Compliance Standard Presentation ENGLISH

The Siemens Compliance System Only clean business is Siemens business

Unrestricted © Siemens AG 2018 siemens.com/compliance The company

Unrestricted © Siemens AG 2017 Page 2 28.08.2017 Mariano Gojman/ Compliance Fiscal 2016 – Key figures

Key figures for Siemens: Fiscal 2016 Revenue by industrial business (Continuing operations; in millions of € except where otherwise stated) Fiscal 2016 Fiscal 2015 Change in % Healthineers 17% Power and Gas 20% Volume Process Industries Wind Power and Orders 86,480 82,340 5% and Drives 11% Renewables 7% Revenue 79,644 75,636 5% Energy Management 15% Digital Factory 13% Profitability and capital efficiency Building Net income1 5,584 7,380 (24)% Mobility 10% Technologies 8% Return on capital employed (ROCE)1 14.3% 21.0% Not included: Financial Services (SFS) Liquidity Free cash flow1 5,476 4,674 Revenue by region Asia, Australia 19% Europe, CIS2, Africa, Employees (in thousands) Sept. 30, 2016 Sept. 30, 2015 Middle East Total (continuing operations) 351 348 (without Germany) 39% Germany 113 114 Outside Germany 238 234 Americas 29%

Germany 13%

1 Continuing and discontinued operations 2 Commonwealth of Independent States

Unrestricted © Siemens AG 2017 Page 3 28.08.2017 Mariano Gojman/ Compliance Global presence

Americas Share of total worldwide Revenue1 €22.7 billion 29% Employees2 72,600 21%

Germany Share of total worldwide Revenue1 €10.7 billion 13% Employees2 113,400 32%

Europe (excluding Germany), CIS3, Africa, Middle East Share of total worldwide Revenue1 €31.1 billion 39% Employees2 102,300 29%

Asia, Australia Share of total worldwide Revenue1 €15.1 billion 19% Close to customers Employees2 62,700 18%

1 by customer location all over the world 2 as of September 30, 2016 3 Commonwealth of Independent States All figures refer to continuing operations.

Unrestricted © Siemens AG 2017 Page 4 28.08.2017 Mariano Gojman/ Compliance The past

Unrestricted © Siemens AG 2017 Page 5 28.08.2017 Mariano Gojman/ Compliance The disaster struck – November 2006 headlines

Possible scenarios • Debarment from public tenders • Penalties up to €10 billion • Long-term damage to reputation and business • Break-up of the company

Unrestricted © Siemens AG 2017 Page 6 28.08.2017 Mariano Gojman/ Compliance Rapid reaction and implementation of our Compliance System…

Immediate actions Implementation Support sustainable business 2006 2007 2008 2009 • Exchange of • Settlement with authorities in • Settlement with World Bank Leadership Team Germany and in the U.S. • Continuous improvement • Tone from the top • Compliance program • Values & integrity • Independent investigation • Compliance organization • Collective Action • Centralization of bank accounts • Compliance training • Launch of 100M USD • Compliance tools Siemens Integrity Initiative

Unrestricted © Siemens AG 2017 Page 7 28.08.2017 Mariano Gojman/ Compliance … and active development and external recognition

2010 2011 2012 2013 2014 • First Funding Round • End of monitorship (Dec. 15, 2012) • NEW: Data Privacy Siemens full implementation of all recommendations since Oct 2013 Integrity Initiative • Re-certification by Gibson Dunn • Second Funding Round Integrity Initiative (31 Projects / in (2015) (24 Projects / USD 35,554M) USD 37,7M) • Dow Jones Sustainability Index: highest rating in the category Compliance for the fourth time in a row, best rankings ctd. in 2015 and 2016

2015 2016 2017 2018 2019 • NEW: • NEW: • NEW: • Further development of LC CO Anti Money Human Rights Export Control and its Portfolio planned as of Oct. 2017 Laundering in collaboration • Third Funding Round Siemens Integrity Initiative since Sep. 2015 with Sustainability (USD 35M) since Oct. 2016

Unrestricted © Siemens AG 2017 Page 8 28.08.2017 Mariano Gojman/ Compliance The Present

Unrestricted © Siemens AG 2017 Page 9 28.08.2017 Mariano Gojman/ Compliance Compliance is non-negotiable

“To be clear: Safety and compliance are the foundation of our business and non-negotiable.“

Joe Kaeser, President and CEO of Siemens AG

Unrestricted © Siemens AG 2017 Page 10 28.08.2017 Mariano Gojman/ Compliance Compliance Priorities

Foster Integrity

Support business management to meet its responsibilities for compliance and further strengthen the culture of integrity in our Company and beyond.

Committed to Business Manage Risk & Assurance

Further intensify cooperation between the Continue providing our businesses with the Compliance Organization and our businesses appropriate level of assurance within our and reinforce our Compliance System’s market Compliance System. and customer focus.

Ownership culture Excellent Compliance Team Effective Processes

Provide an excellent compliance team through a Continue to further optimize and streamline our first-class learning and development landscape compliance processes. and close collaboration.

Unrestricted © Siemens AG 2017 Page 11 28.08.2017 Mariano Gojman/ Compliance Our Compliance System – Management responsibility is the focus

We continuously develop the Compliance System further in order to adapt it to changing requirements according to our global business.

Effective preventive measures such as risk management, policies & procedures, training & communication enable systematic misconduct to be avoided Effective Compliance work requires complete clarification: whistle-blowing Management channels “Tell us” and ombudsman, responsibility as well as professional and fair investigations Explicit consequences and clear reactions support the prevention of misconduct, for example to punish wrongdoing and to eliminate deficiencies

Unrestricted © Siemens AG 2017 Page 12 28.08.2017 Mariano Gojman/ Compliance The Siemens Compliance Organization – Global governance, local parnter

Direct connection to the CEO Roles of Compliance Officer Main tasks

President and CEO Anti-Corruption Data Privacy Joe Kaeser The prevention of The protection of the abuse of personal data entrusted power for private gain Export Control General Counsel Situation Comply with Andreas C. Hoffmann Antitrust (inter)national export The preservation of control regulations market competition Human Rights 1 Chief Compliance Officer Anti-Money The commitment to Klaus Moosmayer Laundering human rights at The protection of Siemens Siemens from being abused for laundering money or Company-wide Compliance organization in financing terrorism Headquarters, Divisions and Regions

1 Direct reporting line to Board of Management and Supervisory Board re compliance risks and measures.

Unrestricted © Siemens AG 2017 Page 13 28.08.2017 Mariano Gojman/ Compliance Compliance Organization – Close cooperation with the operative businesses

Chief Compliance Officer

Global Operations Headquarters Regulatory Governance & Risk Data Privacy Export Control

Regions Americas Asia, Australia Middle East Europe, CIS Africa

Power Generation Process Industries Siemens Gamesa Power and Gas Energy Management Services and Drives Renewable Energy1 Divisions/ Businesses Building Financial Mobility Digital Factory Healthcare2 Technologies Services

1 listed company, separately managed 2 separately managed Unrestricted © Siemens AG 2017 Page 14 28.08.2017 Mariano Gojman/ Compliance Our employees – In dialog on Compliance with their line manager

Integrity dialog • Objectives • to maintain awareness of Compliance • to provide a practical demonstration of management responsibility • Managers discuss Compliance-related topics with their teams • Contents: Risk-based selection of topics with central and local relevance • Supported by Compliance Officer • Repeated on annual basis

Unrestricted © Siemens AG 2017 Page 15 28.08.2017 Mariano Gojman/ Compliance Business partner-related Compliance risks – Uniform risk-assessment of all relationships

The Compliance Due Diligence process for Business Partner • All business partners with an intermediary function between Siemens and the customer must undergo a risk assessment (uniform across the company and supported by a tool) • Based on certain risk indicators – such as, for example, the risk of corruption in the country of deployment – a risk class is defined for the business relationship, which subsequently determines further procedure • Lifecycle management: Daily learning and adaption if needed – continuous development of risk management

Unrestricted © Siemens AG 2017 Page 16 28.08.2017 Mariano Gojman/ Compliance Compliance in Project Sales and Project Execution

Project Sales Project Execution Compliance risks in Compliance risks in Identification and mitigation of the project sales project execution Compliance risks phase are covered by the Limits of In projects that indicate possible Authority (LoA)1 Subcontractors compliance risks, the Project Manager Inappropriate payments to subcontractors process • has to regularly identify and mitigate such risks in the project execution according to a specified “Red Flag Scrap/excess/surplus Material systematic” and Scrap/excess/surplus material is misused for inappropriate purposes • actively involves the respective Compliance Officer in the preparation of the acceptance of the Customer decisions project (e.g. change orders, acceptance, licenses permits) Inappropriate payments

1 The LoA process is the internal approval procedure for external projects of Siemens

Unrestricted © Siemens AG 2017 Page 17 28.08.2017 Mariano Gojman/ Compliance Big data: Concept Compliance Analytics Compliance Dashboards: Data analysis and visualization

Example: Third-Party Analytics & Visualization Due Diligence ▪ Developing methods to handle the increasing amounts of data is Risk / Quality Analysis essential for a modern Compliance System ▪ Analytics coupled with data visualization allows the simulation of risk scenarios that can highlight pre-defined alerts (“red-flags”) ▪ Such methods make it possible to conduct advance analysis / risk scenario simulation not possible with normal analysis methods ▪ It enables more time for clarification of issues, as time is saved through centralized collection & data preparation – maximizing risk mitigation Risk Modelling ▪ Result is an analytical function of complex risks associated with a third-party due diligence

Further examples: Case Handling, Projects, Sponsoring/Donations

Unrestricted © Siemens AG 2017 Page 18 28.08.2017 Mariano Gojman/ Compliance Collective Action is building alliances against corruption in order to support fair market conditions

Background Content/Priorities Position of Siemens

• Collective Action enables corruption • Global implementation of legal and • Promote, extend and implement to be fought collectively regulatory frameworks such as the regional and long-term based UN Convention against Corruption initiatives Goals (UNCAC) • Drive the Siemens Integrity or the OECD Anti-Bribery convention 1 • Create fair and equal market Initiative with a total funding of more conditions for all market players • Increase cooperation and encourage than US$ 100 million partnerships between public and • Actively engage in international anti- • Eliminate the temptations of private sector, and other stakeholders corruption corruption initiatives such as • Increase transparency in government G20/B20, OECD/BIAC and World procurement Economic Forum • Foster global knowledge sharing about anti-corruption and Collective Action

1 The initiative is based on the settlements with the World Bank and the European Investment Bank and supports organizations and projects that fight corruption and fraud through Collective Action, education and training

Unrestricted © Siemens AG 2017 Page 19 28.08.2017 Mariano Gojman/ Compliance Siemens Integrity Initiative covers all major growth regions and high-risk countries: Around 55 projects with more than USD 70 M

CEE (6 Projects, 7.0 M) 0.9 M Russia 2.4 M (1 Project and 1.5 M 1 Sub-Project, 2.4 M) 8.4 M 4.6 M 12.0 M 0.6 M Middle East (9 Projects and 1 Sub- 2.4 M 0.9M South Korea Project, 11.4 M) 0.8M (2 Projects, 1.7M) South 1.5 M Global Projects Europe 4.4 M 2.9 M (9 Projects, 20.4 M) (3 Projects, 3.0 M) 7.0 M China 1.2 M (3 Projects and 1 Sub-Project, 4.4 M)

Americas 6.4 M 1.4 M 1.7 M (5 Projects and 4.0 M 3 Sub-Projects, 7.6 M) 5.2 M 3.0 M India Asia-Pacific (2 Projects and (3 Projects, 3.0 M) 3 Sub-Projects, 3.1 M) Africa (8 Projects and 3 Sub-Projects, 9.2 M)

+ 4 Projects are divided into local Sub-Projects Region/Country of implementation (number of project proposals) Bubble size = Approximate value of funding First Funding Round Second Funding Round

Note: Schematic illustration. Due to rounding, numbers presented may not add up precisely to the totals provided; Status: Sept 10, 2015 (unchanged from March 2017) Unrestricted © Siemens AG 2017 Page 20 28.08.2017 Mariano Gojman/ Compliance … and determinedly pursue any cases that arise …

Compliance investigation process

Compliance case

Allegation Assessment Mandating Research Investigation Preparation Disciplinary received carried out by and planning of the investi- measures examining or gation report and remedia- evaluating the tion allegation before Compliance investigation mandating an investigation

Stipulated standards • The presumption of innocence applies, employee rights are safeguarded • Works Council co-determination rights are protected • Data privacy is observed

Unrestricted © Siemens AG 2017 Page 21 28.08.2017 Mariano Gojman/ Compliance … and continue with the constant development of the Compliance System

• Compliance has top priority • Compliance System to support sustainable growth and create a competitive advantage • Risk-based further development of the Compliance System in order to maintain high standards • High rating and recognition of our Compliance System in the annual assessments for the Dow Jones Sustainability Index: Highest rating in the Compliance category for the 6th time in a row

Mariano Gojman Compliance Officer Siemens S.A. / Chile Cerro El Plomo 6000, piso 11 Santiago de Chile Tel: (+562) 2477.1178 Celular: (+569) 8288.6194 E-Mail: [email protected]

siemens.com/compliance

Compliance Indicators1 Fiscal year

2016 2015

Compliance cases reported 675 568

Disciplinary sanctions 233 208

Therein warnings 112 116

Therein dismissals 96 79

Therein others2 25 13

1 Continuing and discontinued operations. 2 Includes loss of variable and voluntary compensation elements, transfer and suspension. Source: Siemens Sustainability Information 2016

Business Conduct Code of Conduct Compliance Responsible Behavior Siemens Integrity Sustainability Guidelines Internet Initiative Information