Sustainability Report PT Unilever Indonesia Tbk TRANSFORMING FOR A SUSTAINABLE FUTURE CONTENTS TRANSFORMING 1 NURTURING OUR PRECIOUS 69 FOR A SUSTAINABLE FUTURE TALENTS Sustainability Overview 2 People with Purpose 70 Message from the President Director 4 Managing Human Resources 71 Equal Opportunities 74 ABOUT US 7 Creating a Safe and Healthy Workplace 77 About Unilever Indonesia 8 83 Supply Chain of Unilever Indonesia 10 SUSTAINABLE SOURCING History of Unilever Indonesia 12 Ethics in Sourcing 84 Palm Oil 86 Vision, Mission, and Values 14 of Unilever Indonesia Black Soybean 88 Sustainability Awards 2018 16 Tea 89 Coconut Sugar 89 SUSTAINABILITY 19 BUSINESS BENEFITS 91 AS A CORE BUSINESS Fairness in the Workplace 92 The Purpose of Unilever 20 Opportunity for Women 93 Unilever Sustainable Living Plan 21 Inclusive Business 94 Unilever and Sustainability Initiatives 22 Benefits to Shareholders 97 Sustainability Festival: 24 Live Your Purpose for U & I PRODUCTS AND SERVICES 99 Care for Area Surrounding 28 Brand with Purpose 100 IMPROVING HEALTH 33 Product and Packaging Innovation 102 AND WELL-BEING Consumer Protection 104 Health and Hygiene 35 Consumer Voice 105 Improving Quality of Nutrition 45 GOVERNANCE 107 PRESERVING NATURE, 49 Governance Structure 108 REDUCING FOOTPRINTS Business Integrity 110 Zero Waste to Nature 50 Whistleblower System 112 Green Infrastructure Performance 59 Engaging Stakeholders 113 Environmental Performance 62 117 of Operational Activities SUPPORTING INFORMATION Company Information 119 About Sustainability Report 120 GRI Standard Content Index 122 UN Global Compact Principles Index 125 Independent Assurance Statement 126 Sustainability Reporting Team 128 FORWARD-LOOKING STATEMENTS This report contains forward-looking statements. These statements are based on various projections and estimates made by Unilever Indonesia's management. Predictions also come from referenced sources commonly referred to by businesses. Therefore, there is no guarantee that some or all will be achieved. Statements include acceptable forecasts and assumptions at the time this report was prepared. Prologue TRANSFORMING FOR A SUSTAINABLE FUTURE Unilever Indonesia continues to grow positively driven by various continuous transformation efforts, both through innovations launched, and through digitalisation efforts in several aspects of our business operations. Unilever Indonesia also continues to improve capabilities on an ongoing basis. For Unilever, sustainability is the core of the Company's business. The transformation efforts that are carried out are always based on the values of sustainability. Through the Unilever Sustainable Living Plan (USLP) we have contributed greatly to improving the quality of life for millions of people in Indonesia. All of this is in line with USLP's goals to improve health, reduce our environmental footprint, and improve livelihoods. In 2018, we focus primarily on the empowerment of young generation and millennials, as Indonesia’s demographic bonus which is estimated to reach its peak in 2030. A better future rests on this young generation. They are the key agents of social change and need to be aware of their potentials. Our report also covers new innovations and initiatives in 2018, such as new business categories, new product formats, and digitalisation of the distribution system. Furthermore, various sustainability initiatives which were rolled out in previous years are also covered with greater details in this report. PT Unilever Indonesia Tbk Sustainability Report 2018 1 Sustainability as Improving Health Preserving Nature, Nurturing Our Prologue About Us a Core Business and well-being Reducing Footprints Precious Talents SUSTAINABILITY OVERVIEW Unilever is a business founded on a sense of purpose, and our unique heritage still shapes the way we do business today. We want our business to grow but we recognise that growth at the expense of people or the environment is both unacceptable and commercially unsustainable. Sustainable growth is the only acceptable model for our business. people Profit 2.2million + people 33,485 hours 1,329.9% Beneficiaries of Health Employee Stock price increased and Hygiene training hours since 1982 3,500 35,000+ rp9.1 trillion Empowered Women (Saraswati) Small farmers Assisted (soybean, Net profit on the year coconut sugar, chili) PT Unilever Indonesia Tbk 2 Sustainability Report 2018 sustainable Business Products and Supporting Sourcing Benefits Services Governance Information planet 100% 32.78% 33.17% Zero Waste to Landfill Energy intensity reduction, CO2 emission in our Head Office compare to 2008 baseline intensity reduction 26.26% 2,816 7,779 tons Water intensity Number of Unilever Inorganic waste reduction reduction Waste Bank unit through Waste Bank programme PT Unilever Indonesia Tbk Sustainability Report 2018 3 Sustainability as Improving Health Preserving Nature, Nurturing Our Prologue About Us a Core Business and well-being Reducing Footprints Precious Talents MESSAGE FROM THE PRESIDENT DIRECTOR The Meaning of Sustainability for Unilever Indonesia Sustainability is extremely important to Unilever – it is the driver of our business growth. With sustainability, we believe that we have the opportunity to create a new business model where doing good and doing well are directly connected and are not disconnected. Sustainability lies at the heart of our business model, as we believe that our business will only grow when we do it sustainably. Along our value chain, from how we source our raw materials and manufacture our products to how we communicate through our brands and manage our people, we must be focused on sustainability principles as the only way to succeed. Our blueprint for sustainable growth, the Unilever Sustainable Living Plan (USLP) is driving value for our business, our people and our consumers. USLP sets out to decouple our growth from our environmental footprints, while increasing our positive social impacts. Our Plan has three big goals to achieve, spanning our social, environmental and economic performance across the value chain. We will continue to work with others to focus on those areas where we can drive the biggest change and support the Global "Sustainability lies at the heart of Sustainable Development Goals (SDGs). our business model. We will only Transformation in Unilever grow if we apply the principles of Indonesia sustainability along our value chain. We believe that transformation is essential to enable us to keep up with changes in Therefore, sustainability is the focus every aspect of the business. In 2018, we took a number of transformational steps of our brands, business processes and to make our business more sustainable. employee development. That is the We transformed our way to communicate with consumers through optimisation only key to succeed." of digital media utilisation. One of our products, Nameera was launched in a digital media channel (e-commerce). We also transformed the way we serve HEMANT BAKSHI our customers and consumers. Through President Director of PT Unilever Indonesia Tbk our Garuda and Cendrawasih Projects, we enabled our distributors and retailers to be more precise in identifying the range of products that they should put on shelves, PT Unilever Indonesia Tbk 4 Sustainability Report 2018 sustainable Business Products and Supporting Sourcing Benefits Services Governance Information focusing on brands their consumers on how we manage of our footprint, set of indicators , such as speed limit and need the most. Our precision marketing, particularly on flexible plastic packaging. sudden braking, enabling us to track any supported by big data analytics, played an Plastic waste is a big challenge for any unsafe behaviour by the driver. All important role within this aspect. Indonesia. While Unilever Indonesia accidents were fully investigated on by contributes to less than 5% of plastic our safety team to identify root causes In 2018 , we also expanded our business waste, we are committed to finding a and take the learnings to prevent future to a new category within Foods with the solution to this challenge. And leverage on accidents. launch of Jawara Chilli sauce to meet our scale to influence the entire industry the continuing demand in the chilli sauce to become plastic responsible. Unilever Indonesia is always listed market in Indonesia. We also tapped into within the top 25 of SRI KEHATI Index, the ever increasing trend of Korean pop Flexible plastic is difficult to recycle and since the index was first launched. SRI culture among millennials by adding a thus becoming a major concern for us. KEHATI is a sustainability index rating new brand, Korea Glow, into our Home Through our circular economy concept, we by Indonesia Stock Exchange (IDX) and and Personal Care portfolio. A number aim to keep plastic in the economy and out to be top listed consistently in the index of new variants were also in this category of the environment. A collaboration with reflects the recognition of the public on were also launched, including Pond’s like-minded organizations and experts the Company’s sustainable practices. Facial Masks, Pond’s BB Powder and are key to finding a solution to this issue. Globally, Unilever is also listed in the Dow Pond’s Micellar Water. These changes and CreaSolv® Technology is the first and only Jones Sustainability Index (DJSI). transformation are a journey to create a technology in the world at present which product portfolio that meets the specific enables flexible plastics to be recycled