ~81,000 Q1 FY08 ~87,000 Q2 FY08 ~108,000 Q3 FY08 ~980 Q3 FY07 ~1,200 Q4 FY07 ~1,400 Q1 FY08 ~14,800 Q2 FY08Q3 FY08 Implementation set up Substantiated Not substantiated Q3 FY Q2 FY Q1 FY % 18% 54% ~ 30,
Page 9CC © Siemens AG All rights reserved A comprehensive Compliance Program: Examples of important measures Tone from the top Top priority with clear lines of responsibility. Compliance is part of the leadership and corporate culture Helpdesk Outlet for the reporting of unlawful activities and violations of the Siemens Business Conduct Guidelines or other relevant policies (=Tell Us). Also includes a function for the answering of compliance questions (=Ask Us) Ombudsman Neutral individual as a communication channel for the reporting or discussion of compliance issues on a confidential and anonymous basis Independent investigation By Debevoise & Plimpton LLP as well as an assessment of the company’s compliance and control systems No tolerance Consequences arising from misconduct PREVENTDETECTRESPOND Continuous improve- ment
Page 10CC © Siemens AG All rights reserved A comprehensive Compliance Program: Examples of important measures Business Conduct Guidelines Corporate code of conduct and core of the Compliance Program Training Formal program of anti-corruption and other legal compliance training Centralization of the Payment System Siemens is in the process of strengthening internal controls through centralization of its bank accounts and cash payment systems. Business Consulting Agreements Prior written consent of two Group Executive Management members and the relevant Corporate Compliance Officer of Siemens AG. PREVENT Continuous improve- ment
Page 11CC © Siemens AG All rights reserved Our Goal: Benchmark for Compliance and Transparency Tone from the top No tolerance on a global basis for illegal behavior Restore trust Thorough and independent investigation of past compliance cases Compliance Program with focus on “Prevent – Detect – Respond” Clear commitment of management
© Siemens AG All rights reserved "I have made the topic of compliance one of my top priorities. There will be no compromises here: Illegal and improper behavior will not be tolerated under any circumstances." (Peter Löscher, President and CEO of Siemens AG) Munich, July 2007
© Siemens AG All rights reserved Munich, July 2007
© Siemens AG All rights reserved Munich, July 2007
© Siemens AG All rights reserved Munich, July 2007
© Siemens AG All rights reserved Munich, July 2007
© Siemens AG All rights reserved Munich, July 2007
© Siemens AG All rights reserved Munich, July 2007