BUSINESS & CUSTOMERS

Sustainability principle
Satisfied customers, economic stability, ­value-­generating growth and social acceptance are the focus of all of our business ­activities at Porsche. Corporate responsibility begins with our self-image of actively helping to protect the natural conditions for life on earth and of benefiting our business environment. Economic efficiency, environmental consciousness and social responsibility are not mutually exclusive. On the contrary – by combining them we create more value for our stakeholders. As a company, Porsche is an ­integral part of ­society. Ethical behaviour is therefore essential. Porsche embraces fair competition and acts not only lawfully but also legitimately. The company systematically combats corruption, respects and complies with international standards of human rights, and categorically rejects all forms of forced and child labour.

The “Business & Customers” action area covers the following topics identified in the 2017 ­materiality analysis: “long-term economic ­stability”, “long-term customer relations”, “compliance”, “responsibility in the supply chain” and “digital transformation”. All of these topics feature clearly defined processes and ­areas of responsibility, as well as established evaluation procedures.

Economic stability and digital transformation
The automotive industry is facing radical change across the world. Electrification, digitalisation and connectivity are the hallmarks of a new era in individual mobility. This view is shared by Porsche’s stakeholders who ­assigned correspondingly high degrees of relevance to the topics of “economic stability” and “digital transformation” in the 2017 materiality analysis. From the company’s perspective, these two topics must be handled successfully in order to secure Porsche’s long-term economic success.
 
The company enjoys excellent profitability and has set itself the strategic target of a minimum operating return on sales of 15 per cent. At the same time, Porsche is making major investments to ensure it retains its innovative capa­city and can embrace the digital revolution. Digitalisation is impacting on all areas of the company – from internal processes to our ­interaction with customers and the development of new products and services. An inno­vation management system that extends across all of the company supports the gen­eration of new impetus, driving the testing of technologies and trends, and encouraging ­Porsche’s employees to take the initiative to shape mobility in sustainable ways.

In accordance with the Global Reporting ­Initiative (GRI) standards, Porsche covers the topic of “long-term economic stability” through its disclosures pursuant to GRI 201: Economic Performance. This information is measured and reported on the basis of the Porsche AG Group’s financial analysis, financial data and calculations of added value.

Long-term customer relations
Porsche sets high standards with regard to maintaining long-term customer relations, and consistently seeks to improve and develop its range of exclusive sports cars and mobility services in the interests of its customers. ­“Inspiring customers with a unique product and brand experience” is one of the four main aims of the Porsche Strategy 2025. The 2017 materiality analysis also underscores the ­importance attached to “long-term customer ­relations”. Consequently, the Sales and Marketing division uses a variety of measures to strengthen customer satisfaction and loyalty over the long term and to further optimise the customer journey at Porsche.

We strengthen relations with all of our stakeholders through personal interaction and open dialogue. New apps, expanded social media channels, the integration of chat functions and the overarching, personalised “My Porsche” customer portal are all simplifying and speeding up digital communications between the company and its customers. Yet these new ­approaches are by no means replacing personal contact, which will remain just as essential in future as Porsche fosters stable, long-term ­relationships based on trust. This is why ­Porsche supports individual support for its customers across the world throughout their customer journey, updating the technical ­systems deployed for this purpose, staging ­exclusive customer events and ensuring that its sales staff are given the necessary customer-­focused training.

Porsche regards constructive criticism as an opportunity to keep on improving its products, services and processes. The company’s global market research team sends out more than 250,000 questionnaires every year in order to gain a better understanding of its customers and to identify new customer expectations in good time so that these can be fully interpreted. Particularly with regard to new vehicle technology and mobility trends, the findings from the company’s surveys are fed into the process of developing new products and services at an early stage. Porsche takes customer feedback very seriously. In a monthly product ­quality and customer satisfaction forum, the Executive Board of Porsche AG evaluates the results and consequences of the feedback that it receives with developers, as well as with representatives from the Quality Assurance, Aftersales and Customer Relations departments. The ­results of these efforts to look after and communicate with clients in cooperation with ­Porsche’s trade partners are clear to see. For the fourteenth year in succession, Porsche ­occupied one of the top rankings in the Automotive Performance, Execution and Layout Study (APEAL) quality study conducted by the US market research institute J.D. Power in 2018.

In accordance with the Global Reporting ­Initiative (GRI) standards, Porsche covers the topic of “long-term customer relations” through its disclosures pursuant to GRI 418: Customer Privacy. Porsche takes individual data privacy very seriously and respects every data subject’s right to determine what is done with their data. Data protection is integrated – independently and without instruction – into all relevant company processes. Porsche’s data protection system and the relevant business processes are consistently designed to ensure that the statutory requirements are upheld at all times. Over and above the statutory requirements, Porsche has issued its own guidelines committing the company to further data protection principles, including data economy, purpose-based collection and confidentiality. A full-company programme was launched in order to guarantee implementation throughout Porsche of the new requirements imposed by the EU’s General Data Protection Regulation (GDPR). This programme covers documentation and information obligations, the rights of data subjects, and data protection management processes. Due to internal con­fidentiality guidelines, any reports received on specific data protection violations are not ­published, however.

Responsibility in the supply chain
Economic success, the extension of the product portfolio, and the use of new technologies are focusing ever more attention on companies’ supply chain. Two examples illustrating this development are higher delivery figures driving growth in supply parts, while new products frequently also need innovative components that must be procured responsibly. Porsche stakeholders also assigned a high level of ­relevance to the topic of “responsibility in the supply chain” in the 2017 materiality analysis. Together with its suppliers and sub-suppliers, Porsche makes every effort to make its ­supply chain as sustainable and value-adding as possible.

When Porsche was incorporated into the Volkswagen Group, its procurement division was also largely integrated into the Group’s ­organisational structure. Shared purchasing structures, processes and systems were ­specified in a cooperation agreement back in 2011. This means that Porsche’s procurement decisions are largely coordinated and agreed upon with the Volkswagen Group. Cooperation between Porsche AG and the Group is also consistently being driven forward and the relevant structures expanded and strengthened.

A supply chain based on responsibility is built around trust-based cooperation, shared ­values and strict compliance with the sustainability requirements defined in the Volkswagen Group. The concept of “sustainability in ­supplier relations” and the corresponding code of conduct compel all parties to observe and comply with the high environmental, social and human rights standards in the International Chamber of Commerce’s charter and the OECD’s guidelines for long-term, sustainable development. The relevant key labour standards from the International Labour Organization (ILO) serve as the foundation for the ­sustainability requirements that Porsche once again helped to revise and update during the year under review. All suppliers are also ­expected to follow the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas. Porsche is active in this area in the ­context of the Group’s responsible minerals ­initiative (RMI) activities. These sustainability requirements are enshrined in supply contracts, the violation of which can result in ­reviews, formal statements and potentially also the termination of the business relationship. Sustainability audits in the 2018 reporting year yielded two cases in which specific sustainability requirements were not met. ­Appropriate measures were agreed upon with two suppliers, and the introduction of these measures was monitored. As at the end of the reporting year, one case was still open and ­being reviewed.

Porsche always conducts integrity checks ­before entering into business relations with new suppliers. Once the cooperation arrangement is in place, monitoring and development are carried out on a continuous basis, supported by questionnaires, risk analyses of the supplier countries, and e-learning modules and training sessions. Porsche has also been carrying out its own sustainability audits of selected suppliers since 2016. Audits are followed up by detailed reports and plans of action. In this way, and combined with a broad range of other activities including regular employee seminars on sustainability requirements in the supply chain and supplier workshops, the company is putting one of the Porsche Strategy 2025 measures into practice. Sustainability in the supply chain is also a separate area of action within the company’s purchasing strategy. A new guideline in the Volkswagen Group on sustainability in supplier management has also governed all internal processes and areas of responsibility since 2017. Porsche incorporated the requirements defined in this guideline into its own brand-specific guidelines in 2018.

In accordance with the Global Reporting ­Initiative (GRI) standards, Porsche covers the topic of “responsibility in the supply chain” in the ­following content-specific disclosures: GRI 204: Procurement Practices, GRI 308/­414: Supplier Environmental/Social Assessment, GRI 408/409: Child Labor/Forced or Compulsory Labor and GRI 412: Human Rights ­Assessment.

Compliance
Acting responsibly means acting in strict compliance with laws and regulations. Porsche’s stakeholders share this view, duly assigning a high level of importance to the topic ­“Compliance” in the 2017 materiality analysis.

The company has put in place a compliance structure based around its business model to ensure that it acts lawfully, with legally ­secure processes and preventive and reactive measures. The Porsche compliance management system encompasses seven areas of compliance. In order to avoid any infringements of the law and to help its employees act in accordance with legal and statutory provisions, ­Porsche has had a compliance system in place for many years now. This system ­i­ncludes a chief compliance officer, and compliance officers at Porsche AG and at the Group member companies covering every area of the business. The compliance programme ­encompasses a range of different preventive and reactive measures.

Regular risk analysis is carried out to define ­areas that require action and preventive measures. The company’s business model, relevant environmental conditions and the relationships with business partners are all taken into ­account. Key preventive measures at Porsche ­include the adoption and communication of binding rules, while managers and employee have access to confidential advice and risk-based training and information on relevant compliance issues. Ultimately, the code of conduct sets out the most important rules to be applied at Porsche in accordance with the company’s business model. This code documents the expectations of managers and staff in terms of the responsibility they must ­assume for compliance as a member of society, as a business partner and at the workplace. The rules are also set out in guidelines, covering such areas as how to avoid corruption or violations of antitrust law, how to handle conflicts of interest or the receipt of gifts, and how to prevent money laundering. To ensure and promote lawful behaviour over the long term, all managers and employees are given regular information and training on compliance and the related risks.

Porsche’s central compliance help desk provides information and advice on compliance issues internally, providing expert answers to all questions from managers and employees alike. The help desk can also be contacted confidentially to report (potentially) unlawful actions, such as criminal acts or serious ­irregularities. Outside the company, Porsche managers, employees, customers and business partners, as well as public officials and other external individuals, can report legal ­violations anonymously via the ombudsman system. All of the information received is ­carefully examined, and any violations found are responded to appropriately in accordance with the relevant provisions of the employment and co-determination laws. This includes introducing suitable countermeasures and sanctioning cases of individual misconduct. The Executive Board of Porsche AG receives regular reports on actions taken by the ­compliance organisation and on preventive and ­response measures implemented in the ­Porsche Group.

Compliance training
The compliance officers for each area, together with the HR department, are responsible for compliance training. Most of the training ­currently being delivered takes the form of classroom-based sessions. In addition, web-based training sessions devoted to “Technical ­Compliance” and “Data Protection” were also available. The range of e-learning options is to be gradually extended to include more compliance issues in future.

The compliance managers deliver the training on the basis of a subject-specific plan, which uses risk analyses to identify target groups and key areas of content, and also defines ­organisational aspects such as the number and frequency of events and the capacities needed. A regular programme of set training events is in place for (new) managers and ­employees, as well as for junior managers and trainees. In addition, training courses on ­selected topics and with specific target groups are held.

For example: since the relaunch of Porsche’s programme for junior managers (PE programme) in 2018, compliance training has been available in various formats and covering a range of issues through classroom-based and online modules. Participants can also gain an insight into the company’s compliance ­culture, management and rules, and its code of conduct, via an online offering. Using Skype for Business, participants can take a live multiple choice test and ask questions at the end of the session. Compliance issues including anti-­corruption, anti-money laundering measures and antitrust law are presented by compliance ­officers during the classroom-based sessions. As well as presentations and case studies, some sessions involve group work where case studies are tackled with the help of a board game.

New employees are familiarised with the company’s compliance culture during the Porsche Warm-up event, an introductory training ­session generally held monthly. The event is based around the World Café, in which newly hired staff have the chance to look inten­sively at the code of conduct and basic rules on avoiding corruption, tackling specific cases before ­presenting their solutions to the full group. The compliance image film rounds off the event which also covers the most im­portant rules and expectations in relation to the issue of compliance.

All compliance trainings at Porsche are binding. The amount of training undertaken by com­pliance officers is monitored over the course of the year, with the final status being reported to the Compliance Council and to the Executive Board and Supervisory Board. Since the ­beginning of 2018, employees’ attendance at compliance seminars has been recorded in their continuing professional development file.

Information for employees
Information about the Compliance department’s training programme is available to ­Porsche employees on the intranet. In addition to relevant Group and company guidelines, this information includes contact persons and ways to report concerns either internally or ­externally, along with a range of materials such as compliance videos, flyers, note cards and check lists.

Porsche’s code of conduct
The Volkswagen Group’s code of conduct has also applied to Porsche since the end of 2017. These guidelines set out all aspects of ­employees’ responsibility for compliance:

– as members of society: human rights; equal opportunity and equal treatment; product conformity and product safety; environmental protection; donations, sponsorships and charity; communications and marketing; ­political lobbying.

– as business partners: conflicts of interest; gifts, hospitality and invitations; prohibition of corruption; dealings with public officials and holders of political office; prohibition of money laundering and terrorism financing; accounting and financial reporting; taxes and customs; fair and free competition; ­procurement; export control; prohibition of insider trading

– in the workplace: occupational safety and healthcare; data protection; security and protection of information, know-how and ­intellectual property; IT security; handling company assets. Illustrative examples that employees might face on the job are provided for each topic.

There is also a self-administered test designed to help employees make decisions in case of doubt. Porsche’s code of conduct is published on the internet and intranet. All staff are also sent the code of conduct by e-mail and informed about it during training and infor­mation events, and all new employees are provided with a hard copy in the form of a brochure at the welcome event on their first day.

In accordance with the Global Reporting Initiative (GRI) standards, Porsche covers the ­topic of “compliance” through the following disclosures: GRI 205: Anti-corruption, GRI 206: Anti-competitive Behavior, GRI 307: ­Environmental Compliance, GRI 419: Socio­economic Compliance.

PRODUCT RESPONSIBILITY

Sustainability principle
Porsche develops high-quality, innovative and long-lasting products. With each new model generation, Porsche consistently sets new standards in quality, environmental friendliness and safety across the entire life cycle of all ­vehicles.

The Product responsibility action area covers the topics identified in 2017’s materiality ­ana­lysis, namely “Vehicle safety”, “Fuel consumption and vehicle emissions”, “Materials and sustainable raw materials” and “New ­mobility concepts”. Clearly defined processes and skills are in place for these topics, alongside transparent evaluation procedures.

Vehicle safety
Vehicle safety is of the utmost importance to Porsche, with the safety of the vehicle’s occupants being the top priority. In addition, ­making sure that other road users are also kept safe is another key aim. For their part, Porsche stakeholders place a great deal of importance on vehicle safety. During the sustainability survey conducted as part of 2017’s materiality analysis, stakeholders ranked this topic in first place, not least due to its economic relevance and social importance.

Vehicle safety is a decisive criterion from the outset in the development of innovative, ­state-of-the-art vehicles. Alongside accident prevention – by fitting vehicles with ABS or ESP systems or automatic emergency braking ­systems – one of the main goals is to reduce the effect of an accident on the vehicle’s ­occupants. With this in mind, during the development phase of a new model the deformation behaviour of the vehicle body is precisely ­defined for a variety of frontal, lateral and rear end impacts. Vehicles are also fitted with a smart restraint system consisting of airbags and seatbelts. Crash tests are used to check the effectiveness of the safety systems. In a controlled crash the impact of the entire vehicle slamming into an object, such as a wall, is ­investigated. Crash test dummies with sensors are used, which allows an evaluation of the possible injuries of the occupants. Specific ­biomechanical limits must be adhered to, stipu­lating such parameters as maximum accel­eration or deceleration of the head.

In addition to carrying out complete vehicle crash tests, component tests and computer simulations are used during development to tune the complete vehicle system and its behaviour in an impact and continuously ­improve it until it is ready for series production. The Porsche safety strategy defines the ­underlying requirements, not only complying with statutory rules across the world but also meeting internal company requirements. The latter extend beyond the minimum required by law and involve a significantly broader load case portfolio. In this way, Porsche can ensure that, in the event of an accident, its drivers and their passengers, as well as other road ­users, benefit from the high level of protection synonymous with Porsche.

The ultimate vision in terms of vehicle safety is the general avoidance of accidents. Porsche is therefore consistently working on the development of anticipatory systems. In this way, vehicle safety at Porsche will continue to make an important contribution to general road safety in the future.

In accordance with the rules of the Global ­Reporting Initiative, the topic of “vehicle safety” is covered in this report by the indicator GRI 416: Customer Health and Safety.

Fuel consumption and vehicle emissions
Electrification and digitalisation are responsible for radical change in automotive construction. For its part, Porsche is embracing this challenge. The company builds sports cars that reconcile apparent contradictions: tradition and innovation, performance and day-to-day usability, functionality and design, and ­exclusivity and social acceptance.

At the same time, fuel consumption and ve­hicle emissions have a key role to play. After ­vehicle safety, they were identified as the ­second-most important topic by stakeholders in the 2017 materiality analysis. Their materiality to Porsche is also evidently clear within the company: fuel consumption and vehicle emissions are key issues with regard to commercial relevance, yet they also have significant ecological and social consequences. Con­tinuous efficiency gains, the development of alternative drive technologies, falling fuel consumption and lower emissions – for Porsche, resource-saving and environmentally friendly mobility is a primary strategic target.

In addition to a wide range of measures to ­increase efficiency – from lightweight construction and technologies for the optimisation of conventional combustion engines to the use of smart assistance systems – Porsche is increasingly exploiting hybridisation and the complete electrification of its model range. The themes of “electromobility” and “vehicle architecture of the future” are cornerstones of the Porsche Strategy 2025. The Taycan, ­Porsche’s first all-electric model, is redefining sports car construction in terms of perform­ance, driving dynamism and range.

Optimising consumption is one side of resource-­saving mobility; reducing harmful emissions is the other. Modern exhaust after-­treatment systems reduce emissions, regardless of the current discussion surrounding ­diesel engines. In late October 2018, Porsche recalled its diesel Macan with the 3.0-litre V6 engine in emission class Euro 6 for a software update after irregularities were found in the engine control software. Germany’s Federal Motor Transport Authority (KBA) had ordered a recall for a software update in July 2018 in order to remedy the issue. On 1 August 2018, the KBA approved Porsche’s proposed software update for the Macan with the 3.0-litre V6 diesel engine in emission class Euro 6.

Porsche had already recalled diesel Cayennes with the 3.0-litre V6 engine in emission class Euro 6 in Germany during the previous year. ­Investigations had revealed irregularities in the engine control software for these vehicles. The KBA had ordered a recall for a software update in order to remedy the issue. In mid-­October 2017, the FBA approved Porsche’s proposed software update for its diesel ­Cayenne with the 3.0-litre V6 engine in emission class Euro 6. Porsche has since recalled the vehicles concerned for a free software update.

During the reporting year, the KBA issued ­Porsche with recall notices for the Cayenne 4.2-litre V8 diesel (Euro 5 and Euro 6) and Panamera 4.0-litre V8 diesel (Euro 6). As soon as the technical solution has been approved, vehicle owners will be contacted accordingly by their Porsche dealers.

Porsche consistently aligns its product range with its customers’ wishes and strives to achieve technological leadership. Demand for diesel vehicles is falling. Traditionally, the ­diesel segment has been less important to Porsche, accounting for just 12 per cent of business in 2017. At the same time, interest in hybrid models is soaring. As far as the ­Panamera is concerned, 63 per cent of the ­vehicles delivered in Europe are hybrids. As of February 2018 Porsche no longer included any diesel models in its portfolio. The company made the decision in September 2018 to no longer offer any diesel models.

In accordance with the rules of the Global ­Reporting Initiative, the topic of fuel consumption and vehicle emissions is covered in this report by the indicator GRI 305: Emissions. The figures in this report that are required for this indicator refer, however, solely to emissions that arise in production and adminis­trative operations. For this reason, the ­consumption and emission figures for all ­vehicle models are reported instead.

Materials and sustainable materials
Materials and sustainable raw materials are the building blocks of modern, future-ready vehicle architecture. The Porsche stakeholders surveyed as part of the 2017 materiality ­analysis also assigned a high level of relevance to this issue.

The long service life of Porsche vehicles, their high-quality workmanship and the use of low-wear materials all form part and parcel of the Porsche principle. The company is focusing to an ever greater extent on the environmental effects of a vehicle across its entire life cycle, from the acquisition of raw materials and the vehicle’s manufacture and use through to its disposal. The aim is to achieve a total eco­logical optimum.

Electric vehicles, for example, do not cause ­environmental damage when they are being driven, which helps to improve air quality in built-up areas. Conversely, however, the en­vironmental impact of the manufacturing process is on the increase as a result of the raw materials and production processes used for components such as traction batteries. Together with its suppliers, Porsche is therefore working to make improvements to the battery manufacturing process in order to conserve ­resources, cut the energy density further and improve performance. Against this background, the Battery Recycling Working Group was set up during the year under review in ­order to tackle the key questions of what happens to old batteries once they are no longer fit for use. Information and project findings from the relevant departments are being analysed, and the Working Group is submitting recommendations to the Porsche Group which are then being put into practice. A pilot project is running in parallel in the Aftersales department, as part of which used traction batteries are being recycled for use as energy stores as part of a second life concept. In this way, ­resources can be conserved and sustainability enhanced.

Optimal and environmentally compliant vehicle production is an ongoing task for Porsche. This naturally also applies to the selection of sustainable materials and consideration of life ­cycles. The company has been scrutinising both of these areas as part of its 2025 strategy. Consequently, environmental aspects are ­already being given greater weighting in the pre-development phase and taken into account at an early stage in the project award process. Measures are also in place to raise project managers’ awareness of ecological issues even further. The company is also a heavy promoter of the recycling of raw materials, the extraction and processing of which required a high level of effort.

In this report, the topic of “Materials and sustainable raw materials” is covered in accordance with the rules of the Global Reporting ­Initiative by the indicator GRI 301: Materials. The indicator is measured and reported in terms of the annual consumption of materials.

New mobility concepts
Urbanisation, increasing prosperity, a worldwide increase in mobility and the associated higher environmental pollution trigger innovation and market dynamics for the adaptation of the automobile and its use. These factors are leading to a diversification of drive concepts in a move towards highly efficient, alternative concepts. At the same time, however, more and more new and attractive mobility concepts are also being researched and developed. Digitalisation and connectivity, as well as customers’ desire for more flexibility and sustainability, are accelerating this change. In the 2017 materiality analysis, Porsche stakeholders underlined the huge significance of this turnaround.

Porsche is developing innovative products and services to shape flexible and comfortable mobility. These include innovative parking solutions, needs-driven vehicle usage, seamless integration with other forms of transport and the best possible use of electric vehicles thanks to optimised charging options. Agile and interdisciplinary teams are developing models that take their lead from customers’ latest requirements. This development is ­underpinned by close cooperation between the company’s different departments and an open information policy, as well as by early ­piloting and stakeholder involvement.

The mobility options offered to employees are another key area. An interdepartmental project has been launched to determine how to improve the traffic situation and the mobility of staff at Porsche’s sites around the world for the long term. The project is particularly relevant to the main plant in Zuffenhausen, which is located in an urban area. The employees based there receive a monthly subsidy towards local public transport costs. In addition, the availability of parking at the plant, and mobility around the site grounds have also been significantly improved. Porsche manages the daily delivery traffic as efficiently as possible which is why Logistics is already making use of three natural-gas trucks, one e-hybrid truck and two electric trucks.

In order to make mobility fit for the future and make smart cities a reality, Porsche also ­combines attractive mobility offers, technical expertise and digital solutions. In the year ­under review, Porsche and the PTV Group, the world market leader in the development of ­intelligent software solutions and integrated traffic concepts, examined measures for the liquefaction and relocation of traffic in the Ludwigsburg model area. These included innovative approaches such as a change in traffic management, a shift to public transport or the strengthening of inner-city cycling.

Porsche Consulting has also optimized the road construction site “Am Kräherwald” in a cooperation with the city of Stuttgart sponsored by Porsche. The aim was to significantly accelerate the construction project compared to a road section completed in 2017. The ­Porsche subsidiary introduced a new system for planning and controlling the construction site, which accelerated the construction time by more than 80 per cent and thus reduced congestion and emissions.

ENVIRONMENT & ENERGY

Sustainability principle
Porsche views the conservation of natural ­resources as an entrepreneurial obligation. Whether in development or in production, the objective is to impact the environment as ­little as possible, to use energy efficiently and to increase the share of renewable energies. All the steps taken to this end are scrutinised on a continuous basis along the entire value chain, and improvements are made where necessary.

The “Environment and Energy” action area constantly reviews the themes identified in the 2017 materiality analysis: “energy and emissions during production”, “environmentally compatible logistics” and “resource consumption during production”. Porsche has put in place clearly defined processes and responsibilities for all its divisions. Options for feedback and evaluating processes have also been firmly enshrined in the organisa­tional structure. 

Energy, emissions and resource consumption during production
Global climate change, scarcity of resources and advancing urbanisation all pose enormous challenges to the economy and society. In ­Porsche’s 2017 materiality analysis, the ­Porsche stakeholders who are impacted ­directly or indirectly by the company’s activities assign a great deal of importance to ­“energy and emissions during production” and ­“resource consumption during production”.

Environmentally conscious and energy-efficient activity at all sites and across all levels is an essential element of Porsche’s day-to-day business. A Group-wide environment and ­energy management policy continually checks all work processes along the entire value chain with regard to their ecological impact and any irregularities. Internal sets of rules and strategic guiding principles provide the relevant frame of reference. A dedicated Group guideline defines standardised procedures and responsibilities within the Porsche Group. This supports the Group companies in the ­systematic investigation, observance and checking of the regulatory environmental and energy requirements.

The energy and environment management policy covers emissions (air/noise) and soil protection, dealing with contaminated sites, hazardous materials and waste, as well as emergency preparedness, water and nature conservation and energy efficiency. ­Responsibility for and the systematic implementation of the necessary steps lies with the Member of the Executive Board for Production and Logistics, supported by the Environment and Energy Management department. The fundamental aim is that every Porsche employee should be informed about the effects of his or her work on the environment. Every ­employee is called upon to observe the Group and company guidelines in order to minimise, or ideally avoid, any negative impact on the ­environment.

The strategy field “sustainability in production” in the Porsche Strategy 2025 defines short-term, medium-term and long-term measures. The “Environment and energy efficiency ­strategy” and the company’s own “Environmental policy” are additional strategic guiding principles. In this way the company is implementing a requirement of the international standards for environment and energy management, ISO 14001 and ISO 50001, around which ­Porsche’s internal specifications and processes are based. The sports-car maker also complies with the EMAS (Eco-Management and Audit Scheme) standards, a voluntary community environmental management and auditing instrument developed by the ­European Union. The Porsche site at Stuttgart-­Zuffenhausen has been validated according to EMAS for more than 20 years and was also the first auto­motive industry plant in the world to fulfil the ISO 50001 standard. Since then, Porsche Leipzig GmbH, the Research and ­Development Centre in Weissach including its external locations, the central parts warehouse in Sachsenheim and Porsche Werkzeugbau GmbH have all been certified as compliant with this standard and with the ISO 14001 environmental management system.

In addition to the official certifications, Porsche also carries out internal reviews of compliance with environmental and energy legislation as part of its annual system and process audits (compliance audits). These audits are based on high standards and involve the hiring of ­external environment and energy auditors. The site results method records the impact that a site has on the environment: data and key ­figures are used to rate essential environmental aspects on a scale of high, medium and low relevance. On this basis, Porsche can determine all measures needed to ensure that ­potential negative impacts on the environment are reduced if not eliminated altogether. The Environment and Energy steering committee carries out regular progress checks on the pre-defined goals and initiates appropriate steps. The steering committee works cross-departmentally.

Porsche strives to achieve a balanced environmental performance. Using water as efficiently as possible, through circulation systems and multiple reuse, and the careful handling of contaminated production waste water are important aspects in this regard. Avoiding waste, harnessing low-waste technologies and deploying sustainable disposal solutions are key elements of Porsche’s waste management concept. The company’s “environmental protection” resource regulation serves as an internal guideline and is also binding on suppliers.

Generally, environment and energy management staff are always at the disposal of company stakeholders – internal and external – to answer questions or listen to suggestions on the topic of “environment and energy”. The goal is to foster open and transparent stakeholder dialogue. One example of this approach is the central complaints management system within the environment and construction ­management structure. Porsche’s neighbours may contact central contact persons with any complaints or suggested improvements. All ­issues raised are dealt with individually. This system enables Porsche to react as quickly as possible and to incorporate suggestions into its long-term planning for the improvement of its sites.

In accordance with the Global Reporting Ini­tiative (GRI) standards, Porsche covers the topic of “energy, emissions and resource consumption during production” in the form of the ­following disclosures: GRI 302: Energy, GRI 303: Water, GRI 305: Emissions, GRI 306: Effluents and Waste.

EMPLOYEES & SOCIETY

Sustainability principle
At Porsche, people are at the centre of the company. It assumes responsibility for its ­employees and invests in their future. ­Continuous professional development and qualification are hallmarks of the Porsche ­culture. At the same time, key importance is attached to equal opportunities, diversity and co-determination as well as the ongoing improvement of our employees’ worklife ­balance along with fair and performance-based remuneration. As part of our local and inter­national social commitment in the areas of ­social ­matters, education and science, culture and sport, Porsche initiates its own projects and supports external partners in conducting their own important social activities.

Under the “Employees & Society” action area, Porsche covers, among other issues, the important topics identified in the 2017 materia­lity analysis, namely “attractive employer,” “staff development,” “corporate co-determination,” and “occupational health and safety.” In all four areas, Porsche has clearly defined processes and remits in place, as well as established avenues of evaluation and feedback.

Attractive employer
The basis for successful HR work is Porsche’s continual positioning as an attractive employer. Indeed, Porsche’s stakeholders attributed a great deal of importance to this aspect in the 2017 materiality analysis. Porsche scores ­particularly highly for its excellent general ­conditions, the strong corporate culture and co-determination, and the extensive options for reconciling a career and family life. Firmly anchored in Porsche’s HR strategy, employer attractiveness is one of four central priorities enshrined in the overarching Porsche Strategy 2025. Other benchmarks include the codes of conduct and the “Porsche Business Rules”.

The continuous development of its corporate culture is exceptionally important to Porsche, particularly against the backdrop of the strong growth in staff numbers in recent years, and the company’s new focus on electric technology, digitalisation and connectivity.

The patrons of this corporate culture are ­Porsche Chairman of the Executive Board Oliver Blume, Porsche HR Board Member Andreas Haffner and Uwe Hück, Chairman of the Group Works Council. These individuals embody the Porsche code, which draws on the new culture guidelines comprising the four elements of dedication, pioneering spirit, sportiness and family. The Porsche code replaced the previous leadership guidelines during the year under ­review, and all Porsche managers are taking part in “leadership labs” to help implement it.

Porsche greatly strives to ensure that its staff can achieve a work-life balance. Employees ­receive support through a wide variety of different measures. Thanks to local cooperation partners, sufficient childcare places are avail­able in nurseries located in proximity to the company’s sites. Through its family service, Porsche offers free, individualised and comprehensive support for all family life situations. Porsche also provides flexible working options with respect to place of work and working hours. Options agreed with the Works Council range from arrangements for working from home and flexitime aligned to the employee’s current phase of life through to time off to care for family members. Employees may also take voluntary sabbaticals. Job sharing in leadership roles has also proven to be successful in a pilot project and is now being rolled out further.

In this report, the topic of “employer attractiveness” is covered in accordance with the rules of the Global Reporting Initiative by the indicator GRI 401: Employment. This indicator is measured and reported on the basis of the following key figures: total workforce, employee structure, new hires and employee turnover, and parental leave claims.

Staff development
To be optimally prepared for the challenges facing the automotive industry, Porsche identifies and retains qualified and enthusiastic professionals and managers. The pillars of HR work at Porsche include needs-based training that focuses on future requirements, ongoing skills acquisition, and options and routes for ­internal development. In the 2017 materiality analysis, stakeholders rated the topic of ­employee development as highly important. ­Consequently, Porsche is striving to achieve continuous improvement in this area.

Staff development is founded on professional training as well as the support and qualification of students, for example through training options for dual-study programme students and the ­Porsche Trainee Programme. Another important component is the hiring on the ­basis of permanent contacts of all apprentices who pass their final examination. Throughout their careers, employees have access to a ­diverse range of programs for their systematic pro­fessional development on all levels. These ­include the “Porsche Warm-up“ introduction programme for all new hires, the “Porsche ­Development Programme“ to prepare ­candidates to take on management roles, and ­specific qualification and talent promotion measures tailored to the target group in the field of production.

Porsche also runs two modular and internationally oriented training programmes for managers: the “Porsche International Management Programme“, which has been specially designed for second level managers, and the “Porsche Advanced Management Programme” targeted at senior managers.

Employee support and qualification is not only a central component of the Porsche culture and code, but is also firmly anchored in the Porsche Strategy 2025. The digital revolution in particular is placing new demands on the workforce. This is why it is important to foster shared knowledge of the various aspects of the digital revolution in general and of digitalisation at Porsche in particular. With this in mind, the Fit for Digit@l initiative launched during the previous year was rolled out across the Group with significantly more content ­added. “Work and values in transition”, “The core of digitalisation” and “Digital transfor­mation at Porsche” are now fixed components of the programme.

Employee support and qualification is also a tool used for strategic leadership and planning processes. Individual training requirements are identified during annual employee appraisals, and relevant development opportunities established on this basis. The comprehensive range of training opportunities and individual staff development programmes are continuously being expanded and optimised in consul­tation with the Works Council. Here too, skills relating to the digital world and the ­digital mindset are crucial.

Important cornerstones for digital learning are the Porsche learning platform introduced last year and the new media laboratory, enabling the departments to produce their own digital learning formats. HR Development and more than 150 trained representatives from the ­individual departments regularly update the platform content. The fact that there are now over 24,000 user profiles illustrates the extent to which self-managed learning is being actively embraced by Porsche employees as they look to advance their skills.

The “Lernen@Porsche-Community” group was created during the development of the learning platform. Led by HR Development, this community is composed of stakeholders who are responsible for specialist training in their particular areas. The aim of the group is to enable an exchange of knowledge across departments on all areas relating to skills, digital learning and blended learning. Meanwhile, the didactic and methodological structure of digital learning formats is also discussed. In this way, ­synergies can be harnessed across the network as a whole, creating opportunities for more flexible and sustainable learning.

Against the background of the Porsche Strategy 2025 and the far-reaching changes in the ­automotive industry, the structured creation and expansion of critical skills among all ­employees is a vital aspect of HR development activities. The “Strategic Skills Management” pilot project initiated during the previous year has been successfully concluded. The process of upscaling the project to encompass a full department began in 2018. The aim of stra­tegic skills management is to systematically ­determine the skills needed for the future and to introduce measures to achieve these. Based on current and future roles, the required skills, capacities, job descriptions and requirements are recorded. Future tasks and skills yet to be acquired are then compared against each other by means of a fit-gap analysis. Any identified skill gaps can thus be addressed at an early stage through targeted re-training and further training, recruitment and new priorities in ongoing training.

In this report, the topic of “staff development” is covered in accordance with the rules of the Global Reporting Initiative by the indicator GRI 404: Training and Education. This indicator is measured and reported on the basis of the following key figures: the number of partici­pants in training measures and the average training hours per employee. A survey is currently being carried out for Porsche AG and Porsche Leipzig GmbH with an ongoing expansion to include the Porsche AG Group planned for the future.

Corporate co-determination
One of the pillars of Porsche’s corporate culture is corporate co-determination. The ­relevance of the topic was also highlighted by the 2017 materiality analysis. Porsche benefits from con­tinuous dialogue as well as open, direct communication across all levels of the organisation. The employer and the Works Council have trad­itionally worked together closely on all issues affecting the staff and the company. Internal media keep employees of Porsche AG up to date on current issues. In ­addition, the Works Council offers a comprehensive information and discussion platform with its works meetings, which take place at the individual Porsche locations in Germany. In additional information and specific departmental events, the members of the Board of Management and the Works Council report transparently on current topics and developments. It is also established practice at Porsche to inform all employees and their elected ­representatives about important operational changes, doing so comprehensively and in a timely manner. This is done in compliance with national laws, applicable collective bargaining agreements and works agreements. Adherence to this corporate ­practice is ensured in a number of other ways, ­including through a ­Supervisory Board with equal representation, the Works Council committees, and the works agreement database on the intranet. 

At the same time, there are numerous ways for employees to bring their suggestions, problems or complaints to the attention of committees and decision-making bodies, be it openly or discreetly through special channels. The mood barometer involves an anonymous survey of employees throughout the company about topics relating to the working relationship with colleagues and supervisors, the quality of work and the provision of information. A detailed evaluation of the results is followed by a discussion involving the Works Council in all areas of the company. Potential improvements are identified and measures to optimise work procedures and conditions are agreed on.

In this report, the topic of “corporate co-determination” is covered in accordance with the rules of the Global Reporting Initiative by the indicator GRI 402: Labor/Management ­Relations and GRI 407: Freedom of Association and Collective Bargaining.

Occupational health and safety
Porsche’s most important resource is its motivated and capable workforce. Porsche health management has a key role to play in ensuring that the company can continue to develop, produce and sell exclusive vehicles in the future too. Alongside the well-established tools to secure productivity at the development and production sites, new occupational health ­promotion measures are now also available to certain areas. Porsche employees may also ­arrange to have a thorough medical check-up and obtain medical advice on any health issues. This voluntary health check is carried out by qualified doctors during working hours. The Porsche health management system also includes courses on nutrition, mental health strategies and effective self-management. Employees can also access individual physiotherapy advice at the workplace.

Occupational safety is a top priority for Porsche and its employees. An organised and structured system for occupational health and ­safety ensures a uniform approach and the ­implementation of legal provisions. This system helps to prevent accidents at work and occupational illnesses as far as possible.

The central processes are standardised and regulated by the Group guideline on occupational safety. This guideline represents an ­essential element of the company’s compliance management system and applies to all employees. The managers ensure that their employees are familiar and comply with the provisions of this guideline. Specialists in occupational safety, Works Council members and works doctors are available to all employees in an advisory ­capacity. All staff members are also represented through the legally defined representatives in the occupational safety committees in ­accordance with the Occupational Safety Act.

Safety experts design work stations, equipment and installations with the focus on ­prevention and safety. In order to guarantee the highest possible level of safety for all ­project partners working on construction and installation sites, the occupational safety team has been extended to include construction site experts, thereby exceeding the statutory requirements. These experts monitor compliance with the safety standards, which are ­permanently being updated.

Thanks to the joint dedication, the injury rate has been significantly reduced in recent years. With a current rate of 5.8 accidents per million working hours, Porsche AG and Porsche ­Leipzig GmbH are at the same level as in ­previous years.

In this report, the topic of “occupational health and safety” is covered in accordance with the rules of the Global Reporting Initiative by the indicator GRI 403: Occupational Health and Safety. This indicator is measured and ­reported on the basis of the following key ­figures: number of accidents, work days lost and cases of death, as well as injury rate. The key figures are currently being gathered for ­Porsche AG and Porsche Leipzig GmbH with an expansion to include the Porsche AG Group planned for the future.