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Honda // Sustainability Report // 2017

SUSTAINABILITY REPORT 2017

Honda South America 2 3

Honda // Sustainability Report // 2017 Honda // Sustainability Report // 2017

05 1 Message from the Administration

09 About the Report 10 2 Materiality Matrix

13 About Honda 15 Strategy and goals 16 Business context 22 Vision 2030 – Honda South America 23 3 Honda Sustainability Pillars 25 Product 25 Innovation 28 Product safety 28 Respect for and commitment to customers 31 Fuel e€iciency and reduction of emissions 33 Customer satisfaction contents 4 35 5 Supply Chain 39 Corporate Governance 40 Governance assessment systems used by Honda 40 Corruption and fraud prevention 40 Unfair competitive practices 41 Respect for national legislation and international standards 41 6 Ethics Channel and Committee 43 7 Impact on Society 49 8 Labor Practices 53 9 Occupational Health and Safety 57 Environmental Performance 57 Climate strategy 59 Ecoe€iciency 60 Waste management and recycling 61 Rational use of water 62 10 Preserving biodiversity 63 11 GRI Content Index 76 12 Credits and Corporate Information 5

Honda // Sustainability Report // 2017

Message from the administration 01 G4-1, G4-2, G4-4, G4-8 Issao Mizoguchi President of Honda South America

On March 31, 2017, we reached the launches: the tenth generation of the countries where we operate are end of another fiscal year (93 ki*) car that is the symbol of the brand in experiencing a downturn in their having experienced a period of the automobile segment, the New economy due to dropping commodity special milestones in Honda's history. Civic Generation 10, and the long prices, currency depreciation, and awaited CRF 1000L Africa Twin, which political problems. Last year, we celebrated 45 years in returned to the Brazilian Market. Brazil, 40 years with the Manaus plant Thus, in the last fiscal year, sales of and producing the country's best- Regarding results and the business the brand’s cars in Honda South selling vehicle, the CG motorcycle, in environment, we are experiencing America’s subsidiaries reached addition to 35 years of Consórcio one of the most challenging periods 139,175, representing a 15% Honda (Honda Purchase Pool). The in the history of the automobile reduction compared with the period also included important industry in South America. The previous period.

* Japanese fiscal year that begins on April 1 and ends on March 31. 6 7

Honda // Sustainability Report // 2017 Honda // Sustainability Report // 2017

In the motorcycle segment, 849,523 units in the country, which was a In Honda Serviços Financeiros (Honda units were sold, down 15.23% volume 13% lower than in the previous Financial Services - HSF), the results, in It is important to highlight the performance of compared with the previous fiscal period - the total market remained at general, were similar to the figures of the Honda Energy wind farm, which achieved year. Despite a drop of 14% in the the level of about 4 million units per the whole business, but it is worth a record production of clean energy and has total South American market, in the year (new and used). This means that mentioning that we increased interest already prevented us from releasing over 16,000 region, the Power Products segment the fleet is aging and that there is a in our authorized dealer network with grew by 2.2%, with 88,294 units sold strong potential for replacing used the bank Banco Honda and the tons of CO2 into the atmosphere. thanks to the launch of new products motorcycles with new ones - insurance company Seguros Honda, a geared toward the agricultural and something that should occur gradually reflection of our new commercial construction markets. as the economic outlook improves. actions and partnerships. In Consórcio Honda, we achieved very positive In Brazil, our main market in South In the automobile segment, our sales results in the four-wheeler segment, Regarding our manufacturing the social project in Recife, which on improving people's