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PERFORMANCE and SUSTAINABILITY REPORT 2018 Our Front Cover Expresses Our Deep Commitment to Transparency and Enabling Sustainable Lifestyles Around the World

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PERFORMANCE and SUSTAINABILITY REPORT 2018 Our Front Cover Expresses Our Deep Commitment to Transparency and Enabling Sustainable Lifestyles Around the World PERFORMANCE AND SUSTAINABILITY REPORT 2018 Our front cover expresses our deep commitment to transparency and enabling sustainable lifestyles around the world. We chose to highlight a gathering of urban people as they will play the greatest role in making sustainability mainstream, with more than 70% of the world’s population expected to live in mega cities by 2030. Our Pathways to Positive strategy can only succeed if it is relevant and aspirational to them. Around the world, we are seeing a paradigm shift towards good living, with people seeking more authentic experiences. We chose to symbolize this trend with this gathering around a vinyl record player, as it captures the essence and warmth of an authentic music experience, while also reflecting our circular thinking approach. This visual also represents our creativity, the essence of everything we do. © Fulvio Bonavia OUR YEAR IN REVIEW AMPLIFYING GOVERNANCE ACCELERATING GROWTH FAST-TRACKING GREEN TRANSPARENT REPORTING At Firmenich, we are passionate about creating positive emotions to enhance wellbeing, naturally. This is our purpose and constant pursuit across our business. As a family-owned company since 1895, we care about leading our business forward for the good of our customers, colleagues and communities. CONTENTS AMPLIFYING GOVERNANCE FAST-TRACKING GREEN 17 Leading in Integrity 39 Reducing our Environmental Footprint OUR YEAR IN REVIEW 18 Rethinking Sustainability Governance 40 CO 2 and Energy 6 A Message from our Chairman and our CEO 19 Our Commitment to Human Rights 42 Climate Leadership across our Value Chain 8 2018 Milestones 24 Delivering Product Safety and Quality 42 Conserving Water and Cutting Waste 9 Our Performance at a Glance 44 Building Resilience to Climate Change 10 Research & Development ACCELERATING GROWTH 45 Protecting Biodiversity 11 Perfumery & Ingredients 27 Pioneering in Taste and Nutrition 46 Our Scientific Approach to Sustainability 12 Flavors 29 Building the Toilet Economy 13 Pathways to Positive 31 Championing Responsible Sourcing TRANSPARENT REPORTING 14 Our Materiality Matrix and Stakeholder Engagement 35 The Footprint of Fragrances 49 Sustainable Supply Chains 36 Shaping Sustainable Lifestyles 51 About our Reporting 51 External Verification PERFORMANCE AND SUSTAINABILITY REPORT 2018 4 OUR YEAR IN REVIEW AMPLIFYING GOVERNANCE ACCELERATING GROWTH FAST-TRACKING GREEN TRANSPARENT REPORTING FLAVORS We bring moments of happiness to billions Sweet Goods of consumers every day, through unique taste Beverages and smell experiences. Savory With creativity and innovation as our engine of growth, we apply our expertise to enhance wellbeing, from making healthier taste delicious all the way to accelerating access to hygiene for all. As nature is our greatest source of inspiration, as well as the origin of our most precious raw materials, we treat it with the utmost RESEARCH & respect, in order to thrive today and tomorrow. OUR BUSINESS DEVELOPMENT STRUCTURE As the world’s largest privately owned Fragrance and Flavor company, PERFUMERY & Analytical Innovation we are a business-to-business company spanning Perfumery & Ingredients, Flavors and Research. Headquartered in Switzerland INGREDIENTS Cellular Biology and present across more than 100 markets, we employ close to Fine Fragrance Organic Chemistry 7,000 colleagues and operate 66 facilities around the world, including 31 manufacturing plants and four research and development (R&D) Body & Home Care Sensory and Cognitive centers. Expanding our business reach, we secured five acquisitions Science this year. We also opened seven new facilities across the globe, from Ingredients: California to Thailand. Natural, Synthetic, Knowledge Management Taking our legacy into the future, sustainability is one of our White Biotechnology Delivery Technologies “Firmenich Fundamentals” and lies at the heart of our strategy Biotechnology and business growth. #1 #1 #1 CHF 3.7BN +9.6% 7,000 31 4 PRIVATELY OWNED IN FINE I N IN NET SALES GROWTH COLLEAGUES MANUFACTURING R&D FRAGRANCE AND FRAGRANCE INGREDIENTS ( vs. FY17*) PLANTS CENTERS FLAVOR COMPANY * FY = Firmenich fiscal year. PERFORMANCE AND SUSTAINABILITY REPORT 2018 5 PATHWAYS TO POSITIVE OUR YEAR IN REVIEW AMPLIFYING GOVERNANCE ACCELERATING GROWTH FAST-TRACKING GREEN TRANSPARENT REPORTING A YEAR OF STRATEGIC CHOICES WORLD-CLASS INNOVATION A MESSAGE In fiscal year 2018 (“FY18”), Firmenich reached CHF 3.7 billion With innovation as our engine of growth, we delivered a number revenues, recording dynamic growth across all our business of breakthroughs this year, from developing traceable solutions units. We delivered solid market share gains in Perfumery to pioneering in white biotechnology. FROM OUR and Flavors, while consolidating our Number 1 position in For instance, we established innovation hubs in Shanghai and Fine Fragrance and Ingredients. Geneva to advance our research in botanical extraction, food CHAIRMAN It was a year of strategic choices for us as our global environment fermentation and clean food technology processes. We also faced many disruptions, driven by digitalization, changing launched our third white biotechnology perfumery ingredient, consumer and customer expectations, industrial accidents a refined and highly environmentally friendly version of our AND OUR CEO among our suppliers, as well as environmental and geopolitical iconic Z11, a warm, woody amber note. challenges. In this context, we strengthened our partnership FY18 was another year in which our creators were celebrated with our customers with a sharp focus on innovation and by our industry. Our Master Perfumer Olivier Cresp was From left to right: Gilbert Ghostine, CEO and Patrick Firmenich, value creation, while leading our business forward in a highly distinguished by the Fragrance Foundation’s Lifetime Chairman of the Board. responsible way. Achievement Award, while our Master Perfumer Tony Reichert was honored by the American Society of Perfumers’ Lifetime STRATEGIC MARKET EXPANSION Achievement Award at this year’s World Perfumery Congress. We positioned ourselves as a key player in North America’s We also nominated two new Master Flavorists to join our fragrance middle market by acquiring Agilex Fragrances, global circle of leading creators. Bipin Khara is a pioneer a leading mid-sized perfumery company in the United States. in taste modulation with more than 20 years of Firmenich To expand its footprint to the West Coast, we acquired Fragrance successes, particularly in Beverages; and Chun-yu Song is West in California, U.S., in July 2018. a savory specialist with an outstanding track record of over 16 years with Firmenich. To best support our strategic customers, as they accelerate their growth in sub-Saharan Africa, we bought Flavourome, an established flavors company in South Africa with OFFERING THE BEST manufacturing facilities. OF NATURE SUSTAINABLY Expanding our access to sustainable high-quality naturals, we We are committed to providing end-to-end traceability in acquired Natural Flavors, a pioneer in organic-certified flavors a way that consumers can understand and trust, from the in the United States. We also took a strategic stake in Nelixia, source of our ingredients and country of origin, all the way a leading producer of natural ingredients in Central and to our production processes. South America. In Flavors, we launched our Natural and Clean Label platform to Accelerating our speed-to-market, we opened seven new develop a portfolio of the most authentic taste profiles, building facilities worldwide, from a Global Perfumery Creative Center on our Smart Protein and Organic Flavors Centers of Excellence. in Singapore to a Flavors innovation hub in California. In Perfumery & Ingredients, we significantly expanded our naturals’ palette and created the industry’s first fragrance sustainability measurement tool, the Firmenich EcoScent Compass™. PERFORMANCE AND SUSTAINABILITY REPORT 2018 6 PATHWAYS TO POSITIVE OUR YEAR IN REVIEW AMPLIFYING GOVERNANCE ACCELERATING GROWTH FAST-TRACKING GREEN TRANSPARENT REPORTING REINFORCING OUR LEADERSHIP “ In line with our Firmenich values, we IN SUSTAINABILITY consistently offer equal opportunities for Making progress against our ambitious environmental goals, all our colleagues to thrive. Building on our we recorded top CDP rankings, with A in Climate and Water. With certification by the Swiss government as an EcoVadis, we were among its top 1% of Gold-rated companies by Equal Pay Employer, I am proud to be making achieving a score of 82/100. We also reached new milestones in renewable energy, with 78% of our global electricity coming from this benchmark our global standard as we are renewable sources today, and 100% in Europe and Switzerland. committed to becoming 100% gender-equality We are proud that our perfumery palette is “REACH-ready,” as we certified around the world in 2018. This is the successfully completed all REACH registration phases following a right thing to do for society and for business!” thorough ten-year process. Gilbert Ghostine, CEO, Firmenich Fostering a workplace where all our colleagues can thrive around the world, we committed to becoming a 100% certified global gender equality employer by the end of calendar year 2018. To best identify and manage all human rights risks across our business and ecosystem, TAKING OUR LEGACY FORWARD we launched our new Human Rights Policy Statement, in line with the We are very proud of how we lived up to our UN Guiding Principles on Business and Human Rights. legacy in
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