Summary 1. Lafarge Group Activities presentation & recent strategic evolutions 2. Why did Lafarge sign a GFA in 2005? Reasons directly linked to the Groups background 3. Implementation of the 2005 GFA Sharing a few international cases 4. Why is Lafarge signing a new GFA in 2013? Reasons directly linked to the Groups ambitions Questions 2 GIRN Meeting April 24th | 1. Lafarge Group World leader in building materials N1 in Cement N2 in Aggregates N4 in Concrete 15 billion of sales in 2012 employees Based in 64 countries More than production Sites A budget of almost 130 million euros dedicated to innovation 3 Activities presentation & recent strategic evolutions GIRN Meeting April 24th | 2. Why did Lafarge sign a GFA in 2005? Process: critical timing (2 years), difficulty with USA situation, number of exchanges/meetings, signature by HR-EVP Nature and experience of the leadership Culture of the company History of the company re. industrial relations aspects Will to formalize the new dimension of the company Becoming a global company Contain the local industrial relations Corporate Social Responsibilities Ambitions Rights (ILO Conventions) mostly implemented in our operations To favor dialogue with unions at international and local levels 4 Reasons directly linked to the Groups background GIRN Meeting April 24th | 3. Implementation of the 2005 GFA Example of a negative cooperation Korea case , 2007 5 Korean unionists demonstrating for 3 months in front of Paris HQ against subcontracting + asking for re-employment IU left the situation deteriorate and did not intervene positively at all Example of a neutral situation Jordan case , 2013 Local unions asking the company to maintain an unaffordable voluntary departures plan + change in management IU decided not to enter into the debate 5 Sharing a few international cases GIRN Meeting April 24th | 3. Implementation of the 2005 GFA Example of positive cooperations Indonesia case , 2011/2012 Subcontractors employees paid below the local minimum wage + freedom of association issues IU helped Lafarge to create a local committee to resolve these issues Subcontracting topic, from 2007 to 2012 Many examples where regulation and work conditions were not optimized Lafarge faced positive pressure from IU, maintained dialogue, developed a draft policy and included the topic into the 2013 GFA. Because of this dialogue with international unions, IU get in touch with us before forming an opinion and we can often manage potential issues. 6 Sharing a few international cases GIRN Meeting April 24th | Why is Lafarge signing a new GFA in 2013? Process: We took our time (almost 3 years) Signing a new GFA was not obvious because, previously, we had found our cruising speed with IU and we did not want to create new conflicts. Stable interlocutors, formation of IndustriALL, on-going press release Nevertheless, their high initial demands diminished to become more reasonable. The UN Guiding principles on Human Rights are only recognized in their fundamental rights, knowing that the company was already committed to respect the Global Compact. No involvement of local unions, but an observer seat for the Secretary of the European Works Council (formalization of what was done before). Subcontracting is mentioned as an area where fundamental social rights should be respected, but remaining the responsibility of the contractors. Regarding the freedom of association, nothing specific has been changed. Some rights for migrant workers are recognized. This new GFA will likely have a positive impact on the companys perception. To differentiate ourselves from competitors. This new GFA allowed Lafarge to add some elements of its strategy: 2020 Sustainability Ambitions, diversity 7 Reasons directly linked to the Groups ambitions GIRN Meeting April 24th | Questions? 8 GIRN Meeting April 24th |