Michelin Performance and Responsibility

2002•201210

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PROSPECTIVE ANDSUSTAINABLE DEVELOPMENT GROUP DEPARTEMENT+ 33 (0) 4 73 32 20 1823, place des Carmes-Déchaux63040 Clermont-Ferrand Cedex 9 – Franceperformance-responsabilite@fr.michelin.com

COMMUNICATION AND BRANDS GROUP DEPARTMENT+ 33 (0) 4 73 32 20 0023, place des Carmes-Déchaux63040 Clermont-Ferrand Cedex 9 – Francewww.michelin.com

June 2012

2002•201210

The Michelin Performance and Responsibility

approach, launched in 2002 within the Group,

is celebrating its 10th anniversary.

We chose a glossary format to present the

numerous and often intertwined achievements

of the approach, as well as all the progress

made over the 10 past years at the service of

sustainable mobility. Employee quotes, collected

from the Communication campaign “And you,

what’s your better way forward?”, illustrate

each person’s contribution to our commitment

to building sustainable development.

We are pleased to invite you to leaf through

this glossary to discover our actions on the

subjects you choose.

ACHIEVING PERFORMANCE AND RESPONSIBILITY

What has happened in society and in our industry over the past 10 years?

Climate change, dwindling reserves of fossil energy, polluted cities... No one can remain indifferent to the future of the planet. Citizens and consumers are continuously raising the bar when it comes to environmental protection. In the face of these challenges, the transportation industry has been very fl exible to help reduce its environmental footprint against a backdrop of rising raw material and energy prices. At the same time, civil society has increasingly held businesses accountable for their economic and social responsibilities.

We, in the Michelin Group, have been striving to serve our customers interests by providing them with ever-more innovative products and services to further sustainable road mobility. Very early on, we demonstrated that innovation in tire technol-ogy can help reduce fuel consumption and lower CO2 emissions. We have consistently applied and shared our values to remain unique and act ever-more responsibly toward our employees and civil society. Around the world – and this has been the case for far longer than 10 years – we have become a part of the local life, fulfi lling our responsibilities for the benefi t of the communities around us.

Our mission is to meet our economic, social and environmental responsibilities and actively contribute to developing sustainable road mobility. This is not a new mission – our 100 years of history and innovation clearly demonstrate it. But 10 years ago, as sustainable development issues became more obvious and pressing, we decided to take a more systematic approach and develop a framework for action: Michelin Performance and Responsibility. This approach is based on 12 priorities that guide us to achieve performance and responsibility in everything we do.

Launched in 2002, the approach has proven effective for the past 10 years and we can present all that we have achieved. This booklet reviews the progress we have made and the determination that has led us thus far.

Achieving performance and responsibility – that’s our better way forward!

Jean-Dominique SenardMichelin Managing Partner

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Advanced Sustainable Performance Indices (ASPI)

ASPI Eurozone® is one of Europe’s benchmark extra-financial stockmarket indices for evaluating sustainable development and corporate social responsibility. It encompasses the 120 most effec-tive listed companies in this fi eld in the Euro zone. Michelin joined ASPI on the basis of evaluations conducted by the extra-fi nancial rating agency Vigeo.

Antitrust

The fi ght against unfair practices and dominant market positions is a major challenge for international companies such as Michelin. Antitrust policies are developed to protect the market competition process and apply to all aspects of a company’s commercial activity. Every employee is a guarantor of this policy. As far back as 1998, the Group formalized a compliance policy for the rules of competition and since then has never ceased to improve the effectiveness of its program, through the adoption of pragmatic and creative measures. The last of the training tools developed in this field is an interactive game “Mission Antitrust.” It makes learning fun and compels sales representatives to play an active role in this fi eld.

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Guarantee that there is honesty at all levels of the Company.

Finance Group Department

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Bahia

The tropical rainforests of South America are a crucial challenge for the preservation of ecosystems, since they boast extremely rich biological diversity. For example, it is thought that one-third of the earth’s animal and plant species are present in Brazil. For more than 10 years, Michelin has been working to preserve the perimeter of a primary Atlantic forest offering exceptionally varied biodiversity. With this challenge in mind, in 2002, Group imple-mented the “Ouro verde” (“Green gold”) project in Bahia, on its former rubber tree plantation. Over the next 20 years, this ambitious enterprise will enable the reconstitution of a seamless band of primary Atlantic forest spanning more than 3,000 hectares. In addition, Michelin has played a role in developing the local economy, through the selling of the original plantation in 12 plots to Company employees. All of the employees (600 people) have been maintained on site. The produc-tivity of new farm holdings has been boosted thanks to the introduction of banana and cocoa trees and the contribution of agronomists belonging to Group. Finally, Michelin has acted as a major stakeholder in sustainable rubber tree farming by developing new varieties of rub-ber trees that are more resistant to parasites such as the Microcylus Ulei fungus.

Balance of Performance

Although it is relatively simple to optimize each performance characteristic of a tire separately, it is more diffi cult to manage the balance between these performance characteristics. How can energy consumption (use of materials that generate less heat) be reduced, without detracting from grip (need for materials that heat quickly around the contact zone)? Likewise, how can longevity (rigid tread to create less friction) be improved, while maintaining safety (fl exible tread to hug the irregularities of a road surface)? Through innovation, the Michelin teams have been able to overcome these technical contradictions to obtain more balance of performance. Improving grip, energy effi ciency and longevity simultaneously is a necessity in order to achieve sustainable, clean and safe mobility.

See: Performance of tires.

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Biodiversity

This is the term used to designate the diversity of the living world at all levels: diversity of environments (ecosystems), diversity of species, and genetic diversity within the same species. From a very early stage, Michelin became committed to protecting and studying biological diversity. In 2002, a biodiversity study center was created in Bahia, Brazil. This center provides scientists from the world over with an open-air laboratory to study the Atlantic forest. In addition, in order to highlight the dependency of industrial sites on their environment, a fi rst ESR (Ecosystem Services Review) was conducted on the Nyíregyháza site in Hungary in 2008. This process is based on methodology developed by the WBCSD (World Business Council for Sustainable Development) and the WRI (World Research Institute) and was adapted to the tire industry. In late 2010, in order to further the Group’s knowledge in this fi eld, another method intended to measure the dependency and impacts of sites on ecosystems was assessed with an independent body. The objective is to explore various tools which, in the long-run, will enable the Group to quantify the potential interactions of its sites with surrounding ecosystems, so as to enable it to improve their protection. In this framework, the initial aim is to establish an inventory of protected areas in the vicinity of the Group’s industrial sites by 2013-2014.

Biofuels

These liquid or gaseous fuels are obtained from the transformation of biomass. Although today almost all road vehicles still use oil-based fuels, it would now seem that the domination of oil will soon be a thing of the past due to its foreseeable scarcity, its high cost and its negative impact on the environment. On the other hand, global road traffi c is increasing constantly and the demand for fuel is growing commensurately. The 2010 Michelin Challenge Bibendum held in Rio showcased Brazil as an example of a country that has made the successful transition toward the post-oil era. Approximately 90% of new vehicles sold in Brazil are biofuel powered (ethanol + gasoline). This event saw the birth of the Challenge Bibendum

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Booklet Collection designed to stimulate thinking and dialogue among experts, manufacturers, policy-makers, journalists and any other persons wishing to take part in the discussion on the future of mobility. Let’s Drive Bio! What biofuels for what uses tomorrow? is just one of these booklets. They are available free of charge and in three languages on the website:www.michelinchallengebibendum.com

Biomass

Biomass designates a range of carbon-rich plant or animal-based natural materials that are renewable over short time periods. Based on a fi rst assessment made by the Michelin Group, installations using renewable energies are currently under study and include biomass installations. These processes sometimes require long development cycles but in the not too distant future these projects, which have reached varying levels of maturity, will help reduce the Group’s CO2

footprint, either directly or indirectly. In 2010, two biomass-based thermal energy production installations were installed at the Bourges and Cholet sites to replace gas boilers. In 2011, these installations saved 13,000 tons of CO2.

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Promote dialog between rubber producers and consumers, that’s a better way forward.

Public Affairs Group Department

Carbon Disclosure Project (CDP)

Michelin reports its CO2 emissions to CDP, an independent body that strives to reduce greenhouse gases (GHG) emitted by compa-nies and territorial authorities, and which tracks these emissions through an annual survey conducted on behalf of international investors.

See: Extra-fi nancial rating agencies, Environment, MEF.

Career Management

At Michelin, employees are recruited for careers and not for positions; careers with Michelin are personalized and long-lasting. Michelin employees are recruited for their experience, their skills and the development potential that they possess.As soon as they are recruited, all employees are assigned a career manager who helps them map out their professional development aspirations. The Group’s 400 career managers are independent from the hierarchy and help develop the professional career paths of employees based on their performance, their aspirations and the Company’s needs. One of the challenges faced by the Group is retirement. From 2008 to 2013, a total of 30,000 people are set to retire and these people have to be replaced by new recruits. Accordingly, the challenge is to attract and recruit the best talents. To this end, it is important to showcase the Group’s assets in terms of personnel management. The “responsibility triangle” principle is one of our strong points. Three stakeholders share res-ponsibility for career development at Michelin: the employee, his/her supe-rior and his/her career manager from Personnel. Studies and surveys enable us to gauge the level of satisfaction and engagement of employees.

See: “Moving Forward Together”, Training, Managerial quality.

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CO2 (carbon dioxide)

It is one of the main greenhouse gases that helps maintain the heat emitted by the sun into the atmosphere. International climate negotiations aim to stabilize greenhouse gas concentrations in the atmosphere at a level that should prevent dangerous climate disruption. Road transport accounts for 18% of fossil-based CO2

emissions resulting from human activity. Tires account for 4% of these emissions: this is due to the fuel consumed to overcome their rolling resistance. This can amount to one tank of fuel in every fi ve

cars and one tank of fuel in every three trucks. In order to limit the average global temperature increase to 2 °C by 2100, CO2 emissions have to be halved by 2050. How can this objective be achieved, when forecasts show that the number of vehicles and kilometers covered on this planet is set to double over the same period? Also congestion, noise and pollution disrupt quality of life in all of the world’s big cities and are intrinsically linked. Reducing congestion, noise and pollution requires the organized co-existence of individual and collective transport systems, although this alone is not enough. Thanks to hybrid vehicles and electric vehicles,

the objective to achieve zero emission cities (ZEC) or near-zero emission cities in 2030-2040 is no longer an unattainable dream, as shown by the Michelin Challenge Bibendum.

See: Greenhouse gases, MEF.

Code of Ethics

Introduced in 2012, this Code defi nes the beha-vioral standards applicable to Group activities and establishes guidelines on various ethical subjects that all employees should follow. It

underscores the Group’s commitment to the values of respect and responsibility. It is available in 13 languages and was distributed to all 115,000 employees in 2011. Since then, ethics phone lines have been put in place, enabling any employee who so wishes to report any breach of this code, with the utmost confi dentiality. A Group ethics and compliance committee will be set up for each geographic

zone in 2012. By complying with these exacting ethical standards, Michelin wishes to heighten its attractiveness. The quest for perfor-mance and the application of demanding standards in everything that the Group does are not mutually exclusive. On the contrary, they go hand in hand.

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Establish correspondents in each country so as to reduce travels.

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Demonstrate exemplary ethical values in our actions.

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Comfort

Comfort is a performance characteristic defi ned as a subjective expression of the pleasure felt by a user inside a vehicle and which results from a range of different vibration sources: shaking on bumpy roads, isolated obstacles (manhole covers, surfacing joints, etc.), disturbances caused by the tire, the wheel, or fi tting operations. Therefore, improving comfort consists of designing tires that are able to reduce or filter out vibrations located in frequency and amplitude zones perceptible to human beings. A distinction is drawn between the acoustic comfort perceived by the ears of passengers and the vibration comfort perceived by their entire body. For earthmover tires, where the vehicles have no suspension, tires play an extremely important role in driver comfort. With the launch of the MICHELIN XHA2 tire intended for multifunctional loaders in 2009, Michelin reduced vibration by 50% compared with its previous range. The MICHELIN Primacy LC tire launched in 2008 in Asia is a reference in acoustic comfort. The combination of various technologies (materials, t ire architecture and sculpture design) contributed to reducing the noise level on the whole frequency band inside the vehicle.

Community Involvement

Wherever it is located, the Michelin Group takes part in community life by establishing close relations with local organizations (local and regional authorities, education establishments, associations, etc.). If appropriate, Michelin takes part in the activities of these institutions and provides its expertise and/or fi nancial support. The Group is involved in four areas: education; culture and sports activities; the mobility of people and goods; and charitable initiatives. In 2011, € 17 million were devoted to this participation in the life of the communities where Michelin is located.

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In 2003, this f igure was approximately three

times less (around € 6 million). In 2011, Group personnel devoted 19,041 working days to activities directed at local communities (including 43% for education activities and 20% for mobility-related activities).

See: Stakeholders.

Corporate Social Responsibility (CSR)

CSR covers the application of sustainable development to com-panies. The Michelin performance and responsibility process is the expression of the Group’s sustainable development and corporate social responsibility strategy.

In 2001, the European Commission defi ned CSR as follows: “a concept whereby companies voluntarily integrate social and environmental concerns in their business operations and in their interaction with stakeholders." There is no legislative defi nition of CSR in France as yet. However, for companies listed on the French stock exchange, France has transformed this engagement into a statutory obligation, through article 116 of law dated May 15, 2001 on new economic regulations and the recent publication of the law dated July 12, 2010 on national engagement for the environment (the so-called “Grenelle II” law).

See: New economic regulations (NRE).

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I’m a volunteer youth teacher in the community where we live and work.

BRAZIL

My better way forward is to promote our environmental and community relations goals. I am leading a project to install an employee garden on the Research and Development campus. Employees can raise vegetables and share with a local Soup Kitchen.

UNITED STATES

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I'm quite committed to Michelin’s culture and its focus on the individual. A remarkable tolerance toward the individual that gives you a freedom in your personal life. A freedom that leads to great comfort in your job at Michelin – leading to customer care and harmony within the team of colleagues. I see Michelin as an institution rather than a commercial company in these matters. I use it as an example in my private life with friends and private business partners in hope that others will share our understanding of the importance of a better way forward.

SWEDEN

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CCustomers

"Customer satisfaction is the raison d’être of our Company, stated the fi rst PRM report published in 2003. To echo this statement, the Group’s Quality Statement, displayed at each site, announces that “the Customer is the raison d’être of our Company." The Group’s strategy is guided by the desire to remain as close as possible to its customers. In all of its markets, Michelin relies on close-knit relations with its manufacturer, distributor and motorist customers, on the development of its integrated and franchise networks, and on the enhancement of the services that it provides to its customers. However, the Company is convinced that long-term customer satisfaction cannot be based solely on providing a response to their immediate needs. This is why the Company’s efforts are constantly focused on developing innovations that are marketed before their time. This approach is epitomized by the radial tire, but also, more recently, by the MICHEL IN X One and the Tweel. The Green tire was launched when energy savings and reduced CO

2 emissions were

not yet at the heart of customers’ concerns. Since its creation, Michelin has implemented specifi c programs to analyze and anticipate the expectations of its customers because “the customer, due to his/her own free will, is our boss,” recalled François Michelin in 1969.

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Customer feedback helps us monitor the usage performance of our products, understand the reasons why users wouldn’t be satisfi ed and provide designers with tools so that the next generation of tires continue to offer a better way forward.

CANADA

I focus on understanding our consumers’ needs so we can provide valuable information and services on digital channels. Overall I strive for the best possible consumer experience online and offl ine in the tire segment.

BELGIUM

Communicate information to help consu-mers choose the right tires.

Passenger Car & Light Truck Product Line

Provide qualifi ed support to the team to satisfy our customers (internal and external) by extending professionalism in the Supply Chain world.

CHINA

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Diversity

In 2002, the diversity of our teams was one of the nine impro-vement areas of the Michelin Performance and Responsibility process. Today, the Diversity process is spearheaded by a global network of 600 people and revolves around fi ve main axes of work: cultures and nationalities, female-male mix, ages, ethnic origins and disability. Michelin’s objective is fi rst and foremost to recruit and employ competent persons at all levels. Michelin establishes the necessary conditions to attract the talents that the Company needs and this requires access to a broad range of candidates applying for positions. In the Group, diversity is fostered by the formulation

of diagnostic methods and proposed actions to leverage diversity.With regard to the “nationalities and culture” axis of our diversity process, we have obtained conclusive results for senior management positions. In 2003, 33% of these positions were held by non-French nationals. In

2011, this figure reached 46.3%; this result is

a benchmark in the industrial sector. As for the mix between men and women, we are well on the way to achieving this aim: the share of female employees has increased by 2 points in 9 years, from 13.3% as of December 31, 2002 to 15.2%

as of December 31, 2011 Group-wide.

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BRAZIL

All of our communications are issued using non-sexist vocabulary.

SPAIN

Landscaping provided by local companies hiring disabled people.

Purchasing Group Department

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In 2011, Michelin developed and rolled out a method to

include more women among its industrial plants’ and sales force

personnel. All countries are actively involved in this approach, which consists

of identifying obstacles (ergonomics, working hours) and imple-menting action plans. One person recruited by Michelin in every three at the global level (in the support function and managerial categories) is a woman (since 2010). Finally, through its Handicap policy defi ned in 2009, Michelin has pledged to take the appropriate measures to enable the integration of handicapped employees and to maintain handicapped employees or any employees who become handicapped in positions that are compatible with their handicap and which correspond to their qualifi cations. All countries have made a commitment to make progress in this fi eld so as to achieve statutory employment rates for handicapped employees.

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Dow Jones Sustainability Index (DJSI) World

This DJSI is a stockmarket index that lists the 342 companies with the best economic, environmental and social performance, from among the 2,500 largest publicly-traded companies in the world. The companies in this index are selected on the basis of the evaluation made by analysts of the SAM (Sustainable Asset Management) agency and in cooperation with the Dow Jones index. Michelin joined this index in 2003 for Europe and 2006 for the World and since then has never ceased to improve its absolute score, despite the increasingly demanding level.

See: Extra-fi nancial rating agencies, SAM.

Economic dimension

Environmental dimension

Evaluation out of 100

Social dimension

200820070

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2009 2010 2011

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Ecodriving

Since 2009, Michelin has conducted ecodriving courses with its employees in several countries including Spain, France and the United Kingdom. In France, staff members who are required to drive a vehicle for their work are urged to take part in these courses. Product lines such as the Truck Product Line have included these training courses in programs such as the Michelin Fleet Solutions program. These courses include several hours of practical and theore-tical training. They help reduce the risk of accidents by encouraging drivers to anticipate obstacles. They also teach trainees how to drive more fuel-effi ciently through the more effective use of vehicle resources.

Ecosystems

Dynamic groups comprising communities of plants, animals, microorganisms and their non-living environment. These elements belong to an interdependent system enabling their survival and development. Michelin is aware of the essential role and fragility of the ecosystems from which it benefi ts. More specifi cally, approxi-mately 40% of the rubber used by Michelin comes from a renewable raw material which is dependent on a balanced ecosystem: natu-ral rubber, produced from rubber trees. Mindful of the need to continue to benefi t from the services rendered by ecosystems and to protect biodiversity, Michelin currently acts on three levels to limit the impact of its activity on ecosystems. In the rubber farming sector, it implements actions to promote the sustainable production of natural rubber. This is bolstered by strict compliance with the regulations in force related to the preservation of local ecosystems, which it takes even further by applying the SMEM (Michelin Environmental Management System) on each site, and by implementing specifi c actions to prevent ground, water and air pollution. Finally, Michelin has designed green tires in order to limit the impact of its products on ecosystems.

See: Bahia, Recovery, SMEM, WBCSD.

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I’m going to organize Drive Safely trainings for new hires to help reduce road accidents. We can also add to this an eco-driving module to help reduce fuel consumption.

TURKEY

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Employee Engagement

The engagement rate of Group employees has been measured three times in 10 years. The results of the 2001 survey, which involved 25% of employees, showed that 79% of employees were proud to belong to the Group (survey conducted by International Survey Research). In 2010-2011, 76% of operators and 88% of managers and support positions stated that they shared this sense of pride. The 2010-2011 survey was the fi rst of this type to cover such a large population in the Group: it involved 80% of all Group employees. The overall engagement rate of operators stands at 69%, while that of managers and support positions stands at 83% (Employee Engagement Survey: survey conducted by The Conference Board). The results of this new survey, which includes the six dimensions of “Moving Forward Together,” have served as a basis for diagnoses and action plans to improve team engagement in sites and countries. Given the wealth of learnings gleaned from these surveys, the discussions that they fuel, and the progress that they engender, the Group has decided to conduct them annually in all countries beginning 2013.

Empowering Organizations

Empowerment is one of the historic values of the Michelin group. “One of our principles is to empower people who accomplish a given task since they know a lot about this task and this very often

reveals capabilities that these people were not aware of and which make them progress,” said Édouard Michelin back

in 1928. Michelin aims to foster operational excellence, leadership and sustainable performance and strives

not only to apply these values but also to enable individual development. Empowering organiza-tions is a tool used to achieve this dual objective. The empowering organizations process forms an integral part of the Michelin Manufacturing Way and above all, it is a process that enables operators to develop, to increase their autonomy,

to gain control and confi dence and to take pride in their results and in the progress made by their

team and their workshop. It helps create united and strong teams. It also enables managers – at all levels – to delegate more and more effectively ensure ongoing improvement in collective performance. In 2011, this process was accelerated and now involves almost all Group industrial sites.

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Strive to improve people engagement by sharing with them the motivation for actions versus trying to micro-manage their execution.

Personnel Group Department

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Endurance

Michelin tires contribute to the three dimensions of sustainable development. Endurance reduces the consumption of raw materials, decreases usage cost and increases safety. It defi nes the ability of a tire to withstand, for as long as possible, all of the stress and hazards that it is subjected to in the course of its lifetime. A tire is subjected to mechanical but also thermal stress. One million kilometers covered by a truck tire, after three retreading operations, corresponds to 400 million revolutions of a wheel. For each revolution of a wheel, each zone of the tire has to fl ex in order to hug the shape of the road and generate grip.The MICHELIN INCITY XZU3 bus tire, launched in 2011, offers better sidewall protection against sidewalk and roadside scraping. The MICHELIN X MULTIWAY XZE R truck tire designed for the Asian market, is reinforced in the lower tire area, the sidewalls and the crown in order to improve robustness and thus to get the best possible use out of the tread’s longevity.In the Earthmover segment, in 2011 with the launch of the XDR2 tire for rigid dumper trucks, a combination of several technologies (60% stronger steel cable improved thickness at the crown and a new tread pattern to eliminate stones easily) enabled a signifi cant improvement in tire endurance in extremely tough mining conditions.

Energy Effi ciency

The ability of a tire to restore a greater or lesser share of the energy transmitted to it by a vehicle’s drive systems. By reducing rolling resistance, the energy effi ciency of a vehicle is increased. In fact, currently, one tank of fuel in every fi ve passenger cars and one tank of fuel in every three trucks is spent overcoming tire rolling

resistance. Driving with properly inflated tires is the best way of maintaining the energy effi ciency achieved thanks to a range of different technologies.

For example, the truck tires in the MICHELIN Energy Saver Green range launched in 2010

enable a 40-ton truck to reduce its fuel consumption by 0.4 liters for every 100 km covered.

See: Rolling resistance.

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Environmental Footprint

The environmental footprint of a company designates all of the impacts on ecosystems resulting from its activities (consumption of materials and energy, pollution, land use, etc.). It involves all stages of the lifecycle of its products: production of raw materials, product manufacture, use and end-of-life.

See: MEF, SMEM.

Ergonomics

Ergonomics, safety and working conditions at Michelin sites formed part of the nine action areas presented in the fi rst PRM report in 2003. A network of professional ergonomists has helped the Group make progress in improving working conditions for operators and, more generally, for its entire workforce.

Environment

In April 2002, the environment became one of the Group’s fi ve values. “The inclusion of the environment in our values is a formal expression of our intention to pursue a form of growth that will enable our manufacturing and our products to better protect human beings and nature, at all of our locations.” (Édouard Michelin, Journées Groupe).

See: MEF.

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I commit to always turn off the lights and unplug appliances whenever possible to help reduce energy consumption and therefore raw material use.

POLAND

To save trees I would aim to minimize the use of paper in my functional operations, by avoiding taking print-outs, by printing double-sided and using black ink instead of colors, by shredding unnecessary papers, by trying to reuse one-sided paper and by encourage my colleagues to adopt this "green environment" idea.

INDIA

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Physical and atmospheric stresses have been reduced at all industrial sites and strenuous working conditions have been limited. In 2005, Michelin developed evaluation methods in order to construct improvement plans for all work stations (EVANE: evaluation of the ergonomics of work stations). Henceforth, at Group level, the ergonomics network shares experience and disseminates best practices across sites. Ergonomics is systematically included in project design. In order to encourage more female employment, a special work station mapping study has been conducted at all industrial sites. The in-depth ergonomic study of work stations not only improves health and safety at work but also fosters equal working conditions between men and women.

Ethibel Sustainability Index

In 2011, Michelin joined this stockmarket index in the best investment register category of the Forum Ethibel, a Belgian association that aspires to a society that respects the best balance among economic progress, social justice and environmental protection. The starting point for Forum Ethibel’s corporate social responsibility consulting activity is the scope of the Vigeo analysis, which is based on the STOXX® Global 1800 index.

Extra-Financial Rating Agencies

Since 2003, Michelin has been evaluated on its sustainable develop-ment performance by extra-fi nancial rating agencies: these agencies assess the Group’s performance in the environmental, societal and governance fi elds, using their own specifi c criteria and methodology. Based on this information provided to investors, they have created SRI (Socially Responsible Investments) indices. Michelin, which has proven successful in its engagement in sustainable mobility, is very well rated and continues to signifi cantly increase its scores.

See: CDP, SAM and Vigeo.

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Optimizing the tread extrusion process. Through my actions, employees can accomplish their tasks in a safe and ergonomic fashion. Each update will help contribute to the plant’s progress.

POLAND

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“Fill up with air!”

This event, which aims to raise the awareness of motorists on the importance of tire pressure, was organized in approximately 16 European countries between 2002 and 2012 (Austria, Belgium, Czech Republic, Finland, France, Germany, Greece, Hungary, Italy, Ireland, Poland, Portugal, Romania, Slovakia, Spain and United Kingdom) as well as in Algeria, Croatia, Slovenia, Latvia, Lithuania, Russia, Turkey, Malta, Serbia. In May 2004, the Group signed the European road safety charter and made a pledge to “visit” 25 countries per year. More than 100,000 vehicles have been checked directly by Michelin over this ten-year period. The results of this operation show that, all too often, tires are under-infl ated and sometimes dangerously so. The “Fill up with air!” campaign helps prevent numerous road accidents and helps improve the environ-mental and energy performance of tires.

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Fuel

A fuel is a combustible substance that powers an internal combus-tion engine. An engine transforms the chemical energy of fuel into mechanical energy. The principal advantage of fuel is that it has high energy density, i.e. it can produce a lot of energy for a given mass or volume (this is what gives a vehicle powered by an internal

combustion engine signifi cant autonomy). One liter of gasoline contains 9.1 kWh of energy and one liter of diesel contains 10 kWh. This is the amount of energy that can be provided by an average electrical installation for one home in one hour and it takes only two seconds to put in a vehicle’s fuel tank.Over the last 10 years (from January 1, 2002 to January 1, 2012), the green tires sold by Michelin for passenger cars and trucks have enabled fuel savings of 13,856,942,160 liters, which corresponds to a reduction of 34,642,355,400 kg in CO2 emissions.

See: Biofuels.

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We raise our customers’ awareness on environ-mental issues. The Truck commercial team offers retreading and regrooving, conducts fl eet inspections and shares tire pressure guidelines with users to help them save fuel.

SWITZERLAND

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Fuel Cell

A fuel cell enables the generation of electricity from hydrogen and oxygen. It converts chemical energy into electrical energy, with quite a high yield (≈ 50%) and without any pollutant emissions. The PEM (Proton Exchange Membrane) technology is the prefer-red technology for mobility applications. Michelin conducts active research on hydrogen/oxygen and hydrogen/air PEM fuel cells, for road, aeronautical and nautical applications.

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Global Reporting Initiative (GRI)

The GRI is the offi cial partner of the United Nations Environment Program (UNEP) and is an independent body tasked to define and disseminate guidelines with a goal to improving the quality, rigor and utility of economic, environmental and social reporting. It relies on the participation of businesses, NGOs, institutional investors, unions, academia, etc. Since 2003, the majority of indi-cators published by Michelin as prescribed by the French NRE law (law on New Economic Regulations) have matched those of the GRI.

Governance

For a company, governance is a set of rules related to the organiza-tion and functioning of relations between its managers, its Board of Directors or Supervisory Board and its shareholders. La Compagnie Générale des Etablissements Michelin is the mother company of the Group and is organized in the form of a partnership limited by shares. It is managed by a Partner, who is personally liable for the debts of the Company without any limitation as to the amount. An independent Supervisory Board constantly assesses the quality of the management led by the Managing Partner with the support of the Group’s Executive Committee. With a view to adapting the Group’s governance to suit the global environment, in 2011 the Managing Partners made a proposal to the shareholders to allow the Supervisory Board to intervene directly, or via its committees, in processes relating to the renewal, the compensation, or the revocation of the Managing Partner. Finally, a second Partner, the company SAGES, while liable for debts without any limitation, but which is not a Managing Partner, ensures the continuity of mana-gement in the event of any vacancy.

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Greenhouse Gases

These gases are naturally present in the atmosphere and contribute to maintaining temperatures on Earth at a level suitable for the life forms known to man. The excessive build-up of greenhouse gases in the atmosphere due to the increased amounts produced by human activity is one of the causes of global warming. The greenhouse gases listed by the Kyoto Protocol are carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFC), sulfur hexafl ouride (SF6) and perfl uorinated hydrocarbons (PFC). Their impact, which depends on their warming potential, is generally expressed in CO2 equivalent, since carbon dioxide is widely agreed to be the reference gas.

See: MEF.

SHARE OF TRANSPORT IN ANTHROPOGENIC CO2 EMISSIONS

Transport 26%

Industry

18% Road transportation

4% Tire rolling resistance

Other

Residential

Energy

26%

19%

41%

6%8%

18%

4%

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Green Tire

A low rolling resistance tire invented by Michelin in 1992, it contri-butes directly to a reduction in fuel consumption and pollutant emissions. The green tire is a major innovation and, due to its successive upgrades, it now produces a reduction of more than 30% in rolling resistance. For cars fi tted with green tires, this corresponds to a reduction of around 5% in fuel consump-tion and CO2 emissions.The green tire has revolutionized rolling resistance, providing signifi cant fuel savings and reductions in CO2 emissions. Moreover, it has improved user safety even further – primarily due to increased grip on wet roads – without compromising the tire’s lifespan. One of the key aspects of this innovation is the replacement of carbon black by silica in the tire’s tread of passenger car.

See: Rolling resistance.

Grip

Sustainable mobility goes hand in hand with an improvement in road safety. Improved tire grip is at the root of safety. Grip mea-sures the capacity of a tire to transmit forces of acceleration and braking and to negotiate curves without skidding. Grip is produced in the zone where the tire comes into contact with the road, on an area no bigger than that of a human hand. However, on wet roads, water interferes with grip, to such an extent that the braking distance is signifi cantly increased. Therefore, the tire has to remove water at the contact zone between the car and the road as much as possible. The tire of a vehicle driving at 90 km/h has less than one millisecond to “hold” the vehicle to the road.Many ranges of passenger car tires marketed over the last 10 years have signifi cantly improved grip on wet roads. In particular, the following ranges have brought about notable reductions in braking distance: 3 meters less for the MICHELIN ENERGY 3 tire in 2003, 2 meters less for the MICHELIN Primacy HP tire in 2006 and 3 meters less for the MICHELIN Pilot Sport 3 tire in 2010. In the truck tire sector, the Michelin XDN2 Grip tire launched in 2005 introduced a 30% gain in grip for tires that are two-thirds worn.

See: Sipes, Green tire, Road safety.

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History of Michelin

In 1889, the Michelin brothers had already successfully founded their growth strategy on innovation. They decided to keep track of their work in order to show the young engineers of the time the progress made from the fi rst bicycle tire in 1891 to the most modern and state-of-the-art tire. This marked the start of a legacy that still exists today. This history was designed to be shared with others. Since 2007, the onboarding of new hires has included a module on Michelin’s history. The Michelin heritage collections are also used to support internal and external communication actions. In 2009, Michelin decided to open part of its collections up to the general public with the

creation of the Michelin Adventure space in Clermont-Ferrand.

This is a 2,000 square meter exhibition where visitors can

discover the Group’s past, present and future. The exhibition shows how Michelin became a major mobility stakeholder, advocating a “Better Way Forward” and illustrates the values that have guided the Group since its inception.

Hybrid

Vehicle equipped with an internal combustion engine and an electric motor, which operate together or separately according to traffi c conditions. A hybrid vehicle can improve fuel savings of 25-30% in towns and cities. The progressive electrifi cation of road vehicles is expected to be the most visible development over the next twenty years in order to reduce energy consumption, diversify the energy mix, lower CO2 emissions and improve quality of life in towns and cities. The use of electric vehicles as a step towards achieving sus-tainable mobility is the subject of a Michelin Challenge Bibendum Booklet: Let’s drive electric! Hybrid and electric vehicles available on www.michelinchallengebibendum.com

on art he re d. er

can ast, e exhihibibitition shohows

Understand the past to imagine the future.

Industrial and Prevention Performance Department

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Integration

All new hires (i.e. 14,036 people in 2011) benefi t from persona-lized support. While Michelin encourages internal promotion, it nonetheless recruits many new hires, largely due to the growth in emerging zones and the signifi cant number of people retiring in mature countries. Over recent years, specifi c attention has been paid to the fi rst steps made by new employees in the Company. Originally (in 1946) reserved for senior French engineers, the integration period has recently been extended to all levels of personnel and lasts from three days to a few months, depending on the position and level

of responsibility held by the new employee. In 2010, a three-day training program entitled “A Better Way to Start” was introduced for all new employees with “collabo-rateur” (support function) status upon hire. Likewise, operators now benefi t from a structured two-day welcome program followed by a third day a few months later. The integration period is first and foremost intended to enable new employees to get to know Michelin better: to discover the corporate values, the Michelin Performance and Responsibility process and to fi nd out more about sustainable development, the history, organization and activities of the Group, as well as the essential safety rules.

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I help new hires with their orientation.

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The integration program for managerial staff has several modules, including a mandatory two-week internship as an operator in a factory, a problem solving exercise carried out individually and/or in groups, and fi nally, participation in a structured one-month session organized around conferences given by the Group’s senior managers. Each session brings together around one hundred managers from extremely varied backgrounds, including up to 19 nationalities and, in 2011, up to 60% non-French nationals. Back in 2007, when this session was launched, the majority of participants were French nationals (97%).

See: “Moving Forward Together,” Training, Career management.

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IISO 14001

It is an international environmental management standard (based on planning, documentation and effective implementation of environmental policy) that accredits compliant companies and organizations following an audit conducted by a third-party. Starting in 1998, the fi rst Michelin plants received ISO 14001 accreditation (Campo Grande in Brazil was the very fi rst plant to be certifi ed. By 2011 year-end, 98.9% of Michelin’s tire production came from ISO 14001 accredited sites. In 2004, this fi gure stood at only 90% due to new factories in the Group. Michelin’s objective is to ensure that every new site (including the three new industrial facilities in Brazil, China and India) is certified within a given timetable. The Group has set an objective that the SMEM, Michelin’s environ-mental management system, which is a pre-requisite for ISO 14001 accreditation, is to be implemented on all sites acquired more than 5 years ago. In 2011, this was the case for 99% of industrial sites, tertiary sites and technology centers. This process is currently being implemented at logistics sites. In addition, 64% of raw materials suppliers’ sites (i.e. 80% of purchase volumes) were ISO 14001 certifi ed in 2001. Promoting ISO 14001 certifi cation with strategic suppliers is a continuing objectve for Michelin: it has increased by 6 points since 2008.

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Labeling

The global tire labeling system is intended to guide consumers in choosing tires that are the most environmentally-friendly and respectful of human safety. The aim is to inform and help consumers in their choice of tires by assessing key performance characteristics. Labeling is also intended to encourage manufacturers to progress on these functional aspects, with a goal of protecting the envi-ronment and improving safety.The criteria highlighted by these labeling systems and their imple-mentation dates vary from country to country. For example, in Japan, information on grip on wet roads and rolling resistance has been provided for some tires since the start of 2010. In North America, the tire labeling system is still on the drawing board, but the plan is to stress longevity. In Europe, user information will be mandatory by the end of 2012 for passenger cars, light utility vehicles, coaches and buses, and will be clearly displayed at sales outlets. For passenger cars and light utility vehicles, the legislation requires labels to be affi xed to new tires. Consumers will be guided in their choice of tires based on information provided on safety (braking on wet surfaces) and envi-ronmental aspects (fuel saving and exterior noise).

Life Cycle Analysis of a Tire (LCA)

The lifecycle of a product such as a tire covers all stages of its lifespan, including the extraction of raw materials, manufacture, transfer to distribution networks, use and recycling of the tire (we often talk about “cradle to grave” analysis). In order to better understand the environmental impact of its products, Michelin was one of the fi rst European tire manufacturers to conduct a life cycle analysis for a European passenger car tire in 2001. Subsequently, in 2003, it took the initiative to conduct alone another life cycle analysis for a truck tire. These studies showed, without a shadow of a doubt, that the environmental impact of a tire is mainly linked to its on-vehicle rolling phase due principally to the fuel consumption resulting from the tire’s rolling resistance.

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JAPAN

Use my skills and resources to make the Product Lifecycle Management tool successful and to move away from legacy.

Industrial and Prevention Performance Department

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The latest updates of the life cycle analyses for passenger car and truck tires conducted in 2011 show that the environmental impact of a tire decreases throughout its life cycle and even becomes negative at end-of-life. These results justify the pursuit

of Michelin’s research efforts. In 2012, the Group thus became a partner of

the LCA chair of Montreal Polytechnic’s Interuniversity Research Center for the

Lifecycle of Products, Processes and Services (CIRAIG) which aims to develop cutting-edge

expertise on sustainable development tools.

THE IMPACT OF A TIRE DURING ITS LIFECYCLE IN EUROPE

11%4.5% 6%

10.8%

86.3% 94%

Passenger car tire Truck tire

95.3%92.6%

2001 2003 20112011

2% 1.5% -1.3%-3.4%

End-of-life processing

Use, including distribution

Raw materials, energy, production

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LLogistics

Given the fact that this sector includes activities with high envi-ronmental impact, Michelin has, from an early stage, focused on optimizing its fl ows of raw materials, semi-fi nished products and fi nished products. Michelin was the fi rst tire manufacturer to use an Atlas-type machine that optimizes the loading of tires into trucks. The purchasing division selects carriers that have an emissions reduction program. In 2008, Michelin assessed its greenhouse gas emissions resulting from the transportation of its goods and fi nished products by sea, using the emission coeffi cients established by the Clean Cargo Group. In 2008, these emissions amounted to185,000 tons of CO2. In July 2011, a fi ve-year review of CO2 emis-sions was conducted for Europe. The scope of the study included emissions connected with chartered and paid transportation and direct and indirect emissions generated by warehouses. The overall ratio (kilos of CO2 per ton transported) increased by nine points between 2006 and 2010. As a result, Michelin has implemented a new series of actions in order to reduce the number of kilometers covered and limit the carbon footprint of transportation, both externally by its carriers and internally.

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Optimizing transportation helps decrease CO

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emissions while reducing costs for Michelin, optimizing warehouse usage helps develop ergonomics while reducing costs – various PRM goals are thus improved simultaneously.

Supply Chain and Logistics Performance Department

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London Benchmarking Group

A group of more than 300 global companies has established a methodology in order to measure the value and the impact of com-munity and philanthropic investments made by companies, as well as their commercial activities related to sustainable development. In 2011, Michelin joined this group in order to improve the relevance and the impact of the actions led by the Group in these areas.

See: Community involvement.

Longevity

This is the maximum distance covered by a tire before its wear starts to compromise its performance, primarily in terms of safety. Longevity is one of the primary benefi ts attributed to the MICHELIN brand, which for many years has included the need to ensure optimized use of raw materials in its research. For some tires, such as earthmover tires, longevity tends to be expressed in terms of number of hours of use. For aircraft tires, longevity is expressed in the number of landings.The MICHELIN XDN2 GRIP truck tire, launched in 2005, provided a 25% increase in longevity due to the introduction of Michelin Durable Technologies.In 2011, the MICHELIN XZE3 + EVERTREAD truck tire intended for use on North American highways provided a 30% increase in the mileage warranty given tocustomers. The MICHELIN X-TRACTION earth-mover tire launched in 2005 and designed for rigid dumper trucks used for earthworks on building sites or mines brought a 1,500-hour improvement in longevity. In certain conditions, exceptional longevity of up to 10,000 hours can be achieved. By way of comparison, a car that covers 15,000 km per year at an average speed of 50km/h is used for only 300 hours!

In 2011, the MICHELIN Energy XM2 intended for growth zones brings a 20% improvement in longevity while reducing rolling resistance, there-fore reducing a vehicle’s consumption and CO2 emissions.

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Management Quality

Management quality has always been a major objective for Michelin. Managers play a decisive role in the application of Group values, the achievement of results and the development of individuals. Teams are sized to ensure management focus. Annual objectives are defi ned jointly by managers and the employees that they manage. Managers are assessed on their managerial quality. In 2011, the roles and responsibilities of managers (line managers, cross-cutting managers and experts) were described in detail in the Manager’s Guide.

Michelin Challenge Bibendum

There will soon be two billion vehicles on our planet. We are increasingly dependent on oil and CO2 emissions continue to rise. Road transport is right at the heart of geostrategic challenges. In order to further understanding of these major challenges, Michelin Challenge Bibendum is the only global event allowing policy makers to exchange points of view in order to help map out the path towards sustainable road mobi-lity. The technologies presented and the conclusions of the many discussions held during the last Michelin Challenge Bibendum in Berlin in May 2011 prove that the emergence of a new era is within our reach. All it takes is determination!

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Help my colleagues develop to their fullest potential within a demanding context and smile to them. Thus contribute to their well-being and as a result, to the Company’s performance.

ITALY

My better way forward is to provide good methods of work and good tools to allow my colleagues to do the best job for the Company. Team spirit is also a guideline to develop people by working together.

THAILAND

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The Group management of future sustainable development (DGPR)

has organized the Michelin Challenge Bibendum since 1998. Its venue alternates

from one continent to the next (Brazil in 2010, California in 2001 and 2003, China in 2004 and 2007, Europe in 1998, 2002, 2006, 2011, Japan in 2005). It is an international event that aims to further the understanding of mobility challenges in the future, to propose solutions, and to construct a global vision so as to improve the mobility of people and goods. It is based on an ongoing, collaborative and forward-looking approach among different stakeholders, with a goal to identifying the main themes that will shape future mobility. The mobility of the future must be clean, safe, connected, affordable and accessible, while preserving driving pleasure and freedom to travel. The Michelin Challenge Bibendum event revolves around the organization of rallies and vehicle tests, a technological exhibition center, round tables and conferences with mobility experts, and a forum where political and economic decision makers meet. It attracts more than 6,000 professionals from the public, private, scientifi c and media sectors.

Michelin Development

Michelin Development gives vitality to employment in the areas where the Michelin Group is located and plays a role in the implementation of corporate social responsibility. Created in Clermont-Ferrand in 1990 under the name of SIDE (which in French stands for industrialization and economic development company), this unique structure boasts fl exible working methods and is able to mobilize Group specialists on a case-by-case basis. Over the space of a few days, these specialists provide local project leaders with cutting-edge technical expertise and support in a range of dif-ferent fi elds. This consultancy and expertise activity may be backed by fi nancial support in the form of subsidized 5-year loans with no guarantee requirement. These loans aim to leverage support from institutional or private investors and thus to stimulate processes that create local employment. All in all, over 20 years, SIDE, which became Michelin Development in 2010, has supported the creation of more than 25,000 jobs in France and in eight other European countries, as well as 2,000 jobs in Canada and the United States. Moreover, it has spurred 1,400 technical assistance programs intended to encourage the emergence of local businesses. In the event of any industrial reorganization operations, Michelin Development plays a particularly active role.

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Michelin Sites Environmental Footprint (MEF)

In order to increase the environmental performance of all Group sites, it is important to have a suffi ciently global measurement of this performance. For this reason, in 2005, Michelin defi ned an environmental performance indicator (named MEF) covering the six most relevant environmental parameters. This indicator includes the consumption of resources (water, energy) and the emission of carbon dioxide (CO2), volatile organic compounds (VOC) and waste (quantity generated, quantity sent to landfi ll). Each component is then weighted according to importance and expressed as a function of tons of tires produced. Since 2005, the Group has pursued its efforts to reduce the environmental impact of its sites and mea-sures the progress made through a quarterly review of the MEF conducted by the prevention and industrial performance division (DPPI). The initial MEF target aimed to achieve a 35% reduction in the MEF footprint by 2015, compared with the 2005 baseline. At the end of 2011, the MEF footprint had already been reduced by 33%. Signifi cant progress was made in reducing CO2 and VOC emissions in 2011.

MEFBASIC COMPONENTS AND WEIGHTING

Michelin Fleet Solutions (MFS)

The Michelin Fleet Solutions offer is intended for large vehicle fl eets in Europe, which are invoiced in terms of mileage covered rather than in terms of number of tires purchased. For more than ten years, in 24 countries, 300,000 trucks and van fl eets have chosen MFS. MFS deals with everything including choice, mounting, maintenance, assistance, retreading and end-of-life issues. In order to help its customers further reduce their fuel consumption, MFS runs ecodriving training courses and operates on-board information systems that analyze the cause of excessive fuel consumption and thus enable its correction. This example is often quoted by Michelin stakeholders as an illustration of functional economy.

Michelin Junior Bike

This event was launched in Italy and is based on an untimed bike race for 4- to 11-year-olds. It is a fun and educational race that takes place in an urban environment and on a closed circuit. Beyond the fun and friendly atmosphere of the event, the aim is to raise the awareness of children (and their parents) on road safety, through one main and essential lesson: the need to wear a helmet. Since 2002, more than 70,000 children from approximately ten European countries have taken part in these events (e.g. Italy, France, Spain, Germany, the Netherlands, Czech Republic, Hungary, Slovenia and Romania). Starting in 2009, the Michelin Junior Bike e v e n t h a s helped strengthen the trusting relations between production sites and local communities.

See: Community Involvement, Road safety.

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Michelin Manufacturing Way (MMW)

The aim of the Michelin Manufacturing Way process, which was initiated in 2005, is to bring about sustainable and uniform acceleration in the progress made by industrial sites in all perfor-mance areas: safety, the use of resources, quality, lead times and costs. It is based on the sharing of best manufacturing practices and tried and tested tools and progress methods. MMW places people at the heart of the process by developing their empowerment. It targets operational excellence in plants, and highlights progress made: “Everybody, everyday, applies the best known practices, obtains results that are among the best in the world, and continues to progress.”

See: Empowering organizations.

Motorsport

Car, motorbike and cycle races have always been an unbeatable testing ground for new technology. The quality of the vehicles used and the expertise of racing drivers enable bold solutions to be pitted against those of competitors. Michelin’s position in motorsport is renowned the world over, thus enabling it to promote safety and performance, while pushing limits. This is how the MICHELIN Green X Challenge came about, to reward vehicles achieving the best energy performance during races. Since the lifespan of our products has now improved considerably, we may, in the future, see the introduction of new racing rules where fewer tires are used over a given motorsports season.

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Motorized Wheel

Convinced that the future of our roads will also rely on the devel-opment of electric motorization, Michelin has invested in two high-value components: the in-wheel motor and the fuel cell. With this system, the motorization of a vehicle will be within the wheel itself: no more engines under the hood, no more transmission parts or gear boxes. The in-wheel motor designed by Michelin places an electric motor and the braking system at the center of the wheel. It can be used in front (traction) or rear (drive) confi guration, according to the conditions and intended use. The MICHELIN Active Wheel is a “smart wheel” capable of driving a vehicle, while providing electric suspension to guarantee unparalleled road holding and comfort. The in-wheel motor system is silent, provides exceptional road holding, is compact and above all environmentally-friendly. Since it is electric, it generates no emissions at its source. The elec-tricity can be stored in a battery or produced by a fuel cell or by any other power generator. It goes without saying that the impact of the in-wheel motor must be considered in light of the electrical energy production system used, which can vary greatly from one generation system to the next. Michelin is working with several industrial partners and manufacturers with the goal to bring these major innovations to market.

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“Moving Forward Together”

Since its inception, Michelin has always been convinced that the Company’s performance and the professional success of every employee go hand in hand. The “Moving Forward Together” pro-cess was launched by the Personnel Group Department in 2011, with the active involvement of the Group’s management. “Moving Forward Together," the trademark of mutual commitment reaffi rms the values that drive Michelin forward and presents its offer and expectations as an employer. These mutual commitments are detailed in six fi elds. Career Management, Learning and Development, and Managerial Quality – our historic assets – are the most visible of these fi elds and the aim is to ensure continued progress in order to retain our competitive edge. The other three fields include Compensation and Benefi ts, Job Design, and Quality of Work Life in these fi elds, Michelin wishes to be competitive in each market where the Group is present. “Moving Forward Together” provides the opportunity for Michelin to share its iden-tity and ambitions as an employer with its employees and potential employees from all walks of life.

See: Employee Engagement, Integration.

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Create an open, transparent and respectful atmosphere, where feedback from my team will be used to take actions or decisions. Make sure that the challenges we are facing will be taken with a positive and enthusiastic attitude with respect for customers, suppliers and colleagues.

THE NETHERLANDS

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New Economic Regulations (French “NRE” law)

The law on new economic regulations, adopted on May 15, 2001 in France, governs three fi elds: regulation of competition, regulation of fi nancial markets and regulation of corporate activities. Article 116 of this law requires listed companies to publish information on their social, societal and environmental impact. No sooner had this law entered into force than Michelin decided to extend this reporting obligation worldwide. Since 2007, this information has been authenticated and certifi ed by the auditors in a specifi c chapter of the Reference Document. For example: “Frequency rate” and “Severity rate” of workplace accidents, “Headcount” percentage of tires produced in ISO 14001 certifi ed plants, MEF data.

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Performance Characteristics

These are a set of criteria characterizing the qualities of a tire. The overall performance is the balance achieved on the basis of a defi ned use. In order to function properly, a tire, which is a high-technology product, must offer multiple performance characteristics. These

characteristics are often incompatible. For consumers, the key performance characteristics are safety

(including a reduction in braking distance on dry and wet roads), fuel saving, and mileage covered during a tire’s lifetime. These three performance characteristics are maximized in the framework of a complex performance balance. A tire must also respond to manufac-turers’ OE specifi cations (“Original

Equipment”), and comply with regulations that often go beyond

the three key per formance characteristics sought by consumers.

Accordingly, Michelin is constantly improving the other performance characteristics of its tires, notably road handling, comfort, noise, and grip on cold or icy roads (for winter tires).

See: Balance of performance.

Progress Ideas

More than 80 years after their launch in 1927, these proposed progress ideas remain an important component of our corporate culture. The main idea is that there should not be any silos in the Company and that “everybody works for the same customer.” Progress ideas are proposed spontaneously by employees and are intended to improve individual safety, the quality of products and services, savings (cost and lead time reduction), working conditions, environmental protection and respect for the environment, or to increase diversity. This participatory innovation process enables all Company employees to feed back problems and suggest solutions or propose improvements.

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Each one of us at Michelin can and should do our best to move forward through diffi cult times. Progress Ideas are one of the main tools so that each employee can share his or her opinion and contributeto Continuous Progress and the know-how of our factory.

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5858

This process enables every employee to play an active role in progress by showing initiative and creativity. Between 2002 and 2012, the number of persons proposing progress ideas increased by 64% (from 11,201 to 18,358) and the number of ideas proposed increased from 27,483 to 43,085. One employee in every three has proposed an idea and one in every two ideasproposed has been implemented. Beyond the immeasurable progress in terms of safety and working conditions, the progress ideas process earns Michelin more than €11 million every year.

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Purchasing Code

This document details how the Michelin purchasing division intends to apply the guidelines in the “Michelin Performance and Responsibility” Charter to its relationships with suppliers. It describes the principles with which suppliers must comply in the fi eld of human rights, working conditions, the health and safety of their personnel and the residents living close to their sites, while respecting the environment. Published in 2003, this Michelin Purchasing Code has been supplemented by a quality assurance referential and an ethical rules guide governing relationships with suppliers.

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When two providers demonstrate a comparable quality/price ratio, local sub-contractors are chosen (providers that are the closest to Michelin factories). We select the provider with a proven, effective CSR approach.

Purchasing Group Department

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QQuality

Safety is inextricably linked to the quality of a tire’s design and manufacture. Michelin’s strategy in terms of safety is based on extreme vigilance and the rigorous application of a tried and tested quality monitoring plan. In order to satisfy this requirement, quality management systems are in place in all of the Group’s research centers and production units, but also after-sale through a specifi c tire monitoring system. Quality is a paradigm and no innovation has ever challenged the quality of Michelin’s products, which is the same everywhere in the world. Through the Michelin Manufacturing Way process, the best quality practices are reproduced at all sites.The quality of Michelin products is a value that has been recognized and certifi ed by several reputable surveys: the Reputation Institute and i&e survey, 2010; The Global RepTrak™ 100, 2011.

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Radial

The radial design differentiates the crown and sidewall functions of a tire. In a radial design, the reinforced rubber plies are arranged radially (or at a 90 degree angle to the direction of travel) to construct the carcass of the tire. The radial design is distinct from the conventional tire structure consisting of superimposed cross-plies. Invented by Michelin in 1946, the radial tire offers improved robustness and longevity – and therefore safety – and reduces rolling resistance.

Recovery of End-of-Life Tires

Used tires are 100% recoverable in the form of energy or raw materials. Whether used whole

or cut up, they can be used as sound abate-ment walls or railway ballast. Crushed into granules or powder, they can be used to make synthetic fl oor coverings, composite materials or sometimes even road surfaces. New recovery applications are being developed, driven by increasingly scarce

raw materials and fossil fuels.

Used tires pose a dual problem in terms of annual

fl ow management – more than 18 million tons throughout the world – and disposal of unusable inventory estimated at 50 million tons. Michelin supports the principle of the responsibility of the manufacturer for the collection of used tires, which has proven to be effective (Europe: 96% recovery rate; Brazil: 97%). It is a member of f the WBCSD working group, responsible for promoting the creation of recovery chains in emerging countries. In 2011, a new company mana-ging end-of-life tires was created in Italy (Ecopneus). In 2002, French manufacturers created the company Aliapur to make a sustainable commitment to the management of end-of-life tires, while respecting the environment.

See: WBCSD.

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Improve market penetration of MICHELIN’s radial tire by explaining to OE makers truck and trailer’s advantages: fuel effi ciency, productivity, tire cost compared to bias tire.

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Recovery of Waste

This is one of the parameters of the MEF on which Michelin has made the most progress. Between 2002 and 2011, the amount of waste sent to landfi ll from all sites decreased from 33 kg/t to 9.8 kg/t, a decrease of 70.3%. In Europe, more than 98% of our waste is recovered. In our prevention and waste management policy, the following hierarchy applies in decreasing order of importance: 1. Prevention 2. Re-use or recycling 3. Recovery of material 4. Recovery of energy 5. Disposal, including landfi ll.

See: MEF.

Responsibility of the Manufacturer

System fi xed by law whereby manufacturers (producers, importers) are responsible for disposing of products at the end of their life, in this case used and non-recyclable tires.

See: Recovery of end-of-life tires.

Risks

At Michelin, the mission of the Audit and Risk Management Group Department – which reports directly to the Managing Partner – is to help the Group gain better control over its operational risks. The

entire process is defi ned, led and coordinated by the risk manager, who ensures that the Group’s major

risks are kept under control. The audit and risks management division comprises 40 people

of more than ten nationalities, each with several years’ operational experience in one of the 14 families of controlled risks. Whenever an audit highlights signifi cant risks, another identical audit is conducted one or two years later in order to assess developments and the effectiveness of measures taken.

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RRoad Handling

This “road handling” performance characteristic describes how a tire-vehicle assembly responds to the multiple actions by a driver (turning, acceleration, braking, etc.). Road handling is an essential aspect of safety and vehicle stability, but also contributes to driving pleasure. For the end user, road handling is above all related to the vehicle’s exact response to the actions of the driver. Everything should feel natural, reliable and predictable. For car manufacturers, road handling is one of the critical performance characteristics. Combined with safety and driving pleasure, road handling is a key performance characteristic required for tire approval. Road handling performance is one of the most perceptible characteristics for professionals (press launch, specifi ers, etc.) and fi nal users. The road handling performance of tires is assessed through numerous tests (objective and subjective, on dry or wet surfaces and on machines). The customers who are most demanding in terms of road handling are car manufacturers who want tires that are perfectly suited to the features and performance characteristics of their vehicles.

Road Safety

From 2002 to 2012, road safety actions concerned principally Michelin Junior Bike, the “Fill up with air!” operations and the rollout of Bibendum infl ation stations (stations with the Bibendum imagery to check tire pressure). These events form part of the Company’s mission and values, and refl ect Michelin’s determination to play a societal role to help improve safety on our roads (1.3 million deaths world-wide in 2011), by encouraging people to adopt responsible behavior. Since 2009, road safety campaigns organized by Michelin in the framework of the ROSYPE project (Road Safety for Young People in Europe) have raised the awareness of 300,000 young Europeans. Led in partnership with the European Commission, the ROSYPE project aims to educate 730,000 6- to 25-year-olds by the end of 2012. In 2011, a steering committee uniting all Group entities concerned with road safety was created to defi ne a communication plan to highlight the perceived leadership of the brand in emerging countries and to assert this perceived leadership in mature countries. Michelin must become the benchmark and

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Over the last 10 years, Michelin has received more than 2,500 technical certifi cations from car manufacturers across the world.

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an indispensable player in this fi eld. In 2011, on behalf of the Michelin Group, Managing Partner Jean-Dominique Senard, signed the UN General Assembly’s text proclaiming a Decade of Action for Road Safety (2011-2020).

See: Balance of performance.

Rolling Resistance

For each rotation of the wheel, the tire, which is round, must deform itself in order to hug the shape of the road which is fl at, when it enters into contact with the road surface. The viscoelastic materials which form the tire dissipate part of the drive energy in the form of heat, thus generating rolling resistance. The rolling resistance coeffi cient of a tire is closely dependent on the compo-sition of rubber mixes used. It is expressed in kilograms per ton. For an average passenger car, a value of 10 kg/t means that, in order not to lose speed due to rolling resistance, a one-ton car must use the same amount of energy to climb a hill with a 1% gradient. In 1946, the invention of the radial tire enabled a decrease of 25% in rolling resistance. In 1992, the green tire enabled a further gain of 20%. The MICHELIN ENERGY™ E-V tire, approved exclus ive ly for Renault’s electric vehicle ZOE in 2011, improved 35% in rolling resistance compared to the first green tires.

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EVOLUTION OF THE ROLLING RESISTANCE COEFFICIENT(in kg/t)

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First radial tires

First radial tires

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Energy 3

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Rubbers (natural and synthetic)

Developing sustainable rubber farming is a major concern for Michelin which, on a permanent basis, uses almost 10% of the world’s natural rubber production. The Group participates in all initiatives to increase natural rubber production while protecting tropical rainfo-rests. Natural rubber has remarkable physical properties and remains the most versatile elastomer for many applications such as truck and earthmover tires. Moreover, for the same fi nal performance and cost, Michelin prefers to use natural rubber rather than synthetic rubber due to its positive impact on social development in developing countries. According to a worldwide estimate in 2008, natural rubber accounts for approximately six million jobs in rural areas, providing subsistence for 30 million people, and converts 80 million tons of CO2 per year into energy. In parallel, the Group is continuing to optimize its production of synthetic rubber and to develop its research in this fi eld.

See: Bahia.

Tires for cars

Tires for trucks

Tires for subway trains

Railway wheels

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Safety at Work

This is a priority and a reality for Michelin. The New Health and Safety Statement signed by the Managing Partners of the Michelin Group in February 2011 states that “Each person is unique. Health and safety are fundamental,” Michelin’s occupational safety per-formance now places it among the best companies in the world. Health and quality of work life have been and are still subject to major prevention and improvement programs covering all profes-sional levels and geographic zones. All employees received an average of approximately three hours of training on the environment and accident prevention (in addition to métier-specifi c training) in 2011. In 2002, the Managing Partners declared that “in all of the countries where we are present, our objective is to apply the same international health protection standards.” This objective has been largely achieved for several years since, eve-rywhere in the world, the same safety rules are imposed and are complied with on all Michelin sites (from movement on site to working at heights, including the wearing of appropriate personal protective equipment, to name but three of Michelin’s safety principles). The same rules also apply to external service-providers, sub-contractors and temporary workers.

See: TF, TG of workplace accidents.

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Sipes

These narrow grooves, a few tenths of a millimeter wide, cut into the rubber blocks in the tire tread pattern, give better grip and therefore improve safety. Sipes owe their name to metal components in the form of blades present in the tire curing molds that form these grooves. The shape of sipes can vary greatly according to the type of tire. Modern tires have highly sophisticated 3-dimensional sipes that generate ridges to break the fi lm of water on roads and enable grip in wet conditions, while maintaining improved rigidity for rubber blocks.New sipe technologies in the form of “rain drops” introduced on the MICHELIN XDN2 GRIP truck tire launched in 2005 enable a high level of grip throughout the tire’s lifetime. As a result of this technology, chains do not have to be fitted in winter, thus preventing trucks from being held up on roads in icy conditions.

See: Grip.

SMEM

The Michelin Environmental Management System (SMEM) organizes the Group’s environmental policy and allows the achievement of objectives related to the management of environmental impact and compliance with regulatory obligations. In 1998, the Michelin Environmental Management System was adopted in order to reduce the environmental impacts of Michelin sites. This was a crucial step forward as it laid the groundwork for ISO 14001 accreditation for all Michelin sites. A network of specialists at each Group site provides technical and methodological support to local managers. These local managers are also responsible for the environment and prevention performance of their entity. This process is supported by the implementation of an Environmental Management and Risks Prevention system (SMEP) covering all environmental and preven-tion fi elds (assets protection, safety at work, industrial health and ergonomics).

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Socioeconomic Footprint

Based on the same logic that applies to environmental footprint, the socioeconomic footprint measures the creation of economic value and jobs related to the activity of a company. It concerns all stakeholders in the value chain (suppliers, producers, distributors, customers, personnel) and society as a whole, which benefi ts from the use of products and bears the external costs related to the activity. With its strategic plan for 2011-2015, Michelin has launched its most ambitious project in 30 years. The Group’s industrial strategy aims not only to increase its production capacities in geographic zones where tire markets are growing (South America, Asia, Eastern Europe) but also to strenghthen its competitiveness in developed zones where the markets are mature (North America, Western Europe, Japan). In 2011 Michel Rollier wrote “the principles laid down in the Michelin Performance and Responsibility Charter are applied throughout the world for all cultures.”

See: Sustainable development, Diversity, Safety.

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JAPAN

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HEADCOUNT EXPRESSED IN FULL TIME EQUIVALENTS AS OF DECEMBER 31, 2011

GROUP TOTAL:108,340

HEADCOUNT EXPRESSED IN FULL TIME EQUIVALENTS AS OF DECEMBER 31, 2003

GROUP TOTAL:121,345

NUMBER OF EMPLOYEES PER GEOGRAPHIC ZONE

Asia (excluding India) 15,045

South America 5,310

Europe64,450

Africa, India, Middle East 1,852

North America 21,683

Asia/Pacifi c 11,138

South America 5,694

Europe77,308

Africa/Middle East 3,328

North America 23,877

Stakeholders

This comprises all persons and entities that play a direct role in the social and economic life of the company (employees, customers, suppliers, shareholders), that observe the company (NGOs, trade unions), or infl uence it (public authorities, local authorities, civil society). Michelin is a socially responsible company that strives to be transparent with its stakeholders and to listen and respond to their interests. Respect for customers and respect for facts are fun-damental values at the heart of the Michelin group. “We all support customers whom we must satisfy and whom we must serve. We can never serve our customers too well. Progress is necessary, it has to be constant,” foresaw Édouard Michelin in 1937.In line with this quest for constant progress in order to satisfy and anticipate customers’ needs, Michelin takes an active role in the work done by stakeholders in connection with sus-tainable mobility. These inner circles linked to sustainable development come from professional associations such as the ETRMA (European Tyre & Rubber Manufacturers’ Association), which Michelin has chaired since 2011, or international public organizations such as the European Commission’s Directorate-General for the Environment, the IEA (International Energy Agency), the ITF (International Transport Forum), the UNEP (United Nations Environment Program), or many international associations such as the United Nations Global

Compact, the EPE (Entreprises for the Environment), the FIA (International Automobile Federation), the GRSP (Global Road Safety Partnership), the IRF (International Road Federation), the WBCSD, the WEC (World Energy Council), the WEF (World Economic Forum), the WRI (World Resources Institute), etc.

See: Community Involvment, Michelin Development.

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HUNGARY

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Stress

Although the issue of stress goes partly beyond the control of the Company, Miche l in recognizes the importance of this phenomenon. The Group assesses and monitors stress factors. In line with the negotiations on psychosocial risks, the sectors and activities that are particularly exposed to excessive tension have been identifi ed. The employees concerned have been assessed. Antistress consul-tations are available at most sites on a daily basis. For several years, employees have been provided with training on stress management. It is also important to encourage social dialogue and the implementation of suitable measures as close as possible to the working environment, since stress can take on a range of forms depending on the workplace and work methods.

Sustainable Asset Management (SAM)

The Michelin Group is part of the 342 best companies included in the DJSI World ranking (Dow Jones Sustainability Index) for 2012, selected from among the 2,500 companies analyzed in 19 business sectors. This assessment is conducted by the extra-fi nancial rating agency SAM.

See: Extra-fi nancial rating agencies, DJSI.

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Maintaining a stress-free environ-ment helps me move my team forward. I answer all my calls with a smile on my face – and my cus-tomer smiles back. We end the call with a light – hearty laugh – in much higher spirits. We are all here because of our customers. I want them to feel good when they hang up so that a phone call to Michelin‘s customer service is always a positive, stress-free experience regardless of the calls‘ outcome.

UNITED STATES

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Sustainable Development

This term was coined in English in 1980 and designates a form of environmentally friendly economic development, based on the renewal of resources and their rational use, in order to preserve raw materials, but also to ensure socially equitable development. In 1987, in the Brundtland report, the World Commission on Environment and Development defi ned the notion of sustainable development as follows: “development which meets the needs of the present without compromising the ability of future generations to meet their own needs.” Since the Rio Summit in 1992, sustai-nable development has been recognized as an objective by the

international community, by multinational companies and by Michelin in particular. The tire manufacturer is convinced that the impact of human activities (produc-tion and consumption) should not prevent individuals from satisfying their fundamental needs: access to food, shelter, clothing, education, employment and the ability to travel safely and without harm. Michelin Performance and Responsibility (PRM) is the name given to the Group’s sustainable development and corporate social responsibility process.

See: United Nations Global Compact.

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Michelin Performance and Responsibility is not an abstract notion. It is linked to the men and women of the Company, to facts and to life in general. To me, as a Michelin employee, it’s easy to relate to because I enjoy being with other people and listening to them. I express the reality as it is, because that’s my job and I believe we must protect the environment because planet Earth is our children’s legacy. Yes, I believe in Michelin, with its values and with my better way forward!

ROMANIA

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Sustainable Mobility

Sustainable mobility aims to ensure the continued transportation of persons and goods in order to guarantee responsible economic, social and societal development, with respect for the environment and public health, against a backdrop of increasingly scarce raw materials and global warming. To achieve this aim, mobility has to evolve in response to challenges related to energy, climate change, road safety and urban mobility, by integrating innovative technological solutions and reviewing conven-tional mobility blueprints. Sustainable mobility must be accessible and affordable for all. The Michelin Challenge Bibendum is the only global event truly focused on sustainable road mobility.

See: Hybrid (vehicle), Michelin Challenge Bibendum, Motorized wheel, Stakeholders, WBCSD.

To reduce our production costs (therefore our prices) we need to maintain our ‹Bib standards› to the highest possible levels. For my part I need to gain an in-depth knowledge in those standards and pass it on to all members of the production system. Through this I can contribute to transfer the gains we make in production costs to our customers.

INDIA

I am keeping in my mind that Michelin has always been a pioneer in the market, contributing to Sustainable Mobility. We can go forward in creating new market opportunities and protecting the environment with innovative solutions using MICHELIN products and services.

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TAF (Rate of Access to Training)

This is the number of training hours divided by the number of hours worked. The increase in TAF refl ects the continuous effort main-tained by Michelin in training. Michelin’s rate of access to training is above average compared with that of the largest global companies.

See: Training.

TF (Frequency Rate) of Workplace Accidents

TF is the number of workplace accidents with lost time of more than one day occurring in a given period, per million hours worked. The results of a Group-wide study carried out in 2002 showed that the situation was generally unsatisfactory. This study also highlighted that there were major performance differences between sites. At the time, the frequency rate stood at 18.65 at the Group level. Starting in 2003, thanks to the strong determination of the Michelin management, considerable investment has been made in training, awareness and prevention, leading to a reduction of 93.6% in the TF. At the end of 2011, the frequency rate of workplace accidents for all Michelin Group sites as a whole was less than two. As a result of the involvement of managers at all levels – right up to the highest level – and the active participation of employees – parti-cularly operators – it is now generally safer to work in a Michelin plant than it is to work at home.

See: Safety at work.

2011 2010 2009 2008 2007

RATE OF ACCESS TO TRAINING

4.4% 4.2% 3.9% 4.2% 3.7%

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TG (Severity Rate) of Workplace Accidents

TG corresponds to the number of days of work lost over and above one day, due to workplace accidents in a given period, per thousand hours worked. Like the frequency rate, signifi cant progress has been made on the severity rate. At the end of 2011, the TG fell below 0.15, a decrease of 81.5% compared with 2002. All workplace accidents are reported to the services concerned. Eight sites had no workplace accidents in 2005; in 2011, this was the case for a little under half of the Michelin sites (26). Even if accidents can happen, or there is a risk that we miss our target (we strive not to achieve an objective, but rather to ensure the safety of our employees), nonetheless, the progress made and the results obtained in the Group in employee safety are a true source of pride for all employees.

See: Safety at work.

Tire Noise

The noise made by a tire rolling on a road can affect two categories of people: drivers and passengers, on the one hand, and residents in streets or buildings close to roads, on the other. For drivers and passengers, the noise that they hear is described as interior noise. This noise must be reduced to improve in-vehicle comfort. For residents, the noise is said to be exterior and this noise must also be reduced to avoid causing them any nuisance.Noise is measured in decibels (dB) and a reduction of three dB is synonymous with dividing the sound level by two. The contact noise made by a tire on an average vehicle driving at a constant

speed of 80 km/h is approximately 70 dB. The sound level is infl uenced by different factors such as the type of road surface, speed, temperature and tire-vehicle interaction. In terms of exterior noise, following the phase-in of regulations on exterior tire noise in Europe in 2001, Michelin has worked on adapting its products for passenger cars, vans and trucks in order to comply with this new regulatory framework. In addition, over recent years, Michelin has been preparing for the stricter noise regulations set to be enforced beginning in November 2012.

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Promote noise reduction by using a holistic approach is a better way forward.

Public Affairs Group Department

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Tire Pressure Monitoring System (TPMS)

TPMS is an in-vehicle tire pressure monitoring system that warns drivers in the event of signifi cant under-infl ation of tires through a dashboard signal. For earthmover tires, Michelin has developed the MEMS system (Michelin Earthmover Monitoring System), which informs a central maintenance service located at mines in the event of abnormal change in tire pressure or temperature. This enables problems to be corrected swiftly, thus increasing safety and preventing any damage to equipment.

Training

Throughout the world, Michelin invests in training its teams. Every day, 4,000 persons receive training in order to assist the Company in rising to the challenges of international growth, which is increasingly demanding from both technical performance and service orientations. This investment in training refl ects the Group’s exacting standards and its intention to retain its leadership position in its markets. With more than 7.23 million training hours, i.e. an average of 10 days of training per year for all employees, Michelin’s training investment is above average, compared with that of the world’s largest companies.In 2011, this training expenditure accounted for 5.5% of the payroll, compared with 4.9% in 2010. In 2003, the expenditure on training was more limited, with a total of 4.5 million training hours accounting for 3.37% of the payroll. The training effort is still increasing in growth zones where Michelin is making heavy investments. For example, in 2011 in China, the training rate was 40% above the Group average. Since 2011, all Group activities have been geared towards a global process for the recognition of continued skills development and work station capability, formalized in 3 stages. Validation: the employee can start work at his/her work station.

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Qualifi cation: the employee is autonomous and has shown his/her capacity to perform his/her job. Certifi cation: the employee is recognized as a “professional” in his/her position. The rollout of this affi rmative strategy may be adapted to suit certain specifi c features at the local level.

See: TAF (rate of access to training)

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Ensure that people have the right level of competencies to do their job (provide an adequate initial training).

Industrial and Prevention Performance Department

My example of a better way forward is to share knowledge. My best practice is when you learn something new, to share it with three people. Whether it‘s a tip that will make me more effi cient, more knowledge that will allow me a stronger decision or a shared experience that will grow diverse though... Sharing knowledge/information/experience will make all of us better equipped to move forward not only faster, but more effi ciently.

UNITED STATES

Train and develop people through best practices, focus on performance, quality and ethical practices.

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Tweel

Michelin is working on the development of an original wheel, based not on an infl ated tire but rather on a deformable mesh made of composite materials. This innovation is named “Tweel” (a combi-nation of tire and wheel). MICHELIN Tweel® wheels offer some major advantages: they do not puncture, they are not sensitive to under- or over-infl ation and they are fantastically robust. The potential applications for Tweels include tough working environments: construction sites, military uses, etc.

Ultrafl ex

As a result of the introduction of the truly innovative breakthrough technology named Michelin Ultrafl ex in 2004, the Group is playing a leading role in sustainable agriculture. At present, there are seven billion human beings on this planet; in 2050 there will be nine billion. This means that we will have to feed more people and feed them better. Faced with this challenge, farmers will have to increase their productivity while preserving ecosystems. Thanks to the MICHELIN Ultraflex technology, the Group has positioned itself as leader in this field. Michelin tires are more respectful of land (due to less soil compaction), enable fuel savings and offer better longevity. And in soil which is less compacted, seeds grow better.

United Nations Global Compact (Global Compact)

On July 26, 2000 in New York, the Secretary General of the United Nations invited company managers to join an international initiative, the Global Compact, which would unite companies, United Nations organizations, the working world and civil society around nine universal principles connected with human rights, labor standards and the environment. On June 24, 2004, a tenth principle was added to the Global Compact concerning the fi ght against corruption. In 2010, Michel Rollier introduced the Annual and Sustainable Development Report with the words: “Every day, our Michelin Performance and Responsibility process is demonstrating its strength and effec-tiveness in meeting the challenges of tomorrow. It already informs everything our Company does, and the principles expressed in the Michelin Performance and Responsibility Charter are applied around the world, in every culture. That’s why we decided in 2010 to pledge to support the United Nations Global Compact, to fur-ther highlight our commitment to human rights, rights at work, environmental stewardship and anti-corruption, all in a responsible and sustainable way.”

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Values

Michelin’s mission consists of contributing to progress in mobility while putting its fundamental principles into practice: respect for customers, respect for people, respect for shareholders, respect for the environment and respect for facts.

Vigeo

Michelin has been evaluated by this extra-fi nancial rating agency since it was created in 2003. Vigeo measures the performance of companies belonging to the DJ Stoxx 1800 Global index in terms of corporate social responsibility, based on six evaluation fi elds. The agency owns three sustainable development stock exchange indices (ASPI Eurozone®, Ethibel Pioneer Index®, Ethibel Excellence Index®). Michelin’s rating for human resources and governance has progressed and its environmental performance is the best in its sector. In October 2011, Michelin was evaluated alongside a panel of 17 companies and according to Vigeo "Michelin’s total score is 55/100, which refl ects good corporate social responsibility performance and places Michelin among the leading companies in the automotive sector panel."

See: ASPI, Extra-fi nancial rating agency, Ethibel.

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I endorse Michelin values, helping new recruits embrace Michelin values and integrate well. Devoting time to them is my better way forward.

UNITED ARAB EMIRATES

A better way forward is endor-sing the Company’s values.

BRAZIL

I strive to listen to others. We should always be ready to learn from others and from ourselves.

RUSSIA

I live the Group’s values daily and I share them with my team and the people around me.

COLOMBIA

PRM, A better way forward is based on using your brains and your common sense. Always strive to do a better job and be a better person. Treat colleagues, customers and eve-rybody else the way you want to be treated yourself. Avoid any kind of waste (energy, water, material, time, money…). Keep your eyes open for risks and alert others if you discover some. Always make an effort to solve problems through exchange and cooperation.

GERMANY

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World Business Council for Sustainable Development (WBCSD)

This is an association of companies committed to identifying tangible sustainable development solutions and to promoting these solutions as development models based on a balance among economic, social and environmental elements. In 2012, some 200 global companies belonged to the WBCSD. Michelin has been a member for more than 10 years. In 2004, under the auspices of the WBCSD, the work of the Mobility 2030 project was completed (12 companies took part in this project: BP, DaimlerChrysler, Ford, General Motors, Honda, Michelin, Nissan, Norsk Hydro, Renault, Shell, Toyota, Volkswagen). In January 2006, at Michelin’s initiative, the major tire manufacturers joined forces in order to launch a sector-based initiative: the Tire Industry Project. In 2012, the same commission as in 2004 will embark on an update of the Mobility 2030 report.

See: Stakeholders.

Zero Emission Vehicle

A zero emission vehicle is a vehicle that does not emit any harmful gases, particles or noise. Thanks to these vehicles – which Michelin has made a signifi cant contribution to developing (in-wheel motors, fuel cells, etc.) – the zero emission city may become a reality.