Koç Group Corporate Social Responsibility Report 2011 Content of the Report: www.koc.com.tr [email protected] • Initiatives carried out by Koç Holding; For more detailed information about all our We welcome your feedback, suggestions • Projects and examples of best practices activities, and for updated information and criticisms, for these are the most conducted by the Group Companies beginning January 1st 2012, you may visit valuable tools we use to improve our Arçelik, Aygaz, Ford Otosan, Koç Koç Holding corporate website or those of reporting studies. To contact us, please send Information Technologies Group, Opet, the individual Group Companies and the an e-mail to [email protected] Otokar, Otokoç Otomotiv, Tat, Tofaş, Vehbi Koç Foundation. A PDF version of Koç TürkTraktör, Tüpraş and Yapı Kredi Holding CSR Report is also available on our corporate website. • Joint projects conducted by NGOs supported by the Group, The Vehbi Koç Foundation and affiliated institutions. Contents: 1 About the Report 2 Message from the Chairman 3 Message from the CEO 4 Koç Group in 2011 6 Governance at Koç 10 Human Rights at Koç 14 Work Environment at Koç 22 Environmentally-Friendly Practices at Koç 32 Ethical Values at Koç 34 Social Development at Koç 44 GRI Index The Global Compact The Ten Principles of the UN Global Compact United Nations Global Compact (UNGC) Human Rights consists of 10 principles of human rights, Principle 1: Businesses should support and respect the protection of S.10-13 labor conditions, environment and internationally proclaimed human rights; and anti-corruption. These principles are based Principle 2: Make sure that they are not complicit in human rights abuses. S.10-13 on a guiding perspective for businesses and S.13 organizations in order to achieve further Labor Standards objectives, regarding, particularly, risk Principle 3: Businesses should uphold the freedom of association and the management, efficiency growth, motivation effective recognition of the right to collective bargaining; and fidelity of employees, brand awareness Principle 4: the elimination of all forms of forced and compulsory labor; S.10-21 and opening to new markets. Principle 5: the effective abolition of child labor; and S.10-21 Principle 6: the elimination of discrimination in respect of employment and S.10-21 The Global Compact was initiated by the occupation. United Nations in 2000 and since then has been adopted on a voluntary basis. All Environment S.22-31 efforts to comply with the Principles are Principle 7: Businesses are asked to support a precautionary approach to S.22-31 made public through reports accessible on environmental challenges; the UNGC website Principle 8: Undertake initiatives to promote greater environmental S.22-31 (www.unglobalcompact.org). responsibility; and Principle 9: Encourage the development and diffusion of environmentally According to the UNGC website, currently friendly technologies. the Global Compact has reached more than S.32-33 10,000 participants from 130 countries, Anti-Corruption 6,880 from the business world and 3.150 Principle 10: Businesses should work against corruption in all its forms, from NGOs, trade unions, associations, including extortion and bribery. foundations, local administrations and academic circles. In Turkey, the UNGC has reached 196 participants and a local network organization has been established. About the Report Koç Holding Enhancing the quality of life through our guidance methodology for our future * According to the information acquired from GRI operations is a central objective of Koç reporting practices. Online Reporting Database. Source: Group Companies. We believe that to reach www.globalreporting.org this goal, our responsibility to ensure social Koç Group Sustainability Performance and economic development and to protect Evaluation and Reporting System, which we ** “Koç Information Technologies Group” doesn’t and preserve of the environment is as initiated last year, provides a performance represent a legal entity, but a common name for, Koç important as providing products and evaluation infrastructure for this year’s Group IT Companies, namely KoçSistem, Callus, services of the highest quality. We identify studies. During the year, we have improved Bilkom, Promena, Katron, Koç Bilgi ve Savunma this philosophy with the personal motto of this system through expert and user Teknolojileri. Within this report, all performance and our founder, Vehbi Koç, “I live and prosper feedbacks; than improved the system in application information disclosed regarding Koç with my country” and consider this to be the terms of user-experience regarding content Information Technologies Group consisted of shared guiding principle for our way of doing and IT infrastructure, through information data and practices of these 6 companies. business. meetings. We aim to continue improvement efforts for more progress in this area. The continuous growth and development of Koç Group over the last 85 years are Koç Group, the largest private sector characterized by the ability to think the employer owns many of Turkey’s largest and unthinkable, to see the invisible, to reach a most respected industrial companies. It stage never before envisioned; to add an touches the lives of millions of stakeholders innovative, creative and unique dimension of various types due to the extent of its to everything we do; and to make every domain and strength of its impact. Thus as value we have created permanent. Thus we establish content basis and over the years, we have achieved what had communication means, we take into been considered impossible: the account the spectrum of our stakeholders. development of globally distinctive products. The intended audience for this report Besides that, we have been leaders in encompasses a wide range of stakeholder establishing the best working environment, groups, including employees, customers, creating the most environmental-friendly shareholders, investors, NGOs and products and production conditions, professional organizations. founding centers of excellence in the areas of healthcare, education, culture and arts This report covers Koç Holding activities and serving large segments of the community. projects carried out in Turkey between January 1st 2011 and December 31st 2011. This In compliance with the principles of year, our report covers practices and transparency and accountability, we believe performances of Group Companies Arçelik, it is essential to share a constructive Aygaz, Ford Otosan, Koç Information communication environment with all Technologies Group** Companies, Opet, stakeholders and to respond to their Otokar, Otokoç Otomotiv, Tat, Tofaş, Tüpraş, expectations and opinions while conducting TürkTraktör and Yapı Kredi in social, our activities. For this reason, since 2006 we economic and environmental areas. Unless have been issuing Koç Group Corporate there is a statement to the contrary, apart Social Responsibility Reports in order to from the sections which present the general communicate our understanding and profile of Koç Holding, the performance of performance regarding social, economic all these companies is included in the data and environmental issues through a regarding sustainability performance comprehensive and reliable framework. indicators. Although the report Each year, we seek to improve our practice encompasses information on corporate by incorporating new ideas and guidelines. structure, projects and performance results regarding Vehbi Koç Foundation, unless Our previous report, published in April 2011, there is a statement to the contrary, its was the first GRI approved holding company performance is not included in the CSR report in Turkey*. As we did last year, consolidated quantitative performance data, we followed UN Global Compact COP tables and charts presented throughout the reporting procedures and Global Reporting report. The reporting content that we have Initiative G3 Reporting Framework, which is generated represents 85.4% of Group a globally acknowledged standard on employees and 91% of combined revenue. corporate social responsibility reporting regarding B level application requirements. In light of the positive results and responses we received, we intend to follow the same Koç Group Corporate Social Responsibility Report 2011 Message from the Chairman Mustafa V. Koç Dear Stakeholders, out our strategic considerations through work environment where human rights are evaluating and reporting our practices and respected and which set an example; Koç Holding - one of the driving forces of their outcomes. In the coming years, Koç contributing to increased performance development and the largest private sector Holding will continue to pioneer practices across many indicators Group Companies employer of Turkey - has a management that improve its sustainability understanding have also contributed to the development of style that can be best defined by such terms and studies. the communities in which they operate, in as creativity, innovation, productivity and the areas of education, healthcare, sports, institutionalization. Thanks to these As a result of the robust structure that we culture and arts and environment, reflecting characteristics, throughout our history of have established, Koç Group Companies our corporate culture. more than 85 years, we have worked with improved their performance during 2011, determination to go far beyond what is compared to the previous year, in all In 2011, I am proud to report that we easily seen, perceived