Canon EMEA Sustainability Report 2013

canon-europe.com

Canon Europe, Middle East & Africa Sustainability Report 2013

Front cover photo: Alexandra Dias Fernandes – Canon DIGITAL IXUS 870 IS

2 Canon EMEA Sustainability Report 2013 www.canon-europe.com/About_Us/sustainability/

Contents3 Message from the President & CEO, Canon Europe, Middle East & Africa

4 About Canon

6 Supporting our customers

8 Environment

12 Society

16 Business

This symbol indicates that more information is available on our website.

Rokus van Iperen

Canon EMEA Sustainability Report 2013 3

1 Please use the email address on the back cover

www.canon-europe.com/About_Us/sustainability/

Taking our business forward

Ongoing economic challenges

In the face of continuing challenges due to the global economic situation and pressure on business and consumer budgets, I am pleased that Canon EMEA remained profitable in 2013. This is in no small part due to the valiant efforts of every one of our employees and I sincerely thank them.

Canon EMEA’s strategic vision is ‘Enriching lives and businesses through imaging solutions’. Our solutions and services help our customers improve efficiency, contribute to sustainability goals, create value, meet societal and stakeholder demands, support their lifestyle, and take advantage of new opportunities to grow their business responsibly. See ‘Supporting our customers’ for examples of how our approach to sustainability supports our customers’ growth.

Sustainability is embedded in our culture – through our Kyosei philosophy, our strategy and how we do business. Canon EMEA signed up to the United Nations Global Compact (UNGC) in January 2014 to demonstrate and formalise our ongoing commitment to human rights, labour standards, the environment and anti-corruption.

Acquisitions and integration

Our Océ integration programme is now complete in all countries except France (due by 2014) and we are starting to see the benefits of our combined product portfolio, with commercial printing and Canon Business Services showing particular strength in 2013. We also completed the acquisition of I.R.I.S. Group during 2013 which enhances our ability to help customers manage their information, from outsourced solutions to business process optimisation.

From good to great

Our business has a solid foundation but we can’t stand still and our aim is to grow it from good to great. Adding value to our customers’ businesses through the services we offer is one of our key strategies. Services such as managed print services and business process outsourcing help customers to optimise their business processes, enabling them to be more efficient and cost-effective and grow their business.

In the same way we continuously improve our products, solutions and services, we have started a three-year programme to engage employees more directly in developing our business. We call it Pursuing Excellence and I am personally leading this behavioural change programme. We will create a stronger, more dynamic culture of entrepreneurship, engaging employees and enabling them to share knowledge and work more collaboratively, in order to respond to customer and market needs more quickly. In 2013, we gave local management more responsibility, to speed up decision making; initiated a talent management programme, to help us recognise and develop internal strengths and identify when we need to recruit external expertise; and ran roadshows right across the region to reach and engage all employees. We are encouraging employees’ innovation ideas and have introduced a biannual conference for country managing directors to share expertise.

Stakeholder dialogue

We are again using Global Reporting Initiative guidelines G3.1 for this report. In 2014, in preparation for G4, we will initiate stakeholder dialogue through face-to-face meetings, online surveys and other mechanisms, to identify the issues of most material importance to our stakeholders. In the meantime, we have taken pointers from our employee survey (see ‘Society’), and also from interviews with business customers. Employees highlighted talent and performance management, while customers stated clearly that they expect Canon to understand their business and suggest innovations to help them grow, and to deliver on our promises. We will report the progress of our stakeholder dialogue in the next report.

Awards and recognition

Canon received global, European and national awards from industry, independent organisations and the public, recognising us for our products, our brand, employee relationships, and carbon management. Details are in ‘About Canon’ and other sections of this report. Internally, I was delighted to add a sustainability award to our annual Canon EMEA President’s awards recognising outstanding performance. This inaugural President’s Award for Sustainability was won by Canon Norway for its nomination as one of the top 10 Best Places to Work in 2009, 2011 and 2013 by the Great Place to Work® Institute.

By the end of 2013, a few countries were beginning to show signs of economic improvement but recovery is still some way off. I believe our actions to make our business stronger and commitment to doing business responsibly will continue to support our customers’ sustainable growth and our ongoing profitability. I would welcome your comments or suggestions on our activities.1

Rokus van IperenPresident & CEO, Canon Europe, Middle East & Africa

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About CanonCanon Europa N.V. is a wholly owned subsidiary of Canon Inc. of Japan and is responsible for the sales and marketing of Canon’s products, services and solutions to customers in more than 116 countries in Europe, the Middle East and Africa (EMEA). We employ around 17,000 people. In 2013, Canon EMEA’s net sales contributed 30.1% (¥1,125 billion) to Canon’s global net sales.

Our strategyOur strategy is to create sustained profitable growth for ourselves and our customers, by building our solutions and services business, developing technologies that enable our customers to realise the benefits from image and information management, and strengthening our core business capabilities. Our approach to sustainability is in line with Canon’s Kyosei philosophy – living and working together for the common good – and linked to Canon Inc.’s corporate strategy. It is embedded in our core business goals and reported under the three categories of Business, Environment and Society

Our commitment to sustainability is an integral part of our strategy – helping us add value to customers in meeting their own business and sustainability goals; connect to society by enabling people to capture, document and record the world around them; and provide wider benefits to society, particularly through our medical and public sector work.

We have identified the opportunities and issues most material to our business based on Canon Inc.’s strategy; Canon EMEA’s strategy; and customer, employee and wider stakeholder feedback. Key topics include: • inspiring customer loyalty and trust through continued relevance in our markets and sound business practices; • promoting and supporting our customers’ sustainable growth; • reducing environmental impacts throughout our operations and product lifecycles; • recognising and developing the talent in our organisation and ensuring we are equipped to meet future challenges; • supporting wider economic growth and addressing challenges in our local communities.

We intend to initiate stakeholder dialogue during 2014 to improve our understanding of our stakeholders’ material issues.

Risks and challengesOperating in 116 countries brings both opportunities and risks. Supporting our customers with products and services to help them use images more flexibly creates wider economic growth and social development, and meets local needs. However, some of the varied challenges that affect us include:

• The macro economy: in particular exchange rate fluctuations;

• Rapidly developing and variable legislative approaches: to identify and address emerging legislation we coordinate our approach to our various compliance activities at country, regional and headquarters level as necessary;

• Managing our diverse supplier base: we have updated our supplier terms and conditions, formally introducing a unified Supplier Code of Conduct including sustainability considerations;

• Climate change and environmental risks: we pursue various approaches to mitigate these. For example, Canon Inc. works to reduce product environmental impacts while improving functionality; Canon Inc. and Canon EMEA reduce our footprint through an environmental management system globally certified to ISO14001.

Climate change risks include natural disasters that may adversely affect product availability, so measures include building more resilience in our logistics; and implementing better stock forecasting and distribution systems both to improve logistics and bring benefits in terms of customer stock holding and cash flow (for example for retailers of consumer products).

GovernanceCanon EMEA’s highest governing body is the Canon Europe Operations Business Review (CEOBR), headed by President & CEO Rokus van Iperen and made up of the finance and business unit heads. It is responsible for setting strategy, targets, performance criteria and governance structures of the organisation including risk management, conflicts of interest and principles of operation.

Products, services and solutionsOur imaging solutions appeal to customers including individuals, small businesses, large corporates and multinational organisations – helping them realise the power of image in their lives and business. Our services and products include managed print services and business solutions, including business process outsourcing and image storage solutions; cameras for amateurs and professionals, including tV production; printers, scanners and multifunction devices; large format devices, production printers and digital presses for professional printers; semiconductors; medical imaging equipment and solutions; camcorders and projectors.

http://www.canon.com/corporate/vision/strategies.html

Canon EMEA Sustainability Report 2013 5www.canon-europe.com/About_Us/sustainability/

The Chief of Legal, Intellectual Property and Sustainability sits on the Canon Europe Operating Committee (CEOC), also headed by Rokus van Iperen, and is responsible for the sustainability function. Overall accountability for our sustainability programme lies with Rokus van Iperen who is also a Senior Executive Officer of Canon Inc.

The Sustainability Group (formerly called Environment and Product Safety) is responsible for coordinating sustainability in Canon EMEA. Sustainability objectives are incorporated in business unit and functional mid-term plans, agreed by the CEOC and then cascaded to the national and regional sales offices (NSOs and RSOs). From 2014, the objectives framework is more flexible, allowing NSOs and RSOs to address local stakeholder needs and relevant material impacts. Achievements against these objectives will be monitored by the Sustainability Group.

Awards and recognition• In 2013, Canon ranked 35th in Interbrand’s Best Global

Brands, recognising our innovation in a fast moving sector, and 30th in Interbrand’s Best Global Green Brands. The latter praised our Kyosei philosophy and suggested more communication on our strong environmental activities, which we will do.

• We ranked fourth in a study on corporate emissions performance against science-based targets carried out by ClimateCounts and the Center for Sustainable Organizations. This analysed the operational emissions of 100 global corporations between 2005 and 2012. Of the 100, 49, including Canon, were found to be sustainable and on track to reduce carbon emissions in line with scientific targets designed to avert dangerous climate change. Within the 49, Canon and 24 others achieved revenue growth while reducing their emissions.

• Canon received the Deshima Netherlands Award 2013 for our economic impact and actions on sustainability and social engagement in the Netherlands. The biennial awards recognise the importance of successful Japanese investors in the Netherlands.

• Canon was voted Reader’s Digest most trusted camera brand in Europe for the 13th consecutive year.

• Canon was again named a ‘Leader’ in Gartner’s Managed Print Services 2 Magic Quadrant Report 2013.

ReportingWe are reporting in line with Global Reporting Initiative’s (GRI) 3.1 guidelines, with an application level B. A full GRI table, which contains additional information, can be found at www.canon-europe.com/About_Us/sustainability/sustainability_reports/. We have not sought external accreditation.

Going forward, we will engage in stakeholder dialogue to help us identify material issues relevant to GRI G4 and we also await the outcome of the proposed EU legislation on non-financial reporting.

About this reportThis is Canon EMEA’s fifth annual sustainability report. It covers the 2013 calendar year and is aimed at our customers and other interested stakeholders. It includes information on our integrated former Océ operations and recent acquisition of I.R.I.S. Group. It excludes Océ Technologies and other group subsidiaries in EMEA, which report to Canon Inc. Previous reports can be found at www.canon-europe.com/About_Us/sustainability/sustainability_reports/ .

Any comments or queries on this report or Canon EMEA’s sustainability activities should be directed to: [email protected].

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We have used this symbol throughout the report to indicate that additional information is available on our website. The pdf version of the report includes hyperlinks.

Reporting in line with the ISO 26000 core subjects

Organisational governanceAbout Canon and Business

p4,16

Labour practices

Society

p12

Fair operating practicesBusiness

and Society

p12,16

Community involvement

& developmentSociety

p12

The environment

Environment

p8

Consumer issues

Supporting our customers

p6

Human rights

Business

p16

2 Magic Quadrant for Managed Print Services Worldwide, Ken Weilerstein, Sharon McNee, Elizabeth Kim, 21 October 2013

http://carbonscore.climatecounts.org/

http://www.dujat.nl/news/deshima-netherlands-awards-2013

http://www.canon-europe.com/About_Us/sustainability/sustainability_reports/





Supporting our customersWe help our customers take advantage of every opportunity to develop their business or enrich their lifestyle, supporting their economic growth while improving their sustainability. Whether it’s a solution for home, for a small office network or for multi-site offices; from commercial printers to in-house print facilities; from printing posters to scanning cheques; from photobooks to out-of-print books; from targeted marketing to invoice processing. Alongside our wide range of consumer products, Canon and Océ’s combined portfolio delivers the industry’s broadest range of production print products and solutions, so we can meet even more customer needs.

Here are some examples of how we supported customers in 2013.

“I wouldn’t change this printer for the world – unless Canon make a better one, of course!”gary Knight, photographer and photojournalist, speaking of his Canon iPF 9100 large format printer

Sustainable savingsAcross the UK and Sweden, global corporate AstraZeneca had many different print suppliers and devices, consuming high volumes of energy and paper and producing a lot of waste – both equipment and consumables. With only around three users per device, vs the industry recommended 30, the inefficiency and lack of print strategy was costing a lot of money.

Canon worked closely with AstraZeneca to develop a print strategy that would deliver service quality and functionality while reducing costs and environmental impact. Over 4,700 office machines and 40 print servers were replaced by just 1,200 multifunctional devices (MFd) and 8 servers, with each employee no more than 25 metres from the nearest MFd. MyPrintAnywhere software allows employees to

print on any device by swiping their security card and AstraZeneca to monitor print usage. it also increases security as documents are only output on demand.

We tested more than 1,000 software applications used by AstraZeneca to ensure compatibility and the smooth transition was further helped by an end-user training and communications programme. Feedback from an employee survey confirmed the successful rollout and Canon and AstraZeneca are now discussing how to implement the service in AstraZeneca offices across the world. Annual environmental savings since 2012 amount to:

• 34 million fewer pages printed

• Energy usage reduced by over 760,000 kWh

• Over 260 tonnes of CO2 avoided.


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Commercial printing snapshots We work with high volume in-house departments and commercial printers such as publishers, newspaper and book printers, helping them work more flexibly and efficiently.

1. Digital printing solutions help reduce waste and provide the ability to print short runs or even single books on demand. Using the latest ColorStream 3900, one Canon customer prints 300,000 weekly newspapers consisting of 500 variations with as few as 200 copies each, featuring personalised local news and information.

2. To help commercial customers use our products and solutions most effectively to grow their business, we ran events at our Customer Experience Centre in Germany. As well as learning about our new solutions and sharing examples of success using existing Canon solutions, customers discussed the latest technological innovations, industry trends and future challenges.

3. Six new guides for in-house print managers offer strategic and practical advice to help develop and promote their services to internal customers and grow their value to the company. Understanding when to print in-house and when to buy in print services helps maximise their value.

Partner supportA significant proportion of Canon’s business comes from the indirect partner channel which is made up of a group of resellers and distributors. To help them grow their businesses, we offer support and resources and a dedicated account manager, while our partner portal, PartnerNet, hosts information specific to partners including brochures, showroom material, technical specifications and case studies. Partners can access a version of the Canon Learning Portal via PartnerNet for online training and related materials. We also hold annual European Premier Partner events.

Partners now receive an increasing number of requests around sustainability, so we have shared additional tools and information used to support our sustainability proposition to customers, for example the online environmental awareness training course and specific showroom materials.

When seconds countCopenhagen’s University Hospital treats the most critical trauma cases in denmark, when just seconds and access to the right equipment make a difference to patient survival. When the trauma team designed a new, dedicated trauma room, three Canon digital X-ray systems, including one ceiling-mounted, were chosen for their manoeuvrability around immobilised patients. Equipped with our fixed and portable flat panel detectors, X-ray images are displayed almost instantaneously wherever they are needed. A specially-designed Canon Picture and Archiving Communication System allows the trauma team to quickly and easily view, distribute, archive and recall all diagnostic images within the hospital.

Value added outsourcingCanon Business Services (CBS) provides tailor-made outsourced business process services to organisations, including data and information management, targeted marketing and customer relationship management. This helps companies improve their efficiency in a cost-effective way to grow their business. In France, for example, CBS works with both national and global non-profit organisations (NPOs), to manage the complete donor relationship. This includes donor data verification, processing donations and issuing tax receipts – for more than three million donors and over €2 million donations in 2013.

By outsourcing these processes, NPOs optimise the value of their active donor database and improve donor relationship management. They can better target fundraising activities and donor communications, and reduce administration costs – which means more of each donation reaches the NPO’s focus activities.

Invisible security Customisable security settings, UV ink and ‘fugitive’ ink – which runs if tampered with – all help combat fraud; for example, adding an invisible security layer beneath visible printing. Our latest imageFOrMULA Cr-190i cheque scanner can detect both standard and UV images, which may be included as proof of authenticity to verify cheques.

Service and support When personal or business customers need support, they go to our pan European contact centre. Covering 17 languages across 22 countries, in 2013 it handled almost 2.5 million calls and emails. Business customers can also access a self-service portal 24/7. Employees aim to get customers up and running again in one step wherever possible but it may be necessary to escalate to a regional centre or arrange a service engineer’s visit. A new handheld device gives engineers a single view of the customer’s request, helping them solve issues more quickly, improving visit scheduling and reducing CO2 emissions.


Reducing environmental impacts

Silvio Franchini – Canon PowerShot S110

EnvironmentCanon has been designing and offering products, solutions and services with a reduced environmental impact for many years. An EU survey (Flash Eurobarometer 367) found that customers across Europe are interested in buying ‘green’ (sic) products. Eighty percent of respondents said they occasionally or often buy ‘environmentally friendly products’ while, across the EU, 89% of people responding felt that buying such products could make a difference to the environment.

We aim to reduce the environmental impact of our products throughout their lifecycle from design concept to end of life, on a Produce–Use–recycle lifecycle. Environmental impacts come from the raw materials we use, manufacturing,

distribution, customer use, end of life disposal and our operations. Canon inc.’s overall target is to reduce lifecycle CO2 emissions per product by 1.4% per annum (vs 2011 baseline), however a 4% reduction was achieved in 2012, largely through improved distribution, so the target for 2013 was set at 3% vs 2012.

in 2012, around 20% of our products’ CO2 came from customer use. We constantly aim to lower the energy required by our devices and to offer effective solutions and services that help customers meet their own environmental goals. As a result, percentage of emissions attributed to customer use reduced by 5% over 2011.

http://ec.europa.eu/public_opinion/flash/fl_367_en.pdf


Improving operational efficiency for us and our customers

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ProduceProducts sold in EMEA are manufactured in Asia, Canada, the Netherlands and Germany. All global manufacturing operations report directly to Canon Inc.

We target reductions at design stage – to product weight and volume, for example, meaning less packaging and more efficient logistics, reducing CO2 emissions. We also use plastic recycled from Canon sources in some PIXMA, imageRUNNER ADVANCE and wide format imagePROGRAF models.

Energy• Some compact cameras (e.g. Powershot A1400) feature an eco mode that dims the screen after 30 seconds and turns the camera off after three minutes. Users take more shots on one battery charge, reducing charging frequency and electricity consumption and can quickly turn the device on again by pressing any button. • Our latest XEED compact installation projector models use significantly less power than comparable products – under 1W in standby and just 365W in operation (WUX450 model). Their compact size makes installation easier, while the new XEED WUX400ST short-throw product can project a large 100 inch image (approx. 2.5 metres diagonal) from a distance of just 1.2 metres. The remote handset also features an ‘ECO’ button, allowing the operator to switch easily between ‘full’ and ‘low’ lamp power modes, while also providing easy access to power management settings. • For technical documents, our PlotWave 340 and 360 wide format printers are equipped with Océ Radiant Fusing technology meaning virtually no warm up time and first print in 40 seconds – saving time and energy.

Canon’s line of A4 printers and MFPs was awarded ‘A4 MFP Line of the Year for Energy Efficiency’ by the independent Buyers Laboratory Inc. in their winter 2014 awards. Three i-SENSYS and one imageRUNNER ADVANCE devices also received ‘Outstanding Achievement’ awards for energy efficiency. “Canon has proven again and again that its A4-size document imaging products are the environmental choice for energy-conscious consumers,” said Pete Emory, BLI’s manager of laboratory testing.

Almost 100% of Canon’s products in scope qualified for ENERGY STAR® 1.1 (the EU ENERGY STAR® label is applied to the most energy efficient products). ENERGY STAR® 2.0 was published in Europe in April 2014 and Canon is registering for v2.0 all products in scope currently on the market, aiming to maintain a similarly high percentage.

Recycle

Produce

Use

Efficient use of resources

Elimination of hazardous substances

Global warmingprevention

Environmental burden reduction

* Evaluation based on printer connected to PC by USB, off for 16 hours and active for 8 hours, printing 10 colour pages, or in standby**From manufacture to disposal, excluding product use

UseWe work with customers to help them take advantage of the environmental benefits of our products, services and solutions to reduce their environmental impacts, make cost savings, and support their sustainability objectives and wider economic development. With changing business models, customers may now lease hardware more often than buy and also outsource business processes. Our services help them maximise their efficiency and drive growth. For example our Managed Print Services team first reviews and audits customers’ print fleet and needs, then designs a Canon system to maximise value, efficiency and business benefits while reducing costs. Similarly, Canon Business Services manage outsourced business processes for customers, enabling efficiencies and generating additional business opportunities and growth. As imaging experts, we can offer the best solutions and services to meet customers’ needs in the most efficient way (see ‘Supporting our customers’).

For products, we constantly look for ways for customers to save energy when using our products, from eliminating warm-up time to lower sleep mode power consumption. Specific examples of energy and paper resource savings are below.

2013 PIXMA MG5500 series vs MP540 (2008)

lighter

daily power reduction*

total CO2

reduction** smaller

lesspackaging

50%

28%

22%

4%

12%


PaperWe follow a responsible paper procurement policy and have a chain of custody for our complete paper distribution network. Both our EMEA head office and eight of our European sales operations have FSC® or PEFC certification and, in 2013, 75% of the paper we procured was FSC or PEFC certified. To help customers reduce their carbon footprint, Canon Germany offers carbon neutral paper, achieved through a combination of energy generation at the paper mill during the production process and carbon offsetting using gold standard projects. We plan to roll this out further during 2014.

Our scanning and other digital solutions, duplex and N-up print options (printing two or more pages per page) on home and office machines help customers use less paper, saving costs, time and storage space. Other devices include specific paper-saving features; for example our ColorStream 3000 commercial printer prints more slowly until the paper roll is up to speed and stops almost immediately when the stop/pause button is pressed. Customer savings are significant over the device lifetime as comparable inkjet printers may waste 10-30 metres of paper before stopping.

RecycleFor many years Canon has been designing products to be recycled, re-used and to extend their life and materials. This is reflected in programmes including:

• Refurbishment – where devices are returned to a local Canon site for replacement of some parts, returning the product to a suitable condition for resale/lease;

• Factory Produced New Models (FPNM) (formerly called ‘remanufacturing’) – where devices are returned to our factory in Germany at end of lease to undergo a strict cleaning, testing and quality assurance process. This ensures the device is as good as new, effectively doubling its lifetime and guaranteeing the same quality and performance as the original machine;

• Collection programmes: our global toner cartridge collection programme has been operating since 1990, ensuring returned cartridges are recycled into new cartridges using a closed loop process with no waste to landfill; and our inkjet cartridge recycling scheme launched in 15 countries in Europe in February 2013 and collected around 1,000 kg (almost 23,000 cartridges) by year end, removing them from household waste streams;

• Recycling Canon materials into new products such as calculators and printers: two new calculator series in 2013 include recycled plastic – the LS-123K series, which uses dual solar/battery power, and the slimline X MARK II calculator, which runs entirely on solar power.

These programmes save significant resources and CO2 emissions. For example, FPNM models re-use up to 93% of existing components by weight and our lifecycle assessment simulation shows the process saves more than 80% CO2 compared to devices made entirely from new parts in Asia. FPNM models support customers’ environmental objectives and sales across EMEA doubled in 2013 vs 2012.

OperationsWe look to reduce our environmental impacts across all our operations, which cover a wide variety of functions including procurement, supply chain, sales and marketing, service, HR, finance and IT.

Océ integrationThe integration programme continued during 2013. Where integration resulted in a move to a different office building, sustainability considerations were taken into account, alongside other factors. Since 2011 we have made savings of 36,000 m2 on our office area – equivalent to saving a kilotonne on our carbon footprint. In 2013, our per capita footprint reduced by over 30% vs 2012.

ISO 14001Our global ISO 14001 certification demonstrates to stakeholders how seriously we take environmental sustainability; across EMEA, 191 sites in 25 countries are certified. In 2013, 29 sites in 13 countries passed re-certification audits and we registered no non-conformities. Similar to Canon sites, former Océ offices are included in our global certification programme when they meet our internal criteria – for example business need or size of operation (floor m2, energy use).

Corrective actions: We identified two corrective actions in 2013.

• A contractor’s lorry leaked diesel fuel near our warehouse and insufficient cleaning by contractors resulted in some surface water pollution. This was removed and the correct processes and policies to follow were reinforced with our contractors.

Suppliers and partners Following a study of our warehouse capabilities, we are consolidating our European warehouse operations in the netherlands, to improve efficiency in our supply chain. We selected nippon Express as our strategic logistics partner and they will build a new warehouse in rotterdam to meet our needs.

For this strategic partnership, sustainability considerations have been embedded throughout, from the warehouse design and construction, to future operation. this includes a service level agreement covering sustainability performance such as packaging innovation, waste recycling, green procurement and sustainability reporting. nippon Express has appointed a sustainability manager to further develop their sustainability strategy and has involved Canon in a process to identify nippon Express’s material sustainability issues.

the warehouse will be built to BrEEAM-

Very good certification standards and will start operating in 2015.


• We identified that a product used by service technicians contained propellant R134a that has a high global warming potential. A substitute product was sourced, suitable for most required uses, and affected NSOs were asked to replace stocks with the new product. Compliance is being monitored.

Customer engagementThe results of our annual customer loyalty survey continue to show that customers who are aware of Canon’s strong environmental commitment are satisfied with our efforts (84%), and 59% say this has an influence on their buying decision. We also ask customers to complete a post-service survey and, in 2013, 81% of customers expressed satisfaction with our service engineers’ awareness and communication of environmental information.

Working with suppliers and partnersAs a result of the Océ integration, our supplier list increased by around 50%. Procurement is working to rationalise our supplier list, aiming to reduce the total number to 10,000.

We work with suppliers to ensure they comply with our green procurement guidelines. This includes supporting our tier 1 suppliers to work with their own supplier network to meet our guidelines. For example, when we commission work from an agency, the materials may be produced by the agency’s supplier (our tier 2 supplier). If these materials were in scope of our green procurement policy, we would work with the agency and its supplier to ensure the materials met our criteria. We would also help our tier 1 supplier understand the criteria so they could highlight and apply them to their other suppliers, when relevant to Canon business, or to improve their own sustainability objectives.

During 2013, we produced reference manuals relating to sourcing promotional items and event guidelines which included information on sustainable procurement. These help internal colleagues understand and recognise areas where care may be necessary when sourcing items or planning events – for example, avoiding items made from hazardous or non-sustainable substances, and reducing waste by ordering only the required amount.

OtherOther initiatives during 2013 included:

• We launched our Engineer Certification Programme for service engineers. The Foundation level includes a module on sustainability, aiming to help engineers answer questions the customer may have regarding sustainability, for example about environmental savings relating to their products;

• We applied a maximum CO2 rate of 130g/km for new company cars in 2013, reducing to 120g/km for 2014. Several countries acted proactively and achieved the lower level last year for a large proportion of their fleet. Only Russia is exempt, continuing at 130g/km, as the availability of cars meeting 120g/km with suitable size and capacity is very limited;

• We took the decision to change our VPN token supplier which has enabled us to increase internal data security at a lower unit cost and more sustainably, as the new tokens have a replaceable battery. We have also moved about 30% of our tokens into soft tokens, further saving costs and impact;

• An energy review at five Canon offices in the UK, Germany, Austria, Portugal and Denmark resulted in savings worth almost €70,000;

• Four Canon EMEA sites generate renewable energy to meet a proportion of their energy needs; in total 11 sites buy between 70-100% renewable energy.

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AREA OBJECTIVE TARGET* 2013 PROGRESS

Canon EMEA carbon footprint

Reduce by 1.5% per annum vs turnover (compared to 2010)

-15% by 2020* -7% vs 2010

resource efficiency

Increase waste recycling at all EMEA offices

52% by 2014* 50%

Increase waste recycling at Canon warehouses including outsourced warehouses

85% by 2014* 83%

Sustainable productsGrow volume of certified and recycled paper grades

75% of paper turnover by 2014*

86% of paper turnover

transport carbon efficiency

Reduce vs 2012 net sales -2% 2013 Not met

* Measured against the consolidated combined 2010 performance baseline of both Canon and Océ

Achievements against targetsProgress against the targets we set in 2012 is shown below. We are making good progress against three of the objectives but have not achieved the transport carbon efficiency target. This was due to changes to the mix of product categories and volumes shipped, together with additional associated drayage.


Engaging with stakeholdersWe interact with our stakeholders in many ways – from supporting employees, on whom our business depends, to inspiring customers and others who use images to enrich their lives. We seek stakeholder feedback in a variety of ways including surveys, events, conferences and forums. See ‘Stakeholder relationships’ on our website. Our business impacts communities wherever we operate, offering employment opportunities, for example, and providing business to local suppliers. in return, we support communities through a variety of partnerships.

In the workplaceWe want to be recognised as the employer of choice in our sector, attracting talented employees and offering fair working conditions and practices. We welcome the diversity

of our workforce – we have over 50 nationalities working in our headquarters offices, which helps us do business in 116 countries. We have a number of EMEA-wide policies and training that provide a business framework, including for diversity, and all employees operate under the Canon group Code of Conduct, which supports an ethical approach across our entire business. For other areas, however, such as health and safety, each operation follows the prevailing national policy.

in 2013, Canon netherlands and Canon Spain both won top Employer awards, with Canon netherlands achieving the highest score of the 56 qualifying companies. Canon norway won a great Place to Work award, gaining 7th place, and was also chosen to receive the inaugural

Patrizia Poletti – Canon PowerShot S100

Society

http://www.canon.co.uk/Images/CEMEA%20Sustainability%20Report%202012%20-%20Stakeholders%20v4_tcm14-1059208.pdf

Supporting employees and communities wherever we operate


‘President’s Award for Sustainability’ from Canon EMEA’s President, Rokus van Iperen. Canon Oy won The Best Sales Organization in Finland 2013.

Information on our EMEA-wide employee engagement programme called Pursuing Excellence can be found in the CEO message.

Océ integrationWe continued the integration of Océ and Canon operations across EMEA during 2013, operating a joint approach between relevant Océ and Canon teams in each country. For example, Canon and Océ managers and employees from each business area held joint workshops to ensure all relevant information and procedures were mapped out to support a smooth integration and no legal deficiencies.

An integration monitoring survey was carried out in 2012 in the first countries that went through the integration process, to see what went well and what could be improved. Employees’ responses to this survey fed into learnings and actions that were then applied to the integration process in subsequent countries. Actions included • more emphasis on ‘cultural’ integration – for example access to a Canon email address and intranet at integration; • change workshops for directors and managers to focus on cultural aspects and help them support their teams through the process; • early opportunities for team

members from each entity to get together; • customer visits and activities by integrated teams. A further survey was then carried out country-by-country as each completed integration. Results from these showed that employees felt the most important elements to effect a smooth integration were alignment from management, with good leadership and direction; allowing time for the changes to be understood and worked through; and an understanding of the cultural transition taking place.

Learning and development In 2013, learning and development teams worked with business groups and functions to identify the skills and capabilities required to deliver the company’s strategic goals. These needs then fed into the development of learning curricula to support the development of the required skills. Alongside this, as part of the performance management process, employees agreed personal development plans with their manager to help them meet specific needs or career aspirations. We encourage employees to develop their career within Canon and, in 2013, 34% of vacancies were filled by internal candidates.

Learning is delivered through the learning portal, whether online, in classroom or through other media. At the end of 2013, we were able to make the learning portal available via the internet to around 4,000 former Océ and Canon Business Services (CBS) employees who have no intranet access.

SOC

iEtY

Employee surveyIn 2013, we carried out an EMEA-wide employee survey – ‘Your Voice’ – the first since the Océ integration programme started.

We value this feedback from employees and use it to take action to improve our leadership, engagement and performance management programmes across the whole business. See the ‘Message from the President’ for more information on these action plans.

All the survey results are shared with national sales organisations and across departments and functions so that specific plans can be put in place to address areas where action is needed and to further develop our strong points.

In this survey, we changed a previous question asking whether employees felt Canon was ‘socially responsible in the community’ into ‘socially responsible in all its activities’ to broaden the remit. The response was below our benchmark norm score, which may partly be due to differing interpretations of the meaning of the phrase, as 26% of respondents said ‘Don’t know’. We are therefore aiming to improve understanding and knowledge in this area. The next survey will take place in 2014.

90% are proud to be associated with Canon

82% believe Canon does

business in an environmentally responsible way

68% employees responded (11,000+)

Only 40% believe we recruit &

develop future capabilities

88% agree with our strategy

87% understand how their work

contributes to achieving

Canon’s goals & objectives

Under half think their performance review fully identifies their strengths

three-quarters feel their manager recognises a job well done


Employees also have access through the portal to a wide variety of courses outside their identified development needs, including new applications such as getAbstract, which offers access to over 9,000 summaries of the best business books.

All mandatory training is delivered and tracked via the learning portal. See the ‘Business’ section for more information.

In the communityWe support our local communities in a variety of ways, from cash and in-kind donations to sponsorship and volunteering activities. We have captured top-line information on these initiatives in previous years and, in 2013, we introduced a new database to record more detail and can report the following results. We estimate our activities in 2013 reached around 2.26 million people directly or indirectly within our local and business communities.

• 1,475 hours volunteered by employees in working hours

• 1,631 hours volunteered by employees in their own time

• €146,000 in cash donations

• €66,550 for in-kind equivalent support (e.g. product donations)

• 249 activities in total were carried out by 21 national and regional sales organisations and two headquarters offices.

RegionallyWe continued our regional partnerships with the World Wide Fund for Nature (WWF) and the Red Cross. Canon Inc. also announced an official partnership with the International Association of Athletics Federation (IAAF) World Athletics Series from 2013 to 2016, contributing to the promotion and development of athletics worldwide. Regionally, Canon Europe supported the IAAF World Championships in Moscow, including on-site behind-the-scene technical support to journalists and sports photographers from the Canon Professional Services (CPS) team. We also announced that we will be the official supplier of imaging solutions to The 2014 Ryder Cup at Gleneagles. This will include providing all photography, video, print and copying solutions used by the event organisers, and CPS will be on site to share their imaging expertise and help professional photographers take the perfect shot.

WWF: Our principal partnership project in 2013, alongside the global photo network, was the WWF expedition to the Laptev Sea. Scientists have long wondered if the walrus and polar bears living there are a separate species distinct from those found to the east or west. It is hoped that tissue samples taken during the expedition will solve this genetic mystery which has implications for conservation management in this region, where populations are affected by climate change, increased shipping and oil and gas exploration. Russian wildlife photographer, Alexey Ebel, went along to document the expedition, providing stunning images using Canon equipment and also some practical tips for photographers working in similar challenging conditions.

At local level, our national offices and employees supported WWF activities ranging from Earth Hour, when 18 Canon offices

across EMEA switched off their lights, to taking part in voluntary training organised by WWF in how to handle potential oil spills in the Baltic Sea (Finland).

Red Cross: We again supported 16 European Red Cross societies which organise projects that provide opportunities, knowledge and understanding to young people. These included:

• promoting social integration through holiday camps in Belgium, France and Norway for impoverished or disabled children (some including their family too);

• supporting vulnerable families in Denmark and providing emergency shelters in Finland for young people dealing with problems at home, such as alcoholism;

• helping to provide meals for children in Poland who don’t get regular meals at school or home, improving their ability to learn;

• in Sweden, supporting traumatised young refugees arriving from war zones;

• a safe sex and sexual health awareness campaign in Italy;

• an education campaign about gender violence in Spain, ‘El Machismo Mata’ (Machismo Kills).

Locally, employees supported the Red Cross by giving blood; organising golf days for customers; and fundraising following typhoon Haiyan in the Philippines.

LocallyCanon’s focus areas for social contribution activities are outlined on the Canon Inc. website and Canon EMEA targets its community support similarly. Within this framework, however, national organisations are able to decide which specific local projects to support, based on reasons such as proximity to our business operations; knowledge of the requesting organisation; type of support requested e.g. cash, in-kind, volunteering; urgent local need; and supporting our regional partnerships with WWF and Red Cross. Many more requests are received than can be met and projects often cover more than one focus area. Examples of local projects supported in 2013 are below.

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http://www.canon.com/scsa/about/index.html


Environment: Since 2011, we have planted and tended around 18 hectares of forest across several countries. • Working with the Ministries of both Forestry and Education, Canon Eurasia is donating 10,000 trees for a Canon-supported forest in Van (Eastern Turkey). Local school children helped plant some of the 4,000 trees donated in 2013, alongside the Canon forest team, the local Canon dealer and local government representatives. The project raises the children’s awareness of the environment. • With funding from a recycled product promotion, Canon Middle East employee volunteers planted 2,939 native Ghaf tree seeds; the seedlings will be transplanted in 2015.

Social welfare: Canon South Africa continued to support the South African Disabled Golf Association’s ‘First Swing Club’, giving disabled young people the chance to try golf as a sport, which both offers an outdoor experience and improves muscle movement. • Canon South Africa employees repaired the walls, floor and roof of the Orange Farm centre that cares for and feeds orphans and local children who might otherwise starve.

Local communities: Canon Norway helped a local primary school to clear up a stretch of riverbank and also printed booklets for the school. • Canon Portugal continued support for an Iberian wolf sanctuary by donating a photo printer and paper and employee volunteering. • Canon Middle East supported the Dubai Autism Center with their awareness campaign in April.

Education: Canon UK hosted a careers fair for students and their parents, and also invited local school students to their

office to learn about sales and marketing jobs and working in a big company. • Canon Eurasia conducted photography lessons and donated cameras to local schools to promote photography and creative skills and students’ awareness of the natural environment. • Canon Europe’s legal team partnered a London law firm to host an information session for school students considering a career in law. The students, all attending UK government-funded schools, would each be the first in their family to go to university. • Canon Germany printed 100 A1-size colour posters to support a travelling art exhibition raising awareness of illiteracy; one billion adults – approximately 26% of the world’s adult population – cannot read.

Sport: Over 25,000 people took part in the Vienna Business Run, including 39 Canon Austria and Canon Eastern Europe employees, with the ‘Canon Elite Team’ coming 4th overall. • Canon Switzerland employees took part in a Zurich run raising funds for WWF. • Employees from Canon Hungary, Canon Austria and Canon Switzerland took part in bike-to-work schemes, cycling over 11,000 km between them.

Volunteering: Canon Netherlands employees volunteered help in several ways, including cleaning up woodland area, collecting rubbish from a beach, accompanying elderly people on an outing and cleaning an animal shelter. • Canon Europe employees organised a fundraising charity bazaar in the London regional headquarters office raising around €5,500, including a talent show, book sale, hairdressing, cake sales, and a raffle prize draw.

© Alexey Ebel WWF-Canon


Developing responsible businesses

tijs Letschert – Canon EOS 7d

Businessthrough our products, services and solutions, we help our customers develop, diversify and grow their own businesses sustainably. See ‘Supporting our customers’ for some of the ways we support our customers, from tailored print strategies and solutions to collaborative events. We seek to do business profitably and responsibly and we work in partnership with our suppliers to ensure they meet our requirements for safe, responsible products and to support their business development. Finally, we make sure our employees have the right tools and skills to do their job.

Staying compliantOur broad product range and geographical spread bring a wide variety of laws, regulations, directives and standards. We prepare for new regulation by liaising with Canon inc.

and its manufacturing facilities, with relevant legislative bodies, and with our national sales organisations. We belong to over 80 industry associations and lobbying groups across the region, including digitAL-EUrOPE, EUriMAg, JBCE and EuroVAprint and seven pan European federations.

Since 2011, Canon has been a signatory to the EU Voluntary Agreement (VA) on imaging equipment, endorsed by the European Commission in January 2013 as equivalent to binding regulation. Commitments under the VA include compliance with the latest EnErgY StAr® power consumption requirements, as well as ambitious targets to meet the most advanced ecodesign measures (duplex printing, recycling, polymer composition, spare part availability, cartridge recycling etc.). A new version of the

http://www.eurovaprint.eu/home/

http://www.eurovaprint.eu/home/


Supporting wider economic growth

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VA, agreed by the 16 signatories in December 2013, will start applying soon, implementing the new ENERGY STAR® 2.0 specifications for home and office imaging equipment sold in the 28 EU countries.

The dedicated compliance assessment group at our regional headquarters ensures that business areas understand and plan for new regulation, to ensure our products, solutions and services can be safely – and legally – sold.

External complianceIn 2013, we completed the EU timber regulation requirements, prepared for the release of ENERGY STAR® 2.0, and updated Blue Angel requirements. We reviewed the implications of the new WEEE Directive (Waste Electrical & Electronic Equipment), monitored plans by several countries to develop their own WEEE regulation, and have been actively discussing a methodology to identify new substances that will be added to RoHS 2 (Restriction of Hazardous Substances Directive).

Internal complianceIn 2013, Canon Europe reported no deficiencies from internal compliance standards and also reported no negative responses in the global Canon Financial Statement letter of fiscal year 2013 and internal controls questionnaire, completed by almost all Canon Group entities. Alongside this annual reporting, we also submit regular performance updates to Canon Inc. including biannually on environmental targets and company performance, and monthly on financials.

All Canon employees are bound by the Canon Group Code of Conduct, which supports an ethical approach across our entire business. It includes clauses on fair competition; respect for laws and intellectual property; corporate ethics; respect for the individual; and non-discrimination. It is supported by EMEA policies and training such as anti-corruption and bribery.

Compliance training: All employees, including new hires, must complete compliance training on a variety of topics including anti-corruption and bribery, competition law, environmental awareness, information protection and IT security. The courses are available in a number of languages including English, French, German, Italian, Spanish, Russian and Turkish, however some employees say it is hard to complete the courses where they are not in their first language. To remedy this, we are translating our legal compliance courses into additional languages and investigating why employees have not completed the training within the allocated timeframe.

To strengthen our compliance programme, we are introducing refreshed courses for anti-corruption and bribery and competition law. This is to ensure employees maintain their knowledge and know where to go to should they have questions. Online compliance training provides basic information; where additional region-specific knowledge is needed, we are carrying out more comprehensive workshops for the relevant employees.

All former Océ (now Canon) employees were given access to the Canon learning portal at the end of 2013 and will complete training during 2014. We will summarise progress in our next report.

SecurityWe take data security very seriously; we have an information security policy and the security group maintains an ISO 27001 certification which extends to the services we offer to customers. This ranges from having processes to securely erase all data at the end of device life to advising customers on print security and providing solutions. Canon Europe is a member of the Information Security Forum (ISF) and sponsored the 2013 world congress. This allows us to better understand organisations’ priorities around print security and also to share other ISF member companies’ experiences and responses to issues. We have also contributed to the ISF’s published Standard of Good Practice for Information Security pertaining to document security.

Suppliers and partnersSupplier Code of Conduct: In 2013, Canon introduced a formal Canon Supplier Code of Conduct, setting out the international principles we believe in and support, such as not allowing forced or child labour and fair compensation, and we ask our suppliers to comply with the specific standards of conduct as a minimum.

New General Purchase Terms and Conditions: Canon also updated its General Purchase Terms and Conditions in 2013, which now contain a clause on sustainability, setting out our expectations from suppliers in this respect. The Canon Supplier Code of Conduct is incorporated in our updated General Purchase Terms and Conditions.

We anticipate that all national sales organisations will have translated and included these changes into their own terms and conditions by mid-2014, which will enable us to better evaluate where risks may lie in our EMEA supply chain and take action.

Green procurement: By the end of 2013, 74 suppliers of product-related and packaging items had been assessed for compliance with our green procurement standards. Teleconferences were held with 10 new suppliers to review their completed questionnaire and offer advice.

Maintaining our brand reputationThe Canon brand is the external face of our organisation and we rigorously protect it to maintain our good reputation – from taking action against counterfeiters, to ensuring marketing is clear and honest, to protecting intellectual property (IP).

Patent protectionAs Canon’s business continues to expand – through new developments, market expansion and by acquisition – the need to protect our technology and innovations increases. After completing an acquisition we work with new colleagues to bring patent protection into line with Canon’s practices.

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Such acquisitions bring opportunities to develop new joint technologies based on shared expertise and opportunities and we ensure patent protection is in place to safeguard new developments. We are developing a mandatory online course on patent awareness for all employees within product and service development.

In emerging markets, we are developing different strategies from those Canon uses in more developed countries to obtain and enforce IP rights. Patents may not always be the most effective way to protect Canon’s IP, especially where the inventions are in software or complex fields of technology. External developments also affect us; we expect the Unified Patent Court to be created by 2016, along with the Unitary Patent, which will have profound effects on the way Canon and its competitors obtain and enforce patents in the EU.

We continued to take steps towards a regional IP headquarters, developing and training relevant employees at EMEA headquarters and also in our EMEA companies. In 2013, this included staff exchanges between Canon Europe and Canon Inc. to offer insight into challenges faced by each company and to improve collaboration.

Brand protectionOne of the actions we take to protect our brand and reputation is to remove counterfeit products from sale and stop the import of Canon products not intended for the EMEA market, which may damage customers’ experience of our products.

We continue to work with international organisations, such as the World Customs Organisation and INTERPOL, and other imaging consumables manufacturers through the ICCE industry group, to investigate the import and sale of counterfeit goods. In EMEA in 2013, we conducted 84 raids, received 172 customs notifications and seized 225,000 counterfeit items. We also identified and took action against websites and social media accounts trading in counterfeit Canon products, or impersonating genuine Canon sites.

We carried out 48 training sessions for customs and police and we added Belarus to the countries in which we hold a customs registration, which allows customs to seize suspected counterfeit Canon-branded goods more effectively.

During 2013, we created and distributed new internal guidelines for sourcing promotional items, including advice on making more sustainable choices. The guidelines include the requirement to register with Chinese customs any branded promotional or marketing items we source from China, so they can be identified as items genuinely procured by Canon.

We work closely with consumer protection organisations across EMEA to try to prevent the importation of Canon products that, although genuine, are not intended for sale in the EMEA region. These products, imported and sold without Canon’s consent by a few resellers, can damage consumers’ experience and enjoyment of our products and may harm our brand and reputation. Such products may not have correct language manuals and may have had dangerous third party accessories fitted by the reseller to try to localise the product for the EMEA region – for example an electrical power adaptor.

Human rights and labour standardsWe have taken two significant steps in this area. We have a specific Supplier Code of Conduct that references the ILO Covenants (see ‘Suppliers and partners’ above) and Canon EMEA signed up to the UN Global Compact in January 2014, thus underlining the importance we place on upholding these rights and other principles. We are currently baselining our performance for reporting.

To share experiences and best practice on respecting human rights in daily business activities and effectively address and remedy internal and external complaints, we took part in a research project organised by CSR Europe and also participated in pan European workshops with other corporates to share learnings. In 2013, no grievances related to human rights were filed.

Stakeholder dialogue We have taken as our key stakeholders those identified as most relevant by our parent company Canon Inc. and we use a variety of mechanisms to engage with them including surveys and other forums. In order to identify the issues of most importance to our stakeholders, we will start to conduct specific stakeholder dialogue during 2014 and will report on this in our next sustainability report.

STAKEHOLDERS

NGOs

Other companies

National and local governments

Employees

Local communities

Customers

Canon Inc.

Suppliers

Universities and research institutes

Shareholders and investors

Canon EMEA Sustainability Report 2013 19

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www.canon-europe.com/About_Us/sustainability/

Canon Europe Ltd3 The SquareStockley ParkUxbridgeMiddlesexUB11 1ETUnited Kingdom+44 (0)20 8588 [email protected]

Canon inc.canon.com

Canon Europecanon-europe.com

© Canon Europa N.V., 2014

Please recycle this report after use

Photos on pages 2, 8, 12, 16 and 19 were taken by Canon employees working in Germany, Italy, Switzerland and Canon Europa

Find more information on Canon Europe and sustainability at www.canon-europe.com/About_Us/sustainability

Please send any feedback or queries relating to this report, or to Canon EMEA’s sustainability activities, to: [email protected]

Canon EMEA – selling to customers in 116 countries

Employees 2011-2013

2013

2012

2011

16,721

13,664

10,888

Global net sales by region 2013

Our regional headquarters are split over four locations in the UK, Netherlands (x2) and Germany

Japan19.19%

Americas28.39%

Europe30.15%

Asia & Oceania22.27%

We have used this symbol throughout the report to indicate that additional information is available on our website. The pdf version of the report includes hyperlinks.

Documents

Canon EMEA Sustainability Report 2013