(Translation from the Italian original, which remains the definitive version) PININFARINA GROUP 2017 consolidated non-financial statement Pininfarina S.p.A. - Share capital €54,287,128 fully paid-up - Registered office in Turin, Via Bruno Buozzi 6 Tax Code and Turin Company Registration no. 00489110015 Letter to stakeholders In an era when companies are under constant pressure and hard put to keep pace with the market and society in general, Pininfarina has opted for a proactive forward-looking approach with renewed enthusiasm for the challenges reserved by the future. Its traditional values of Purity, Elegance and Innovation are seconded by those of sustainability, integrity and social equity which have become an ingrained part of its culture and way of business over the years. We are fully aware that economic growth and attainment of business objectives cannot and should not be achieved to the detriment of individuals, the environment or the communities of the areas where the Group operates. Permanent value cannot be generated without a sustainable growth policy. This viewpoint, which has been fine-tuned by the Group ever since its set-up, can clearly be seen over the years: from its focus on the aerodynamics of its vehicles to the efforts to merge innovation and design as factors to improve efficiency, reduce consumption and waste, right up to the recent move to designing environmentally-friendly electric models. In line with our values and commitment, we are proud to present a non-financial statement this year in addition to the 2017 Financial Report, which we hope will become a fast track communication channel with our stakeholders. Silvio Pietro Angori, Chief Executive Officer The Board of Directors approved the parent’s 2017 consolidated non-financial statement on 22 March 2018. 1 2 CONTENTS Introduction ................................................................................................................................................ 5 1. Group profile, reporting scope and material topics .................................................................... 6 1.1 Pininfarina Group - Identity and creation of sustainable value over time ................................ 6 1.2 Corporate governance structure .................................................................................................... 7 1.3 Management and control system ................................................................................................... 8 1.4 Reporting scope ............................................................................................................................... 9 1.5 Materiality .......................................................................................................................................... 9 1.6 Reconciliation with Legislative decree no. 254/16 .................................................................... 11 2. Anti-corruption .................................................................................................................................... 12 2.1 Internal policies ............................................................................................................................... 12 2.2 Main risks ........................................................................................................................................ 13 2.3 Performance indicators ................................................................................................................. 13 3. The Group's people ........................................................................................................................... 14 3.1 Internal policies ............................................................................................................................... 14 3.2 Main risks ........................................................................................................................................ 15 3.3 Performance indicators ................................................................................................................. 16 4. Environment ........................................................................................................................................ 24 4.1 Group policy .................................................................................................................................... 24 4.2 Main risks ........................................................................................................................................ 25 4.3 Performance indicators ................................................................................................................. 27 5. Social aspects - compliance with social and economic regulations ................................... 34 5.1 Internal policies ............................................................................................................................... 34 5.2 Main risks ........................................................................................................................................ 34 5.3 Performance indicators ................................................................................................................. 35 6. Human rights ....................................................................................................................................... 36 6.1 Internal policies ............................................................................................................................... 36 6.2 Main risks ........................................................................................................................................ 36 6.3 Performance indicators ................................................................................................................. 37 7. Diversity of governance bodies ..................................................................................................... 38 7.1 Internal policies ............................................................................................................................... 38 7.2 Performance indicators ................................................................................................................. 39 8. Methodology for reporting non-financial information .............................................................. 41 8.1 Standards applied .......................................................................................................................... 41 3 8.2 GRI Content Index ......................................................................................................................... 42 9. Report of the independent auditors .............................................................................................. 44 4 Introduction As a public interest entity, the Pininfarina Group (the "Group" or "Pininfarina”) is required to comply with Legislative decree no. 254 of 30 December 2016 which transposed into Italian law Directive no. 2014/95/EU of the European Parliament and the Council of 22 October 2014, amending Directive 2013/34/EU with respect to the disclosure of non-financial and diversity information by large companies and groups ("Legislative decree no. 254/2016" or the "decree"). Pininfarina has prepared this 2017 consolidated non-financial statement (the "non-financial statement" or the "statement") in accordance with the decree. While it is a separate document from the Directors' report, it forms part of the 2017 Financial Report. The non-financial statement includes information about the environment, social aspects, labour practices, respect for human rights and the fight against corruption, useful to aid an understanding of the Group's performance, operations, results and the impact thereof. Pininfarina referred to the specific principles and methodologies defined in the most recent standards published by the Global Reporting Initiative, an authoritative independent body which defines non-financial reporting models, in 2016 (the "GRI Standards"). In order to provide a high level of transparency, Pininfarina prepared this report in accordance with the Core option provided for by the GRI Standards.1 This option entails the reporting of a number of indicators that specifically disclose the Group's sustainability and at least one indicator related to each identified material aspect. The scope and quality of reporting reflects the principle of materiality, which underpins the reference regulations and the GRI standards. The topics presented in this statement are those considered material by management after its careful assessment as they reflect the impact of the Group's activities on society and the environment and can affect its stakeholders' decisions. The following pages present a table that shows the sections and GRI standards used for reporting for each category provided for by Legislative decree no. 254/2016 to facilitate an understanding of this statement. The independent auditors checked the compliance of this statement according to the procedures described in their report attached hereto. The parent’s Board of Directors approved the non-financial statement on 22 March 2018. It has been posted in the "Financial" section of the parent’s website (www.pininfarina.it). 1 GRI 102-54: "In accordance" option picked 5 1. Group profile, reporting scope and material topics 1.1 Pininfarina Group - Identity and creation of sustainable value over time Group