Compliance Competitive Edge or Bureaucracy

Business Integrity Conference Time for Action in the Baltic Sea Region Riga, Latvia February 14, 2013 Mika Winqvist Director Compliance, Security and Quality Siemens Osakeyhti

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Siemens AG Global presence basis for competitiveness

Sectors Energy Americas
Employees 84 000 Revenue, Bn 22.9 Production facilities 77

Germany
Employees 119 000 Revenue, Bn 11.1 Production facilities 75

Industry Asia, Australia

Employees 63 000 Revenue, Bn 15.5 Production facilities 73

Healthcare Infrastructure & Cities Employees 370 000

Europe (excl. Germany) CIS, Africa, Middle East

Employees 102 000 Revenue, Bn 28.8 Production facilities 70

Revenue 78.3 Bn Production facilities more than 290 Founded in 1847

2012
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Tapping future growth in emerging markets requires a proper implementation of compliance

Strengthening local presence in fast-growing markets to gain market share...

Russia United States Europe 1) Germany

CPI 2009 2) 8.0 8.9 7.0 7.9 6.0 6.9 4.0 4.9 3.0 3.9 2.0 2.9 1.0 1.9

Middle East

China

India Brazil
Bubble size = Estimated GDP growth from 1990 to 2020

Africa

...is as important as implementing compliance to protect against the high corruption risk
1) Europe = EU 15 w/o Germany 2) Source: Transparency International Corruption Perceptions Index 2009 Unrestricted Siemens Osakeyhti, 2013. All rights reserved.

Employees get guidance for their daily work through policies that are based on external laws and The Compliance Path of Siemens internal values & guidelines
Immediate Actions
2006 2007

Implementation
2008
DoJ/SEC settlement

Support sustainable business!

2009
World Bank settlement
Continuous Improvement

2010

Exchange of Leadership Team

Compliance Program

Continuous Improvement

Tone from the Top

Compliance Organization

Values & Integrity

Independent investigation

Compliance Training

Collective Action

Centralization of bank accounts

Compliance Tools

Sustainable Development
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Employees get guidance for their daily work through policies that are based on external laws and internal values & guidelines
Values Responsible Compliance Policies and Tools * Project Business Business Partner Gifts & Hospitality Data Protection Environmental Protection Occupational Health and Safety Committed to ethical and responsible actions. Excellent Achieving high performance and excellent results. Innovative Being innovative to create sustainable value.

Company Values

Business Conduct Guidelines External Laws

* Examples of Compliance Policies

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Employees get guidance System: The Siemens Compliancefor their daily work through policies that are Detect Respond Prevent based onexternal laws and internal values & guidelines Prevent Detect
Management responsibility
Compliance risk management
Policies and procedures Training and communication Advice and support Integration in personnel processes Collective Action

Respond

Whistle blowing channels Tell us and Ombudsman

Compliance controls Monitoring and Compliance reviews Compliance audits Compliance investigations

Consequences for misconduct

Remediation Global case tracking

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We help to ensure fair competition

Continuous dialogue with stakeholders

"Collective Action projects

"Compliance Learning Initiative

We cooperate with the most important organizations: Transparency International World Economic Forum International Business Leaders Forum International Chamber of Commerce UN Global Compact World Bank Institute Center for International Private Enterprise

We fight corruption in cooperation with other companies and stakeholders We promote integrity and fair competition in public contracts We have established a $100million fund to promote anticorruption projects and initiatives

Our goal: Ensure that today's and tomorrow's managers pay greater attention to compliance

Sharing of best-practice examples for successful anticorruption activities in business (e.g. Harvard case studies)

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Employees get guidance performer in work through policies Siemens is the strongest for their dailythe three categories of the that are based on external laws Diversified Industrials sector and internal values & guidelines
Corporate Governance Risk & Crisis Management Codes of Conduct/ Compliance/ Corruption&Bribery Innovation Management Customer Relationship Management Supply Chain Management2) Strategy for Emerging Markets2) Average Score 1)

Supersector Leader Industrial Goods & Services"

Average Score 1) Siemens Score

47% 88%

50% 94%

Siemens Score 92%

Siemens Score

Average Score 1) Siemens Score

41% 96%
2) New categories in 2012

1) Average score of all assessed companies in the Diversified Industrials sector

Source: SAM, Sustainability Office

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Thank you.

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