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Integrated Profit & Loss Statement Natural Capital Summit 2018 Antonio Carrillo Doblado, Head of Performance & Tools, Sustainable Development Barcelona, June 13 2018

LafargeHolcim at Gance

Natural Capital Summit, June 2018 | Antonio Carrillo © 2018 LafargeHolcim

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Our environmental and social footprint We extract natural resources

We emit CO2

We use energy

We withdraw freshwater

We are present in challenging countries

Natural Capital Summit, June 2018 | Antonio Carrillo © 2018 LafargeHolcim 3

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We will generate 1/3 of our net sales from solutions with enhanced sustainability performance

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Rationale: Why impact valuation? Understand the extent of impacts

Shape the mindset

• Assess and quantify the risks of externalities on LH bottom line • Translate environmental and social KPIs in a common language, understandable throughout the organization

• Have a comprehensive view of company performance/impact • Track progress over time • Engage, mobilize and educate beyond Sustainable Development experts, facilitate confrontation

Enhance decision making process

• Investments lock LH into assets for a long period of time • Start assessing decisions bottom up, working with interested companies


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The IP&L complements traditional financial metrics by providing an estimation of the total value that our company provides for society Reach 2014: First IP&L publication

2016: Public commitment towards integrated reporting (AGM)

Inform the organization and other stakeholders

Enhance Group decisionmaking process

Measure the extent of impacts & test methodology

2012

2016 Natural Capital Summit, June 2018 | Antonio Carrillo © 2018 LafargeHolcim

Time

2020 6

IP&L 2017 is the baseline from which to build long lasting value for shareholders, the planet and people


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Placeholders to be completed


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The outcome is the result of cross-functional collaboration, pioneered in a variety of countries within the Group > Cross-functional

> Pilot and scaled up

> Projects prioritization

> Stakeholder engagement

> No additional data collection

> Towards integrated reporting


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Widely recognized as a reference in impact measurement & valuation methodologies > 3 Years

> Methodology & Assumptions

> Pioneering

> Replicated within industry

> DJSI Leader in IV

> Max Score in 2017: 100

> Cross-Industry Reference

> LH founder member of IVR


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Impact Valuation Roundtable | Context What is the Impact Valuation Roundtable? • Founded in 2015, the Impact Valuation Roundtable (IVR) is an informal group of about two dozen international companies who wish to develop and operationalize the emerging field of Impact Valuation.

Wht about the participants? • The IVR participants are at different stages of piloting, implementing, and communicating their efforts on Impact Valuation and are using the techniques at different levels within their organizations such as at corporate, country, project or product levels. • The IVR participants consider an Impact Valuation assessment as the best approach to measure and value the effects of business activities on the health and well-being of people and the planet – in economic, environmental and social dimensions. • The IVR participants wish to share their best practices and learnings on Impact Valuation with the objectives of: − facilitating the uptake and implementation of the available concepts; − identifying benefits and limitations of the techniques; − and achieving an increasing alignment of valuation techniques and data sources used.


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