www.constellium.com Switzerland Zurich 8048 6 Hoegger-Strasse Max France Paris 75008 Washington Rue 40–44 Washington Plaza States United York, 10022New NY floor 9th Avenue, Third 830 offices Corporate Netherlands The 1119 NW, Schiphol-Rijk Tupolevlaan 41-61 Headquarters Ideas. Materialized. Ideas.
Constellium – Business and sustainability performance report 2014 possibilities Infinite report 2014 report performance and and Business sustainability
Business and sustainability Business and sustainability 2 performance report 2014 performance report 2014 3
Heading 1 Inside this report:
Business in focus Key figures 2 We explain our organization and our Infinite possibilities 3 strategy, as well as the progress that Value we create 4 our business units have made during Highlights of the year 6 the year. Company organization 8 Chief Executive Officer insights 10 Our strategy 12 Innovation 15 Market overview 16 Aerospace and Transportation 18 Packaging and Automotive Rolled Products 20 Automotive Structures and Industry 22 Board of Directors 24 Executive Committee 26 Governance 28 Engaging with stakeholders 30
Sustainability in focus Sustainability highlights 32 We outline why and how sustainability Altogether more sustainable 34 matters at Constellium, and showcase Our materiality assessment 36 some of the key achievements of 2014. Stakeholder perspectives 39 Making our products more sustainable 42 Supporting our people 50 Making our operations more efficient 58 About this report Doing business responsibly 64
Reporting period Financial year 2014 (January 1, 2014 to December 31, 2014) Managing sustainability 68 Reporting cycle Annual Date of publication June 2015 Report scope The data or financials relate to Constellium worldwide falling within Consolidated income statement 70 the scope of consolidation at December 31, 2014. Wise Metals data Performance in detail is not included since the acquisition of Wise Metals occurred on Consolidated statement of financial position 71 January 5, 2015. This section provides greater detail Consolidated statement of cash flows 72 Report content The content of this report is based on our business data and the and data on both our business and results of our dialog with stakeholders, the Global Reporting Initiative Share information 73 G4 requirements and other sustainability ratings and rankings. sustainability performances. Sustainability data 74 Global Reporting Initiative GRI G4 guidelines – Core Assurance The report is in compliance with the GRI G4 guidelines and maintains Memberships 77 code of reporting as advised by GRI. It is not externally assured. GRI G4 disclosure index 78 Contact For further information please contact: Forward-looking statements 81 [email protected] or [email protected]
Have a look at the new Constellium microsite dedicated to our business and sustainability report: www.business-sustainability.constellium.com Business and sustainability Business and sustainability 2 performance report 2014 performance report 2014 3
Key figures Infinite possibilities as of December 31, 2014
Group sales Adjusted EBITDA €3,666m €275m We are Constellium. 2014 3,666 2014 275 We are a global leader in aluminium solutions 2013 3,495 2013 280 2012 3,610 2012 223 whose business is to materialize today’s and tomorrow’s ideas. For us, aluminium is more than a metal.
Revenue by business unit Full-time employees by geographic region Full-time employees* Packaging It is part of the solution for tomorrow’s and Automotive Automotive Rolled Products North Asia Structures 44% America 3.4% and Industry 14.6% 24% lighter, faster economy. Abundant, endlessly 9,148 recyclable and reusable, aluminium’s
Europe 82.0% unique properties mean that, together Aerospace and Transportation 32% with our partners, we can shape a future *Permanent and fixed-term employees of infinite possibilities. #1 #1 #2 Worldwide for Worldwide for Worldwide for Crash aerospace plates closure stock Management Systems #1 #1 #1 #2 In the USA In Europe for hard In Europe for In Europe for for large coils alloy extrusions large profiles can body stock
For more information see page 8 Business and sustainability Business and sustainability 4 performance report 2014 performance report 2014 5
Value we create
Our vision, objective and values underpin a business model that continues to meet the demands of world-leading customers through three business units.
Our vision Sense of urgency Our business model We are the leading global supplier of aluminium aerospace plates To be the most profitable and and decentralized We are a global sector leader and closure stock, the leading the fastest growing company in decision-making strongly committed to designing European supplier of large profiles our industry. and manufacturing innovative We relentlessly focus on actions and hard alloy extrusions as well aluminium products and Resource extraction that drive business forward, as a leading global supplier of solutions for a broad range creating structures, processes can body stock and automotive Our objective of applications dedicated and communications to enable structures. Our unique platform To achieve leadership positions primarily to aerospace, swift decisions at the point has enabled us to develop stable, in our global target markets automotive and packaging of impact. diversified and long-standing by continuously enhancing markets. Our business model customer relationships – in fact our portfolio of products and is to add value by converting Responsibility and we have worked with most of improving the levels of service, aluminium into semi-fabricated Aluminium smelting accountability our largest customers for over quality and added value we products, and we are the 25 years. provide to our customers. We engage personally in actions supplier of choice to numerous that continuously improve our blue‑chip customers. We operate through three performance, challenging the business units: Our values status quo and taking risks. Our facilities are strategically Semi-manufacturing These are the core beliefs that located in the United • Aerospace and Transportation States, Europe and China. guide our actions: Rigor and discipline • Packaging and Automotive These comprise 23 production We objectively assess the situation Rolled Products sites, 10 administrative Rolling Extrusion Teamwork and mutual trust and act immediately on deviations, and commercial sites and refusing to compromise on quality • Automotive Structures We develop and utilize a world-class technology and Industry operates relationships across Constellium and integrity. m center. We collaborate with iu ll e to leverage mutually beneficial Key customers include: t around 40 external scientific s outcomes and opportunities. Transparency and highest n partners aiming at sharing o Aerospace: C
standards of ethics e
emerging knowledge, exploring Airbus, Boeing, Bombardier, r e
Entrepreneurship and We act honestly, ethically and innovative concepts and h
Dassault Aviation, Embraer, KAI, Recycling W Product decisiveness honorably. We show beliefs identifying new talents. Lockheed Martin, Pilatus, SpaceX Products recycled manufacturing We lead, engage and inspire through behaviors and lead Our International Scientific back into the At our customers Packaging: or at their employees to pursue our by example. We enrich our Council gathers several of the production process Amcor, Anheuser-Busch InBev, customers vision, encouraging growth and community and make responsible, world’s top material scientists Ball, Can-Pack S.A., Coca-Cola, improvements that support sustainable decisions. to further strengthen our Crown, Rexam business objectives. technical leadership and innovation performance. Automotive: Audi, BMW Group, Ford, General Product use Motors, Mercedes-Benz, Porsche, Each product has its own PSA Peugeot Citroën, Tesla, Valeo usable lifetime Business and sustainability Business and sustainability 6 performance report 2014 performance report 2014 7
Highlights of the year
From major investments and a landmark acquisition to the supply of aluminium products for the new F-150 pickup truck that is changing the face of our industry, 2014 saw many examples of achievement and progress at Constellium.
Announced Significantly Won contract to We provide Ford Motor Co. acquisition of expanded with aluminium structural Wise Metals Body-in-White supply structural parts for the all-new Ford parts for the new F-150 pickup truck. The truck We announced the acquisition (BiW) production delivers the industry’s best of Alabama-based Wise Metals lightweight Ford towing and payload capability in a capacity-expanding in Europe among full-size, lightduty move. We plan to invest up to We announced a planned F-150 pickup pickups, enabled by reducing $750 million by 2022 in the €200 million investment truck its weight through the use of Muscle Shoals plant which over the next three years high-strength aluminium alloy is currently focused on the to grow our European BiW in the body. can market, to increase business – which produces capacity and start producing automotive body sheets. automotive body sheets for the car industry. See case study on page 21 for more information.
We signed a joint-venture Increased Invested in with UACJ to produce BiW Increased AIRWARE® North America to aluminium sheets in Bowling passenger Green, Kentucky. We have production produce Body‑in- started building the new facility safety with new White (BiW) that will be hosting a first BiW lightweight and capabilities finishing line. We invested in a new casthouse products high-strength in Issoire, France, enabling us to meet increasing material demand for our AIRWARE® We launched new Crash technology – which allows Management Systems (CMS) aircraft manufacturers to technology for the front and reduce the weight of aerospace the rear of vehicles to improve components. AIRWARE® is protection in the event of a onboard to be part of major collision. Now we can produce new aerospace programs. aluminium CMS 15% lighter or 10% stronger than the current options. Joined forces Endorsed new Joined research Invested in Decin with global can global aluminium consortium including recycling manufacturer sustainability led by MIT technology Rexam to convert standard We joined the Massachusetts We finalized a €15 million Institute of Technology investment in Decin, Czech production lines Constellium is a member of (MIT) Industrial Fracture the Aluminium Stewardship Republic, to boost production We expect can makers across Consortium, reinforcing our of high-volume alloy products Initiative, a unique value chain commitment to partnering Europe to continue converting program that has delivered for the automotive industry by with leading institutions their production lines from the first voluntary standard for almost 10,000 tons per year. to achieve breakthrough steel to aluminium due to its responsible aluminium. The investment includes a new This innovations. The consortium many advantages for packaging extrusion line and a casthouse new voluntary standard is the will use simulation software applications. to process and recycle both culmination of a year-long to predict how automotive consultative dialog involving machining scrap from our structural components behave customers and demolition. industry leaders and civil during accidents and help us society organizations. improve safety. Business and sustainability Business and sustainability 8 performance report 2014 performance report 2014 9
Company organization Our global footprint
Constellium is a global sector leader strongly committed to designing and manufacturing innovative and high value‑added aluminium products and solutions for a broad range of applications. Our primary markets are aerospace, automotive and packaging – and we meet the needs of p Plant customers in these markets through three business units. Office ¦ Technology center ut Joint-venture Aerospace and Packaging and Automotive Structures Main plants Transportation Automotive Rolled and Industry Provides technologically Products Produces advanced solutions for North America Europe Asia advanced aluminium alloys Develops, provides and recycles the global automotive industry, with wide applications across aluminium sheets and coils for including Crash Management Van Buren, MI Singen, Germany Neuf-Brisach, Changchun, China the global aerospace, defense, Systems (CMS) and other • P roduces customized • Integrated hot/cold-rolling France • Joint-venture with packaging applications (beverage automotive structures and line Engley, majority owned by transportation and industrial and food cans, closures, foils) structural and safety parts • S econd largest volume, Crash Management Systems • Recognized for closure stock fully integrated, rolling mill Constellium sectors. The business unit as well as automotive solutions, and extrusions. This business (CMS) and functional surfaces in Europe • Provides global customers offers a wide range of products unit also manufactures large including high-performance • Features advanced • O ne of the largest extrusion • Dedicated primarily to can with CMS and other structural including plates, sheets products for Body-in-White (BiW) profiles mainly for road and rail prototyping and development presses in the world stock and Body-in-White modules capabilities and extrusions which allow and heat exchangers. transportation, energy and other • Advanced and highly • World-class recycling center Constellium to provide tailored industrial applications. productive integrated CMS solutions to our customers. Bowling Green, KY manufacturing lines • Joint-venture with UACJ Valais, Switzerland • P recision plate shop for For more information For more information For more information (Japan), majority owned by Issoire, France Constellium general engineering products see page 18 see page 20 see page 22 • O ne of the world’s two leading • Leading large profile • One Body-in-White aerospace plate mills, with finishing linePlant supplier for high-speed train Office wingskin capabilities manufacturers • DesignedR&D cen ttore allow for • New AIRWARE® casthouse for Joint venture • Casthouses in Steg and expansion beyond low-density alloys 100,000 tons Chippis • R ecycling facility Revenues €m Revenues €m Revenues €m • Sierre plate shop and Steg casthouse qualified for Ravenswood, WV aerospace Voreppe, France 2014 1,197 2014 1,576 2014 921 • W orldwide unique assets for aerospace plates • C -TEC, our world-class 2013 1,204 2013 1,480 2013 859 technology center • Recognized supplier to the Decin, Czech 2012 1,188 2012 1,561 2012 910 highly demanding defense Republic industry • Eu rope’s largest hard alloys • Wide-coil capabilities and extrusion plant Adjusted EBITDA €m Adjusted EBITDA €m Adjusted EBITDA €m largest stretcher worldwide enabling unique product creation 2014 91 2014 118 2014 73
2013 120 2013 105 2013 58 Muscle Shoals, AL • W idest strip mill in the US 2012 106 2012 92 2012 46 • World-class recycling center
Plant Office R&D centre Joint venture Business and sustainability Business and sustainability 10 performance report 2014 performance report 2014 11
2014 was a pivotal year for Constellium in many respects. Chief Executive Pierre Vareille, Chief Executive Officer, highlights the main achievements of the last 12 months, before outlining his Officer insights expectations for the period ahead.
What have been your personal is to make sure that all our are confident that improvement number 1 or number 2 globally 2030, which means that market that seeks to mobilize a broad highlights as Chief Executive colleagues get back home safely, will begin to be demonstrated. in all our markets. This will shares for Constellium and base of stakeholders to establish Officer over the last year? every day. What progress has been ensure the long-term future of our peers will remain relatively and promote responsible practices One of the events that will have a How would you describe made with the Lean our Company. We also aim to be stable for the foreseeable future. across the aluminium value chain, great influence on the long-term Constellium’s financial Transformation program? recognized as the most innovative We have to take advantage of including business ethics and future of Constellium was the performance over the last year? and reliable partner in the industry this opportunity to dramatically environmental performance. Over the last two years, Lean has and the natural home for its improve our operations, control acquisition of Wise Metals, which It has been a solid performance, been the platform for a significant What are your hopes and is a real game-changer for us. best talents. our costs and prove that ambitions for the next 12 months which could have been stronger improvement in the service we Constellium can get back to the Not only has it made us a more still. But we were impacted by provide to customers, in terms Finally, following the acquisition of and beyond? international company and the Wise Metals, Constellium is now a pole position we held in the past in higher metal premiums and by the of quality as well as delivery this high-tech industry. I expect to see the projects third largest hot rolling company disappointing performance of one performance, and this helped us major player in the US packaging initiated during 2014 come to in the world, it has also given us of our business units, Aerospace continue to take market share market. We plan to invest up to What were the key sustainability fruition in 2015. They include the the capability and presence to and Transportation. from our competitors. Among the $750 million in our Muscle Shoals achievements of 2014 – and successful integration of the newly participate in the fast-growing many success stories around plant to start producing auto the disappointments? acquired Muscle Shoals plant, Body-in-White (BiW) market in The dynamic global automotive body sheets and take advantage industry, and the increasing Lean, I am especially proud to note The major downside concerned the turnaround of Aerospace and the US. This is part of a program that over half of our employees of the very promising appetite our safety record, which has Transportation, good progress that sees us investing massively importance of aluminium to of the automotive industry for both structures and BiW were now contribute at least one helpful now stagnated for two years. with the investments announced in new and improved production suggestion every month. aluminium solutions. Our response has been to launch over the last 12 months, a facilities on a global scale, to again the chief drivers for our growth. Against this background, Although there is still room for Looking at the aluminium a vigorous plan to make sure that successful launch of Lean phase 2 help us achieve our long-term industry, what are the key we once again make progress in and a return to an improving growth ambitions. the Automotive Structures and considerable improvement, we Industry business unit performed have already accomplished a lot. challenges and opportunities this vital area. The latest employee safety performance following the From a business, innovation and well and we have expanded our We are now continuing our Lean that lie ahead? survey also showed that we still stagnation of the past two years. operational standpoint, our overall plants at Decin in the Czech journey with a five-year phase two, In the automotive sector, have much work to do to deliver At a personal level, I again look great performance in 2014 has Republic, Gottmadingen in which will see us empower even the challenge will be to meet satisfaction to all our employees, forward to leading a team of been achieved first and foremost Germany and Van Buren in more of our people at plants and increasing demand for high- despite the marked progress committed, talented individuals. by the dedication of our talented the US, and built a new plant extend Lean into our office and quality and innovative aluminium achieved since 2012. Our record on Our people are aligned along teams around the globe. We all in China to meet the rapidly- support functions. body sheet and structural parts, production waste is another area the same vision, with the same share the same ambition for our increasing demand. as this industry moves away from where significant improvements shared values and commitment company, an ambition supported 2014 has been a big year for are required if we want to reach Packaging and Automotive Rolled investments. How will this impact steel and towards aluminium. to delivering our strategy. It was by an aggressive strategy both in This is why we are so active with our targets. a privilege to work alongside terms of growth and of improving Products also recorded a good 2015 and the following years? performance, with the plant at R&D and investments to build On a positive note, in addition them during 2014 and I thank our operations and service to Firstly, it is important to new capacity. to the increase in employee them unreservedly for their skills, our customers. Neuf-Brisach in France breaking understand that the only reason several records for volume, quality With regard to packaging, suggestions, we have improved support and tireless enthusiasm. But there have also been that we have been able to make our energy efficiency and already and service to our customers. these investments is because I strongly believe steel will finally some low points, notably our The plant at Singen in Germany disappear as a material for cans, hit our 2015 target. In addition, Our commitment to the safety performance. Sadly, we Constellium’s success has we have accelerated the speed of experienced a less satisfactory generated a high level of Free Cash with aluminium taking 100% of the United Nations Global Compact experienced a fatality at Chippis year due to subdued demand. market over the next few years. innovation, where we are ahead “We have reaffirmed our support in Switzerland in December. Flow during the two last years. of target, and taken important Aerospace and Transportation In other words, we are investing The market will continue to grow of the Ten Principles of the United My thoughts, and those of in Europe, albeit at a low rate. strides forward with our Life Cycle Nations Global Compact (UNGC) everybody at Constellium, are returned figures well below because we have the means Assessment program. expectations. The issues at and because of all the work we In order to maintain and increase in the areas of human rights, labor, very much focused on this tragic our market share, we have to learn It was also rewarding to see environment and anti-corruption. loss. This puts everything in Aerospace and Transportation, have accomplished together in which were associated with previous years. to be more flexible and more at the the launch of the Aluminium These principles lie at the heart of perspective: we can succeed in all our commitment to sustainability. operational challenges and service of our customers. Stewardship Initiative’s new global we do, but nothing really counts These investments form the sustainability standard for the In this report we communicate on capacity constraints, are not yet In the aerospace industry, no new our progress and have referenced compared to such an event. foundations for our future aluminium industry in December Our first and utmost responsibility fully resolved. However, we have success. In a few years, I believe aircraft are scheduled to be in the UNGC Communication on taken the necessary actions and design then production before 2014. Constellium has been one of Progress logo where applicable.” Constellium will be ranked either the prime movers of an initiative Business and sustainability Business and sustainability 12 performance report 2014 performance report 2014 13
Our strategy
Our strategy is consistent and proven. It aims to establish us with immediate access The Wise Metals acquisition 1. Safety to 450,000 metric tons of hot will help us meet that demand. This is our utmost priority and mill capacity. We plan to invest up to $750 million we are disappointed that we Constellium as the most profitable and fastest growing by 2022 to increase Muscle Shoals’ Our packaging strategy is also have failed to live up to our high current hot mill capacity to over supported by Wise Metals which expectations. We have reduced aluminium company in the world. 700,000 metric tons and build has a steady revenue stream the number of accidents by 80% 200,000 metric tons of dedicated driven by long-term contracts since 2004 and in 2014 these BiW finishing capacity to help us with most American beverage can stood at only one-third of those continue to grow in this value- customers. We now hold leading of the European Aluminium added market. positions in the can body stock benchmark. However, it is with Our strategy markets in both North America Our vision is to become a leading great regret that we have to again (#3) and Europe (#2), where we global player in all three of our main report that while the recordable Our ambition is to become the announced a partnership with markets. Our success in seizing injury rate remained broadly most profitable and the fastest Rexam to switch two of their steel opportunities across the globe stable, we experienced one growing company in our industry. can lines to aluminium in Spain. depends primarily on our ability fatality during the year. Please see We aim to achieve leadership Although growing at a relatively to deliver innovations, which is page 51 for details of how we positions in our global target modest rate, packaging remains central to our strategy. Relative to intend to improve our safety markets of aerospace, automotive the cornerstone of Constellium; it our sales, we already invest more performance in 2015. and packaging by continuously is a stable, high-volume business in R&D than our competitors and enhancing our portfolio of where our technical strengths can this has created a track record of 2. Empowering our people products and improving the play to good effect. proven innovations. These include a We aim to involve our employees quality of the service we provide to new AIRWARE® casting system that In aerospace, our progress against in the transformation of our our customers. enables us to produce aluminium- the strategy was disappointing, Company by asking them to make lithium billets using advanced Our strategy is based on three due to capacity constraints and suggestions that will improve alloys, new Crash Management strategic pillars: operational issues. However, this performance. Our ambition was Systems (CMS) and GRIPSTERTM, market remains very attractive for 50% of employees to make at which brings reduced noise 1. F ocus on profitable to us and we are addressing the least one suggestion per month. qualities to refrigerated vehicles markets and segments challenges experienced in 2014. In reality, the figure at the end 3. Accelerate performance double capacity at Van Buren (see page 44). Our reputation for We are confident that we have the of 2014 was 58%, so we have S trengthen our leading position in in Michigan, which will enable innovation is further endorsed by B e best-in-class in safety right leadership team, products outperformed our Lean target. the aerospace market us to take advantage of North the high-value output delivered and services, and anticipate a Control costs American demand for automotive by our International Scientific Expand our market share in the marked improvement in 2015 3. Quality structural parts. Early in 2015, Council as well as by close working automotive segment Monitor trade working capital and beyond. we announced a major contract relationships with external Two years ago we were receiving Increase margins and volumes in Continue to improve operational with Ford for the new Ford F-150, organizations, such as the new too many quality-based customer the can stock market performance through our Lean which incorporates extensive use Building global partnership with Massachusetts complaints each month. Today, Transformation program and of aluminium. This is the first time capabilities to drive Institute of Technology (MIT) that thanks to engaging our people improve service through the that aluminium will feature heavily growth we established during 2014. through initiatives such as 2. Build global capabilities designating 2014 as the ‘Year to drive growth extension of the program to in a mass market vehicle and we believe it will be a game changer The explosive growth of BiW is of Quality’ and due to our additional functions currently the single most powerful Accelerating C ontinue to lead our industry for the automotive industry. relentless deployment of very trend in the automotive sector. performance in innovation Focusing on profitable In addition, we made significant precise tools and methodologies, investments at our plants in China, Our acquisition of Wise Metals Our Lean Transformation program we have decreased the number Expand our Body-in-White (BiW) markets and segments Germany, Czech Republic and has transformed Constellium is already changing the way we of complaints by around 70%, and automotive structures During 2014, we made overall France to boost production for the from a relatively Europe-centric work. Lean is based on relying on exceeding the Lean target of a activities in the US progress in our main markets. automotive industry in Europe. organization to a truly global player all our employees to contribute to 50% improvement. able to serve global customers Continue to evaluate selective the progress of our Company and In the US automotive market, Our strategy in automotive is better and faster. The BiW market potential investments in Asia providing specific, very efficient 4. On-time, in-full delivery a number of expansion projects further enabled by the acquisition in the US is expected to grow from tools to produce a major impact on We have successfully met our Develop our technological and the strategic acquisition of Wise Metals (see ‘Building 100,000 metric tons in 2012 to our people, our customers and our expertise of Wise Metals are giving us global capabilities to drive over one million tons in 2020 and target and reduced the number of operations. In 2012, we identified late deliveries by half from 2012 the capacity we need to grow growth’ opposite) which has the around two million tons in 2025. six Lean KPIs, and targeted B ecome an industry leader in the in this booming segment. widest hot strip mill in North to 2014. area of sustainability progress of at least 2% per month We have invested $40 million to America. Wise Metals provides on each KPI. Business and sustainability Business and sustainability 14 performance report 2014 performance report 2014 15
Our strategy continued Innovation
5. Inventory Innovation is the oxygen that feeds Constellium’s strategy. At C-TEC, our world-class We have reduced inventory by 17% technology center, over 250 specialists from 22 nationalities are responsible for since 2012, with minor progress creating the innovations that bring new standards of performance to customers in the in 2014, so this initiative has not yet had the anticipated impact on aerospace, automotive and packaging sectors. World leaders in R&D for aluminium our flexibility and our service to and related solutions, we invested €42 million in innovation during 2014 and helped our customers. Transforming the bring several new products to market (see Products on page 44 for details). supply chain is a mid-term process and 2015 has been designated the ‘Year of Just in Time’, in order to drive inventory C-TEC provides us with a ‘lab to that could create possibilities reduction and accelerate flows. “The Auto hub, enabled by industrial-scale’ capability which for products and applications Lean tools, is another concrete enables us to de-risk innovations in our markets. Web-integrated 6. Equipment downtime step in our commitment to for our customers. During 2014, production could revolutionize dramatically reduce the time to Due to organizational or we accelerated and finalized a manufacturing processes. market for our innovations.” technical issues, some key major change in the way C-TEC In automotive, many Original equipment was not operational works. The facility now operates Equipment Manufacturers (OEMs) Simon Laddychuk Vice President and Chief Technical Officer for up to 30% of the time in Longer Wider through a project management are developing driverless car 2012. We have now reduced this Phase 2 is a five-year program The original six production-based approach with a sharp focus on technology. What new demands figure to 15%, meeting our Lean which will anchor a culture of KPIs will continue. But phase 2 execution. This project-driven would this create on the shape of target and freeing up capacity continuous improvement in the will also embrace the Lean office, focus empowers people to take vehicles, and hence for aluminium Working with the best to increase production without Company, ensuring that this is a covering non-manufacturing responsibility and helps us work body parts? Through C-TEC, we collaborate capital expenditure. permanent change for the better. functions such as sales, faster and smarter, bringing with the brightest minds in the We have set the target of 2% purchasing, finance, IT, R&D and ideas to fruition more quickly Reducing time to academic world. month-on-month improvement, HR. We have identified KPIs for and enabling customers to seize The Lean journey market USA: Massachusetts Institute of which equates to a year-on-year each function and these will be competitive advantage. continues C-TEC launched the first platform Technology (MIT), Northwestern reduction of 20%. Our objective is measured company-wide and by The first phase of Lean has been dedicated to automotive University, University of to reach a 70% improvement over each site. a resounding success, driving Eyes on the future Body-in-White (BiW) projects South Carolina, Worcester the five years of the program. A key role for C-TEC is to use for faster R&D. This generated Polytechnic Institute a marked improvement in our “The Lean transformation ‘watch’ processes to continuously immediate benefits including operations and the service program is only starting and the UK: Brunel University, Deeper monitor and evaluate technology better communication within provided to customers. We have second phase in the next five University of Manchester, Instead of being implemented trends that may open up new the teams, more efficient made a tremendous difference in years will make Constellium the University of Oxford the space of 24 months. But this at a plant level, phase 2 is opportunities for our business project management and faster benchmark in our industry.” France: CNRS/University is just the beginning – in January now being implemented at units. Our International Scientific decision-making. The Auto hub, laboratories, IRT M2P, 2015, we announced Lean phase 2, Autonomous Production Unit Pierre Vareille Council brings together several of inspired by the Toyota ‘Oobeya’ Chief Executive Officer IRT Jules Verne which has three new dimensions: (APU) level. Each APU Manager the world’s top material scientists (Japanese for ‘big project room’) will be coached and challenged and nurtures our innovation concept, is a large space where Germany: RWTH Aachen, on KPIs in order to drive strategy with new perspectives. the Project Manager, lab team German Aerospace Center DLR continuous improvement deeper The center integrates this latest members and R&D scientists Switzerland: EPFL Lausanne into Constellium. thinking, together with other with various competencies Netherlands: TU Delft inputs from its ‘watch’ processes, (metallurgy, forming, modeling) into its strategy and works closely work together. This is an important with the business units to create step in the deployment of Lean a product/process roadmap and tools at C-TEC, and seven portfolio. Developments that we further project platforms are are exploring include 3D printing, planned to be in operation by which is advancing at phenomenal the end of 2015. C-TEC is also speed leading to new potential working on creating “competency opportunities. Nanotechnology is platforms” aimed at maintaining enabling sensors to be integrated a good balance between project into inanimate objects – the efficiency and building skills. basis for the ‘internet of things’ Business and sustainability Business and sustainability 16 performance report 2014 performance report 2014 17
Market overview
Lloyd O’Carroll is an experienced metals equity analyst and the author of ‘The O’Carroll Aluminum Bulletin’, one of the industry’s most respected research services. Here, he outlines the latest developments in the automotive sector and the opportunities that face the aluminium industry.
What are the major trends Although China is not achieving What role is regulation in the wider aluminium the 15–18% growth of recent playing? years, it is still seeing high single industry? digit growth. This is being driven Regulation is the major factor Aluminium has been the fastest by factors including the increase here, driven by concerns over growing metal for the last 20 years in major infrastructure projects, climate change – and those and consumption is continuing especially the power grid – high concerns are likely to become even to grow at around 7% per year, and medium voltage power lines more pronounced in the years to compared with 2% for steel. are aluminium, not copper. come, as regulation increases There is more to come, especially across all major markets. in light-weight, high-volume How significant is Ford’s In the US, the requirements of the vehicles following the landmark Corporate Average Fuel Economy decision by Ford to incorporate switch to aluminium for (CAFE) standards are set to so many aluminium parts in the the new F-150? double by 2025, from 27 miles per F-150. This is little short of a game gallon (7km per liter) across an changer. By transforming its best- automaker’s fleet to 55 miles per The US is the biggest aluminium selling vehicle in the US, Ford sent gallon (14km per liter). In Europe, market and is experiencing the a clear message to the rest of the regulations are even more strongest growth, propelled automotive industry: the future is aggressive and the forecasts are by the transportation sector. aluminium. Historically, aluminium that Japan will shortly adopt the Auto production volumes are was used in transmission more stringent European model, high and we are seeing many new casings, engine blocks and heat with China and India probably applications for Body-in-White exchangers but as far as bodywork doing the same at some point. Now it is ‘how can we improve the (BiW) as well as structures such What is likely to happen in What should the is concerned, it was limited to product to make it more efficient as bumpers, engine cradles and The auto manufacturers are the longer term? aluminium industry be premium cars. Ford’s decision and create value for everyone drive shafts. There is also good doing what they can to increase As aluminium companies become doing for automakers? signals a new era. fuel economy, but there is only involved?’ That should be the growth for aluminium in heavy and a driving force in the automotive Anything that makes it easier and so much that can be achieved focus. It is a massive opportunity, medium sized trucks and trailers. The switch by Ford makes perfect industry, steel producers will more efficient for them to use by adapting drive frames and and it is essential that aluminium sense. It is moving from mild take a back seat. Although new aluminium in their manufacturing. Europe is up slightly, and some engine transmissions. The rest producers execute flawlessly, steel to a blend of aluminium and high-strength steel alloys will That could mean coatings experts are now upgrading their will be delivered by lowering develop as good a product as high-strength steel as a way of continue to play a part in vehicle or better gauge control, and forecasts. The weaker euro will vehicle weight, and that is where possible and continue to add reducing mass and increasing fuel chassis construction, their anything in alloy development. help export markets, while the aluminium comes into its own. capacity. It is a tall order, but the efficiency. This is a very important use will be limited. Along with Metallurgists should be tweaking stronger dollar will take some Switching from steel to aluminium future is bright. trend for aluminium as it will add its light-weighting properties, existing alloys and determining growth away from the US. is not only cheaper. Lighter weight an additional 1–1.5% to total aluminium provides better whether something new is needed. also means more economical In the emerging markets, we are global growth for this metal. corrosion resistance and greater It is no longer a case of ‘whatever engines with lower CO2 emissions. seeing strong growth in the Pacific energy absorption in a crash. we sell them must be cheap’. Rim, Southeast Asia and in India, Electric vehicles may play a part What is more, it is not clear while Brazil has stuttered a little. too, but range and price remain how cars made of lighter, high- serious shortcomings. strength steel could be cut into by rescue services in the event of an accident. Business and sustainability Business and sustainability 18 performance report 2014 performance report 2014 19
Aerospace and Transportation
“2014 was a challenging year for Aerospace and Transportation, with management Moreover, the highlight of the year Meeting demand Taking advantage of lower alloy was the decision to build a new changes and operational issues hampering progress. However, the business is density and improved material casthouse at Issoire in France, ® ® essentially strong and the turnaround is already well underway. The efforts of my for AIRWARE properties, AIRWARE enables to meet accelerating demand for team are demonstrating that we can deliver on our potential in the coming years.” structural parts to be redesigned AIRWARE® technology (see the technology and allows manufacturers to case study to the left). Laurent Musy, President of Aerospace and Transportation reduce significantly the weight of aerospace components, thus Our AIRWARE® technology is improving fuel consumption of Plans for 2015 and driving significant improvements How we meet commercial aircraft. AIRWARE® beyond in performance for aerospace customer needs also eases the production of Looking at the year ahead, the customers including Airbus, complex parts, guarantees focus will remain on returning the Constellium is the world leader in Bombardier, Lockheed Martin higher durability and contributes business to its growth trajectory. value-added aerospace plates, and SpaceX. With demand to the development of a more Much of the work essential to a market that is continuously continuing to increase, early sustainable aerospace industry achieving this began towards the expanding thanks to healthy in the last financial year we due to its infinite recyclability. end of the last financial year, and growth in aircraft production, announced plans to expand we will be redoubling our efforts driven by the steady increase in our AIRWARE® manufacturing These qualities explain why it has throughout 2015. Specifically, global air travel. Customers all capacity at Issoire, in France. been selected for several major we will: over the world rely on our wide aerospace programs, including range of innovative aluminium We are building a new AIRWARE® Airbus’ A350 XWB, Bombardier’s • implement the operational rolled and extruded products casthouse that is expected to CSeries, NASA’s Orion spacecraft transformational program to which contribute to decreased ramp up production during 2015. built by Lockheed Martin and the improve reliability and deliver on aircraft weight and deliver fuel As the brand for our patented Falcon 9 Launcher from SpaceX. our commitment to customers; range of aluminum-lithium efficiency gains. These products Constellium’s products are onboard major aerospace programs The new casthouse will enable alloys, AIRWARE® is changing the • increase capacity and grow include rectangular and machined us to meet increased demand for face of the aerospace industry our business to support plates, as well as extrusions for AIRWARE® and clearly illustrates Our manufacturing skills and customers and reduced customer based on its unique combination our customers’ own growth aircraft wings (including skins, ribs our long-term commitment to capabilities in Europe and complaints, both of which were of strength, lightness and ambitions, not only by supporting and stringers), as well as frames strengthen our leading position North America are supported achieved before the end of the improved corrosion resistance. programs in ramp-up phase and fuselage sheets. We are also in the aerospace market. proud to serve the space industry, by C-TEC, our world-class financial year. We were also but also by anticipating future a segment characterized by the technology center in Voreppe, pleased to report excellent increases in production – for highest requirements in terms of France. The center develops new progress on safety performance example, the single-aisle aircraft technology and performance. technology and aluminium-based within the business unit projects at Airbus and Boeing; solutions addressing current during 2014. In addition, we provide advanced and future market needs, such • strengthen collaboration across We continued to serve our aluminium solutions that enable as our internationally-respected our production network which major customers during 2014, manufacturers in transportation, AIRWARE® portfolio of products. serves the aerospace market – industry and defense to address primarily through long-term Issoire, Ravenswood and Valais; their technology challenges. contracts secured in previous • develop and ramp up production We have strong market positions Highlights of 2014 years. These customers include at the new casthouse at Issoire to in rolled aluminium for truck 2014 was characterized by a the world’s major aircraft increase AIRWARE® capacity; floors, tank trailers and dump disappointing performance from manufacturers such as Airbus, bodies, railcars and roof coils our Aerospace and Transportation Boeing, Bombardier and Dassault • continue to develop new, in North America and Europe. business unit, primarily due and their suppliers. We supply a innovative solutions for our We also provide specialized plate to operational challenges and wide range of alloys for Original customers in aerospace as for armored vehicles. capacity constraints. As the year Equipment Manufacturers (OEMs) well as in other markets such progressed, the improvements leading commercial and military as defense; In all of our markets we offer we put in place to effect a programs via multi-year contracts. customized services designed business turnaround began to • reduce costs and Furthermore, the range of plant to improve the effectiveness of have an impact. Primary focus at improve efficiency; and investments planned for 2014 operations and reduce costs, Aerospace and Transportation were also implemented as • maintain our focus on safety at including pre-machining, is to improve operational expected, including recalibrating Complex shapes through age forming all our sites, at all times. advanced welding and recycling. performance and to secure and burners at several sites and the strengthen the business’ position Innovation is a key competitive extension of aerospace capacity at in its key segments. The early advantage for our customers in our plants in Valais, Switzerland. Aerospace and Transportation. signs of progress include an uplift in delivery performance to Business and sustainability Business and sustainability 20 performance report 2014 performance report 2014 21
Packaging and Automotive Rolled Products
“This was a good year for our Packaging and Automotive Rolled Products business. in Europe and the largest market • ensure efficient integration of • continue to build our global BiW for steel cans, this is a significant Wise Metals within Constellium capacity, including execution We made a number of key decisions that will impact positively the business unit’s landmark in the drive towards and make it even more of our investments in new future and that of Constellium as a whole. These include the acquisition of Wise 100% aluminium beverage cans. competitive, drawing on the production lines in Europe, Metals as part of our ambitious investment plan to develop our Body-in-White Currently, approximately 80% skills and experience developed at Neuf-Brisach (France) and of cans in Europe are made at our European plants – Singen (Germany); and capability both in the US and in Europe.” from aluminium. particularly the Lean program; Pierre Vareille, President of Packaging and Automotive Rolled Products ad interim • as aluminium continues to • begin to ramp up capacity at penetrate the mass automotive Plans for 2015 and Wise Metals to meet the North market, partner with Original beyond American demand for BiW; Equipment Manufacturers (OEMs) worldwide on R&D How we meet 2015 will be a year of • work closely with our JV partner projects for aluminium-intensive implementation, with the UACJ to start and ramp up customer needs solutions for the cars of decisions taken in 2014 translating on time the new BiW plant at Being now the world #1 for closure the future. into tangible activities across Bowling Green (USA) scheduled stock and #1 in Europe and #3 in Constellium. Specifically, we will: North America for can stock, we for 2016; are market leaders in aluminium for packaging, as well as a growing 2022 to increase current hot mill In addition to being a profitable and leading supplier to the Benefiting from capacity to over 700,000 metric business in its own right, automotive industry both in Europe tons and build 200,000 metric with a customer base that and the US. Customers worldwide the Wise Metals tons of dedicated BiW finishing includes leading names such trust us to provide them with capacity to serve the rapidly as Anheuser-Busch InBev the innovative products and acquisition growing US automotive market. and Coca-Cola, Wise Metals advanced alloys that they need As part of the $750 million enhances our global footprint to create value and competitive The growing importance of strategic investment plan, we and offering: firstly by increasing advantage. Our customers include aluminium to the automotive have recently decided to build our exposure to the North major beverage and food can industry is nowhere better a $160 million finishing line in American market; and secondly manufacturers such as Anheuser- demonstrated than by Ford’s North America with a capacity of by supplementing our leading Busch InBev, Ball, Coca-Cola, decision to incorporate many Tabstock production at Constellium 100,000 metric tons. This second position in Europe. Over time, we Crown and Rexam, specialty aluminium parts in the 2015 line is due to start in early 2018. expect to benefit from increased packaging producers like Amcor F-150, the most popular vehicle product development resources and leading automotive companies Highlights of 2014 the automotive mass market. in North America for the last 20 A key milestone for Constellium, In May, we signed a joint‑venture and technological capabilities, including Audi, Mercedes-Benz, The most significant development years. BiW will play a major role in the Wise Metals deal will enable agreement with United Aluminium wider global reach and greater BMW Group, PSA Peugeot Citroën of 2014 was our announcement of this industry transformation – we us to provide greater sustainable Corporation of Japan (UACJ) to operational flexibility. and Tesla. the acquisition of Wise Metals that estimate that the North American value to our customers globally. supply BiW aluminium sheet to was completed on January 5, 2015 market for BiW aluminium rolled Packaging, which accounts for the fast-growing US automotive (see case study opposite). We also products could grow from less the majority of the business unit’s industry. The joint‑venture will decided to invest €200 million in than 100,000 metric tons in 2012 revenue is a large, strong and have an initial target capacity of BiW capacity in Europe, of which to approximately two million tons stable business that is expected to 100,000 metric tons of finished €180 million is being invested in by 2025. grow by around 2% annually. products. The semi-products – a new continuous annealing and cold rolled coils – will be supplied On January 5, 2015 we completed Demand in the automotive sector conversion line in Neuf-Brisach, from both partners’ rolling mills. the acquisition of Wise Metals, is growing at a much faster pace, France. We are also investing in Production is scheduled to start at a private aluminium sheet particularly for Body-in-White a new line at Singen, Germany, the new Bowling Green, Kentucky, producer located in Muscle (BiW) products such as car hood, that is already producing revenue facility in the first half of 2016, Shoals, Alabama, for $1.4 billion. door and roof panels. and meeting increased demand with full capacity expected to be The acquisition of Wise – which in Europe. The business unit is also the reached by 2018. has the widest hot strip mill largest non-integrated producer Driven by the Corporate Average in North America – provides In packaging, we announced of foil stock in Europe and a world Fuel Economy (CAFE) regulations us with immediate access to a partnership with Rexam to leader in aluminium solutions for in the US, which require significant 450,000 metric tons of hot mill switch two of its steel can lines Aluminium ingots getting ready for the hot line at the bright and functional surfaces in reductions in fuel consumption, capacity. In parallel, we intend to aluminium in Spain. As Spain Muscle Shoals plant lighting, decorative applications aluminium BiW is now penetrating to invest up to $750 million by and cosmetics. is one of the largest can markets Business and sustainability Business and sustainability 22 performance report 2014 performance report 2014 23
Automotive Structures and Industry
“The business unit has enjoyed another very successful year, significantly This will enable us to deliver advanced products to customers worldwide. In the US, the CAFE outperforming our competitors. We have grown adjusted EBITDA by 23% over with unparalleled speed. Changing standards are set to double by 2013 and for the fifth consecutive year achieved record levels of adjusted 2025, from 27 miles per gallon the game (7km per liter) to 55 miles EBITDA per metric ton. In addition, we have continued to win important nominations Plans for 2015 per gallon (14km per liter). and lay the groundwork for future success, particularly in the automotive market.” and beyond In January 2015, Ford launched It is a similar story elsewhere the new F-150, which is a game Paul Warton, President of Automotive Structures and Industry • Bring our new production in the world, with automotive capabilities up to full capacity changer for the automotive manufacturers globally turning and ensure they can deliver high industry worldwide. The new to aluminium to reduce weight quality, on time, every time. Ford F-150 – the most famous and improve fuel efficiency. and popular vehicle in North How we meet customer • Continue to win nominations America with sales running at Our role is to help customers needs from existing and new OEMs, approximately one every 45 exploit the advantages of including for relatively new Automotive Structures and seconds – is built with extensive aluminium and therefore we product areas such as body Industry is a global business unit use of high-strength, military- continue to meet consumer structures and chassis. operating in two principal areas: grade aluminium alloy. This is and legislative demands. In the The industry trend is towards automotive structural parts and the first time that a mass market wake of this landmark contract common platforms with a larger Crash Management Systems vehicle is built with such a – which has established number of different vehicle (CMS); and hard and soft alloy high reliance on aluminium, us not only as one of Ford’s New production lines for automotive structures at the Van Buren plant models sharing the same extrusions for the automotive, largest suppliers of aluminium components including front and and we are proud to be one transport and industrial markets, structural parts, but also the rear CMS. The nominations we of Ford’s largest suppliers of such as components for trains, #1 provider in the US – we are will account for 30% share of the with the official inauguration have won will drive the business F-150 components. trucks, buses, and power rails. already working with other total CMS market in Europe and of the plant extension in April in 2017 and beyond. With fewer The business unit is the #1 or #2 Through the use of high-strength high-volume OEMs to help them 20% in the US respectively, and 2015. The coming year will in volume but more significant player in all key market segments. steel in the frame and aluminium achieve similarly impressive that combined aluminium CMS see production running at nominations likely to be available, alloy in the body, Ford has production for China, Europe and full capacity. weight savings. They are seeking We enjoy strong, long-term and it is more important than ever to reduced the weight of the new North America will reach more opportunities to replicate the well-established relationships At the same time, we invested have the proven global capacity F-150 by up to 700lbs and this than 28 million units. success of the F-150 and with with many of the world’s leading €10 million in new buildings and and quality to deliver. has delivered the industry’s best automotive Original Equipment aluminium now proven on a Automotive Structures and equipment at Gottmadingen in • Capitalize on the partnership towing and payload capability Manufacturers (OEMs) including high automotive manufacturing Industry has a global footprint, Germany, to meet demand from with Brunel University and among full-size light-duty Audi, BMW Group, Fiat Chrysler platform, barriers no longer exist with operations in Europe, North European customers including Jaguar Land Rover, including the pickups. This is a tipping point Automobiles, Ford, General Motors, to prevent its rise as a truly mass America and China. The business BMW Group. This line will be opening of the Advanced Light for an industry coming to terms Jaguar Land Rover, Mercedes- market solution. unit has two additional integrated operational in 2015. Metals Processing Research with tighter emissions standards Benz and PSA Peugeot Citroën, remelting centers that guarantee Center. This will incorporate all of which rely on aluminium’s At Decin in the Czech Republic, we both a supply of prime extrusion a fully integrated direct chill physical properties and completed a €15 million casthouse billets and also contribute to our casting facility and a full-size Constellium’s know-how to create and tube press line, and launched recycling efforts. extrusion press. We expect to vehicles that are lighter and another growth program that see the center begin to make therefore more fuel efficient and invests a further €22.5 million progress in three key areas: environmentally friendly. (See case Highlights of 2014 in additional casting, extrusion light-weight material design; study opposite for details of our Our strong performance in 2014 and fabrication capacity at the sustainability and recycling; role in the new Ford F-150.) creates opportunities for all same facility. our stakeholders, including our and joining, pre-treatment and During 2014, we progressed Environmental regulation, people, and underpins our plans vehicle integration. particularly the Corporate Average the new state-of-the-art for the years ahead. • Maintain the focus on Lean Fuel Economy (CAFE) standards research facility in the UK which programs and processes, which in North America, in combination At our Van Buren plant in the US, we jointly share with Brunel drive costs down and customers’ with resurgent automotive we invested $40 million to double University and Jaguar Land satisfaction up. Lean made an market growth, is fueling an production capacity in order to Rover. With completion planned important contribution to our unprecedented and fast-growing take advantage of surging North for the third quarter of 2015, the quality, our on-time delivery demand for both aluminium American demand for automotive Advanced Light Metals Processing and our working capital in 2014. structural parts and CMS among structural parts, as evidenced Research Center will give us by Now we need to build on that volume manufacturers of cars and by the new Ford F-150 (see case far the most rapid prototyping progress in 2015 and generate Ford F-150 windshield headers produced by Constellium trucks. Automotive sector analysts study opposite). During 2014, capability in our industry, with an even better performance for expect that by 2018 aluminium we carried out a successful a full-sized extrusion press and production ramp-up with Ford casting equipment. our customers. Business and sustainability Business and sustainability 24 performance report 2014 performance report 2014 25
Board of Directors
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Richard B. Evans – 1 Guy Maugis* – 6 Mr. Evans has served as Chairman of our Mr. Maugis has served as a member of our Board since December 2012 and as a member Board of Directors since January 2011. of our Board of Directors since January 2011. Matthew H. Nord (Not photographed) Pierre Vareille – 2 Mr. Nord has served as a member of our Board Mr. Vareille has served as Chief Executive of Directors since May 2010. Officer of Constellium and as a member of our Board of Directors since March 2012. John Ormerod* – 7 Mr. Ormerod has served as a member of our Michiel Brandjes* – 3 Board of Directors since June 2014. Mr. Brandjes has served as a member of our Board of Directors since June 2014. Werner P. Paschke* – 8 Mr. Paschke has served as a member of our Philippe Guillemot* – 4 Board of Directors since May 2013. Mr. Guillemot has served as a member of our Board of Directors since May 2013. Lori A. Walker* – 9 Ms. Walker has served as a member of our Peter F. Hartman* – 5 Board of Directors since June 2014. Mr. Hartman has served as a member of our Board of Directors since June 2014.
*Independent Director
For full biographies visit www.constellium.com Business and sustainability Business and sustainability 26 performance report 2014 performance report 2014 27
Pierre Vareille – 1 Didier Fontaine – 5 Laurent Musy – 9 Executive Committee Chief Executive Officer Chief Financial Officer President, Aerospace and Transportation President, Packaging and Automotive business unit Rolled Products business unit on an Simon Laddychuk – 6 interim basis Vice President and Chief Technical Wesley N. Oberholzer – 10 Officer Vice President, Packaging and Automotive Marc Boone – 2 Rolled Products North America Vice President, Human Resources Jeremy Leach – 7 Vice President and Group General Vittorio Rossetti – 11 Nicolas Brun – 3 Counsel Chief Information Officer Vice President, Communications Yves Mérel – 8 Jun Tao – 12 Béatrice Charon – 4 Vice President, EHS and Lean Vice President, Strategy and Business Vice President, Business Planning Transformation Development Paul Warton – 13 President, Automotive Structures and Industry business unit
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For full biographies visit www.constellium.com Business and sustainability Business and sustainability 28 performance report 2014 performance report 2014 29
Governance
• to review, evaluate and make • to establish criteria for Board Function We are committed towards maintaining the highest recommendations to the full and Committee membership • develops and implements the Board of Directors regarding and recommend to our Board of operational business decisions, standards of corporate governance to ensure our business our compensation policies and Directors proposed nominees as defined by management and is run in the best interests of our shareholders. This is a establish performance-based for election to the Board of the Board of Directors; incentives that support our Directors and for membership • monitors the implementation long-term goals, objectives on committees of our Board of and progress of significant vital element of building trust and in acting with integrity. and interests; Directors; and operational projects; • to review and approve • to make recommendations to • monitors the execution of the the compensation of our our Board of Directors regarding Budget, and in particular the Chief Executive Officer, all Board governance matters Free Cash Flow generation of the Director independence Board meetings in 2014 Function employees who report directly and practices. business; and We maintain a one-tier Board The Board of Directors held Our Board of Directors has to our Chief Executive Officer • submits reports, proposals and of Directors consisting of both 10 meetings in 2014 and reviewed determined that three members, and other members of our Executive Committee recommendations on all matters Executive Directors and Non- matters including: John Ormerod, Werner P. senior management; relating to the operations to the Function Executive Directors (each a Paschke and Lori A. Walker, • to review and make Executive Committee. • reports from the Board’s are audit committee ‘financial • reviews all strategic issues ‘Director’). Under Dutch law, the committees; recommendations to the Board Board of Directors is responsible experts’ as defined by the SEC of Directors with respect to our and evaluates all significant Code of Conduct for our policy and day-to-day • reports from the Chief Executive and also meet the additional incentive and equity-based proposed acquisitions or Our Worldwide Code of Employee management. The Non-Executive Officer (including EHS and criteria for independence of audit compensation plans; divestments, financial and Business Conduct sets out M&A activity); committee members under the restructuring, alliances and Directors supervise and provide • to set and review the the standard of behavior we Securities Exchange Act of 1934, strategic partnerships; expect from our employees. guidance to the Executive Director. • a pproval of the 2013 compensation of and as amended. The Code governs the way As a foreign private issuer under Annual Accounts; reimbursement policies • develops and monitors The principal duties and implementation of key strategic, Constellium acts in business, and the Securities and Exchange • a pproval of filing of Form 20-F for members of the Board responsibilities of the Audit financial, investment and how we expect our partners and Commission (SEC) rules, we are with the SEC; of Directors; suppliers to behave. It applies Committee are to oversee and organizational decisions; not required to have Independent to all Constellium employees, • a pproval of the draft agenda for • to provide oversight concerning Directors on our Board of monitor the following: • controls the execution of the five- subject to applicable local law. the Constellium General Meeting selection of officers, Directors, except to the extent that • our financial reporting process management succession year plan and of the Budget; Compliance with the Code is our Audit Committee is required to of Shareholders of June 11, 2014, essential to preserving and and internal control system; planning, expense accounts, • reviews reports and proposals consist of Independent Directors. including nomination of the new enhancing the Company’s • the integrity of our consolidated indemnification and insurance made by the Operations However, our Board of Directors Non-Executive Directors; reputation as a responsible financial statements; matters, and separation Committee to evaluate its has determined that, under • amendment of the Delegation corporate citizen, and ultimately, packages; and economic and financial current NYSE listing standards Authority; • the independence, qualifications to maximizing shareholder value. and performance of our • to provide regular reports to the consequences; and regarding independence (which • approval of the Wise Metals independent registered public Board of Directors and take such • as and when required, submits Whistleblower policy we are not currently subject acquisition; to), and taking into account any accounting firm; other actions as are necessary reports, proposals and We have implemented a • a pproval of re-financing through and consistent with our applicable committee standards, • the performance of our internal recommendations on all matters whistleblower policy to foster issue of high-yield bonds issue Amended and Restated Articles Messrs. Brandjes, Guillemot, audit function; within its scope of responsibility an environment where our Hartman, Maugis, Ormerod, and new revolving credit facility; of Association. to the Board of Directors. employees can act without • our related party transactions; fear of retaliation and report Paschke and Ms. Walker are • r eports from the business units For more information on and wrongdoing or suspected Independent Directors. (on any major projects); and Nominating/Corporate our Executive Committee see pages 26–27 wrongdoing or irregularities • our compliance with legal, ethical Governance Committee • approval of 2015 budget. of a financial, accounting, Our Board and regulatory matters. Our Nominating/Corporate Operations Committee banking or corruption nature in The Board of Directors is Our Committees Governance Committee currently Constellium to a reporting official. responsible for our policy and Remuneration Committee consists of three Directors. Chairman To facilitate this reporting, we day‑to-day management. Pierre Vareille, are in the process of establishing Audit Committee Members The Non-Executive Directors Members Chief Executive Officer an external hotline in all the supervise and provide guidance Members Our Remuneration Committee Richard B. Evans, Chair, countries and languages we currently consists of three Directors: Michiel Brandjes, Matthew H. Nord Members have operations in. to the Executive Director. Our Audit Committee currently consists of five Independent Matthew H. Nord, Chair, • Business Unit Presidents For more information on the Function Insider Trading policy members of our Board of Directors Directors under the Richard B. Evans, Peter F. Hartman • Chief Financial Officer see pages 24–25 NYSE requirements: The principal duties and We have an Insider Trading policy Function responsibilities of the Nominating/ • Vice President Strategy and which sets out the restrictions on, Werner P. Paschke, Chair, Business Development inter alia, trading in Constellium The principal duties and Corporate Governance Committee Philippe Guillemot, Guy Maugis, are as follows: securities and the use of John Ormerod, Lori A. Walker responsibilities of the Remuneration • Vice President Human Resources inside information. Committee are as follows: Business and sustainability ConstelliumBusiness and sustainability 30 performance report 2014 Businessperformance and reportsustainability 2014 31 performance report 2014
In this section: “Constellium is making Engaging with stakeholders Sustainability highlights 32 Altogether more sustainable 34 good progress delivering Our materiality assessment 36 on our commitment to Our stakeholders include suppliers, customers, Stakeholder perspectives 39 sustainability. Along with our Making our products more sustainable 42 employees, Non-Governmental Organizations (NGOs), Supporting our people 50 rapid growth, we are working local communities, industry organizations and others Making our operations more efficient 58 hard to shape the future of a in the aluminium value chain. Engaging with them Doing business responsibly 64 Managing sustainability 68 responsible and sustainable proactively helps us to govern our business in line with aluminium industry.” their expectations and needs. Laurent Musy Chairman, Constellium Sustainability Council
Who we engage with How we engage When we engage Analysts and investors Annual analyst day, regular exchanges • Quarterly earnings conference calls through our Investor Relations team • Analyst day once a year • Exchanges on a regular basis
Visits, industry associations, regular • Bi or tri-annual customer satisfaction Customers customer satisfaction surveys, trade surveys organized within business units shows • Meetings with customers for commercial and technical aspects Employees Employee feedback collection, • Exchanges throughout the year works councils, Management Days, • Biennial Global Employee Survey management calls, Environment, • Annual business unit President Health and Safety (EHS) days, customer roadshows presentations and business unit • Quarterly LIVE magazine (internal President roadshows, Chief Executive newsfeed) Officer plant visits, Chief Executive Officer memos as appropriate, • Weekly newswires Lean workshops, THANK YOU • Annual employee recognition program AWARDS, interaction with employee representatives
Aluminium Stewardship Initiative (ASI), • General meetings and many other Industry stakeholders industry associations including European meetings for various working groups, Aluminium, The Aluminum Association, taskforces International Aluminium Institute (IAI), Groupement des Industries Françaises Aéronautiques et Spatiales (GIFAS) and others. See ‘Memberships’ on page 77
This is managed at local levels. See • One community program in each site Local communities ‘Supporting communities’ on pages 56 and 57
ASI, community engagement activities • 3–4 general meetings/year but many NGOs other meetings for various working groups, taskforces Annual General Meeting, roadshows • Annual General Meeting once a year Sustainability Shareholders • Roadshows as appropriate Suppliers Code of Conduct, visits, sustainability • Visits are organized for new suppliers targets • Regular audits in focus For more information see ‘Stakeholder perspectives’ pages 39–41 Business and sustainability Business and sustainability 32 performance report 2014 performance report 2014 33
Sustainability highlights
We continued to work hard in 2014 to embed sustainability across the business. These are some of the many achievements we recorded during the year.
Carried out the Improved energy Worked in 2014 Global efficiency at partnership Employee Survey Ravenswood to develop the Our second Global Employee Our unit at Ravenswood (USA) world’s first Survey revealed a high overall reduced electricity consumption participation rate of 75%, by nearly 20,000 MWh, notably ‘2l/100km’ vehicle an 11% increase from 2012. thanks to investing in a new In partnership with car We made headway in most motor drive for a rolling mill and manufacturers Renault and categories, including employee replacing 80% of the plant lighting PSA Peugeot Citroën, and parts engagement, customer focus, with LED lighting. and tools supplier SNOP, we training and development, and are participating in the Allegria providing clarity around our project which was filed and strategic direction. validated by ADEME1. This project aims to develop materials and technologies that will enable the development of a 2 litre/100km Performed Life vehicle by 2020. Cycle Assessment Implemented ISO studies on 50001 at Decin aluminium cans Our Decin plant in the Czech and car hoods Republic implemented the We extended our program of We performed third-party verified ISO 50001 standard on energy Reinforced our Leadership Safety Tours. Life Cycle Assessment studies management. The standard These tours are a company‑wide commitment to on two key products – a beverage specifies requirements for initiative through which all our can model and a car hood model, establishing, implementing, Leadership Safety leaders – from senior management following the introduction of a maintaining and improving an to shift supervisors – interact Tours sustainability check for every energy management system. with their teams on a weekly basis new product or process within our and encourage all our people to innovation process in 2013. identify simple, sustainable solutions on the shop floor.
Launched our first Won recognition materiality matrix at the European based on GRI G4 Business Awards Constellium proudly took Constellium was named Contributed to the part in the new era of space guidelines Environmental and Corporate exploration on the journey to We launched our first materiality successful test Responsibility Champion in Mars, providing AIRWARE® assessment exercise in line France by the European Business flight of NASA’s aerospace technology to with international standards Awards, which recognizes and NASA’s Orion spacecraft. (Global Reporting Initiative’s Orion crew module rewards excellence, best practice AIRWARE® technology was G4). This has allowed us to and innovation in companies aboard Orion’s successful first identify the issues that are most across the European Union. flight test, Exploration Flight important to internal and external Test-1 (EFT-1) built by Lockheed stakeholders. Martin and designed for human exploration of deep space.
1. A DEME: Agence de l’Environnement et de la Maîtrise de l’Energie. ADEME is the French state operator that supports environmental and energy transition. Business and sustainability Business and sustainability 34 performance report 2014 performance report 2014 35
Altogether more sustainable
We have identified a series of commitments and targets On track which we use to evaluate our progress towards becoming Needs improving a more sustainable business. Achieved Missed
This symbol identifies sustainability Key Performance Indicators throughout this report
Products People Operations Responsible business We are committed to We are committed to ensuring We are committed to We are committed to developing, producing and our people are safe, skilled, minimizing the environmental undertaking the highest selling sustainable products motivated and engaged. impact of all our operations standards of governance that meet our customers’ in terms of energy, waste across all our activities in line needs now and in the future. and water. with Constellium values.
We will We will We will We will Maximize recycling rates of our products, Protect the safety and health of our employees, Further develop recycling Subscribe to the highest levels of transparency and including after the end of their useful life contractors and visitors as a top priority accountability, and commit to develop company and industry sustainability programs Continuously innovate and offer lighter, safer and Strive to enhance employee engagement Optimize the use of natural resources, especially energy Promote the adoption and implementation of infinitely recyclable solutions and development sustainability policies by our suppliers and contractors
Prevent and minimize environmental impacts
Targets Progress Targets Progress Targets Progress Targets Progress 75% beverage can recycling rate 60% improvement in recordable cases 10% decrease in energy consumption 100% of key suppliers joining the in Europe by 2015 by 2014 per processed unit by 2015 UNGC by 2015
All major new innovation projects No serious injuries in 2015 Major European sites reaching through Life Cycle Assessments ISO 50001 certification by 2015 For more information by 2015 see page 65 50% improvement in employee 75% total landfill reduction by 2020 10% of sales from innovative products contributions by 2014 by 2015 75% participation rate in the employee For more information For more information survey in 2014 see page 59 see page 43 Six-point improvement in the employee satisfaction rate in 2014
For more information see page 51 Business and sustainability Business and sustainability 36 performance report 2014 performance report 2014 37
Our materiality assessment
Our materiality assessment process guides our Mapping and Of the issues that did not emerge Materiality matrix key prioritizing issues as highly material, two in particular Use this color key to see how approach to sustainability by allowing us to identify are of high interest to us, namely each material issue fits within We used the outcomes of our diversity and local communities. stakeholder survey to map all 35 the four pillars of Constellium’s and manage the issues that are most likely to impact These topics have been sustainability strategy: issues. The 17 issues that were in communicated within the People the business and the stakeholders we surveyed. the upper right half of the matrix pillar of this report. Products were identified as our material People issues and have been indicated in The remainder will be reported to Operations the chart below. interested stakeholders through Responsible business other channels, such as our Our approach The following issues did not emerge website (www.constellium.com). as highly material: labor and During 2014, we undertook Initiatives regarding these issues human rights, treating suppliers a materiality assessment to are already underway, even though with respect, local communities, identify the issues that matter they have not been identified as work/life balance, diversity and most to Constellium and our material issues by our materiality absenteeism, water, renewable surveyed stakeholders. assessment process. energy in operations, global Based on surveys and regular warming, biodiversity, expanding engagement with our internal and our markets, traceability of our external stakeholders, we identified products, selecting suppliers on a total of 17 material issues that sustainability and performance. form the basis of the potential issues Pierre Vareille, Chairman of European Aluminium, introduces the covered in this report. Sustainability Roadmap towards 2025
Consulting with internal We asked each participant to Gathering additional insight and external stakeholders rate the relative importance of Ensure safety As part of the consultation, at work The first step in our materiality 35 sustainability topics, which process was to consult with internal we asked open-ended questions. were identified through external Engage suppliers Reduce use of harmful Customer These were intended to give us Very important and external stakeholders to find out benchmarking and grouped under in sustainability substances satisfaction a fuller understanding of what which sustainability issues they see five areas: environment, health performance stakeholders are particularly as most important for Constellium. and safety, people, supply chain Promote and Increase external Innovation interested in, and what they want to enforce ethical recycling activities and economy. We then asked • Internal assessment: see more of. business practices participants to choose two or three We administered a questionnaire Increase internal Improve employee to representatives from senior priority issues within each area Three main areas emerged: recycling activities satisfaction to create a comprehensive list of management and our Sustainability 1. Recycling, particularly related to material issues. Council, of which 84 provided input. creating a circular economy Increase economic Develop Improve energy performance training and efficiency of operations • E xternal assessment: Implementing the 2. M anagement transparency, empowerment We spoke to and conducted surveys outcomes including accountability for our with 27 external stakeholders, sustainability charter including customers, suppliers, The exercise has shown good investors, Non-Governmental alignment between our internal and 3. Our ambition regarding energy Reduce our Reduce waste Reduce Prevent pollution
policy and relevant Key Importance to stakeholders (external) Organizations, regulators, scrap external stakeholder expectations greenhouse gas from operations psycho-social from operations traders and dealers, union for sustainability. It has confirmed Performance Indicators emissions risks representatives, certification that our four priority areas of See page 39 for more information bodies and industry associations. products, people, operations and on how we are engaging with responsible business, are still the stakeholders, and an overview of Develop products with the main topics raised in 2014 environmental benefits
most relevant for our business. It has Important also given us focus within those Important Importance to Constellium (internal) Very important areas as we look ahead and develop. Business and sustainability Business and sustainability 38 performance report 2014 performance report 2014 39
Our materiality assessment continued Stakeholder perspectives
The chart below shows where In the following chapters, we will Products Stakeholder engagement ensures that our approach to the primary impacts for each of explain how we are managing these People the issues sit with respect to the potential issues, engaging with Operations sustainable business is relevant and effective. It gives us an boundaries of our business. people and partners across the Responsible business supply chain, as necessary. outside perspective, helping us to evolve our business in line with both internal and external expectations.
pacts outside ary im Cons rim tell P ium Our approach Customers seek leading Engage suppliers in “This stakeholder consultation sustainability performance There are many ways that we engage process should enable action on environmental with our stakeholders – from Constellium to further develop impacts ithin and ou ts w tside meetings and business activities its sustainability policy, beyond pac Co Many of our customers expect im ns to membership and participation y te already recognized strengths Constellium to lead on reducing ar ll m Innovation iu in organizations. like the management of safety ri m the environmental impacts of our P at work. This will help them Our stakeholders include employees products. Others emphasized tackle important sustainability and employee representatives, the importance of improving Promote and acts within Customer challenges and improve the mp Co satisfaction sustainability across the supply enforce ethical y i n customers, suppliers, our Board business r s quality of the information a Ensure safety te of Directors, shareholders and chain, and some suggested that practices m l i at work li included in the sustainability r u investors, regulators and policy we could usefully carry out further P m performance report.” Reduce psycho-social risks makers. They also include the work on improving beverage can Increase communities in which we operate as Pascal Thomas recycling rate. internal recycling Increase Develop Improve energy efficiency of operations Reduce our AFNOR activities well as sustainability organizations, external products with greenhouse recycling environmental gas emissions including Non-Governmental Reduce use of harmful Some regulatory bodies activities benefits substances Organizations and academic “By engaging in such a push for us to retain institutions concerned about the consultation process, industry leadership Develop training Improve social, environmental and climate Prevent Constellium took a relevant and empowerment employee impacts of the production and use Some regulatory bodies we interact pollution from satisfaction approach to define its operations with acknowledge our performance of aluminium products. Through our sustainability priorities. materiality assessment exercise, with regard to safety and also Reduce As shareholders, we strongly Increase economic we have started to engage with our that we have given due attention waste from performance support this determined operations stakeholders in a more systematic to the environmental impacts of attention to environmental, our business activities. However, manner. We have also connected social and governance closely with selected stakeholders in 2014 they also emphasized factors, as we understand the importance of us retaining during the development of sustainability as a potent lever this report. our leading industry position. for corporate competitiveness.” A number of them also expressed See page 30 for a summary of the Sébastien Blot concern regarding psycho-social main ways that we engage with Bpifrance risks and reducing stress levels our key stakeholder groups among employees.
Scope and boundaries across different regions and We also used the guidance notes Research organizations call This materiality exercise has been business units in the materiality on accountability and the material for continued investment assessment process. This was an aspects criteria defined by Global conducted for Constellium in its Innovation is fundamental to entirety, and therefore considers extensive process, but does not Reporting Initiative to inform necessarily represent the totality our approach. creating products that customers the impacts of all of Constellium’s want. Through our engagement in consolidated operations. We involved of all our internal and external stakeholders’ views. 2014, several research organizations a range of stakeholders encouraged us to continue investing Constellium Prize 2014 awarded in research and development. to Dr. Thierry Loiseau Business and sustainability Business and sustainability 40 performance report 2014 performance report 2014 41
Stakeholder perspectives continued Human rights
Industry associations The voluntary standard will allow emphasize the importance Developing the industry to better respond to Strengthening of transparency the world’s growing customer and consumer sustainability in Some industry associations demand for a more sustainable have asked us to work towards first sustainable supply chain. the supply chain increased levels of transparency and aluminium Once implemented, the new accountability, including an increase standard will allow industry In 2014, we launched a supplier in our external reporting activities. standard participants to certify aluminium assessment campaign to products through a third- strengthen our suppliers’ Investors support our Leaders from the aluminium sector party certification system. sustainability credentials sustainability approach unveiled a new comprehensive This certification will signal that and align them with our vision and strategy. We are focused on ensuring that standard that aims to improve the products have been produced in line with the standard’s principles investors see Constellium as a leader industry’s environmental, social Part of this campaign included relating to environmental in high value-added aluminium and governance performance the launch of a pilot program with performance, social responsibility products and solutions. The surveyed throughout its entire value chain, an external and independent and governance practices. We see investors indicated that we must including plans to reduce its assessment company – an online the new ASI standard as a natural continue to work on positioning greenhouse gas emissions. platform which allows companies ourselves as a leader in sustainability. extension of our own sustainability This is the culmination of a to monitor the environmental In 2014, they acknowledged our efforts. By working together with Key stakeholders interacting at the launch of European Aluminium year-long consultative dialog and social performance of their continued commitment to ensuring our stakeholders, we can become Industry’s Sustainability Roadmap towards 2025 involving industry leaders and civil global suppliers. safety at work. They also stressed the more sustainable as an industry. society organizations. importance of good corporate ethics We are proud of our contribution We have also been promoting our We have supported European and transparency and indicated Constellium joined Aluminium to the development of the ASI Code of Conduct to key suppliers Creating an Aluminium as it engaged with the they would welcome additional Stewardship Initiative (ASI) at its standard. In our view, this standard and encouraging them to adopt industry-wide European Union decision-makers communication on these topics. inception and we have participated is truly groundbreaking as it brings the principles set out by the and the wider policy community in the development of the new together players across the entire United Nations Global Compact roadmap to 2025 to promote the outstanding standard under the leadership aluminium value chain and defines (UNGC). Setting up the process properties of aluminium and Non-Governmental We have helped develop the of the International Union for a Chain of Custody, which directly has not been straightforward, optimize the contribution our metal Organizations see us European Aluminium Industry’s Conservation of Nature (IUCN). links sustainable practices to the but we are starting to see positive can make to meeting Europe’s as a valuable player end products used by businesses results. For example, one of our Sustainability Roadmap towards sustainability challenges. We engage with Non-Governmental and consumers. suppliers has joined the UNGC 2025. The roadmap seeks to create Organizations, especially those as a result of this dialog. a vision, future outlook, priority operating in the social and Read more at areas and targets which will help environmental sectors. They stress www.aluminium-stewardship.org See pages 65 –67 to see how enhance sustainability in the that because of our very specific we are engaging with suppliers aluminium value chain. position in the center of the aluminium value chain, we have an opportunity to be a key player. Most of them also emphasize the Suppliers want Certification bodies Maintaining healthy We take our stakeholders and their importance of working towards common standards and Suppliers are encourage greater relationships with expectations very seriously. We are reducing the environmental footprint increased recycling supportive of creating consistency union representatives trying to address the expectations of our products and operations that stakeholders have raised. Suppliers are a crucial part of our shared standards Some of the certification bodies we In 2014, union representatives – with recycling possibilities and This report provides information on value chain and play an important engaged with in 2014 encouraged us expressed the need to maintain increased investment in renewable across the supply chain the key actions taken. role in the overall sustainability of to be consistent across all aspects of healthy management–union energy being specific issues raised with the Aluminium our business. Most of our suppliers our sustainability communications. relationships, and some shared in 2014. They also stressed the express the need for a clear and Stewardship Initiative their views on the environmental importance of having a clear and well-defined supply chain strategy. impacts of our business. well-defined greenhouse gas (GHG) (ASI) emissions target, which we are Our scrap dealers and traders currently working on. emphasize the need to promote the benefits of recycling for the environment. Business and sustainability Business and sustainability 42 performance report 2014 performance report 2014 43
Making our products more sustainable
customers are through bi-annual We also held a Truck Preparation We must design, manufacture and sell products that meet Materiality coverage satisfaction surveys which help Area workshop to improve our on- to identify areas where we need time in-full delivery performance our customers’ needs – both now and into the future. For us, • Customer satisfaction to take action. Results are already and reduce inventory at our • Innovation visible. Between 2012 and 2014, we casthouse in Issoire, in line with this boils down to delivering high-quality products efficiently, witnessed a clear improvement in our Lean culture. Truck Preparation • Develop products with customer satisfaction at Packaging Areas play an important role in the developing innovations that anticipate market needs and environmental benefits and Automotive Rolled Products. process efficiency of our operations. The business unit mandated an They involve organizing the shipping reducing the environmental impacts across the aluminium • Increase recycling activities external research agency to conduct area of a production unit around its customer satisfaction survey, specific customer orders to control life-cycle. Targets covering all aspects of our offer, incoming and outgoing product flow. including the quality of our products, 2015 is the ‘Year of Just In Time’, • 75% beverage can recycling logistics, technical support, sales rate in Europe by 2015 service, management, level of to ensure optimum customer innovation, as well as sustainability satisfaction. We will pursue • All major new innovation and communication topics. The global continuous improvement on projects through Life Cycle satisfaction rate at Packaging and this front. Assessments (LCAs) by 2015 Automotive Rolled Products has • 10% of sales from innovative increased by 10 points since 2012. products by 2015 Since its launch two years ago, our company-wide Lean Performance Transformation program has made a significant contribution to • Latest available data show customer satisfaction. Our focus continuous improvement with on quality control and just in time 69.5% beverage can recycling production have helped us reduce rate in Europe in 2012 the percentage of missed deliveries by half and the number of customers • Over the last 12 months, 73% complaints by 70%. For more on Lean Partnering with of new projects incorporated Transformation see pages 13 and 14. customers a sustainability checklist as Our Chief Executive Officer Pierre part of their project reviews. Vareille named 2014 the ‘Year of to increase Depending on the outcome Quality’, reinforcing quality at the of this checklist, LCAs heart of our approach to building efficiency were performed customer satisfaction, supported In 2014, Constellium’s by our slogan ‘Quality makes the • A head of our target with 13% of Ravenswood plant created a difference’. This philosophy was sales from innovative products Lean system for leading tank clearly demonstrated in late 2014 in 2014 by the Automotive Structures and trailer manufacturer Heil Trailer Industry extrusions plant at Sierre. International. Working with We organized an extensive Total Champagne Metals, the team Customer satisfaction Productive Maintenance (TPM) level reduced the manufacturer’s one workshop that took place at one lead-time while improving Our customers include some delivery times and reducing of the largest manufacturers in of the site’s major rail production facilities. Key highlights of this time-lags across the entire the aerospace, packaging and supply chain. automotive industries. Meeting their workshop included strong team expectations and anticipating their motivation, great team effort, a “The driving force behind this needs are fundamental to building high participation rate (32 people) was to improve the overall enduring relationships and our long- and excellent overall results. business processes between term business success. Thanks to the workshop, the team the two companies.” has now defined clear improvement At the Packaging and Automotive actions as part of TPM level two and Andrew Cordell Rolled Products business unit, three workshops, reinforcing our Sales Manager, Constellium we monitor how satisfied our Lean culture. Business and sustainability Business and sustainability 44 performance report 2014 performance report 2014 45
Making our products more sustainable continued
Innovation We also developed new lighter- challenge of significantly lowering weight, stronger alloys to be used in industry-wide fuel consumption. Assessing lifetime impact With its properties of lightness, Crash Management Systems for the LCA is a technique to assess the strength, formability, corrosion- In the aerospace market, our automotive industry and supported environmental impacts of a given resistance and infinite recyclability, AIRWARE® lightweight alloys are our plants in developing a Body-in- product throughout its life, from aluminium is the ideal solution for reducing the weight of components, White (BiW) capability by improving raw materials extraction for the many applications. and reaping significant fuel processes and optimizing equipment original manufacturing process reduction benefits (see ‘Innovation’ Constellium products bring for R&D. through usage to its end-of-life. on the opposite page). And in the innovative qualities to our three main This is a vital tool in mapping the aviation industry, our emphasis markets of automotive, aerospace upstream impacts and downstream Developing products with on end-of-life recycling through and packaging, including reduced benefits of our products, and helps environmental benefits projects such as SENTRY (see fuel consumption and reduced identify where environmental ‘Recycling partnerships’ on page 49 greenhouse gas (GHG) emissions. Aluminium is a finite resource. improvements can be made at Its manufacture uses energy and for more) are helping to close the various stages of the product life- However, constant innovation is Our innovative automotive products displayed at C-TEC water, and waste is formed as a loop of our value chain, avoid waste cycle. It provides an overview of required to make sure that aluminium by‑product. But it is also a lightweight, and reduce energy use, water and impacts across different categories remains a material of choice, capable more readily recyclable alternative greenhouse gas emissions. such as greenhouse gas emissions of delivering sustainable and proven products that must deliver in the new aerospace applications and to other materials – offering Collaboration has been central to water eutrophication, acidification, advantages to our customers 1 marketplace. So instead of focusing deliver improved buy-to-fly ratios . opportunities to reduce environmental this drive. In 2014, we continued resource depletion, toxicity and and to consumers worldwide. on the number of patents we file, Developed at C-TEC, this system is impacts across its life-cycle. our work with the Aluminium waste production. we monitor the percentage of annual now in the final stages of trials. Based in Voreppe, France, C-TEC, As a major manufacturer of aluminium Stewardship Initiative (ASI) to Constellium sales generated by our technology center, has a proven 1. In the aerospace industry, the ‘buy-to-fly’ products, it is our responsibility to bring together organizations from products or processes created in the ratio is routinely used to describe the track record of conceiving and work closely with others in the value across the value chain as well as previous five years. Our objective is amount of raw material required to produce incubating ideas that shape the chain to minimize these impacts, from NGOs to establish a standard for 10% by the end of 2015, and in 2014 a finished part. world (see ‘Innovation’ on page 15). production and distribution through responsible aluminium. 73% Sometimes these innovations we achieved 13%, so we are already of new projects to design and end-use. Across all We also contributed to the European may take the form of incremental well ahead of target. incorporated a sustainability markets, our customers look to us to Aluminium Industry’s Sustainability improvements. At other times, they checklist as part of their project In one of the highlights of the year, offer solutions that are cost-effective, Roadmap towards 2025, helping can be true breakthroughs. At all ® 13% reviews in 2014 we perfected a new AIRWARE of sales from innovative efficient, and help them meet their to develop targets that enhance times, we believe that an innovation casting system that enables us to products in 2014 environmental objectives. sustainability (see ‘Creating an must be commercially viable if it is produce aluminium-lithium billets We have the opportunity to drive industry-wide roadmap to 2025’ on based on criteria including to be adopted by our customers and using advanced alloys which bring significant change with our products page 41 for more). environmental risks or opportunities. incorporated in transformational the advantages of AIRWARE® to by bringing new solutions to Over the last 12 months, 73% existing markets. Life Cycle Assessment (LCA) of project reviews performed at our C-TEC technology center the organization in Europe which In the automotive industry, for To improve the overall sustainability of incorporated this check. GRIPSTER™: certifies low noise vehicles. example, the Aluminum Association our products, we look to identify ways highlights that using aluminium of embedding environmental benefits During the sustainability check, GRIPSTER™ is a differentiated the quiet revolution instead of steel in cars could save throughout a product’s life. One of the we also decide if an LCA should product offer for the tread up to 44 million tons of carbon key ways to achieve this is to conduct plate market and we anticipate be conducted. LCA tools are used Refrigerated trailer deliveries to emissions each year. Last year a Life Cycle Assessment (LCA). to support our decision-making city premises can cause excessive converting customers from we worked in partnership with At the end of 2013, we introduced a process and can be used across noise and disturb local residents polyester or extruded floors. car manufacturers Renault, PSA sustainability check for every new common products and processes to and businesses. Launched in 2014, Testing began in the summer of Peugeot Citroën, and parts supplier product or process at the innovation broadly identify the most significant our new GRIPSTER™ product 2014 with vehicles operated by French truck Original Equipment SNOP to develop the world’s phase of product development. environmental impacts. In 2014, offers a superior tread pattern first affordable 2 litre/100km no mandatory LCA studies took for refrigerated vehicle floors. Manufacturers (OEMs) Aubineau, Here, members from our research car. This effort forms part of our place, as no case of significant It is the only solution on the Chereau and Lamberet. Feedback and technology, sales, marketing, work for the Allegria project (see uncertainties or potential negative market that combines greater was positive and demand is strategy, general management and ‘Sustainability highlights’ on page 33 impacts were found. durability and better grip with now increasing. We believe that production teams meet to decide for more), which aims to address the reduced noise qualities that soon, several hundred vehicles whether or not to pursue a project meet the requirements of PIEK, manufactured by these OEMs will incorporate GRIPSTER™. GRIPSTER™ pattern for tread plate Business and sustainability Business and sustainability 46 performance report 2014 performance report 2014 47
Making our products more sustainable continued
There were a significant number In 2014, we extended the scope of product categories. Our target is for Recycling The misleading concept of of cases where an LCA was our LCA tools to cover a broader all new major innovation projects to Using recycled aluminium reduces recycled content recommended to support product range of products and processes. go through a screening using LCA the need for primary aluminium and Some players in the industry use 69.5% promotion, two of them leading to a In addition, we increased the number tools by the end of 2015. therefore reduces waste, avoids ‘recycled content’ as a metric, beverage can recycling decision to proceed – both detailed of impact categories from 5 to 22 1. Impact 2002+ and CML are LCA resource depletion and reduces which measures the amount of rate achieved in Europe in ‘Life Cycle Assessment in practice’ and these now cover most of those methodologies, covering a wide range of GHGs across an aluminium product’s recycled aluminium in products as in 2012 below. identified by IMPACT 2002+ and impacts, from water, soil and air impacts life-cycle. an indication of how environmentally CML1. We also developed some more as well as GHG, land occupation, resources depletion and toxicity. friendly that product is. For us, this specialized LCA models for specific In the aluminium industry there are Therefore, having products with metric is misleading because: two key sources of recycled material: higher than average amounts of • it fails to distinguish between end- ‘recycled content’ does not make • end-of-life scrap metal, which is of-life and other scrap content. any difference to the overall impact combination of strength and material that has already been Aluminium beverage can (g CO2 eq. /can) This can encourage inefficiencies of the aluminium industry (see Life Cycle lightness of aluminium achieves used and disposed of; and 130 in production because it rewards diagram below). major weight savings, and hence Assessment 120 • process scrap metal, produced wasteful processes that produce lower fuel consumption during use. W e have continued to engage in 110 during the manufacturing process. more scrap; and in practice Its efficient recycling also helps 100 industry initiatives to promote to recover a significant part of the 90 From an environmental point of view, • there is only a limited amount better handling of recycling and initial investment. 80 only end-of-life scrap can be of recycled aluminium available recycling metrics, notably in relation In 2014, we conducted two full 70 LCA studies to improve our associated with a lower environmental globally. Logically, this means that with Metal Packaging Europe and 60 footprint, because its impacts have increasing recycled material on European Aluminium initiatives1. understanding of the sustainability Aluminium vs Steel (kg CO ) 50 2 eq. already been taken into account one product line will remove it from risks and opportunities relating to 40 1. S ee ‘Recycling rate vs recycled content’ and 300 0 10 20 30 40 50 60 70 80 90 100 during its initial life. Of course, process others, thus offering no actual ‘Metal as a permanent material’ documents aluminium automobile hoods and Recycling rate % 250 scrap is always recycled because we benefit for the environment. at http://metalpackagingeurope.org/what- beverage cans, and to demonstrate 200 Constellium Industry average we-stand-for/ the intrinsic performance of acknowledge our responsibility to 150 retain it in the manufacturing loop. our products. 100 50 These results highlight the vital Automobile hoods 0 importance of increasing end- -50 of-life recycling rates to improve We wanted to investigate the Aluminium Steel hood hood the sustainability of the industry, effects of using an aluminium car Increasing recycled content offers no actual environmental benefit Metal production Use End-of-life and confirm Constellium’s strong With a limited scrap pool, increasing the recycled content of one product is made possible by decreasing the hood produced by Constellium position relative to competitors. instead of a traditional steel version. recycled content of another. This is why, at Constellium, we focus on making the scrap pool bigger by increasing end-of-life recycling rates. Assessed by a third party critical Aluminium beverage cans “ Rio Tinto Alcan is proud to review led by Quantis and using collaborate with Constellium real manufacturing data from plant We were also keen to understand for the evaluation of the processes and metal supply, the the effects of recycling rates on environmental footprint of their LCA showed that the proposed carbon emissions for aluminium products. Rio Tinto Alcan’s very aluminium hood had significantly cans manufactured with our low carbon footprint aluminium lower greenhouse gas (GHG) metal. Once again using real helps Constellium and its Producer 1 Producer 2 emissions than its steel alternative. manufacturing data, we proved customers to reduce their global Sharing that an average recycling rate of environmental footprint and More precisely, GHG impacts of 69.5% yields a carbon footprint of to make aluminium an always the limited the aluminium hood (156kg CO .) 1 2 eq 80g CO2 eq. for our own cans . This is better solution.” based on our material were found a favorable figure when compared to scrap pool to be 37% lower than for a steel Jérome Lucaes the European average of 94g CO2 eq. Director Material Stewardship, Rio Tinto Alcan one (247kg CO2 eq.). Despite higher impacts associated with the Based on a recycling rate of 90%, which is representative of many 1. 69.5% is the EU+EFTA average recycling upstream aluminium processes, rate for 2012 (most recently published). the aluminium hood showed European countries, this figure 2. Germany, Belgium, Luxembourg, Sweden, lower overall impacts throughout further reduces to 67g CO2 eq. Norway, Finland, Switzerland all perform 2 at 90% or higher recycling rates, according the whole life-cycle. This is per can . to the most recent data currently available Products 1 Products 2 mainly because the (2012) – press release from European Aluminium, March 16, 2015. Business and sustainability Business and sustainability 48 performance report 2014 performance report 2014 49
Making our products more sustainable continued
Recycling partnerships: Looking ahead • Maintain our commitment to customer satisfaction by working on projects such as Lean phase 2 (see page 43 for Aluminium Stewardship Initiative: Every Can Counts: We are working more information) We are collaborating to establish together on a communication a standard for responsible and collection program to boost • Push for new innovations such aluminium across the value chain. beverage can recycling rates. as lightweighting and more scrap tolerant alloys that bring environmental benefits to our products
IRT M2P: We are associated with • C ontinue to invest in research Canibal: A one-of-a-kind machine its ‘LCA and Recycling’ program, and technology to create at Constellium Paris and the Neuf- sharing and improving knowledge successful new products and Brisach plant that gobbles up used and practices in the field of prepare for future developments beverage cans, plastic bottles Core project team at Decin, inaugurating the new furnace end-of-life recycling – especially • Further expand our use of Life and plastic cups. The Canibal also in automotive. sorts and crushes used containers. Cycle Assessments (LCAs) and Repurposing The new recycling furnace in Decin Not only does the furnace mean Every ton of waste generated by ensure they are undertaken on operated at its full annual capacity that our customers can now Canibal is equivalent to 2.5 tons of all new major developments for the first time in 2014, recycling access an efficient solution to carbon credits. 6,000 tons 6,000 tons of aluminium. recycle their turnings, it also allows • Continue to work with key us to efficiently transform end- stakeholders to create and of waste The furnace recycles two different of-life demolition scrap back to Metal Packaging Europe: We are enhance efficient end-of- sorts of material, both of which are wrought products. advocating for the notion of metals life recycling processes for traditionally difficult to recycle: CR3: We are a member of the as permanent material and on the aluminium products small spirals of waste aluminium, Center for Resource Recovery use of relevant recycling metrics. known as turnings; and painted or and Recycling that brings together coated end-of-life scrap. universities and industry partners to improve recycling processes, through better sorting, metal target set by the European recyclers to validate the feasibility Increasing end-of-life composition analysis and SENTRY: Led by the Basque beverage can industry to raise the of recycling properly sorted recycling across the industry conditioning of scrap. GAIKER-IK4, IK4-LORTEK and IK4- recycling rate to 75% by the end demolition scrap and turning it into Our approach is to focus our efforts AZTERLAN R&D centres, SENTRY of 2015, and are partners in the new products; on increasing end-of-life recycling is part of the Clean Sky program. ‘Every Can Counts’ initiative – a and designing with end-of-life • Lowering the amount of Its objective is to define dismantling consumer campaign to increase recycling in mind. Recycling is a scrap generated by our and recycling operations for new recycling rates of beverage shared challenge, and increasing customers, particularly in the Industry Associations: metallic aero-structures with cans. Latest available data show end-of-life recycling is the best way aerospace market; and As members of European the minimum environmental continuous improvement with of getting more recycled metal back Aluminium and International impact, to maximize potential 69.5% achieved in 2012, up from • Developing more scrap-friendly for a new life. Aluminium Institute we work with reuse of the recovered materials. 52% in 2005 (and 43% in 2000); alloys that will further develop the others on industry challenges, Through SENTRY, the Europe-based At the same time we aim to minimize use of scrap in wrought alloys, thus • Improving end-of-life processes, including the Aluminum companies Dassault Aviation, the amount of scrap generated avoiding potential down-cycling in particularly dismantling and Association in the US. AELS and Constellium, together across our operations, and recycle cast products. shredding. See our partnerships with the Israeli IAI, are working any scrap that we do produce, with IRT M2P, CR3 and SENTRY on Next steps include our involvement with IK4 members to develop new despite our best efforts. the opposite page; in recycling in the US, notably fuselage technologies and end- Key activities in 2014 included: through the recent acquisition of-life procedures to benefit the • Enhancing the recycling of wrought of Wise Metals. aviation sector, aluminium industry • Improving end-of-life collection products into new wrought and environmental assessment rates, particularly in packaging. products, through better sorting. in general. We have endorsed the collective We have been working with metal Business and sustainability Business and sustainability 50 performance report 2014 performance report 2014 51
Supporting our people
Ensuring safety at work must be investigated through Our aim is for Constellium to be recognized as the natural Materiality coverage our 8D (Discipline)2 problem- Environment, Health and Safety solving process within five days. (EHS) is the number one priority home for talented and dedicated employees. We know that a • Ensuring safety at work During 2014, we continued to for Constellium – we want every • Reducing use of assess the effectiveness of how we employee, visitor and contractor safe, content and engaged workforce translates directly into harmful substances implement this methodology with to return home safely every day. our effectiveness score rising from • Improving employee satisfaction improved business performance, and we will continue Using EHS FIRST, our comprehensive 75% in 2013 to 87%. to invest in initiatives to support our people. • Reducing psycho-social risks and integrated EHS management (work-related stress) system, has improved our safety • Developing training record in recent years, yet we can – and must – do better. In 2014, the 204 and empowerment 8D investigations number of serious injuries including in Constellium in 2014 fatalities decreased from seven to Targets four. However, the single fatality we • 60% improvement in recordable experienced during the year detracts This score measures how effectively cases by 2014 significantly from this achievement. the 8D process has been performed In December, at Chippis, Switzerland three months after the incident, • N o serious injuries in 2015 an employee was killed in a molten against a 100% ideal assessment. • 50% improvement in employee metal explosion during the casting At the same time, we increased the suggestions by 2014 process. We deeply regret this tragic number of 8D investigations from accident, which strengthens our 72 to 204. • 7 5% participation rate in the resolve to do everything we can to employee survey in 2014 ensure the safety of all our people. Improving safety performance • S ix-point improvement in the Learning from this incident, we have We continue to develop new employee satisfaction rate introduced several new measures to processes and modify existing ones in 2014 protect employees during casting. to improve our safety performance. These include constructing new The two fatalities in 2013 and the Performance physical structures, such as screens fatality in 2014 have led to significant and cabins, and replacing manual new programs. These include a range • Our Recordable Case Rate activities where possible. of initiatives to address the dangers remained largely unchanged 1 of crane operation and working at at 2.8 Our Recordable Case Rate remained height, following the fatalities at largely unchanged at 2.8. This rate • It is with great sadness that our plants in Ravenswood, West has reduced over the last decade, we report one fatality in 2014. Virginia and Levice, Slovakia in 2013 from 13 in 2004, largely through The number of serious injuries (see ‘Working safely at height’ on the introduction of best practice including this fatality was four page 52). measures. Achieving a further • Improvement in number of reduction is a key challenge, but 1. R ecordable Case Rate measures the number of fatalities, serious injuries, lost time employee suggestions, with it is one we face with resolve injuries, restricted work injuries or medical 58% now making at least one and commitment. treatments per one million hours worked. suggestion per month 2. The 8D (Discipline) problem-solving method All our plants use a structured is a structured, step-by-step approach to • 11.4% improvement in problem-solving methodology to understanding a problem and developing employee survey participation identify the root cause of safety solutions. It prevents problem solvers from jumping to premature conclusions before in 2014 to 75% or environmental incidents under a problem is properly defined and its root • Two-point improvement in an EHS directive. All recordable cause identified. employee satisfaction rate cases, high potential near misses, high potential first aid incidents and environmental events Business and sustainability Business and sustainability 52 performance report 2014 performance report 2014 53
Supporting our people continued
We are committed to sharing best Working safely practices on EHS across the Creating a great The results at Gottmadingen were broader industry and in 2014 achieved through a twin focus on at height again collaborated with place to work engagement and communication. European Aluminium, the For example, in 2014, managers at the plant again increased their Working at height is inherently International Aluminium Institute Our Gottmadingen automotive shop floor tours, ensuring that dangerous, yet sometimes and the Aluminum Association production site in Germany employees are treated with respect essential to our operations. In 2014, in the US on a range of initiatives. recorded the highest scores and that managers are aware of following a height-related fatality For more information see in the employee survey, with a any issues. Employees responded at the plant in the previous year, ‘Stakeholder perspectives’ on participation score of 98% and a with a high level of suggestions the EHS team at Levice in Slovakia pages 39–41 satisfaction score of 90%, up from per month, with around 85% of developed and implemented an 85% and 77% respectively in 2012. all employees making at least innovative yet relatively simple THANK YOU AWARDS to the Working @ Height team Reducing use of harmful This performance was achieved one improvement suggestion per solution which reduced height- substances despite the plant’s rapid growth month. This feedback underlines related risk to employees and As our use of chemicals is a material from around 30 employees when the value of direct face-to- contractors by 89%. features a total of 13 new safe hosted by Chief Executive Officer it was established in 2000 to some working areas and three new Pierre Vareille. These annual awards issue, during the year we continued face engagement. The Working @ Height initiative 550 today. service platforms on existing are designed to foster excellence to evaluate how we handle harmful The management team organizes (W@H) included the installation crane tracks. throughout the Company and pay substances such as hydrofluoric At the heart of this strong twice-yearly meetings with of new fixed ladders and railings tribute to the talented people who acid, which remains essential to performance is a culture all employees to inform them to working platforms as well as In September 2014, W@H was a support our business. our manufacturing processes. of teamwork and trust, about key business and site the purchase of dedicated safety Gold Winner at the Constellium As a result, we improved the ways in empowerment and mutual issues. The meetings include: equipment. The Levice plant now THANK YOU AWARDS which were For more information on which we use, transport and store respect. The key performance THANK YOU AWARDS see page 54 an assessment of the market; this substance. tool deployed by the plant’s stable a forecast of future performance; management team is to lead and an outline of projects currently We extended our program of We also launched a new concern at Constellium’s current Improving employee work alongside people, listening underway and planned; an outline Leadership Safety Tours during communications program based safety performance and invited satisfaction to what employees say but also of any development plans for the hearing what they are not saying. 2014. These tours are a company- on the FIRST acronym below, to all employees to “make safety an We value our employees highly and plant; and a Q&A session where wide initiative through which remind employees of our five key everyday priority”. In addition, many Quality and high-performance employees are encouraged to work hard to ensure they enjoy delivery are core objectives for all our leaders – from senior safety behaviors: sites organized activities to improve maximum job satisfaction; we interact with management. management to shift supervisors EHS performance. For example, we managers, but so too are ‘leading believe this translates into improved with a smile’, being approachable – interact with their teams on a ollow EHS rules even if carried out emergency procedure business performance. weekly basis and encourage all F you are in a hurry tests in Dahenfeld, Decin, Paris, and being alert to employee stress. our people to identify simple, Levice, Carquefou and Neuf- In 2012, we launched our biennial ntervene immediately if sustainable solutions on the shop Brisach and health workshops employee survey program, which somebody is taking risks or floor. This is a direct and effective in Ravenswood, Crailsheim and is designed to understand our I deviating from EHS rules means of gathering feedback to Landau. Contractors participated in employees’ needs and improve improve safety performance on the eport EHS hazards to these events alongside Constellium satisfaction. Every employee had ground and is now a dedicated EHS R prevent injury employees and generated the opportunity to take part in the Key Performance Indicator. A new earch out EHS risks suggestions for safety improvement survey, either via the internet or EHS template for daily Compliance before any changed or during work sessions. on paper. The survey identified to Rules Tours and the Leadership S non-routine activity our key strengths and areas for Safety Tours makes it easier and Strengthening stakeholder improvement, and in 2014 we carried more effective to monitor and follow- ake EHS as your interaction out a second survey to evaluate the up on situations that are potentially first priority progress we had made. T Contractors, suppliers and visitors to harmful. Compliance to Rules tours our sites are expected to comply with of our plants help us identify any Every year, we take time to remind the same high EHS requirements as deviations from rules and to take the our people about the importance employees. Each person receives a necessary corrective actions. of safety through our EHS FIRST 75% Day. In 2014, this event engaged plant-specific orientation and is fully participation rate in the thousands of Constellium supervised throughout their visit. employee survey in 2014 employees. The theme this year Each person entering a Constellium was behavior as the key driver to managed area is included in Annual EHS FIRST day at the Gottmadingen plant improving safety. Our Chief Executive the Constellium Injury Record Officer Pierre Vareille voiced his Keeping System. Business and sustainability Business and sustainability 54 performance report 2014 performance report 2014 55
Supporting our people continued
Promising results The Lean Team Development Work related stress can affect In 2014, participation in the survey Fund was created earlier this year. employees in every organization. Supporting reached 75%, in line with our Each Team Leader receives a sum At our Issoire and C-TEC target. Promisingly, our employee of €1,000 to be used by operators locations we have implemented sporting excellence satisfaction metric has increased to implement improvement ideas a multidisciplinary approach to Majid Jabbour, who works in our IT by 2%, but this was not sufficient to and generate team spirit. The teams this complex issue. Working with department, has been passionate reach the six-point improvement we are free to spend it as they wish, employees, unions, management about kayaking since the age of 14. had targeted for 2014. and since January 2014, the teams and health experts, we have Today, he is a member of the Kayak have used the funds to make launched several initiatives, National Team of Morocco and We have made good progress in several investments. For example, including: was ranked 27th worldwide in 2011, several areas. The results show a production team at Nuits-Saint- Finally, we must make further • us ing an employee survey to as well as third at the last African that our people have a better Georges in France used its €1,000 progress in encouraging our people identify the main causes and championship in 2013. Majid is and several other international understanding of the vision and fund to capture benchmarks and to take more pride in product quality, consequences of stress. More than now aiming for qualification for regattas. To help Majid maintain strategy of the Company, and they share best practices by visiting the and this was addressed through 1,200 employees have participated the 2016 Olympic Games in Rio de his training and preparations, we are more confident that our Senior Crailsheim site in Germany. ‘Year of Quality’ campaign, which was Janeiro, Brazil. This year, he will provide him with flexibility at work, Managers and leaders can execute at Issoire; implemented widely in 2014. participate in two World Cups, as well as financial sponsorship for this strategy and make the right • c reating a multidisciplinary pilot To improve our performance Promoting health and the World Championship in Milan, his equipment and training. decisions promptly. Furthermore, reducing stress group that is helping us monitor our people increasingly adhere ahead of the 2016 survey, we are our stress prevention initiatives; to our goals and objectives, have empowering each site to take Promoting health and reducing performance by giving feedback and also provided with mentoring a better understanding of our accountability for improvement. stress underlines our commitment to • r eviewing stress indicators through a simple method: identify for 12 months. In addition to our values and greater belief in our In September 2014, each site all aspects of employee wellbeing. quarterly to identify and address the Situation, the Task, the Action corporate programs, each site products and services. They believe presented the main drivers behind key situations. At C-TEC, for Over the last 12 months, our teams in and the Result. The 5 Whys provides safety, technical and that Constellium is improving its their highest scoring categories example, we have identified 10 Germany carried out important work methodology tackles root causes, personal development training to customer focus and are more to senior management. Based on indicators while at Issoire we have to help people return to Constellium questioning why something has employees, in line with local needs. confident that they will be able best practice sharing, all sites have created a 34-point action plan following absence. Also in Germany, happened and analyzing how In return, each team was given a to develop to their full potential. set up relevant local action plans, which will be deployed by the end we launched an extensive improvements could make a €1,000 development fund to spend in Concerning their job, they now have with their achievements subject to of 2015; health campaign at our Singen, difference to the outcome. any way they chose (see ‘Recognition a better understanding of their roles quarterly reviews. Gottmadingen and Dahenfeld plants, • launching a training and awareness and reward’ on the opposite page for and performance objectives, and Because our people understand Furthermore, we exceeded our target focused on five key elements: program for managers and more information). their appreciation of immediate of achieving a 50% improvement employees. 80% of employees where and how we can improve, • stress management, including management has improved. in employee suggestions by 2014. at C-TEC and 100% of Issoire we set a Lean target of half of all Employee behavior is guided by our stress analysis through a heart employees making a suggestion Code of Conduct and the year saw us However, there remains On average, each employee now managers have been trained to scan, together with seminars on each month. During 2014, we again deliver e-training modules and significant room for improvement. provides eight suggestions every date; and how to reduce stress and how exceeded that target, with 58% of refresher courses. As Constellium has moved from year, which are duly considered and leaders can encourage health; • creating a “preventer network”, employees giving us the benefit of being a division of a large group to a treated as required. trained to listen, alert and advise their experience and knowledge. fully independent company listed on • promoting physical activity, Encouraging gender on work related stress. We have The aim is to analyze most the New York Stock Exchange, the through eight-week circuit diversity 15 preventers at C-TEC and 25 suggestions within 24 hours and to survey clearly showed the impact training programs; 8 at Issoire. implement them as soon as possible. Currently, we manage diversity at of change. Although our values suggestions per employee • ergonomics, including a a local level. The year saw a focus are better understood, people every year physiotherapy consultation and Training and empowerment At the same time, we have continued on recruiting more young women, have signaled that we need to do to deliver training programs to Front specifically in production functions expert personal advice; At Constellium, we know that training more in order to build a strong Line Managers, this year focusing including Lean Manager, supervisor • nutrition, based on improving and empowerment not only ensure company culture in which they can Recognition and reward on adaptive leadership sessions and operator roles. fully engage. They also expressed nutrition by promoting balanced that we meet our business objectives which aim to enhance leadership concerns about how they are The THANK YOU AWARDS are one menus in our canteens; and but also that our people fulfill their and communication skills. In 2015, Government legislation in France recognized in their daily activities. way in which we recognize the great own personal potential. managers will receive training on also requires organizations to reach work of our people during the year. • vaccination, including agreement with unions on gender We have therefore developed a As part of our Lean leadership conflict resolution. This program celebrates individual influenza vaccinations. equality. C-TEC, our technology specific training program on giving program, over 3,500 operators employees and teams across the In addition, we developed an center, was the first Constellium and receiving feedback, as part of each received two hours of training Company for their remarkable Emerging Leaders program in facility to sign up to the agreement in the Lean program. on feedback and the 5 Whys efforts and accomplishments, which 2014, with 20 selected employees 2012. Today, women account for 30% methodology. STAR feedback is combine to advance our collective being coached on a week-long of employed staff in C-TEC. a pragmatic tool that improves ambition, goals and values. residential course in Germany, Business and sustainability Business and sustainability 56 performance report 2014 performance report 2014 57
Supporting our people continued Labour
days where families, friends and training for a wide range of other neighbors can visit the site to see our Looking ahead roles such as sales, marketing and work at close quarters. During 2014, Environment, health and safety • Carry out a site-by-site analysis human resources. Each year, more we held these events at Levice in than 20 apprentices graduate and of potential emergency situations, Slovakia, and Carquefou in France, • Integrate the Muscle Shoals including chemical spills, and take their places on the Singen as well as at our joint-venture at plant in the US with the EHS shop floor or in our offices. evaluate our capability to manage Changchun, China. organization and align it an emergency situation that has The Singen approach, where public to Constellium standards. escalated into a crisis education resources are integrated The integration program will into our facilities, is a training model Restoring a include the introduction of proven Employee engagement that we believe offers great Constellium initiatives such as a number of serious injury • Work to improve our engagement opportunities. We work closely with hamlet, building and satisfaction scores ahead local schools at Singen and deliver prevention programs as well as Preparing the workforce of tomorrow – apprentices at the Neuf-Brisach plant a team Leadership Safety Tours of the next survey, scheduled the majority of the training within for 2016. This includes the site, ensuring that apprentices • Roll out the Contained implementation of action plans in During 2014, a team of new vocational training program to gain practical knowledge of the Hazards program, in line with all sites, and several organization apprentices from our site at Fueling our future help 59 young people, including working environment. the Lean phase 2 KPI, which development initiatives in the Valais in Switzerland spent a 20 women, become production This integrated approach, which is encourages immediate action to Aerospace and Transportation week restoring the culturally The young people of today are the line operators. well-established in Germany and at identified risks unit in order to address the important hamlet of Chiessio future of Constellium. We work Valais in Switzerland, is now being identified weaknesses At Singen in Germany, over 100 • Reduce the time taken by new hard to ensure that they have the rolled out to other Constellium in the Alps. Supervised by apprentices and students take part employees, or those joining to skills they need to succeed, with a sites, particularly in France. professionals, they carried out • Encourage every site to lead in a three-and-a-half-year program various tasks including building complete their EHS introductory community activities and share primary focus on apprenticeships. Towards the end of 2014, our Chief at our Industrial Training Center. lime walls, installing doors and modules, from six months to best practice with other sites During 2014, we increased the The program covers the different Executive Officer Pierre Vareille, water pipes, repairing roofs and four weeks disciplines that the site depends as well as Executive Committee Training and empowerment number of apprentices by 29% over cutting wood. • Implement the Business Unit 2013. We have doubled our intake on, including mechatronics, members Marc Boone and Laurent (BU) President site visit program. • Launch the Constellium of apprentices at Neuf-Brisach and mechanics, process mechanics, Musy, met a number of apprentices The purpose of the project was Under this initiative, every BU University, a formal onboarding Issoire in France. At Neuf-Brisach, materials testing and mechanical at Singen. not only to rebuild the hamlet President will visit each plant program aimed at new managers for example, we launched a new engineering. Singen also delivers and the access paths in order to support tourism – but also once a year, with the visit focused • Implement Conflict Management to build a team among the solely on EHS matters, as a training for Front Line Managers apprentices, who slept on-site demonstration of EHS FIRST The agreement at C-TEC included Finally, we permit some flexibility from health and sport initiatives and presentation skills for and shared cooking and cleaning in action 10 action points that will enable to part-time employees, and we at Issoire, Montreuil-Juigné manufacturing support functions us to: increase diversity during allow them to work from home in and Carquefou in France and responsibilities at the camp. • Standardize our environmental recruitment; support the promotion case of specific situations with the Gottmadingen, Dahenfeld and risk assessment methods • Continue to encourage employees of women; ensure salaries are paid agreement of their manager. Singen in Germany to educational to suggest areas for improvement, fairly, independent of gender and projects at Valais in Switzerland. • Participate in the 2015 biennial through the Lean training program improve the balance between work At Neuf-Brisach in France, we European Aluminium safety Supporting communities • Launch AIRWARE® school, which and home life. organized a day when youngsters workshop, building on our We rely on local communities to could find out about their parents’ success at the 2013 workshop aims to develop technical training provide people with the skills, ® Following the agreement, we have jobs and also held several student where we took the top three on AIRWARE commitment and experience already made good progress on a visitor days. At Decin in the Czech places, out of 39 entrants. that we need to maintain our • Enable open enrollment in number of issues. These include Republic, initiatives included an This event facilitates the competitive edge. So we are keen leadership program ensuring equality in promotion award presented to the best high sharing of best practice to to play an active part in supporting opportunities for men and women school student. We also supported further improve our industry • Develop Lean program those communities wherever and and providing individual coaching environmental schemes at C-TEC, safety performance and functional training for to support the promotion of whenever possible. support functions Paris and Zurich, made financial • Produce two new safety videos: women. In addition, 25% of women donations at Ravenswood and Each plant adapts its initiatives to Safe Behavior at Machines and • Activate a central Human and 11% men have seen their its own local environment, rather Van Buren for the Toys “R” Us salaries adjusted. Constellium has Contractor Management to Resource Information System than merely adopting a company- foundation and restored an ancient encourage the adoption of safety also partnered with other local (HRIS) wide approach. building at Valais (see ‘Restoring a behavior in the workplace companies to facilitate nursery hamlet, building a team’ opposite). Apprentices at camp in Valais access in case of emergencies Every site was involved in valuable In addition, many of our facilities related to employees’ children. community work during the year, regularly organize Open House Business and sustainability Business and sustainability 58 performance report 2014 performance report 2014 59
Making our operations more efficient Environment
Maintaining efficient operations is fundamental to strong Improving the energy We calculate our energy efficiency Materiality coverage efficiency of our operations by using an ‘energy consumption to produced ton’ ratio, which is then long-term performance. It saves costs, reduces our direct • Improve energy efficiency With its properties of lightness with modified by a product mix factor. of operations strength and infinite recyclability, This is because although more environmental impacts, and can even improve the speed aluminium has clear advantages in • Control and reduce our complex products deliver greater terms of energy efficiency. at which we get products to market. 2014 was another greenhouse gas emissions environmental benefits during Although the initial process use, they also require more energy strong year, particularly in the areas of resource and • Prevent pollution to manufacture aluminium is to manufacture. We introduced from operations necessarily energy intensive, Life Cycle Assessments (LCAs) energy efficiency. • Reduce waste from operations aluminium products such as cars specifically to ensure that the energy and airplanes enable greater energy efficiency benefits during usage are efficiency during usage, while taken into account when discussing Targets recycling requires only moderate the extra energy consumed energy consumption. during production (see ‘Life Cycle • 10% decrease in energy Assessment’ on page 45). consumption per processed We address the challenge of unit by 2015 (2010 baseline) energy efficiency by developing Our improved performance in 2014 and supporting improved recycling was driven by several factors, • All five major European (see ‘Recycling’ on pages 47–49), including enhanced metal recovery sites achieving ISO 50001 by increasing the performance of processes, which provide more certification by 2015 our products and by working on metal output for the same energy •75% total landfill reduction by the energy efficiency of our own input. In addition, we invested in 2020 (2010 baseline) operations, which in turn improves new and more efficient production the performance of end products tools as well as ancillary equipment Performance (see ‘Products’ on page 43). such as boilers and lighting. We also revitalized our energy network during • Improved energy consumption Improving efficiency by 10% 2014, to improve how we share best practice across Constellium. per processed unit by 10% Even though our energy consumption ahead of 2015 target date makes only a minor contribution ISO 50001 certification • A chieved ISO 50001 to the lifetime energy used by an certification at Decin. Neuf- aluminium product, we remain Our target is that all our major Brisach, Issoire and Valais committed to becoming more energy European sites will be certified under are all expected to follow suit efficient. Our target was to improve the ISO 50001 energy management during 2015 efficiency by 10% by 2015, from a scheme by the end of 2015. These 2010 baseline, and we are pleased sites account for over 60% of our • Re duced landfill waste in 2014 to report that we have achieved this energy consumption. by around 1,212 metric tons target in 2014. (mainly due to change in non- recurrent activities), but we 2010 2011 2012 2013 2014 still need to make significant 1.00 0.96 0.93 0.93 0.90 ISO 50001 improvements regarding our recurrent activities Certification achieved at Decin. Neuf-Brisach. Issoire and Valais are all expected to follow suit 10% during 2015 decrease in energy consumption per processed unit Business and sustainability Business and sustainability 60 performance report 2014 performance report 2014 61
Making our operations more efficient continued
Reducing greenhouse What does this mean for adverse impact on water quality. gas emissions (GHG) Constellium? Firstly, we are These require constant monitoring, continuing to work hard to cut and we have decontamination In common with all progressive GHGs through initiatives such as treatment underway. In addition, industrial companies, we are improvements on our production other risks relate to our use of committed to reducing our impact lines and by making sure we use chemical compounds, notably on the environment by cutting GHG as little material as possible. fuel, lubricants, raw materials for emissions wherever possible. Secondly – and this will ultimately coatings and surface treatment. However, this is a complex issue lead to a far greater understanding The potentially significant impacts for the aluminium industry. In order of aluminium’s role in GHG are pollution of soil, groundwater or to ensure understanding of the emissions – we are keen to report river courses. our performance under Scopes 1, true impact of our operations, We have rigorous internal directives 2 and 31, and are preparing to do we need to encourage a holistic in place regarding issues including so in the near future. Now favored view. Specifically, we wish to raise spill containment, underground tank by many regulators and proposed awareness of GHGs throughout storage and soil and groundwater to be used as the basis for new the entire life-cycle of aluminium monitoring. These cover all key legislation, reporting under Scope 3 products, not only during aspects of environmental protection, will provide a clearer picture of our manufacturing processes. and these are complemented by GHG emissions because it will take written guidelines. We have now We acknowledge that the into account factors other than our added new guidelines to the directive manufacturing processes that manufacturing processes, including Oxy-fuel combustion technology on emergency preparedness and Energy efficient LED lighting at the Ravenswood plant at the Neuf-Brisach plant create aluminium are indeed energy the life-cycle benefits of aluminium crisis management. These include intensive. LCA studies consistently and recycling. show that reducing GHG emissions improved emergency procedures, In fact the LEDs, which save energy In our 2012 sustainability report, over the full life-cycle depends on In 2014, our Scopes 1 and 2 particularly where the situation Taking a total and also improve safety and we highlighted a project where two factors: being able to deliver emissions increased by 1.6% demands external support. The new working conditions because of their we worked with our oxygen and high-performance products, which to 755kt CO2 eq., in line with our guidelines will be rolled out across all approach to energy added brightness, now account for gas supplier Linde to reduce require less material and reduce increased energy consumption. Constellium production sites in 2015. energy consumption during usage; The principal contribution to this efficiency 80% of Ravenswood’s lighting. energy consumption and CO2 Our EHS Managers meet and emissions. In 2014, we continued and further improving end-of-life increase is the increased production Ravenswood provides an instructive share best practice twice a year, that collaboration by fitting new recycling rates. of automotive parts in our Van Improving energy efficiency is one example of how a number of under the umbrella of the EHS oxy-fuel technology to one rotary Buren facility and the recycling of our key objectives, and during separate improvements combined For instance, although the network. An internal mandatory furnace at our Neuf-Brisach operation in Decin associated with 2014 we again launched, extended to have a major impact on total manufacture of aluminium parts for auditing program verifies that plant. Early results show energy our new furnace (see page 48). and rolled out a wide range of energy efficiency during 2014. cars initially produces relatively high we are following the directives consumption falling by 50% Although recycling helps reduce energy-saving initiatives. Together, the new motor drive levels of GHGs, the lighter weight of and implementing the correct and the melting rate increasing the overall GHG emissions (through and LED lighting have reduced these parts has a dramatic effect procedures at all times. In addition, For example, we optimized by 20%. This is part of a joint Scope 3), it comes at the cost of local electricity consumption by almost on the energy efficiency – and during 2014 we introduced an heating systems and boilers development agreement between higher emissions for Scopes 1 and 2. 20,000 MWh. At the same time, therefore the GHG emissions – of the external audit in one pilot site to at several sites, including the our companies which will see the we have increased production car during its lifetime. Furthermore, evaluate our performance, and we introduction of energy recovery remaining furnaces at Neuf-Brisach Preventing pollution on-site capacity at the site by optimizing aluminium can be infinitely recycled have decided to roll-out this audit in systems at Decin in the Czech converted by the end of 2016. metal composition and processing, through processes that require Pollution prevention is overseen by 2015 and forward, towards covering Republic and Burg in Germany, and and balancing the upstream and “ This project is very significant significantly less energy than the a dedicated organization supported all our sites. Each plant also carries installed a new pusher furnace at downstream heat treatments to for Linde in terms of our original manufacturing processes by commitment at all levels of out an annual drill to optimize the Neuf‑Brisach in France which has reduce natural gas consumption commitment to technological (see ‘Recycling’ on page 47). our workforce. performance of our people and led to around 7% improvement processes in the event of a pollution per ton by 4%. progress as a sustainable This means that when the car has Pollution is a material risk at all in energy consumption. or emergency incident and during solutions provider. We welcome reached the end of its useful life, the production sites. In two of our sites, the year we also implemented a In addition, we invested in new this joint development with aluminium can be transformed into there are significant risks being full-scale emergency response drill motor drives at our rolling mills at Constellium as it will advance new products extremely efficiently. posed by soil contaminated by Working together (see ‘Ensuring the right response’ on Issoire in France and Ravenswood the development of the oxy- chlorinated solvents during previous in the US. Ravenswood also page 62). Our strategy is not only to share fuel process, save energy and operations, which could have an achieved efficiencies through a new best practice and collaborate increase efficiency for fully 1. S cope 1 emissions are direct emissions LED lighting project, following on from owned or controlled sources. with colleagues but also with ramped-up plants.” from the success of similar projects Scope 2 emissions are indirect emissions our suppliers, building long‑term Thomas Niehoff from the generation of purchased energy. at Singen in Germany in 2012 and Head of Non-Ferrous and Mining at Linde relationships that deliver Scope 3 emissions are all indirect emissions Issoire in 2013. mutual benefits. (not included in scope 2) that occur in the value chain of the reporting company, including both upstream and downstream emissions. Business and sustainability Business and sustainability 62 performance report 2014 performance report 2014 63
Making our operations more efficient continued
had the effect of making our target Ensuring the The scenario at Neuf-Brisach was a It also endorsed the ability of more challenging. In order to rise to fire on a lacquering line, followed by the crisis management team to this challenge, we will engage with right response an explosion in a furnace that led to support their colleagues in the partners to deliver common solutions chemical leaks and major injuries. field, and to handle all aspects to waste recycling. We selected this scenario because of communication. Following the We work hard to minimize the it could lead to the greatest drill, we discussed the challenges likelihood of on-site pollution potential impact and required of such a large-scale incident with Looking ahead incidents, and as a responsible the intervention of a number of the external emergency rescue • F urther improve energy organization, have plans in place to specialist teams. We deployed the services and shared thoughts efficiency by rolling out protect employees, the community Emergency Response Plan, which on how our response could be new practices such as and the site in the event of an mobilized our teams on-site and improved. These included the need upgrading to oxy-fuel burner incident. There is no substitute guided how we worked with the to provide additional training to the rotary furnaces, at our for first-hand experience, which external rescue services, with all members of the crisis management Neuf‑Brisach plant is why in 2014 we carried out a actions managed from a dedicated team in order to give them a full-scale emergency response crisis management center. greater understanding of their Casthouse at the Issoire plant • R oll out ISO 50001 certification and crisis management drill at personal roles. to three major plants: Issoire, The drill highlighted the robustness our Neuf-Brisach plant in France. Neuf-Brisach and Valais This involved 50 of our people, of our plans and demonstrated We have not received a fine for by 75% by 2020, against a 2010 including our own on-site fire excellent cooperation between the environmental issues for a decade, baseline. This will require a reduction • D efine a new set of operational brigade, working alongside the internal and external teams. and this again applied in 2014. of around 8,000 metric tons per year. targets, notably in the area of external emergency and rescue Our risk prevention processes and energy efficiency and reducing To meet this ambitious target, services as well as local authorities. compliance with regulations are GHG emissions we are developing solutions to recognized by ISO 14001 certification, help us recycle waste that goes to • D eploy a new employee guide which states that sites must prevent landfill that is not currently widely for emergency situations based pollution. In addition, our sites have classified as recyclable. The solution on 2014 drills and learning to fulfill legal requirements, meet must be technically feasible and throughout the year the requirements of insurers or economically viable in order for it to insurance and follow our own internal • Integrate the Muscle Shoals be implemented. directives and guidelines. All our plants in Alabama. This will fully-owned industrial sites are now In 2014, a solution was found to involve preparing the plants to certified to ISO 14001. We also adopt recycle 300 tons of municipal meet ISO 14001 and OHSAS a systematic approach to identify waste which is produced annually 18001 certification, sharing best potential ongoing cases of non- at our Issoire plant in France but practice and ensuring the plants compliance, and this is additionally which was previously incinerated. meet Constellium policy reviewed by the Executive Committee We also conducted trials on recycling • E ndorse the future Aluminium of Constellium. Although we have filtration dust alongside salt slag Stewardship Initiative (ASI) the highest standards supported during the year, and continued our standard (see page 40 for by commitment at all levels of work towards reducing waste sent more information) our workforce, we will never to landfill. be complacent. • F urther engage in reducing the Although we aim to go beyond amount of waste sent to landfill, legislative requirements at all our despite challenging targets Reducing waste from our plants, the program to reduce waste is operations complicated by the different legislative Aluminium is a highly recyclable environments that govern our plants product. However, the manufacturing worldwide. A more rigorous regime in process produces waste products – Europe has led to the development such as salt slag, filtration dust and of more facilities for recycling, and sludge from wastewater treatment. therefore more opportunities for us to We aim to reduce these waste reduce waste sent to landfill. products wherever practicable. In the US, where there are fewer Crisis preparation emergency drill We have an ambitious target to cost-effective recycling solutions, Sorting of production waste at Above: Cast house at Issoire. one of our sites reduce the waste we send to landfill our acquisition of Wise Metals has Business and sustainability Business and sustainability 64 performance report 2014 performance report 2014 65
Doing business responsibly
We are committed to transparency and improving the Promoting and enforcing of the minerals used in our products Materiality coverage ethical business practices originated from conflict zones during the previous year. We also set up sustainability of our sector. Our approach is underpinned by • Promoting and enforcing ethical We view compliance as an a dedicated team to answer any business practices opportunity to add value and specific questions relating to our use the principles of fairness, responsibility and due-diligence mitigate risk. The way that our • Engaging suppliers in of minerals during production. employees conduct themselves is sustainability performance and is maintained through strong relationships that adhere key to managing this risk. This process will continue in the future, so that we are able to provide • Increasing economic Promoting and enforcing ethical to applicable regulations. We endorse the United Nations performance (see pages 2, answers to our stakeholders on an business practices through our ongoing basis. Global Compact (UNGC) principles and actively work towards 10 and 70) Code of Conduct helps us to embed appropriate behaviors across our Engaging suppliers in encouraging our suppliers to become fellow signatories. Targets business and our supply chain. sustainability performance • 100% of key suppliers joining Updating our Code of Conduct At Constellium, sustainability does the UNGC by 2015 We regularly review and update our not just mean ensuring that our own Code of Conduct which lays down social, environmental and ethical Performance strict guidelines on the behaviors standards are in place. It also means we expect from all our people, on all making sure our values are reflected • We provided 60 customers with sites (see page 77 for details on Code across the supply chain. information relating to the use of Conduct Training programs). of conflict minerals Our comprehensive and company- wide sustainable supply chain • 10 suppliers had their No conflict minerals policy outlines the behaviors sustainability performance With the launch of the Dodd-Frank we expect from our suppliers, assessed through a new Act in the US, it is now a legal including social and environmental pilot program requirement for manufacturing behaviors. In 2014, we assessed the sustainability performance of our • Around half of our key suppliers companies to provide information key metal and energy suppliers, as are signatories to UNGC by 2014 relating to where they source some specific raw materials. This call well as those suppliers identified as for increased transparency aims posing greater risk to our business, to control the use of minerals such primarily due to their location. as gold, tantalum, tin and tungsten We launched a pilot program with obtained from conflict zones – such 10 suppliers to identify the risks and as the eastern provinces of the opportunities of our engagement Democratic Republic of Congo and with them. We are currently neighboring countries. analyzing the results before deciding how to progress. In 2014, we were contacted by over 60 customers to provide information Aligned with the UNGC, our supply about the use of conflict minerals chain policy is a proven way of in the production process. In line encouraging meaningful dialog with with companies registered on the our stakeholders. It also supports New York Stock Exchange, we our target of ensuring that all key filed a disclosure document with suppliers adhere to UNGC principles the US Securities and Exchange by 2015. Unfortunately, despite Commission (SEC) in May 2014, engaging closely with our key suppliers which can be found on our website. to encourage them to become The results were based on an signatories, the process is taking investigation which involved tracing longer than expected, as it requires materials down the supply chain to companies to evaluate and sometimes the smelting phase of production. realign their strategy and compliance models. To date, nine of our 16 key By engaging with our suppliers, suppliers are signatories to UNGC. we were able to determine that none Business and sustainability Business and sustainability 66 performance report 2014 performance report 2014 67
Doing business responsibly continued Anti -corruption
As well as our supply chain policy, we our aluminium suppliers and to Our ability to be a safe and also have a dedicated Supplier Code encourage them to be compliant. responsible corporate citizen also of Conduct in place. The Code meets depends in part on the capability The essence of the ASI standard is all pillars of the UNGC principles and performance of those who that it enables transparency, not and we are currently in the process help us carry out our operations only regarding the sustainability of of ensuring that it is signed up to by (see ‘Strengthening stakeholder our suppliers, but also of the entire all our suppliers. The Supplier Code interaction’ on page 52 for value chain. Moreover, the Chain of Conduct applies to all suppliers, more information). of Custody will ensure that the subsidiaries, consultants, contractors metal we buy has been certified. and affiliates of Constellium. A copy This serves as an important step can be found on our website. Looking ahead towards fulfilling our commitment As an active member of the towards supplier sustainability. • Encourage our suppliers to Aluminium Stewardship Initiative We look forward to welcoming more sign up to the Aluminium (ASI), this standard is one of the focal members into this project and to all Stewardship Initiative (ASI) points of our dialog with the industry participants across the value chain • Roll out our company-wide and with our suppliers. We intend becoming ASI certified, which forms Supply Chain policy to comply with the standard, with an integral aspect of our approach our key target being to involve to our supply chain (see page 40 for information about our work with the ASI).
Team at Oddo Metals
Oddo has embedded a number of “ At Oddo, we have immediately Oddo Metals: sustainability principles in the way understood and given full support it works, including: to Constellium’s sustainable Paving the way supply chain strategy.” • adhering to the United Nations Global Compact (UNGC) Antoine Chacun Our long-term partnership with Managing Director, Oddo Metals supplier Oddo Metals went from principles; strength to strength in 2014. • b eing evaluated on sustainability “W e have been very pleased to have Oddo has made it a priority processes and practices by Oddo supporting us from the very to support our sustainability an external and independent beginning of our efforts towards agenda and has taken steps to assessment company; and align its practices with our policy. a more sustainable supply chain, By adhering to our standards, • establishing a Code of Conduct at and we look forward to all our the locations of its own suppliers. suppliers following suit.” Christian Keidel Group Director, Strategic Purchasing, Metal and Energy Procurement, Constellium
Using train to transport metal supply, be it metal slabs or used beverage cans, to be recycled Business and sustainability Business and sustainability 68 performance report 2014 performance report 2014 69
In this section: Managing sustainability Consolidated income statement 70 Consolidated statement of financial position 71 Consolidated statement of cash flows 72 Share information 73 Sustainability data 74 Memberships 77 GRI G4 disclosure index 78 Forward-looking statements 81
Above: (from left) Rovertos Gross, Béatrice Charon, Olivier Néel, Catherine Athènes, Laurent Musy, Didier Vasner, Frédéric Dunod
Our Sustainability Council was The key discussions and outcomes Carole Michalland formed in 2012, to provide a formal from the 2014 meetings included: Human Resource Consultant body to develop and implement our • 2014 results versus objectives of Guy-Michel Raynaud sustainability goals and practices. the roadmap; Director, Technology It includes representatives from every aspect of our business, • launch of specific actions: Didier Vasner because sustainability is a collective materiality assessment, LCAs of Group Environment Manager agenda. We believe it is important for key products; and each department to have a voice and “ Our council has moved from • definition of new objectives. be able to share its perspective. an informal group of engaged executives to an established The council defines and updates our Members committee of managers. sustainability policy and links it with Laurent Musy They represent all business units the overall Constellium corporate President, Aerospace and functions at high levels, and strategy. As part of this, council and Transportation beyond their genuine interest members discuss feedback and any Chairman, Sustainability Council in this subject, they bring the sustainability projects proposed right expertise and momentum by key stakeholders, including Catherine Athènes for Constellium to improve. customers, suppliers and NGOs. Sustainability Council Leader Areas for improvement include Director, Marketing, Packaging and The team is responsible for agreeing better representation of our US Automotive Rolled Products on key environmental and social activities and accelerating our objectives, targets and indicators, Olivier Néel sustainability projects.” and tracking our performance Sustainability Manager Béatrice Charon against them. In addition, the Vice President, Business Planning council’s role is to ensure accurate Laura Berneri disclosure of sustainability data, Director, External Communications together with alignment to Global Volker Brockhagen “ I joined the Council recently Reporting Initiative (GRI), Carbon Director, Group EHS (Environment, representing the ‘Automotive Disclosure Project (CDP) and United Health and Safety) Structures and Industry’ Nations Global Compact (UNGC) business unit and I truly amongst others (see ‘Memberships’ Béatrice Charon Vice President, Business Planning appreciate the work that is being on page 77). done and the commitment of The Sustainability Council meets Frédéric Dunod participants. As a newcomer to on a regular basis four times a Director, External Reporting Constellium, it is also interesting year. One of these events is a Sophia Elasri to gain a global view of the special meeting with the Executive Manager, Strategic Purchasing company through its approach Committee of Constellium where Energy Procurement to sustainability.” Performance members recap actions and decide Rovertos Gross the key priorities for the years ahead. Rovertos Gross Director, Strategy, Automotive Structures Director, Strategy, Automotive and Industry Structures and Industry in detail Business and sustainability Business and sustainability 70 performance report 2014 performance report 2014 71
Consolidated income statement Consolidated statement of financial position
Year ended Year ended Year ended At December 31, At December 31, (in millions of Euros) December 31, 2014 December 31, 2013 December 31, 2012 (in millions of Euros) 2014 2013 Revenues 3,666 3,495 3,610 Assets Cost of sales (3,183) (3,024) (3,136) Non-current assets Gross profit 483 471 474 Intangible assets (including goodwill) 28 21 Selling and administrative expenses (200) (210) (212) Property, plant and equipment 632 408 Research and development expenses (38) (36) (36) Investments in joint-ventures 21 1 Restructuring costs (12) (8) (25) Deferred income tax assets 190 177 Other (losses)/gains – net (83) (8) 62 Trade receivables and other 48 60 Income from operations 150 209 263 Other financial assets 33 7 Other expenses – (27) (3) 952 674 Finance income 30 17 4 Current assets Finance costs (88) (67) (64) Inventories 432 328 Finance costs – net (58) (50) (60) Trade receivables and other 568 483 Share of (loss)/profit of joint-ventures (1) 3 (5) Other financial assets 57 25 Income before income tax 91 135 195 Cash and cash equivalents 989 233 Income tax expense (37) (39) (46) 2,046 1,069 Net income from continuing operations 54 96 149 Assets classified as held for sale 14 21 Discontinued operations Total assets 3,012 1,764 Net income/(loss) from discontinued operations – 4 (8) Net income for the period 54 100 141 Equity Net income attributable to: Share capital 2 2 Owners of the Company 51 98 139 Share premium 162 162 Non-controlling interests 3 2 2 Retained deficit and other reserves (207) (132) Net income 54 100 141 Equity attributable to owners of the Company (43) 32 Non-controlling interests 6 4 (37) 36 Liabilities Non-current liabilities Borrowings 1,205 326 Trade payables and other 31 35 Deferred income tax liabilities – 1 Pension and other post-employment benefit obligations 654 507 Other financial liabilities 40 36 Provisions 61 65 1,991 970 Current liabilities Borrowings 47 22 Trade payables and other 872 646 Income taxes payable 11 19 Other financial liabilities 71 24 Provisions 49 38 1,050 749 Liabilities classified as held for sale 8 9 Total liabilities 3,049 1,728 Total equity and liabilities 3,012 1,764 Business and sustainability Business and sustainability 72 performance report 2014 performance report 2014 73
Consolidated statement of cash flows Share information
Year ended Year ended Year ended Share price evolution In US$ (from May 16, 2014) (in millions of Euros) December 31, 2014 December 31, 2013 December 31, 2012 Cash flows from/(used in) operating activities 35 Net income from continuing operations 54 96 149 Adjustments 241 133 81 30 Changes in working capital: 25 Inventories (95) 41 35 Trade receivables (48) 9 26 20 Margin calls 11 4 7 Trade payables 170 (1) 20 15 Other working capital (33) (9) 27 Changes in other operating assets and liabilities: 10 Provisions (12) (17) (31) Income tax paid (27) (29) (28) Pension liabilities and other post-employment benefit obligations (49) (43) (40)
Net cash flows from operating activities 212 184 246 05-16-2014 06-16-2014 07-16-2014 08-13-2014 09-16-2014 10-14-2014 11-14-2014 12-16-2014 01-16-2015 02-13-2015 03-16-2015 04-16-2015 05-14-2015 Cash flows (used in)/from investing activities Purchases of property, plant and equipment (199) (144) (126) Proceeds from disposals, including joint-venture (2) 7 – Investment in joint-venture (19) – – Proceeds from finance lease 6 6 8 Shareholding structure (as of December 31, 2014) Other investing activities (2) (1) (13) Average number of daily shares traded: 2.65% Net cash flows used in investing activities (216) (132) (131) 12.23% So far the average number of shares Cash flows from/(used in) financing activities Public shareholders Net proceeds received from issuance of share – 162 – traded for Constellium since May 30, Bpifrance Interim dividend paid – (147) – 2014 is Withholding tax reimbursed/(paid) 20 (20) – Management Distribution of share premium to owners of the Company – (103) – Interest paid (39) (36) (28) Net cash flows used in factoring – – (49) Proceeds received from Term Loan and Senior Notes 1,153 351 154 Repayment of Term Loan (331) (156) (148) 85.12% 884,472 Proceeds of other loans 13 2 6 Payment of deferred financing costs (27) (8) (14) Transactions with non-controlling interests (2) (2) – Other financing activities (34) – (7) shares Net cash flows from/(used in) financing activities 753 43 (86) Net increase in cash and cash equivalents 749 95 29 Cash and cash equivalents – beginning of period 236 142 113 Effect of exchange rate changes on cash and cash equivalents 6 (1) – Cash and cash equivalents – end of period 991 236 142 Less: Cash and cash equivalents classified as held for sale (2) (3) – Cash and cash equivalents as reported in the Statement of Financial Position 989 233 142 Business and sustainability Business and sustainability 74 performance report 2014 performance report 2014 75
Sustainability data
GRI G4–10: Total workforce
In this section (pages 74-77), we provide our Throughout this section, the following symbols included in Temporary (agency, performance across the four pillars of Constellium’s some charts help the reader identify our progress on those Inactive Inactive excluding sustainability strategy: Products, People, Operations Key Performance Indicators where we disclose data. Apprentice restructuring without pay Permanent Fixed-term contractors) and Responsible Business. All Constellium Number of employees Male 260 7 40 – – – per specific employment type Female 57 6 21 – – – Key Performance Indicators: Products People Operations Responsible business Number of employees Male – – – 7,671 499 601 per employment contract Female – – – 872 106 Number of employees working Full-time 296 8 47 8,227 594 363 full/part time Part-time 21 5 14 316 11 238 Products People Total full-time employees (permanent and fixed-term) 9,148 Total workforce 10,140 Europe Beverage can recycling rate* Recordable case rate* Number of employees Male 260 7 20 – – – per specific employment type Female 57 6 19 – – – 13.25 80 14 Number of employees Male – – – 6,514 201 601 75% target for 2015 per employment contract Female – – – 749 40 70 69.5% 12 10.85 66.7% Number of employees working Full-time 296 8 25 6,947 237 363 60 63.1% full/part time Part-time 21 5 14 316 4 238 58% 10 8.65 Total workforce 8,474 50 7.25 48% 8 Asia 43% 46% 40 Number of employees Male – – – – – – 6 5.15 per specific employment type Female – – – – – – 30 3.85 3.55 3.2 2.8 Number of employees Male – – – 7 257 4 2.65 2.71 – 20 per employment contract Female – – – 7 45 10 2 Number of employees working Full-time – – – 14 302 – full/part time Part-time – – – – – – 0 2000 2002 2004 2006 2008 2010 2012 0 04 05 06 07 08 09 10 11 12 13 14 Total workforce 316 *This is the most recent data. Figures for this data-point consume long processing *Recordable case rate is a ratio that measures the number of fatalities, serious North America time and 2012 data was made available only in 2015. Since 2000, the beverage can injuries, lost time injuries, restricted work injuries or medical treatments per one recycling rate has seen tremendous improvement from 43% (in 2000) to 69.5% million hours worked. Number of employees Male – – 20 – – – (in 2012). per specific employment type Female – – 2 – – – Number of employees Male – – – 1,150 41 – per employment contract Female – – – 116 21 Number of employees working Full-time – – 22 1,266 55 – full/part time Part-time – – – – 7 – Total workforce 1,350 Sales from innovative products Number of serious injuries including fatalities GRI G4–LA1: Employee turnover 14 13% 8 Apprentices and fixed-term employees have not been included, for accuracy in turnover rate calculation 12 7 7 7 Between 26 Between 46 9.3% 10 6 6 Under 26 and 45 and 55 Above 56 Total 5 Europe 8 Number of new employees hired in 2014 Male 83 184 67 5 339 4 6 4.5% Female 8 52 8 3 71 3 3 Number of employees who left the Company in 2014 Male 29 92 30 108 259 4 Female – 32 7 15 54 2 Number of employees on December 31, 2014 Male 211 2,917 2,313 944 6,385 2 Female 23 406 226 101 756 0 2012 2013 2014 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Turnover rate Male 14% 3% 1% 11% 4% Female – 8% 3% 15% 7% North America Number of new employees hired in 2014 Male 35 146 38 19 238 Female 5 24 9 5 43 Number of employees who left the Company in 2014 Male 4 21 19 26 70 Female 1 10 5 3 19 Number of employees on December 31, 2014 Male 31 439 407 209 1,086 Female 2 41 25 15 83 Turnover rate Male 13% 5% 5% 12% 6% Female 50% 24% 20% 20% 23% Asia Number of new employees hired in 2014 Male – 2 – – 2 Female – 5 – – 5 Number of employees who left the Company in 2014 Male – 1 – – 1 Female – 1 1 – 2 Number of employees on December 31, 2014 Male – 11 2 – 13 Female 1 11 2 – 14 Turnover rate Male – 9% – – 8% Female – 9% 50% – 14% Business and sustainability Business and sustainability 76 performance report 2014 performance report 2014 77
Sustainability data continued
Operations Responsible business
Greenhouse gas emissions In kt CO2 eq Indirect energy consumption* (in TJ) Code of Conduct Training Source 2010 2011 2012 2013 2014 1,118 1,116 500 446 446 Electricity 3,982 4,111 4,071 4,089 4,007 974 450 416 403 414 935 400 Direct energy consumption* (in TJ) 350 307 Energy sources 2010 2011 2012 2013 2014 283 287 297 300 278 Anthracite 459 395 439 519 492 250 Liquefied 10 10 10 11 13 200 Petroleum Gas 150 Natural Gas 6,570 6,463 6,618 7,254 7,295 100 Diesel 115 112 109 114 113 50 96% 99.82% Heavy fuel 188 190 168 187 182 achieved achieved 0 2010 2011 2012 2013 2014 2013 2014 Total 7,342 7,170 7,344 8,085 8,095 Scope 1 Scope 2 Number of people targeted Number of people achieved Total energy consumption (in TJ) In TJ/year 10,890 10,810 10.936 11,677 11,815 *This includes, in some cases, our own energy generation.
Water consumption In 106 m3 Air emissions In metric tons 30 550 Memberships 500 25 450 Participates in 400 20 projects and 350 Memberships and associations Has positions in governance committees 300 15 Aluminum Association (AA) Member Yes 250 Aluminium Stewardship Initiative (ASI) Member and part of Standard Setting Group Yes 200 10 150 ARPAL, Spain Member No 5 100 Association Française de l’Aluminium (AFA) President, Béatrice Charon Yes 50 Carbon Disclosure Project (CDP) No No 0 2010 2011 2012 2013 2014 0 2010 2011 2012 2013 2014 Cercle de l’Industrie Member No Total water Ground water Surface water Water from public net NOX Particulate materials SO2 VOC Emballages et Bouchages Métalliques (SNFBM) Member No European Aluminium Foil Association (EAFA) Member Yes European Aluminium (EA) Chairman, Pierre Vareille Yes France Aluminium Recyclage (FAR) Chairman, Laurent Musy Yes Production waste and handling In metric tons Gesamtverband der Aluminium Industrie (GDA) Member of Board, Laurent Musy Yes Groupement des Industries Françaises Aéronautiques et Spatiales (GIFAS) Member No 120,000 Global Reporting Initiative (GRI) No No 100,000 International Aluminium Institute (IAI) Member Yes 80,000 La Boîte Boisson (BCME) Member Yes Swiss Aluminium Association (alu.ch) Member No 60,000 Syndicat National des Fabricants de Boîtes, emballages et bouchages Member Yes 40,000 Métalliques (SNFBM) United Nations Global Compact (UNGC) No No 20,000 8,224 8,840 9,683 10,840 9,628 Wirtschafts Vereinigung Metalle (WVM) Member of Board, Laurent Musy Yes
0 2010 2011 2012 2013 2014 Total Recycling Incineration Landfill
Key Performance Indicators: Products People Operations Responsible business Business and sustainability Business and sustainability 78 performance report 2014 performance report 2014 79
GRI G4 disclosure index We have achieved full disclosure against the general standard disclosures and specific standard disclosures listed below, and reported against the mining and mineral sector guidelines (which are marked with a *).
GENERAL STANDARD DISCLOSURES SPECIFIC STANDARD DISCLOSURES DMA and Indicators Cross reference/Additional information Page CATEGORY: ECONOMIC STRATEGY AND ANALYSIS DMA and Indicators Cross reference/Additional information Page G4-1 Statement from the most senior decision-maker Chief Executive Officer insights 10–11 INCREASE ECONOMIC PERFORMANCE of the organization MATERIAL ASPECT: ECONOMIC PERFORMANCE ORGANIZATIONAL PROFILE G4-DMA Generic Disclosures on Management Approach Our strategy 12–14 G4-3 Name of the organization Constellium G4-EC1 Direct economic value generated and distributed Performance in detail 70–73 G4-4 Primary brands, products, and/or services Business operational performance 18–23 G4-EC2 Financial implications, risks and opportunities for Due to the uncertainty of the effects of climate change it is difficult to quantify its impact. Possible scenarios that ® ® ® ® ® ® Our main brands are: AIRWARE , SEALIUM , ALUMOLD , Surfalex , Formalex , Strongalex , the organization’s activities due to climate change could create financial risks for our business include availability of water, additional regulation to mitigate climate ® ® ® ® ® ® ® Ultralex , Skybright , Inoxal , Solar Surface , LONGLINEFINISH , BUTLERFINISH , STAYBRIGHT , change, serious weather events causing damage to operations and supply chain, and climate warming/cooling TM TM KEIKOR and GRIPSTER trends in different regions positively or negatively affecting the sales of finished products in particular beverage G4-5 Location of the organization’s headquarters Amsterdam (Netherlands) Back Cover cans. As a participant since 2013 in the EU ETS (European Union Emission Trading Scheme), changes to this system and a higher price of carbon could have an impact. G4-6 Countries where the organization operates Company organization 9 There are, however, opportunities from climate change and associated legislative changes. New technology and G4-7 Nature of ownership and legal form Constellium is a public company that aims to operate with the highest ethical standards and best products which are lightweight and recyclable and are being used to lower fuel emissions in vehicles present an practices, to answer to our shareholders and other stakeholders, and operates under a worldwide opportunity for aluminium, including, increased sales and opening of new markets as well as increasing aluminium Code of Conduct. We are listed on NYSE and on Euronext under the ticker symbol “CSTM.” share in existing markets, promotion of aluminium for new markets, providing innovative solution for customer Shareholders as of December 31, 2014 – public shareholders 85.12%, Bpifrance 12.23%, and needs, R&D investment, and expansion of manufacturing facilities. Opportunities from the EU ETS include being management 2.65% able to trade excess emissions certificates, which would provide an additional income, and no costs except those to reduce emissions to the required level to have excess certificates. G4-8 Markets served Company organization 9 CATEGORY: ENVIRONMENTAL G4-9 Scale of the reporting organization Performance in detail 70-77 INCREASE RECYCLING ACTIVITIES G4-10 Workforce characteristic Performance in detail 75 MATERIAL ASPECT: MATERIALS* G4-11 Employees covered by collective bargaining Approximately 80% of our total headcount are represented by unions or equivalent bodies or are agreements covered by collective bargaining or similar agreements that are subject to periodic renegotiation. G4-DMA Generic Disclosures on Management Approach Recycling 47–49 The vast majority of employees based in Europe and approximately 53% of U.S. employees are G4-EN2 Percentage of materials used that are recycled Recycling 47 covered by collective bargaining agreements. input materials G4-12 Organization’s supply chain Value we create 5 IMPROVE ENERGY EFFICIENCY OF OPERATIONS G4-13 Changes in organization’s size, structure, ownership Acquisition of Wise Metals in the US closing on January 5, 2015, disposal of Sabart facility MATERIAL ASPECT: ENERGY or its supply chain in France, creation of the joint-venture with UACJ in Bowling Green, Kentucky, and closure of Kunshan facility in China G4-DMA Generic Disclosures on Management Approach Improving the energy efficiency of our operations 59, 60 G4-14 Precautionary approach Our strategy 12–14 G4-EN3 Energy consumption within the organization Performance in detail 76 Governance 28–29 G4-EN4 Energy consumption outside of the organization Performance in detail 76 G4-15 Externally developed charters, principles or initiatives Memberships 77 G4-EN5 Energy intensity Improving the energy efficiency of our operations 59 to which the organization subscribes At Constellium, ‘energy efficiency’ is the way we define ‘energy intensity’. G4-16 Membership of associations or organizations Memberships 77 G4-EN6 Reduction of energy consumption Improving the energy efficiency of our operations 59, 60 Stakeholder perspectives 39-41 G4-EN7 Reductions in energy requirements of products Developing products with environmental benefits 45, 46 IDENTIFIED MATERIAL ASPECTS AND BOUNDARIES and services G4-17 Entities included in the organization reports Our materiality assessment 38 REDUCE GREENHOUSE GAS (GHG) EMISSIONS G4-18 Reporting principles for defining report content About the report IFC MATERIAL ASPECT: EMISSIONS G4-19 Process for defining content and aspect boundaries Our materiality assessment 37 G4-DMA Generic Disclosures on Management Approach Reducing greenhouse gas emissions 61 G4-20 Material aspects within the organization Our materiality assessment 38 G4-EN15 Direct GHG emissions (Scope 1) Performance in detail 76 G4-21 Material aspects outside the organization Our materiality assessment 38 G4-EN16 Energy indirect GHG emissions (Scope 2) Performance in detail 76 G4-22 Restatements of information provided in earlier reports None G4-EN19 Reduction of GHG emissions Reducing greenhouse gas emissions 61 G4-23 Significant changes from previous reporting periods About the report IFC G4-EN20 Emissions of ozone-depleting substances (ODS) None recorded in the reporting year in scope and aspect boundaries G4-EN21 NOX, SO2, and other significant air emissions Performance in detail 76 STAKEHOLDER ENGAGEMENT REDUCE WASTE FROM OPERATIONS G4-24 Stakeholder groups engaged by the organization Engaging with stakeholders 30 PREVENT POLLUTION FROM OPERATIONS Stakeholder perspectives 39–41 MATERIAL ASPECT: EFFLUENTS AND WASTE G4-25 Identification and selection of stakeholders to engage Our materiality assessment 36 G4-DMA* Generic Disclosures on Management Approach Reducing waste from our operations 63 G4-26 Organization’s approach to stakeholder engagement Engaging with stakeholders 30 Preventing pollution on-site 61 G4-27 Key topics collected through stakeholder engagement Our materiality assessment 37 G4-EN22 Water discharge Performance in detail 76 REPORT PROFILE G4-EN23 Waste disposal Performance in detail 76 G4-28 Reporting period About the report IFC G4-EN24 Significant spills No major spills recorded in the reporting year G4-29 Date of the last report Issued in 2014 (Available on the sustainability page at www.constellium.com ) DEVELOP PRODUCTS WITH ENVIRONMENTAL BENEFITS G4-30 Reporting cycle About the report IFC MATERIAL ASPECT: PRODUCTS AND SERVICES G4-31 Contact point for questions regarding the report About the report IFC G4-DMA Generic Disclosures on Management Approach Developing products with environmental benefits 45 G4-32 GRI Content Index GRI G4 disclosure index 78–80 G4-EN27 Mitigation of environmental impacts of products Life Cycle Assessment (LCA) 45, 46 G4-33 External assurance About the report IFC and services GOVERNANCE G4-34 Governance structure Governance 28–29 ETHICS AND INTEGRITY G4-56 Organization’s values, principles, standards and Governance 28–29 norms of behavior Promoting and enforcing ethical business practices 64–67
IFC stands for inside front cover Business and sustainability BusinessBusiness and sustainability and sustainability 80 performance report 2014 performanceperformance report report 2014 2014 81 81
GRI G4 disclosure index continued Forward-looking statements
SPECIFIC STANDARD DISCLOSURES This report contains statements that relate to future events These risks and uncertainties include, but are not limited CATEGORY: ENVIRONMENTAL CONTINUED and expectations and as such constitute forward-looking to, those set forth under the heading ‘Risk Factors’ in our DMA and Indicators Cross reference/Additional information Page statements within the meaning of the Private Securities Annual Report on Form 20-F, and described from time to DEVELOP PRODUCTS WITH ENVIRONMENTAL BENEFITS CONTINUED Litigation Reform Act of 1995. time in subsequent reports, filed with the US Securities and MATERIAL ASPECT: COMPLIANCE Exchange Commission. G4-DMA Generic Disclosures on Management Approach Promoting and enforcing ethical business practices 65-67 Forward-looking statements include those statements G4-EN29 Monetary value of significant fines and total number None recorded in the reporting year containing such words as ‘expects’, ‘intends’, ‘plans’, Constellium disclaims any obligation to update publicly any of non-monetary sanctions for non-compliance with environmental laws and regulations ‘scheduled’, ‘should’, ‘could’, ‘will’, or other words of forward-looking statements, whether in response to new ENGAGE SUPPLIERS IN SUSTAINABILITY PERFORMANCE similar meaning. All statements that reflect Constellium’s information, future events or otherwise, except as required MATERIAL ASPECT: SUPPLIER SUSTAINABILITY expectations, assumptions or projections about the by applicable law. G4-DMA Generic Disclosures on Management Approach Engaging suppliers in sustainability performance 65–67 future other than statements of historical fact are G4-EN32 Suppliers screened using environmental criteria No quantitative data available currently forward‑looking statements. Engaging suppliers in sustainability performance 65–67 CATEGORY: SOCIAL The forward-looking statements contained in this report SUB-CATEGORY: LABOR PRACTICES AND DECENT WORK are subject to a number of known and unknown risks, IMPROVE EMPLOYEE SATISFACTION uncertainties and other factors and are not guarantees MATERIAL ASPECT: EMPLOYMENT of future performance. G4-DMA* Generic Disclosures on Management Approach Improving employee satisfaction 53, 54 G4-LA1 Number and rates of new employee hires and Performance in detail 75 employee turnover G4-LA2 Benefits provided to full-time employees that are Part-time workers have pro-rata benefits of full-time employees; temporary workers are not not provided to temporary or part-time employees eligible for the same benefits. Some select benefits related to health insurance are granted depending on seniority. MATERIAL ASPECT: LABOR/MANAGEMENT RELATIONS G4-DMA Generic Disclosures on Management Approach Strengthening stakeholder interaction 52, 53 G4-LA4 Minimum notice periods regarding The minimum notice period changes depending on the country of operation operational changes and is based on local regulations. We follow the rules of the country in question. G4-MM4* Number of strikes and lock-outs exceeding one None recorded in the reporting year week’s duration ENSURE SAFETY AT WORK REDUCE PSYCHO-SOCIAL RISKS REDUCE USE OF HARMFUL SUBSTANCES MATERIAL ASPECT: SAFETY G4-DMA Generic Disclosures on Management Approach Ensuring safety at work 51, 52 G4-LA5 Workforce represented in health and safety committees 100% of our sites have workforce representation in health and safety committees. This report was released in June 2015 G4-LA6* Injuries, occupational diseases, lost days, absenteeism Performance in detail 74 Coordination: Print: and total number of work-related fatalities Corporate Communications Printed by Park Communications on G4-LA8 Health and safety topics covered in formal agreements Promoting health and reducing stress 54, 55 Department and Sustainability FSC® certified paper. with trade unions Health and safety topics are covered not only in agreements with trade unions but also in our Council. procedures and directives. Psychological risks prevention was specially covered in 2014. Park is an EMAS certified DEVELOP TRAINING AND EMPOWERMENT Design and production: company and its Environmental MATERIAL ASPECT: TRAINING AND EDUCATION Radley Yeldar | www.ry.com Management System is certified to G4-DMA Generic Disclosures on Management Approach Training and empowerment 55, 56 ISO 14001. Photography credits: G4-L A11 Employees receiving regular performance and career Training and empowerment 55 Aerial Innovations 100% of the inks used are vegetable development reviews 100% of professional grade employees receive annual performance and career development Airbus oil based, 95% of press chemicals through the IPCM (Individual Performance and Career Management). This has been extended to some supervisory levels in France. All other employees receive an annual performance review but G. Brooks are recycled for further use and this is done on a site-by-site basis and tracked centrally for all managers C. Butcovich on average 99% of any waste F. Debatty associated with this production will SUB-CATEGORY: HUMAN RIGHTS A.Doyen be recycled. PROMOTE AND ENFORCE ETHICAL BUSINESS PRACTICES M. Ellis MATERIAL ASPECT: NON-DISCRIMINATION European Aluminium Association This document is printed on Cocoon G4-DMA Generic Disclosures on Management Approach Promoting and enforcing ethical business practices 65 European Business Awards Silk 100; process chlorine free (PCF) paper containing 100% recycled G4-HR3 Incidents of discrimination and corrective actions taken None recorded in the reporting year J. Goldstein fibre approved by the FSC®. MATERIAL ASPECT: FREEDOM OF ASSOCIATION AND COLLECTIVE BARGAINING Heil Trailer International Istock G4-DMA Generic Disclosures on Management Approach Promoting and enforcing ethical business practices 65 M. Lieske G4-HR4 Risks to the right to exercise freedom of association None identified V. Martin and collective bargaining Master Image Programmes SUB-CATEGORY: PRODUCT RESPONSIBILITY D. Mortemore INNOVATION Thinkstock G4-DMA Generic Disclosures on Management Approach Innovation 44, 45 G. Uféras C. Williams CUSTOMER SATISFACTION G4-DMA Generic Disclosures on Management Approach Customer satisfaction 43