Sustainability Report 2019 Sustainability Report 2019 TURKEY’S VALUES-BASED TECHNOLOGY LEADER CONTENTS 12 Highlights of 2019 38 Our Proven Professional 80 Our Innovation-Driven Product and 12 Our Fields of Operation Management Approach Service Approach 14 Our Key Sustainability Indicators 38 Corporate Governance 80 Product and Service Quality 40 Ethical Principles 82 Technology and Innovation Activities 16 ASELSAN at A Glance 41 Internal Audit 92 Information Systems and Information TURKEY IS OUR MOST VALUABLE ASSET! 16 ASELSAN in Brief 42 Anti-Bribery and Anti-Corruption Security 18 Message from the Chairman, 43 Risk Management ASELSAN is committed to meeting the needs of Turkey’s security President and CEO 44 Fighting the COVID-19 Pandemic 94 Our Value-Driven Supply Chain 20 Our Key Financial and Operational Management forces by using local resources while serving as a reliable business Indicators 48 Our Value-Driven Human 96 Supplier Evaluation 22 Our Organizational Structure Resources Approach 102 Localization Efforts with Local partner in global markets. Our Turkey-focused nationalization efforts 23 Shareholding Structure 50 Employee Profile Companies 24 Mission and Vision 52 Employee Rights are not confined to the defense industry. We also serve the nation’s 26 Awards 52 Social Diversity and Equal 104 Our Environmental Responsibilities 28 Milestones of Our Sustainability Opportunities 104 Environmental Management transportation, security, energy, and healthcare sectors. Journey 54 Recruitment 106 Climate Change and Carbon 57 Performance Development and Management 30 Our Future-Driven Sustainability Career Management 106 Emissions and Energy In 2019, we drove technological innovation while posting record- Approach 59 Remuneration and Fringe 110 Water Management 30 Our Sustainability Priorities Benefits 112 Zero Waste Management breaking financial results. This fiscal year was marked by new, 32 Our Stakeholder Map and 61 Employee Development and On- 116 Environmental Compliance Communication Approach the-Job Training Opportunities 117 Green Solutions in Operations sustainable achievements thanks to our 45 years of experience, highly 36 Memberships and Initiatives 64 ASELSAN Academy Graduate 117 Information Systems Supported Education Program 118 Facility Management skilled human resources, reliable suppliers, and bright young talent. 67 Internal Communication and Employee Motivation 120 Our Contribution to Social 72 Decent Working Conditions Development 73 Human Rights We hereby present our Sustainability Report along with our corporate 74 Occupational Health and Safety 78 Occupational Health and Safety values that drive us forward on our journey to sustainable success. Management System ABOUT THE REPORT With its 7th sustainability report in 2019, ASELSAN is disclosing its sustainability performance in a wide range of areas from economy and the environment to corporate governance and social investments to the stakeholders in its impact area. This report has been prepared by using the Core principles of the 2016 Standards by the Global Reporting Initiative (GRI) as a guide. Publishing Sustainability Reports on an annual basis, the Company also aims to build an interactive relationship with all its stakeholders, from employees to investors, based on the principles of transparency and accountability. The report includes ASELSAN’s economic, corporate, social and environmental sustainability activities in Turkey. The sustainability performances of the Company’s affiliates as well as operations abroad are excluded from the scope of this Sustainability Report 2019. ASELSAN’s Investor Relations Department has assumed the role of coordination within the Company’s organizational structure during the reporting process. Questions, feedback and comments about the ASELSAN Sustainability Report 2019, available in Turkish and English, can be submitted to the following address: [email protected] Sustainability Report 2019 We boast almost 8,000 employees under our Our total turnover grew corporate umbrella. Each department at ASELSAN produces original and 44% to creative work aimed at demonstrating excellence. Every corporate unit has its own unique functions and ways of TRY 13 billion. doing business. The mighty ASELSAN family is composed of diverse units, our suppliers and stakeholders. Together we operate as a coherent whole. Sustainability Report 2019 We are explorers who have set out on a journey to develop innovations and discover new destinations, while EBITDA jumped understanding the fundamental 51% to need for, and driving change. TRY 2.9 billion. Innovation is a core value for ASELSAN. We challenge the ordinary, generate new ideas and boldly experiment with creative solutions. We monitor innovative approaches around the globe, while proactively embracing innovation. Sustainability Report 2019 ASELSAN inspires confidence among the people of Turkey and Net profit rose remains the country’s up by 45% to most reliable enterprise. TRY 3.4 billion. Our strategic advantage in being the companion of Turkey is the culture of trust we have established here. At ASELSAN, we walk the talk. We keep our promises while continuing to take significant leaps forward. Sustainability Report 2019 Development is a core value and passion for us. Our supplier network includes ASELSAN employs the best, most talented and more than knowledgeable people because we want to take big leaps toward development. Driven by our agile, dynamic and 5,000 enterprises. continuous-learning organization, we constantly challenge our capacity and capabilities. We also actively help our internal and external stakeholders to develop. Sustainability Report 2019 With the responsibility we assume, we only produce excellence. We use resources efficiently, manage processes effectively, and We operate strive to be the best in everything we do. Our objective is to achieve the highest quality – always. We are a forward-looking 27subsidiaries company that looks at the current picture with a broader around the globe. perspective. ASELSAN is committed to consistently providing world-class quality. ASELSAN Highlights of 2019 Sustainability Report 2019 ASELSAN OUR FIELDS OF OPERATION Founded in 1975 by the Turkish Armed Forces Foundation in Ankara, ASELSAN is Turkey’s The Pride of Turkey in biggest cutting-edge technology, defense and security company. the Global Defense Industry... Communications Radar and and Information Electronic Technologies Warfare Systems Microelectronics, Transportation, Guidance and Security, Energy, Electro-Optics Automation and Health Defense System Technologies 12 13 ASELSAN Highlights of 2019 Sustainability Report 2019 ASELSAN OUR KEY SUSTAINABILITY Championing the Sector in INDICATORS the Field of Sustainability Consistent A World-Class Competent and Turkey’s OHS Practices A Responsible Social Growth and Professional Dynamic Human Largest R&D with a Focus Management Investments Overseas Business Corporate Resources Center on Business Approach Bolstered Volume Governance Continuity and Minimizing By Employee Approach Efficiency Environmental Participation Total Revenue Corporate Governance Total Number of Impacts (TRY Thousand) Rating: Employees: 44% Increase 9.29 7,649 Total TRY 2,975 Award Winner in the CDP Reporting A Social Million R&D Merit Category with a Score of A- Responsibility at the 2020 British 2019 Ratio of Shares Traded Number of “Talent A” Spending Movement Led Safety Awards Fundamental 13,012,551 in Borsa Istanbul: Employees: by Employees: Total TRY 2,659 Environmental 2018 25.80% 206 ASELSAN Social Million Externally- A Leading Awareness 9,008,516 Innovation Funded R&D Company with ISO Training for 6,251 Leaders (ASİL); Total EBITDA Spending 45001:2018 Employees and the Solidarity (TRY Thousand) Certification Foundation 1,546,473 kg 51% Increase Total TRY 316 in Turkey... established under of Waste Recycled Million Internally- the ASİL Structure Funded R&D at the Macunköy, 2019 Total Hours of Spending Training Delivered Akyurt and Gölbaşı 2,853,811 A Firm Step to Raise to Employees: Premises 2018 Intermediate Staff 158 Patent 46,803.46 hours 1,895,596 Applications with for the Defense Industry: ASELSAN Total Assets 68 Registrations Vocational and (TRY Thousand) Technical High 31% Increase School 2019 25,633,044 2018 19,473,631 14 15 ASELSAN ASELSAN At A Glance Sustainability Report 2019 ASELSAN ASELSAN IN BRIEF Founded in 1975 by the Turkish Armed ASELSAN consistently maintains its Turkey’s Largest R&D Company ASELSAN’s mission is to reduce Turkey’s Forces Foundation in Ankara, ASELSAN solid reputation for reliability in the As part of its corporate transformation reliance on foreign technology and ASELSAN is is Turkey’s biggest advanced technology, many countries across the globe that initiative launched in 2019, ASELSAN provide high added value to its domestic ASELSAN aims to taking confident defense and security company. ASELSAN select ASELSAN products and systems. placed employee opinions and feedback and foreign customers with innovative gain further large primarily serves the Presidency of In 2019, the Company registered strong at the heart of its operations. Areas in and reliable products. In the coming year, steps forward on Defense Industries and Turkish Armed growth, boosting turnover by 44% to need of transformation were identified ASELSAN aims to gain further large scale scale orders, while its transformation Forces, in addition to domestic and TRY 13 billion. In addition, ASELSAN and all employees were included in