5 September 2012

To our stakeholders:

I am pleased to confirm that Van Gansewinkel Groep reaffirms its support of the Ten Principles of the United Nations Global Compact in the areas of Human Rights, Labour, Environment and Anti-Corruption.

In this annual Communication on Progress, we describe our actions to continually improve the integration of the Global Compact and its principles into our business strategy, culture and daily operations. We also commit to share this information with our stakeholders using our primary channels of communication.

Sincerely yours,

Cees van Gent
CEO
Van Gansewinkel Groep bv

Code of conduct
It is Van Gansewinkel Groep’s firm belief that it is impossible to create value without respecting values. In everything we do, we seek to comply with applicable laws and regulations, to make our compliance visible and transparent and to go about our business with integrity. That is why our policy principles and core values and the principles of the UN Global Compact serve as the point of departure, for how we want all our people to conduct themselves. This is how we safeguard our standards and values: for our employees, our customers, our suppliers, our shareholders and the world around us. In 2011 a first Code of conduct was drafted in collaboration and accordance with the Central Works Council describing:

- our organisation
- business integrity
- responsibilities of the company
- responsibilities of the employees

In the company’s business principles a full reference is made to the 10 principals of the UN Global Compact.
Policy principles
• To realise growth for the company and its employees
• To bring about intensive and innovative cooperation with customers in order to provide the best possible service
• To supply raw materials and fuels as a second life for all waste products
• To contribute to a sustainable development of society
• To take social responsibility
Core values
• Putting the customer first: we are involved, genuinely interested and customer oriented
• Progressive: Our vision is Waste No More. This fits with the cradle-to-cradle philosophy
• Partnership and trust: We guarantee integrity and transparency in the processing of material streams
• Prioritising safety: We want everyone who works for us to be able to go home healthy and well
• Promoting competence and expertise: We encourage personal growth and collaboration

Integrity

In 2011 a code of conduct was drafted, together with the regulation on Integrity Issues. Local integrity contacts were appointed at the various sites, and the communication path during integrity-related investigations was formalised. A complaints procedure was included for the manner in which integrity investigations are conducted. To assist employees, we also developed an integrity workshop and a training course for dealing with aggression and violence. These will be rolled out further in 2012.
Sustainable supply chain management

Van Gansewinkel Groep has a formal monitoring process in place of the supply chain. Most critical are the waste treatment facilities, where collected waste is brought to. We adapted the audit checklist to include human rights topics. Next step will be to create a supplier code of conduct which will be based on our own Code of Conduct.

Integrity

The Integrity Manager received 33 reports of non-integrity during 2011. Some of those reports came from within the organisation, while others were made by individuals and institutions outside the organisation. The reports concerned one instance of aggression and violence (internal), 19 instances of crime (primarily theft), two instances of fraud, two instances of improper practices with regard to working hours, one instance of improper use of company assets, four instances of improper/indecent conduct and four other incidents.

Of the 33 reports, 16 were taken under investigation and three were forwarded to the HR department as concerning undesirable forms of conduct. For 15 reports, it was decided that they were to be classified as not requiring investigation. The reasons for that classification were explained to the parties reporting the incidents, further advice was issued or the report was forwarded to another department or organisation. Four investigations are still pending in 2012. Several instances resulted in reports being filed with the police, and in some cases criminal investigations were conducted. Three employees were dismissed with immediate effect on grounds of involvement in instances of non-integrity.

Van Gansewinkel Groep did not receive any complaints about violations of human rights in 2011.

Sustainable supply chain management
Depending on the score, a high/medium/low risk profile will be assigned. The criteria for processing businesses are the type of waste processed, the business’s situation with regard to permits, the system certificates achieved, whether or not the business processes cross-border waste and the country of final processing business. Depending on the risk profile, we might assess additional or fewer details relating to compliance with laws and regulations. Negative reports about our partners also give us cause to take additional steps or to assign a higher risk profile to particular businesses. Our ambition is to map out as much of the supply chain as is possible. As such, we are increasingly concentrating on the parties that are the ultimate recipients of our flows of raw materials. Based on our sustainable development ambitions, in 2012 we will also assess the extent to which processing businesses and partners, both in Europe and elsewhere, are demonstrably committed to the standards of the UN Global Compact. For example, requirements will apply with regard to such issues as ethics, integrity, human rights and child labour.

In 2011 we commenced work on a methodology for selecting and assessing (critical) suppliers. That methodology is an extension of the methods used for processing businesses. Suppliers are initially assessed based on their impact on our primary process, on the risk they pose for our image and on turnover. A series of checklists is used to assign each supplier a level per separate theme. Themes considered in this connection include compliance with laws and regulations, orderliness and neatness, safety, care system, quality of processes and products and social aspects. These themes are compared with the guidelines set out in the UN Global Compact. The Group audits its critical suppliers at least once every three years. Nine audits were conducted last year.
A procurement board has been set up for the Collection & Services business unit, to offer assurance with regard to the separate interests relating to the use of our suppliers within the overall business unit. That board is made up of a multidisciplinary team of members of the company’s management. It commissioned a study into the possibilities for improving our business’s sustainable procurement practices. The results were assessed during a round-table conference with suppliers. The input provided by that session will be taken on board as we fine-tune the sustainable procurement policy that will be introduced in 2012. This will be further adjusted and implemented based on individual and group meetings with suppliers to discuss the practical application of the policy. We also plan to introduce similar boards for the other business units.

In 2011 a first Code of conduct was drafted in collaboration and accordance with the Central Works Council describing:

- our organisation
- business integrity
- responsibilities of the company
- responsibilities of the employees

In the company’s business principles a full reference is made to the 10 principals of the UN Global Compact.

Employee participation

Van Gansewinkel Groep encourages employee participation, and for that purpose actively seeks out the dialogue with its employees and representatives (employee participation councils and unions). We believe that cooperation with those councils and unions is a very important factor in realising our mutual goals.

The way in which employee participation has been given shape reflects the decentralised business model fostered by our group: participation where the actual work takes place: at the separate companies. Almost every division has its own works council. Group Works Councils for Collection, Recycling and Processing also exist, as well as a Central Works Council. Each works council has a SHWE (Safety, Health, Welfare and Environment) committee, as required by the Dutch Working Conditions Act (Arbowet). In all, 121 and 12 employees, respectively, were active in the various Dutch and Belgian works councils.

Collective employment agreement

Over 90% of Van Gansewinkel Groep’s employees are subject to a collective employment agreement or other form of collective scheme. Under the collective employment agreements, salaries are based on the pay grades for specific jobs. As such, no measurable difference exists between the salaries of male and female employees. The collective employment agreements for Professional Goods Transport by Road (Beroepsgoederenvervoer over de weg), WENb (Waste & Environment sector), Metalworking Industry (Metaalnijverheid) and Orsima are in force in the Netherlands. In Belgium indirect employees have what is commonly known as collective insurance. Direct employees fall under three joint committees: PC 226 (transport/logistics), PC 121 (cleaning) en PC 142 (recovery of materials). These include pension schemes and early retirement schemes. In the Czech Republic, two subsidiaries – Tempos a.s. and Van Gansewinkel Services sro – have collective employment agreements. The other employees, like those in Poland, have individual contracts that are based on internal regulations and prevailing laws and regulations. There, too, no distinction is made between men and women. The conditions for permanent employees, such as insurance, healthcare and leave entitlement also apply to temporary employees.
The collective employment agreements also specify minimum periods of notice in connection with operational changes.

Health and safety

Since the introduction of an agreement for Safety, Health, Environment and Quality (SHEQ Agreement) in 2007, and its implementation in the Group’s separate regions and businesses, the safety figures are displaying a positive trend. The Injury Frequency rate (IF) dropped by more than 20% for the fourth consecutive year: this year the figure dropped by 27%. The severity rate dropped by more than 22% to 0.19. That figure is low compared with the average for the sector. For the second consecutive year we did not experience any fatal incidents.

The lost time injuries, 104 in all, mostly concerned bruises, sprains and cuts. In 97 cases the victims were men and in 7 cases women. We regret that 18 serious incidents also occurred, involving broken bones and amputations. In 2 cases the victims had their fingertips removed. In the most serious incident, a worker at the Krakow location in Poland lost his forearm.
We inform our external employees about safety and provide them with relevant basic training. However, the IF among temporary employees was 80% higher than among our own employees (12.3 compared with 6.8%) in 2011. Research* shows that the following factors have a major impact on work-related incidents of temporary employees:
• Age of victims: 50% of temporary employees are younger than 30. This age group is involved in 60% of all work-related incidents
• Integration and rotation of temporary employees: work-related incidents are more likely to occur at the start of a job. Temporary employees change jobs more often than permanent employees and as such have a higher risk of becoming the victim of a work-related incident
• Temporary employees are often employed as direct employees and as such are more exposed to risks
* The findings presented above have been taken from a Belgian study of figures for 2009 conducted by Preventie en Interim (PI): www.p-i.be/nl/

Prevention

To help reduce the number of incidents even further, we are placing an even greater emphasis on reporting unsafe actions and hazardous situations, the ‘near misses’. We have started mapping out the underlying layers of the accident pyramid more carefully. This means that all incidents, for example incidents leading to different work or hospitalisation and first-aid incidents must be reported in a clear-cut manner. As a consequence, management now has a report that allows for even better response to near misses and helps us to prevent those near misses from becoming incidents. Targets (levels of ambition) have been defined for several of the categories identified. This shows whether our accident pyramid is a ‘healthy’ one. The results for 2011 were as follows:
• Number of ‘recordables’ compared with number of total recordable cases: 3, target was also 3
• Number of first-aid cases compared with number of lost time injuries: 4.3, target was 10
• Number of near misses compared with number of total recordable cases: 33, target was 50

The results show that the accident pyramid is statistically ‘unhealthy’. Too few first-aid cases and near misses are reported. We feel that this is sufficient cause to take steps. This issue was discussed during the Top 200 management, and local initiatives have been taken to better record first-aid cases and to further lower the threshold for reporting near misses.

Absence

The absence rate for Van Gansewinkel Groep’s total workforce was 5.1% last year. Ambition is to reduce this to 4.9% in 2012. The frequency with which employees called in sick in 2011 was 1.2%. In Benelux the absence rate decreased from 5.4% in 2010 tot 5.3% in 2011.

Awareness raising – integrity

In 2010 we started work on actively giving shape and substance to the theme of integrity, to further improve the professionalism of our sustainable development efforts. The appointment of an Integrity Manager to give further shape and substance to policy, awareness, prevention and research was the starting point in this process. Last year we worked on developing an integrity policy and drafting a Code of Conduct, Integrity Regulations and an Investigations Protocol. Local integrity contacts were appointed at the various sites, and the communication path during integrity-related investigations was formalised. A complaints procedure was drawn for the manner in which integrity investigations are conducted. To assist employees, we also developed an integrity workshop and a training course for dealing with aggression and violence. These will be rolled out further in 2012.

Measurement of results
Every two years since 2008, Van Gansewinkel Groep has conducted an Employee Motivation Survey (EMS). The surveys show how the company manifests itself in ever-changing circumstances and provides information about areas that require more adjustment.
The results of the EMS conducted late in 2010 showed that the general level of satisfaction with our work scored 7.4 out of 10. Willingness to help out colleagues scored highest, with 8.3. Opportunities for development, working conditions and follow-up on measures in response to the 2008 EMS scored lowest.

In response, the managing boards of all the group’s divisions and regions set about developing plans for improvement, which they drafted during 2011 with input from the local works councils. Parts of those plans were already implemented in 2011; implementation will be completed during 2012. Wherever possible, the actions incorporate the centrally defined priorities: 1) organisation, 2) opportunities for development and 3) working conditions.
A number of actions have been set up and implemented in response to the results, as illustrated by these examples:
•It emerged from the EMS that staff of a business unit were unhappy with the terms of employment. The EMS also showed that the terms at one branch were different from those at the other branch. This caused differences between colleagues of separate branches when they needed to work together on projects. The fringe benefits have been harmonised, with effect from 1/1/12, in very close cooperation with the works council
•One branch argued that management was perceived to be isolated from the workfloor. As physical proof that no ‘wall’ exists between the management team and the workfloor, a partition was literally removed
•The EMS showed that employees in a certain region wished to be kept informed of business in a different, more future-oriented way. In response, visits were paid to all locations and employees were interviewed to hear what their wishes and expectations were. Quick wins were arranged straight away and made visible, including the use of television screens
A central database will be used to monitor the actions.

At the management meeting of the Top 200 (the company’s management layer) in November, workshops were organised that addressed the progress being made with the improvements based on the EMS. The conclusion was that a great deal of effort was being put into the improvements, but that in particular knowledge sharing could be improved. People are still not properly informed about the progress being made with the actions stemming from the survey. That is why interviews will be held in 2012 with the people who have become the driving forces behind improvement projects. These show cases will be shared using internal media and will accompany the next EMS in the form of a newspaper.

The EMS results were incorporated into the bonus system in 2010 and 2011. This serves to further embed the follow-up on results and works as a driver to carry through improvements. It reinforces the importance of satisfied employees and management’s responsibility and role in achieving that satisfaction.
Van Gansewinkel Groep will continue to use Employee Motivation Surveys as control tools. The next EMS will be conducted in December 2012.

Male/female diversity
Van Gansewinkel Groep had operations in nine European countries in 2011. Besides the 6,027 employees (not including Veolia Belgium), an average of 1,061 FTEs from temporary employment agencies worked for the company over the course of the year.
Last year 4,943 men and 1,084 women worked for Van Gansewinkel Groep based on fixed-term or permanent employment contracts. The corresponding figures for 2010 were 4,846 men and 972 women. This means that the change in the proportions during 2011 was minimal.

Male/female diversity in management
Management (members of the Board of Directors, directors of the central support departments and regional management teams) of Van Gansewinkel Groep comprises mostly men. The group of staff reporting directly to members of the Board of Directors is made up of 33 men and 1 woman. The ‘Top 200’, as it is commonly known, consists of 161 men and 20 women.

New employees

The workforce increased from 5,818 to 6,027 employees (not including Veolia Belgium and temporary employees) in 2011. We have made structural investments in expertise by providing training and hiring people whose profile suits our transformation to a supplier of

Staff turnover
Staff turnover, i.e. the number of employees no longer working for Van Gansewinkel Groep divided by the number of employees at year-end, was 10.9%, compared with 14% for the year before. We had 864 new employees, compared with 657 employees no longer working for Van Gansewinkel Groep.

Collective employment agreement

Over 90% of Van Gansewinkel Groep’s employees are subject to a collective employment agreement or other form of collective scheme. Under the collective employment agreements, salaries are based on the pay grades for specific jobs. As such, no measurable difference exists between the salaries of male and female employees. The collective employment agreements for Professional Goods Transport by Road (Beroepsgoederenvervoer over de weg), WENb (Waste & Environment sector), Metalworking Industry (Metaalnijverheid) and Orsima are in force in the Netherlands. In Belgium indirect employees have what is commonly known as collective insurance. Direct employees fall under three joint committees: PC 226 (transport/logistics), PC 121 (cleaning) en PC 142 (recovery of materials). These include pension schemes and early retirement schemes. In the Czech Republic, two subsidiaries – Tempos a.s. and Van Gansewinkel Services sro – have collective employment agreements. The other employees, like those in Poland, have individual contracts that are based on internal regulations and prevailing laws and regulations. There, too, no distinction is made between men and women. The conditions for permanent employees, such as insurance, healthcare and leave entitlement also apply to temporary employees.

The collective employment agreements also specify minimum periods of notice in connection with operational changes.
Most of the 22 processing businesses and suppliers audited in 2011 achieved sufficient to good scores. In total, three operators scored insufficient result and three were classified as ‘No Go’. Plans for improvement have been drawn up with those six businesses, and arrangements have been made about the timing of the improvements. The businesses with ‘No Go’ scores are subject to additional supervision. Our partnerships with them can only continue once the plans for improvement have been fully implemented. The results of the audit process led to us discontinuing our partnership with one business.
In two instances, Van Gansewinkel Groep’s auditors were involved in performing audits as part of due diligence work.

Information and management systems

Because every incident is one too many, incidents and dangerous situations are recorded in TrackWise. Those records are used for analysis and follow-up within the organisation. The causes, actions and lessons learned are communicated throughout the organisation, to draw continual attention to safety and to increase awareness.

Van Gansewinkel Groep has set up environmental management systems at all its critical businesses and locations. This means that potential hazards have been identified, the risks and impact calculated and appropriate control measures put in place.
In 2011, the management system for ensuring accurate, complete and secure registration of SHEQ-related items was expanded with the addition of a module for integrity and compliance violations.

Independent verification of management systems

Bureau Veritas Certification audits and certifies Van Gansewinkel Groep’s various local management systems. The thoroughness of the external management system audits has proven to be an excellent driver for improvements. The external audits conducted in 2011 (>200 audit days for the whole of Van Gansewinkel Groep) resulted in 130 Non-Compliance Reports (NCRs), of which 34 ‘majors’ and 96 ‘minors’. Although this is comparable with the findings for 2010 (139 NCRs), the number of certificates increased, particularly OHSAS 18001. The three most frequent NCRs concerned the following elements (or non-compliance therewith):
• Measurement and monitoring: not all scheduled internal audits were performed, and the mandatory annual compliance check was not carried out, or not carried out properly
• Product realisation: Van Gansewinkel Groep has drawn up acceptance conditions for accepting or rejecting streams of waste. The audits showed that awareness of or adherence to those conditions is lacking in practice
• Risk management: our analyses of environmental aspects and risk identification and assessment are incomplete and/or outdated
The separate regions are required to remedy all these NCRs within three months, and the remedies must be accepted by Bureau Veritas Certification. To date we have succeeded in doing so. The final outstanding actions will be completed early in 2012.

Compliance

Last year, a total of eight material penalties/sanctions (higher than €500) were paid for non-compliance with laws and regulations.
Two instances concerned non-compliance with the Dutch Working Conditions Act (Arbowet), two instances involved violations of ADR regulations (transport of hazardous goods), one instance involved non-compliance with the Dutch Driving Hours Decree (Rijtijdenbesluit), one instance concerned a vehicle with an excessive load, one instance concerned the absence of the correct authorisation for a particular type of waste and one instance involved an expired fire extinguisher. The total penalty was €19,711.
The competent authorities imposed five orders for incremental penalties for:
• Non-observance of a CO2 emission standard
• Non-observance of a maximum duration for inoperational particulate matter sampling
• Non-observance of a water emission standard
• Non-compliance with regulations under the Dutch Major Accidents (Risks) Decree (Besluit Risico’s Zware Ongevallen)
• Non-observance of a maximum noise level

A single penalty was collected for the last of these orders only, to the sum of €250. For the remaining orders, it is currently unclear whether any penalties will be collected in 2012.
The Integrity Manager received 33 reports of non-integrity during the year. Some of those reports came from within the organisation, while others were made by individuals and institutions outside the organisation. The reports concerned one instance of aggression and violence (internal), 19 instances of crime (primarily theft), two instances of fraud, two instances of improper practices with regard to working hours, one instance of improper use of company assets, four instances of improper/indecent conduct and four other incidents.

Of the 33 reports, 16 were taken under investigation and three were forwarded to the HR department as concerning undesirable forms of conduct. For 15 reports, it was decided that they were to be classified as not requiring investigation. The reasons for that classification were explained to the parties reporting the incidents, further advice was issued or the report was forwarded to another department or organisation. Four investigations are still pending in 2012. Several instances resulted in reports being filed with the police, and in some cases criminal investigations were conducted. Three employees were dismissed with immediate effect on grounds of involvement in instances of non-integrity. Van Gansewinkel Groep did not receive any complaints about violations of human rights in 2011.

The worldwide population growth and increasing prosperity are causing raw materials to become scarcer. In the longer term, we should expect physical shortages of materials worldwide. Already certain materials – for example specific earth metals used by the hightech industry and for other purposes – are becoming less freely available because they are being reserved for a small number of countries. This is damaging to political, economic, ecological and social interests.

The global scarcity of raw materials forms the basis for our strategy. As a raw material and energy supplier Van Gansewinkel Groep can make a significant contribution to fighting raw material scarcity and global warming. Together with customers and other stakeholders, recycling and waste prevention can help keep natural raw materials in the environment. And, in nearly every instance, recycling leads to CO2 reduction.

Van Gansewinkel Groep succeeded in giving more waste a second life in 2011 than in the year before. In total, 77.5% of the waste was given a second life by being used as a raw material or being usefully applied as green energy. By giving 58.1% of the waste a second life in the form of raw materials or building materials, we also prevented the emission of 1.22 million tons of CO2. These performances exceeded the ambitions that we expressed last year.

Van Gansewinkel Groep is working together with various larger and smaller parties that see us as the connecting link in closing chains of materials. This has resulted in the establishment of more than a hundred initiatives over the past four years. In 2011, for example, the EcoSmart SmartBin was C2C-certified and we entered into a partnership with Koninklijke Auping for recycling and upcycling mattresses.

In 2011, our ambitions were explicitly focused on further increasing the percentage of materials given a second life. The forecast for 2012 is that we will be able to convert 58.5% of our waste into raw materials or building materials. This should prevent 1.25 mtons of CO2 emissions in the chain. Our long-term vision is that ultimately only around 10% of our materials will be incinerated, while the remainder will be given some form of second life. The final 10% that is incinerated will consist of materials for which incineration is wiser for reasons of hygiene, or for which recycling is technically possible but the ecological/economic balance is negative. We will dedicate our efforts to working with partners in the market to ensure that any materials that are incinerated will eventually be designed in such way that they can in fact be incinerated: designed for incineration, as it were. Those materials will not contain any interferants, generate a favourable percentage of energy and produce clean ashes, which can then be used as building materials or as ground structure materials. We will achieve this relative reduction in the incinerated volume by substantially expanding our other activities, services and reclamation of raw materials.

As part of the development outlined above, we will again focus on further increasing the volume of raw materials to be reclaimed in 2012, in all our categories of materials: minerals, metals, plastics and biogenous materials. We have defined growth targets varying between 5% and 25%. At the same time, we are constantly working to improve the level of the second life, to match the C2C philosophy that it is very important to maintain the quality of a material for the same product purpose or the same function. For example, we have set up specific programmes to further increase the volume of our plastics and at the same time improve their quality. For biogenous materials, we are explicitly working on building what is commonly known as a biomass cascade, in which valuable raw materials and nutrients are first extracted from biomass and then used as fuels or fertilisers.

CO2 emission prevented in the chain

The European climate policy targets a 20% reduction in CO2 emissions by 2020 (compared with 1990). For the Netherlands, reductions of 40% and 80% (compared with 1990) are targeted for 2030 and 2050, respectively (Durban Conference 2011). CO2 emissions in the Netherlands in 2011 totaled 200 million tons: 6% less than in 1990. To realise the European 2020 target of a 20% reduction compared with 1990, we must achieve a further 14% reduction, or 28 million tons of CO2.

Van Gansewinkel Groep prevented 1.22 million tons of CO2 emissions in the chain in 2011, which represents 4.4% of the European target for 2020. In terms of the 2030 target for the Netherlands, the emissions need to be reduced by a total of 75 million tons during the next 18 years. Van Gansewinkel Groep’s 1.22 million tons of CO2 prevention in the chain represents 1.6% of that target.
This shows that recycling and producing energy from waste can contribute significantly to the reduction of CO2 emissions. By increasing recycling rates and preparing the recycled streams of waste/raw materials generated for high-grade applications, we can further increase the volume of CO2 prevented in the chain. We can autonomously achieve significant results within the space of a few years, for example by optimising the collection and sorting of waste substances and upgrading them to high-grade raw materials. Additional incentives through tax breaks (low VAT rate), raw materials passports, CO2 and credits for compost will also yield visible results within a period of five to ten years towards achieving the CO2 targets for the Netherlands and Flanders. In the other countries of the EU where recycling is less prominent and where much of the waste still ends up in landfills or is incinerated, without any appreciable heat or electricity generation, proper waste management can lead to substantially higher gains, percentage-wise, towards realising the CO2 reduction targets

To optimally convert the collected waste substances into raw materials and energy, we ourselves often need to perform high-energy activities with materials. This automatically means that we emit CO2. As discussed above, the output, i.e. the raw materials that Van Gansewinkel Groep supplies, such as glass, metals, plastics and wood, lead to considerably lower CO2 emissions in the production of new goods. As such, although increasing our own efforts to upgrade waste substances to raw materials might result in an increase in our ‘own’ CO2 emissions, ultimately it leads to a significant reduction in the chain as a whole. Van Gansewinkel Groep believes that improving the second life percentage is a more important goal than reducing CO2 emissions in the whole chain.

Environmental and reputation risks
As a waste service provider and supplier of raw materials and energy, Van Gansewinkel Groep operates in the environmental sector. Parties operating in this sector are exposed to risks associated with incidents that have an adverse impact on the environment and that give rise to costs for remedying the situation. Incidents might also have a negative effect on Van Gansewinkel Groep’s reputation and good name. Van Gansewinkel Groep has set up environmental management systems at all its critical businesses and locations. This means that potential hazards (for example fire) have been identified, the risks and impact calculated and appropriate control measures put in place. Each operational entity has trained staff and has built suitable checks into the process of acceptance and processing. No corners are cut with investments aimed at supporting these control measures. If an incident as yet occurs, the emergency plans will be put into action. Our organisation’s readiness is tested regularly. The company adopts a proactive central crisis communication policy in the case of incidents.

Awareness raising

In 2011 we again accepted various invitations to give presentations and we participated in discussions and dialogues of others. People want to hear what we have to say. The theme of raw materials is a prominent issue on the social and political agenda.
The dialogue with others helps us to add depth and scope to our vision and generates valuable input for follow-up processes in separate areas. For example, it allows us to continually contribute to and help drive the discussion concerning the concept of a circular economy and yields valuable input for improving our annual report.

In dialogue with the Board of Children
In 2010, Van Gansewinkel Groep started a partnership with the Missing Chapter Foundation of Princess Laurentien van Oranje-Nassau. The aim of that non-profit organisation is to bring today’s decision-makers into contact with children’s refreshing and candid ideas about strategic dilemmas surrounding sustainability. Under the name of Raad van Kinderen (‘Board of Children’), the foundation links primary schools to businesses. Van Gansewinkel Groep also has its ‘own’ Board of Children: the 8th Montessori School Zeeburg in Amsterdam. Last year, we talked with them about our vision of Waste No More and about how Van Gansewinkel Groep can make sure that producers use ‘cleaner’ methods to make their products and that consumers separate more waste to give it a second life in the form of raw materials. In 2012, the Board of Children will meet with some members of the management team to discuss their ideas.

Dialogue with our customers
In 2007, Van Gansewinkel, together with a number of major industrial customers, formed the ‘Platform for Industry’ as a way to share expertise and understanding. The members meet annually. In 2011, they met at the ‘Raw Materials Recovery Forum’ organised by Van Gansewinkel. A series of propositions were posited to generate discussion about the mandatory use of recycled materials in the production of goods, regulations about mandatory recycling of unwanted products and how to merge economics and ecology to ensure the success of a circular economy. Based on this discussion, among other conclusions, the meeting determined that what appears to be waste material for one operator can constitute a raw material for another. Van Gansewinkel can act as the connecting link here. The next session, which is scheduled for mid-2012, will consider the extent to which this has become a reality.

Initiatives and programmes to reduce waste materials

As a raw material and energy supplier we can make a significant contribution to fighting raw material scarcity and global warming. Together with customers and other stakeholders, recycling and waste prevention can help keep natural raw materials in the environment. And, in nearly every instance, recycling leads to CO2 reduction.

Van Gansewinkel Groep succeeded in giving more waste a second life in 2011 than in the year before. In total, 77.5% of the waste was given a second life by being used as a raw material or being usefully applied as green energy. By giving 58.1% of the waste a second life in the form of raw materials or building materials, we also prevented the emission of 1.22 million tons of CO2. These performances exceeded the ambitions that we expressed last year.

Environmental incidents
Last year, Van Gansewinkel Groep’s activities led to environmental incidents on 290 occasions. Of those incidents, 143 concerned discharges into the air. Most of those cases took place at the energy-from-waste stations, and primarily involved the carbon monoxide emission standards being exceeded. A further 96 incidents involved discharges into the ground, including primarily oil spills. A few times this involved several hundreds of litres. Discharges into water occurred on 32 occasions. Once this involved a discharge of around 100 litres of oil into the surface water. Other types of incidents occurred on 25 occasions, for example excessive levels of dust and odours. In addition, fires occurred 79 times in 2011. Our own staff were able to put out 52 of those fires. The fire services were needed on 27 occasions. None of the fires caused any appreciable damage. All environmental incidents are reported and recorded in a central database, and the measures to be taken are strictly adhered to in the environmental care system.

Emissions
The principal locations of airborne emissions are the energy-from-waste plants in Rozenburg and Duiven. A number of components in the airborne emissions are measured continually (or semi-continually). The measuring equipment has been verified and approved, and no permit requirements were exceeded in any significant way.

By far the majority of the Group’s waste water is produced by the two energy-from-waste plants in Rozenburg and Duiven and the activities of Van Gansewinkel Minerals. The volume is the same as the average water pollution caused by 3,800 Dutch individuals during a year. The waste water from the remaining Van Gansewinkel Groep activities is insignificant and comprises less than 5% of the volumes listed in the table below.

Biodiversity

The location of our sites and the work connected to them mean that our activities have a very minor, if not negligible, impact on the biodiversity. Earlier inventories showed that a few Van Gansewinkel Groep sites are located near nature conservation areas. Groundwater is extracted at only three sites, where the effects on the surrounding areas are negligible. None of the environmental permits for any of the sites stipulate restrictions that have a measurable influence on our operations.

Information and management systems
Van Gansewinkel Groep has set up environmental management systems at all its critical businesses and locations. This means that potential hazards have been identified, the risks and impact calculated and appropriate control measures put in place.
In 2011, the management system for ensuring accurate, complete and secure registration of SHEQ-related items was expanded with the addition of a module for integrity and compliance violations.

Independent verification of management systems
Bureau Veritas Certification audits and certifies Van Gansewinkel Groep’s various local management systems. The thoroughness of the external management system audits has proven to be an excellent driver for improvements. The external audits conducted in 2011 (>200 audit days for the whole of Van Gansewinkel Groep) resulted in 130 Non-Compliance Reports (NCRs), of which 34 ‘majors’ and 96 ‘minors’. Although this is comparable with the findings for 2010 (139 NCRs), the number of certificates increased, particularly OHSAS 18001.

Compliance
Last year, a total of eight material penalties/sanctions (higher than €500) were paid for non-compliance with laws and regulations.
Two instances concerned non-compliance with the Dutch Working Conditions Act (Arbowet), two instances involved violations of ADR regulations (transport of hazardous goods), one instance involved non-compliance with the Dutch Driving Hours Decree (Rijtijdenbesluit), one instance concerned a vehicle with an excessive load, one instance concerned the absence of the correct authorisation for a particular type of waste and one instance involved an expired fire extinguisher. The total penalty was €19,711.
The competent authorities imposed five orders for incremental penalties for:
• Non-observance of a CO2 emission standard
• Non-observance of a maximum duration for inoperational particulate matter sampling
• Non-observance of a water emission standard
• Non-compliance with regulations under the Dutch Major Accidents (Risks) Decree (Besluit Risico’s Zware Ongevallen)
• Non-observance of a maximum noise level
A single penalty was collected for the last of these orders only, to the sum of €250. For the remaining orders, it is currently unclear whether any penalties will be collected in 2012.

Code of conduct
Our business stands or falls with trust, and that trust has to be earned every day. Our people play an important part here. In 2011, we adopted a code of conduct that addresses important elements of desirable fair and honest conduct. The code of conduct describes not only what conduct is expected from Van Gansewinkel Groep’s employees, but also what the employees may expect from Van Gansewinkel Groep. The code expands on the policy principles and serves as an umbrella for other, more specific codes and policy documents within the Group. The Code of Conduct will be introduced at the start of 2012.

Operational risks
Operational risk management refers to the process of identifying and quantifying risks stemming from the operation of business functions at our organisation. Operational risk management also includes deciding what control measures are necessary. Control measures are activities that reduce the possibility that a risk will occur or limit the possible consequences. The principal operational risks are:

Fraud
Fraud is a phenomenon that takes many forms, that has no precise definition and that overlaps with activities such as deceit, forgery, abuse, data manipulation and impersonation. Van Gansewinkel Groep uses a broad definition of fraud: intentional deception for the purpose of unlawful or illegal gain. To prevent fraud, instances of fraud must naturally first come to light and come to the attention of those who can take steps. Van Gansewinkel Groep seeks to increase the willingness to report such instances. Everybody is urged to report violations of the code of conduct. Van Gansewinkel Groep’s Code of Conduct sets out important elements of desirable fair and honest conduct. The code of conduct can help employees to weigh different options and to make their choices. Reports can be made via the employee’s immediate manager or higher management, the local Integrity Contact and/or Van Gansewinkel Groep’s Integrity Manager. Employees reporting a violation or a suspicion of a violation need not worry about any repercussions and are protected in accordance with the Integrity Regulations.
As explained above, a framework has been developed for the internal controls for financial processes. Various processes aimed at limiting fraud risks are used to verify whether:
• Functional separation is in place where necessary
• Authorisation and delegation schedules are followed
• Payments are recorded and made in the appropriate manner
• Stocktakings are conducted in the appropriate manner
• Elementary elements of IT security are used and critical data are protected

Integrity
In 2010 we started work on actively giving shape and substance to the theme of integrity, to further improve the professionalism of our sustainable development efforts. The appointment of an Integrity Manager to give further shape and substance to policy, awareness, prevention and research was the starting point in this process. Last year we worked on developing an integrity policy and drafting a Code of Conduct, Integrity Regulations and an Investigations Protocol. Local integrity contacts were appointed at the various sites, and the communication path during integrity-related investigations was formalised. A complaints procedure was drawn for the manner in which integrity investigations are conducted. To assist employees, we also developed an integrity workshop and a training course for dealing with aggression and violence. These will be rolled out further in 2012.

The Integrity Manager received 33 reports of non-integrity during the year. Some of those reports came from within the organisation, while others were made by individuals and institutions outside the organisation. The reports concerned one instance of aggression and violence (internal), 19 instances of crime (primarily theft), two instances of fraud, two instances of improper practices with regard to working hours, one instance of improper use of company assets, four instances of improper/indecent conduct and four other incidents.

Of the 33 reports, 16 were taken under investigation and three were forwarded to the HR department as concerning undesirable forms of conduct. For 15 reports, it was decided that they were to be classified as not requiring investigation. The reasons for that classification were explained to the parties reporting the incidents, further advice was issued or the report was forwarded to another department or organisation. Four investigations are still pending in 2012. Several instances resulted in reports being filed with the police, and in some cases criminal investigations were conducted. Three employees were dismissed with immediate effect on grounds of involvement in instances of non-integrity.
Van Gansewinkel Groep did not receive any complaints about violations of human rights in 2011.

In 2010 we started work on actively giving shape and substance to the theme of integrity, to further improve the professionalism of our sustainable development efforts. The appointment of an Integrity Manager to give further shape and substance to policy, awareness, prevention and research was the starting point in this process. Last year we worked on developing an integrity policy and drafting a Code of Conduct, Integrity Regulations and an Investigations Protocol. Local integrity contacts were appointed at the various sites, and the communication path during integrity-related investigations was formalised. A complaints procedure was drawn for the manner in which integrity investigations are conducted. To assist employees, we also developed an integrity workshop and a training course for dealing with aggression and violence. These will be rolled out further in 2012.

In 2010 we started work on actively giving shape and substance to the theme of integrity, to further improve the professionalism of our sustainable development efforts. The appointment of an Integrity Manager to give further shape and substance to policy, awareness, prevention and research was the starting point in this process. Last year we worked on developing an integrity policy and drafting a Code of Conduct, Integrity Regulations and an Investigations Protocol. Local integrity contacts were appointed at the various sites, and the communication path during integrity-related investigations was formalised. A complaints procedure was drawn for the manner in which integrity investigations are conducted. To assist employees, we also developed an integrity workshop and a training course for dealing with aggression and violence. These will be rolled out further in 2012.

The Integrity Manager received 33 reports of non-integrity during the year. Some of those reports came from within the organisation, while others were made by individuals and institutions outside the organisation. The reports concerned one instance of aggression and violence (internal), 19 instances of crime (primarily theft), two instances of fraud, two instances of improper practices with regard to working hours, one instance of improper use of company assets, four instances of improper/indecent conduct and four other incidents.

Of the 33 reports, 16 were taken under investigation and three were forwarded to the HR department as concerning undesirable forms of conduct. For 15 reports, it was decided that they were to be classified as not requiring investigation. The reasons for that classification were explained to the parties reporting the incidents, further advice was issued or the report was forwarded to another department or organisation. Four investigations are still pending in 2012. Several instances resulted in reports being filed with the police, and in some cases criminal investigations were conducted. Three employees were dismissed with immediate effect on grounds of involvement in instances of non-integrity.

Van Gansewinkel Groep did not receive any complaints about violations of human rights in 2011.