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RESPONSIBLE COPPER

TRADE OFF?

Transparency Water footprint Carbon Productive Productive footprint Development Development Gender parity

Ethics Inclusion Respect for Human Rights

THE COPPER VALUE CHAIN

MARKET TRENDS ARE REFLECTED ACROSS THE VALUE CHAIN

MARKET´S NEW STRUCTURE DEMANDS

SOCIAL ENVIRONMENTAL ECONOMICS

Suppliers Divisions Manufacturers Final goods and Final consumer services producers

Through their purchase decision, consumers push back the value chain, which is why suppliers are required to offer more CODELCO´S COMERCIAL NEED sustainable raw materials.

COPPER MARKET TRENDS

The main productive sectors that consume copper And our customers demand us… have certification plans and systems that contain sustainability indicators. Audit Requirements

Electricity y electronics (8.900 kt/año) HSEC Environmental report & Eco -labelling Labour conditions Made in China 2025 Declaration of Construction (7.000 kt/año) Human Rights Made in China 2025 Leed Certification Anti-bribery Codes Transparency Codes

General Products (2.250 kt/año) Legal Compliance Eco-labelling Responsible Production

Environmental certifications Transportation (2.620 kt/año) Electromobility vs. Fossil Fuels ... End of life Directive (ELD)

Source: Own elaboration, International Copper Association and WoodMackezie. www.codelco.com Copyrights © 2016 Codelco Chile. Todos los Derechos Reservados. | Copyrights © 2016 by Codelco Chile. All Rights Reserved. 4

INDUSTRY´S RESPONSE TO NEW MARKET CONDITIONS

BHP will reduce fresh water Anglo American will cut Companies manufacture “Cobre Verde” must be the consumption by 100% in Chile Greenhouse Emissions (GHG) products aligned with new future of mining in Chile by 2030 30% by 2030 trends

The generation of sustainable products By 2030, BHP contemplates the Main users of aluminum are driving must be accompanied by a clean integrated management of water Anglo American is pursuing community the demand for a cleaner and greener production in the mining processes resources in all its operations, and development, reducing its impact on metal. Rio Tinto certified its product (Oscar Landerretche, CESCO Shanghai eliminating the consumption of fresh environment and improving "RenewAL", within the Aluminium 2017 and CESCO Santiago 2018). water in its operations in Chile transparency within the mining Sustainable Initiative (ASI) (Malchuk, CESCO 2018). industry.

CODELCO´S RESPONSE TO NEW MARKET CONDITIONS

The Sustainability Master Plan launched in 2016

Strategic Innovation Occupational health and safety Goal 2020: 5% traceable production Goal 2020: zero fatal accidents Goal 2030: To be in the 1st quartile of the Goal 2030: Frequency rate < 0,5 most environmentally friendly cathodes

Environment Goal 2020: reduce by 10% fresh water consumption per treated ton People Goal 2030: Goal 2020: 20% of women in top SUSTAINABILITY -Capture 99% of SO2 and As emissions management positions -Reduce by 40% fresh water consumption per treated Goal 2030: 30% of women in decision-making ton position -Reduce GHG at least 30% by redistributing Codelco´s energy matrix and implementing more energy- efficient technologies

Business and Corporate Governance Communities and territory Goal 2020: Goal 2020: zero incidents -To be positioned in the second quartile of cost consistently Goal 2030: To be perceived as close, transparent -Corporate Governance aligned with OCDE Guidelines and an active member of the community Goal 2030: -have a diversified business plan and global reach

CODELCO´S DISTINCTIVE SEAL

The Responsible Copper Initiative, within Codelco, put emphasis on a number of strategic dimensions included in the Sustainability Master Plan in order to develop a distinctive seal in the industry.

Topics Occupational Health Environment Community and Business and People Strategic Innovation and Safety Territory Corporate Governance Dimensions People´s safety and Community relations Financing Development Structure and culture of processes Emissions / Air quality and indigenous peoples organization and people innovation

Occupational health Develop community and Water resources territory Corporate governance Diversity and inclusion Technological breaks industrial liquid Construction of Labor Relations Divisional projects residuals bussiness plan

Operational, financial Traceability Closure plan and productivity Management culture

Mining waste Ethics, lobby, conflict of interest and transparency

Energy efficiency

Territory, soil and landscape

Biodiversity

Responsible Copper Initiative

CODELCO´S RESPONSIBLE COPPER

Emissions footprint Water footprint Seeks to articulate the 8 Carbon footprint copper value chain to DIMENSIONS Respect for Human Rights respond effectively to the Health and occupational safety requirements of the market Impact on communities and territories and society, through a Transparency, ethics and compliance system of traceability in all Inclusion and gender parity its stages and thus achieve sustainable and responsible practices. 3 Partnerships (to date)

CODELCO´S RESPONSIBLE COPPER

Key Sustainable Indicators Preliminary Definition Dimension Current Standard or Standard/Initiative Key Sustainable Indicators Initiative? Health and Occupational Safety YES GRI, ASI, RJC, IRMA, ICMM • Frequency Rate (FR) • Training and information on • Accident rate occupational health • FR reduction target • Emergency procedures • Evaluation Impacts on health Community and Territory YES GRI, ASI, RJC, IRMA • Number of significant events on • Periodic reports on impacts and the environment mitigations • Reduction of significant events • Deposit closure plan target • Impact evaluation • Reconciliation plans Transparency, Ethics and Compliance YES GRI, ASI, RJC, IRMA, ICMM, OCDE • Disclosure of environmental • Sustainability report judgments • Compliance system • Code of ethics Inclusion and Gender Parity YES GRI, RJC • Female participation • Non-discrimination code • Indigenous participation Respecto for Human Rights YES GRI, ASI, RJC, IRMA • Signature of voluntary principles of • License to operate of indigenous security and human rights groups • Freedom of unionization and • Participation of all stakeholders collective bargaining • Prevention and risk mitigation

Water Footprint YES ASI, IRMA • fresh water use rate • Recirculation rate • Fresh water reduction plans • Reports and monitoring Carbon Footprint YES ASI, RS • GHG total emissions • GHG reduction target Emissions Footprint YES GRI, RJC • SO2 and As emissions • Energy consumption • Potential of acidification • Renewal sources • Hazardous substances control • Energy efficiency goals www.codelco.com Copyrights © 2016 Codelco Chile. Todos los Derechos Reservados. | Copyrights © 2016 by Codelco Chile. All Rights Reserved. 9

RESPONSIBLE COPPER INITIATIVE (RCI)

For the final product to be indeed sustainable, recognized, valued and PREFERRED, an integration of the value chain is required.

RCI Multi-stakeholder Partners and Collaborators

Industry Validation

CODELCO is a relevant actor to articulate the entire chain.