corporaTe ResponsiBiliTy reporT 201o 201o TaBLE of coNTENTS nESher chap 01 ENvironmEnTal STRENGTh chap 05 Letter from Management 1 Nesher 2010: Ecological Balance & Environmental Impacts 33 Performance Summary 3 Meeting International Standards 34 Company Profile 11 Energy Efficiency 36 Air Quality and Greenhouse Gases 38 orgaNizaTioNal STRENGTh chap 02 Sustainable Resource Management 42 Company Values 15 Water Consumption and Wastewater 45 Management, Responsibility & Monitoring Systems 16 Financial Investments in Environmental Protection 46 Active in Local and International Business and Industry 18 social STRENGTh chap 06 naTioNal aNd iNdividual STRENGTh chap 03 Work Environment and Job Security 50 Cement – Infrastructure for Green Building 22 Safety – A Core Value 52 Commited to Quality and Service 24 Supporting the Community 54 Transparency as a Guideline and Dialogue with Stakeholders 54 EcoNomic aNd fiNaNcial STRENGTh chap 04 Climate Change & Global Warming – Challenges & Opportunities 28 planT performaNce iNdicaTors chap 07 Economic Valuation of Environmental Efficiency 30 Nesher Ramla 60 Nesher Har Tuv 62 Nesher Haifa 64 gri iNdEx chap 08 GRI Index 66 Cover: Private Residence / Architect Eyal Malka chap Nesher | Corporate Responsibility Report 2010 1 o1 nesher lEΤΤER fRom maNaGEmENT We are proud to present you with Nesher’s Corporate Responsibility Report for At Nesher we chose to convert challenges into opportunities: the opportunity 2010, the fourth of its kind. This report represents another step in our commitment to supply vital raw materials for the continued building and growth of the State to be among the leading industries in the Israeli economy, and a leader in the of Israel, born out of the need for local produce as an existential and strategic global cement industry with regard to environmental and social management foundation; the opportunity to contribute to the resilience of the State of Israel in and maintaining transparent and honest dialogue with all our stakeholders. light of potential security and safety threats; and the creation of a learning system for the development and adoption of environmental solutions in the field of Global events in recent years, including the great financial crisis that began cement. We are striving vigorously to find technological solutions that will enable in 2008, the rice protests in eastern Asia, the Facebook revolution in the the efficient production of cement according to demand while using production Western World and the growing debt of many western countries, have crossed methods that use less external energy sources and fewer natural raw materials. geographical boundaries and touched a wide range of economic, social and environmental fields. The common denominator for all of these is a sense of This is what our parent company accomplished by establishing the power station uncertainty with regard to the quality-of-life of current and future generations in in Ramla, which operates on natural gas, what we too achieved by utilizing light of rising prices and the shortage of commodities and natural resources. industrial waste produced in our plant, and what we will continue to do with the establishment in the coming year of the sorting station that will supply Nesher We at Nesher understand that our direct and indirect activities have plants with waste-based fuel. environmental and social implications. Combined with the knowledge that integration of responsible goals in business strategies will provide us with a We believe that genuine corporate responsibility means driving this issue into business advantage, this realization has led to the inclusion of environmental the core of our business on a daily basis, from senior management down to the considerations in our managerial decision making processes in order to minimize last production worker, and that is where we are headed. risks and create trust relationships with all stakeholders: employees, customers, suppliers, the community, the government, etc. Our activity includes, inter alia, issues pertaining to climate change and emissions, the prevention of soil, air and water pollution and the tightening of environmental standards and regulations in the company’s plants. Amnon Dotan, Chairman Joel Feldschuh, CEO chap Nesher | Corporate Responsibility Report 2010 2 o1 nesher aBoUT ThE 201o REpORT This report summarizes Nesher’s social, financial and Measurement techniques > For the purpose of analyzing the trends taking environmental activities. 5 place in the Company in each of the reported subject areas, an effort was made to provide data from previous years as well. Presentation of the data was the data in this report refers to calendar year 2010. Reporting period > carried out according to the GRI protocol, as expected in reports of members 1 Data from previous years is presented for identifying the trends taking of the global reporting initiative. The reported data are a result of direct place in the company and setting future goals. measuring of the subject at hand (unless otherwise specified). Gathering of the Reporting cycle > The last report was published in 2009 and summarized information was carried out internally by various relevant Nesher environmental 2 Nesher’s activities in 2008. Nesher has opted to publish a public report departments, Human Resources and the reporting plants. once every two years in order to periodically monitor the trends and principal This year Nesher plants began quantifying the solid waste produced by them. processes taking place in Nesher and at the Company’s plants. Between the reports, various reporting activities to stakeholders are carried out. For more Changes in reporting > No significant reporting changes were made information, please see page 54-58. 6 compared with the 2008 report. Report scope > The quantitative data in this report relate to Nesher’s Reporting highlights > The topics reported in this report were chosen in 3 three production plants: Nesher Haifa, Nesher Har Tuv and Nesher Ramla. 7 accordance with the GRI criteria, including materiality. The World Business In addition, a partial reference is made to three plants’ raw material quarries, as Council for Sustainable Development (WBCSD) uses specific indicators for well as quantitative data regarding the Company’s headquarters, which include the cement industry. This report addresses these indicators. Nesher reports Nesher Environment (1997) Ltd. Not included in this report are data regarding air emissions in accordance with the WBCSD Cement Sustainability Initiative the following affiliated companies: Paper products Manufacturing (PPM) Ltd., (CSI). In this report, emissions are reported per ton of clinker, in order to allow M.P. Minerals and Marble Ltd., and Taavura Holdings Ltd., as well as outsourced comparisons to performance of other cement companies worldwide. activities and joint ventures outside the framework of the three Company plants. The content and highlights take into accout Nesher’s unique stakeholders, as Report content > Nesher reports according to the principles of the Global well as feedback received from the public and the regulators. The performance 4 Reporting Initiative (GRI). GRI is a cross-sector initiative for reporting indicators, which appear in the GRI sector supplement for mining and metal on environmental-social aspects in businesses. Its members are social- industries – GRI’s most relevant supplement for Nesher to date – were environmental organizations and business entities. For more information, implemented in this report. visit: www.globalreporting.org. As an industrial company with a plant of international scale, an emphasis was The report complies with level B requirements of the GRI and includes a placed on the environmental effects of the company, both locally in Israel and reference to the GRI sector supplement of the mining and metal industry. globally. The standards according to which the performance of the plant were measured were also chosen in accordance with these needs. In the last report there was an error in the number of reported work accidents. The data was corrected and this report shows the updated data. As of December In order to address local stakeholders in detail, Nesher hereby reports its primary 2010, no substantial changes had occurred regarding the organization since the environmental effects, which are presented and specified in this report for each previous public report. plant. Looking ahead, the report describes Nesher’s short-term goals and its vision for the more distant future. Nesher welcomes stakeholders’ feedback regarding the report. Currently, Nesher does not present the report for external assurance. chap Nesher | Corporate Responsibility Report 2010 3 o1 nesher pERfoRMaNcE SUMMaRY The following table summarizes Nesher’s performance according to the main environmental, social, and economic indicators, as defined by the WBCSD cement project Financial Strength 2008 2009 2010 GRI Indicator Production Cement in tons 4,861,577 4,758,894 5,139,045 Clinker in tons 4,281,546 3,578,722 3,990,263 Financial Information* Income in NIS 1,560 1,508 1,589 EC1 Cost in million NIS 1,180 1,155 1,231 EC1 Operating profit (loss) in million NIS 380 353 358 EC1 Environmental Responsibility and Strength 2008 2009 2010 GRI Indicator Climatic changes Total direct CO2 emissions 3,533,855 2,927,055 3,284,927** EN16 CO2 emissions per ton product (net) kg/ton cementitious materials 662 636 644 EN16 Raw Materials and Energy Raw materials in tons 8,056,627 6,604,010 7,395,337 EN1 Percentage of alternative raw materials 12.1% 13.9% 12.1% EN2 Energy consumption (fuels) in GJ 13,666,402 10,855,998 12,713,195 EN3 Energy consumption (fuels) in tons 383,489 305,426 357,752 EN3 Percentage of alternative fuels 0.96% 0.84% 0.65% EN5 Electricity consumption in GWh 503 435 478 EN4 Nesher’s total electricity consumption in KWh per cement ton 103.5 91.4 93.0 EN4 Air Quality Particulate matter (PM) emission in tons 171.9 137.4 190.6 EN20 PM emission per ton of product – gm. per ton of clinker 40 38 38 EN20 Nitrate oxide (NOx) emission in tons 10,711 9,909 9,649 EN20 NOx emission per ton of product – gm.