CEVA’s 2014 Environment, Social Responsibility and Governance report

Sustainable Excellence

2014 CEVA Logistics

Issued in April 2015

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CEVA at a glance 3

Quick Facts 4

CEO Letter 5 CEVA’s sustainability approach 6

2014 and 2015 sustainability goals 7 Sustainability : Trade , Innovation & Risk Management 8 Sustainability is everyone’s job 11

Our environment 12 How we are organized 12 CEVA’s sustainability management structure 13 What we have achieved 14 Customer supply chain carbon emission reduction programs 14 Eco sustainable warehouses 15 CEVA Supply chain optimizations and sustainable redesigns 16 Sustainability in fleet and driver performance 17 Better use of resources by means of automation and recycling 19 Certifications 20

Our people 21 Diversity 21 Recognition from external parties 23 Child and forced labor 23 Employee empowerment and ownership 24 Behavioral Safety : the road to ZERO HARM ZERO BLAME 24

Corporate citizenship 26 Code of Business Conduct 26 Anticorruption 26 Antitrust 26 Supplier relationship management 27 Security 28 Community engagements 29

Governance 30 Corporate governance 30 Enterprise Risk Management 30 Process governance and performance 31

Table of Contents

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CEVA, one of the world’s leading non-asset-based supply chain management companies, designs and implements industry-leading solutions for large and medium-size national and multinational companies.

Over

950

locations worldwide

Present in over

170 countries

CEVA at a glance

24%

23%

20%

20%

6% 4% 3%

Our sectors

Automotive Consumer and Retail

Technology Industrial

Energy Healthcare

Other

7,864 US$ millions

Over 42,000 people around the world

Quick facts

Some highlights of our 2014 environmental program results around the world

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• less than one injury per 200,000 hours worked

Best company to work for

CEVA was named as one of the Best Companies to Work for in Asia at

the 2014 HR Asia Awards in Singapore

Winner of the Best Green Logistics Operator award at the Asian Freight and Supply Chain Awards 2014 (AFSCA) for incorporating environment requirements in strategic planning and operations

Winner of three gold awards at the 2014 RoSPA (Royal Society for the Prevention of Accidents) Occupational Health and Safety Awards in the United Kingdom

Global HSE performance:

• reduction of injuries by 32%

• lost time due to injuries reduced by

37%

More than 3,487,000 kg of packaging materials recycled worldwide

Our CO2 initiatives resulted in more than 52,700 tons of emission reductions

In Latin America alone, more than 6,400 employees were actively involved in CEVA’s diversity and inclusion program

Winner of the Environmental Improvement Award at the Chartered Institute of Logistics and Transports (CILT) Annual Awards for Excellence

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CEO Letter

We have also been able to put our operational capability to good use, delivering more than 70 tons of supplies to Monrovia for the U.S. Agency for International Development in support of the Ebola-related relief efforts.

We are very much aware that our commitment to sustainability not only helps us to serve our customers better, but is also the foundation of good citizenship and reduces the impact of environmental, social and governance risks to our company.

Through our advancements in this area we are able to share the benefits with our customers and create sustainable value through top line growth opportunities, bottom line improvements and risk mitigation.

You will notice a common theme across all our sustainability activities – People, Environment and Performance.

People: • Foster the well-being of co-workers and communities

Environment: • Uphold respectful business behavior with regards to

earth’s natural resources

Performance: • Driving customer satisfaction with strong financial

results

I hope you find this report useful and informative. If you have any comments, please email them to sustainability@cevalogistics.com.

Xavier Urbain

Chief Executive Officer

2014 was the year we went through our first cycle of sustainability management. In this report you can read that we improved our capability to deliver sustainability results that have an impact on environmental, social and governance aspects with initiatives that made good business sense too.

At CEVA we believe that sustainability is everyone’s job and that a sound corporate sustainability governance framework promotes strong leadership by all our management. Sustainability is the foundation of good management practices, contributing to the long-term success of companies and better risk-adjusted returns for our customers.

In this report we have selected some of the best practices we have successfully implemented. Examples include establishing warehouses to manage organic goods in the United Kingdom, supporting the consumer trend to purchase healthier food and the development of sustainable trade in the Lombardy province in Italy with an efficient logistics infrastructure, providing employment to many people. For sustainability we work on many cases with customers and other stakeholders to improve supply chains that deliver better sustainable and economical results. By doing so, and through our philosophy of continuous improvement, CEVA is constantly developing new supply chain management methods that better benefit both our customers and our workforce.

In 2014 we had to manage the knock-on impact of events such as weather-related floods (Italy), hurricanes (Philippines) and political or economic instabilities. These events needed our continued attention and required effective responses to ensure business continuity and to safeguard people in the communities we operate in.

Welcome to CEVA’s 2014 Environment, Social Responsibility and Governance report. I am pleased to share our latest initiatives and progress with you since we issued our first report last year.

The sustainable strategic focus of CEVA is delivering long-term value for all our stakeholders: customers, employees, suppliers, investors and the communities in which we operate on an ongoing, pragmatic basis. Within this sustainability approach, CEVA takes broader economic, governance and social aspects such as labor practices, human rights, societal responsibility into account. This approach guarantees that our services and solutions are provided to our customers in a manner that is respectful to people, the environment and is economically smart, every time. A sustainability approach can only be successful if activities planned and results booked continuously support advancement of the three core values of the program: People, Environment and Performance. We create sustainable value through top line growth opportunities, bottom line improvements and risk mitigation while continuously engaging with our customers and other stakeholders. Our commitment to sustainability helps us to reduce waste and share the benefits with our customers. It permeates the way we do business, driving us to innovate and be creative in everything from warehousing operations to transportation, from solution design to procurement policy. Sustainability results benefits our customers, our communities, our people and our planet. It is ethically right and commercially smart.

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CEVA’s Sustainability Approach

From CEVA’s perspective, sustainability makes good business sense and ensures that the company is a responsible corporate citizen.

Our objectives

We have met our sustainability objectives for 2014.

In 2015, we continue to pursue these objectives and to further advance our efforts.

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Protect safety and health We consider safety and health in our operations a core value. We believe that all injuries can be prevented, meaning we can achieve our vision of ZERO HARM, ZERO BLAME by having a visible leadership commitment to safety so we know how to work safe and why. Goal: less than one OSHA- (Occupational Safety and Health Administration) recordable lost-time injury per 200,000 hours worked, with an aim to achieve zero.

Reduce environmental impact CEVA is dedicated to reducing the environmental impact of its logistics operations. We believe that the protection of tomorrow’s environment starts today. Goal: develop and implement economically smart and fact-based carbon emission reduction initiatives for warehousing and transportation.

Ensure industry-leading governance CEVA is a responsible corporate citizen and committed to meeting all of its legal, ethical and economic responsibilities. Goal: improve the quality of life in the communities in which we operate, while preserving profitability for stakeholders.

Promote economic development We focus on economic and social development at the local level by supporting local businesses, communities and organizations with employment and development opportunities Goal: develop and extend economic development activities with sustainable impact.

Manage climate risk The consequences of climate change (such as floods and hurricanes) for our operations require effective action and business continuity management. Goal: respond to pandemics and climate change events effectively in close consultation with customers and (local) stakeholders .

Respect human rights and security At CEVA we believe that our presence can and should have a positive influence on the treatment and security of people in the communities in which we operate. Goal: Have no human right violations in CEVA’s business operations worldwide.

Sustainability:

Trade, Innovation and Risk Management

Sustainable trade As part of the global community, CEVA continuously seeks innovative solutions to the sustainability needs of the communities and customers we work with.

CEVA’s core competence is an enabler for sustainable trade, bringing sustainable employment and new, environment-friendly work practices, technologies and processes innovations to life that have the potential to become the standard operating practice of tomorrow.

In 2014, CEVA Logistic won the Lombardy Hub International award at the Invest in Lombardy Award event in Milan. Invest in Lombardy is a regional network that works closely with business communities and helps to address their needs.

CEVA received for its investments made to support economic development in the region, in particular Stradella, from which CEVA is able to reach approximately 13,000 pharmacies, 500 hospitals and 400 wholesalers in Italy.

Management of Organic Goods

During 2014 and the start of 2015, four of our United Kingdom operating sites received registration from the Soil Association. This registration addresses the emerging sustainability consumer trend for increasing organic food consumption with as consequence the need that our customers can store our their finished organic goods in our warehouses, assured that the organic status of their products will not be compromised. Each site was registered after an assessment by the Soil Association, which involved the sites demonstrating robust stock control, organic compatible pest control, excellent hygiene standards and packaging reduction.

Even though sustainability is a priority for most of the governments, customers, suppliers and stakeholders CEVA works with, economical benefits and cost reduction remain to be at least at the same priority level. From CEVA’s sustainability perspective, this is the economical reality of today. Political uncertainties and tensions can lead to trade embargos and stricter governmental regulations, impacting profitability on an ongoing basis, positive or negative. As a result, companies need to simultaneously manage their finance positions, respond effectively to emerging sustainability needs and prevent operations disruptions due to climate change. CEVA’s sustainability approach looks at the broader economical situation measured against the three sustainability aspects: environment, people and performance. We use our logistics expertise and sector knowledge to help customers and stakeholders to meet emerging sustainability needs with challenging cost pressures at the same time.

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Working with our customers

Since 2012, sustainability has been part of our annual Customer Satisfaction Survey. Here is what our customers told us during the latest survey1:

• 91% indicated that their company is focused on reducing their impact on the environment

• 93% are satisfied with the level of CEVA’s sustainability efforts

• 78% indicated that environmental sustainability is a key decision making factor when selecting a logistics provider

• 89% see sustainability as an initiative that generates financial return on investment.

These results reinforce our belief that sustainability in all areas of a business is essential.

As an integrated global organization, we believe that by facilitating dialogue, we empower our people to make change happen, which in turn makes our customers’ businesses flow and more sustainable.

This philosophy is behind our logistics services and Centers of Logistics Excellence in Singapore and Jacksonville, Florida, USA, both of which were opened in 2013 and Ashby (UK) in 2014. They are centers of gravity for innovation, sustainability, technology and real life logistics, bringing our collective knowledge and experience together.

At CEVA, we all manage sustainability through an innovative integrated approach that delivers results-- a cross-functional, committed and passionate group engaging with customers and stakeholders to ensure better logistics and sustainable results that matter to everyone involved.

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Warehouse management operations for BP Zhuhai

“CEVA strictly followed the EHS rules and quality norms of the state, the industry and BP and completed the work successfully and safely, with high efficiency and good quality. This proves that CEVA is a first-class logistics provider in China.

With the great support of CEVA, we achieved the safety goal of zero Lost Time Injuries in 2014. That is highly appreciated by BP p.l.c.”

Graeme Stewart, GM of BP Zhuhai, January 2015

1 Sample was 911 respondents across various sectors from around the world

CEVA in Brazil: A comprehensive planning process with more than 20 customers was implemented in 2014 in order to ensure an effective emissions reduction of 10% carbon dioxide in the atmosphere by the operations involved.

The approach of CEVA on CO² emissions reduction included the identification of business processes where the program could be applied and the establishment of a consumption control plan of natural resources. We calculated the CO² emissions in each operation to deliver reduction targets impacting a total workforce of 4,000 people, who were trained and actively engaged as they delivered the improvement concepts. Many of these concepts were the result of open dialogue between our people and stakeholders.

The best innovation results are achieved • through customers and NGO’s stakeholder

dialogues • with fresh perspectives that bring us new insights

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As a globally operating company, CEVA recognizes that all over the world our operations and our people may be exposed to extreme weather conditions, natural disasters or pandemics.

To minimize risk and maximize safety, CEVA continues to develop and expand its global Pandemic Response Management (PRM) and Business Continuity Planning (BCP) competency in close cooperation with its customers and stakeholders.

CEVA conducted several Business Continuity Planning efforts with customers and responded and anticipated to climate events, such as typhoon Hagupit (Ruby) in Philippines, floods in Italy and extreme winter conditions in the US.

In 2014 we implemented our Global Pandemic Response plan that will help us to respond swiftly and adequately to possible outbreaks of – for example – tuberculosis and Ebola and provided advice or services to customers and third parties when requested.

CEVA airlifts supplies to West Africa in support of Ebola response CEVA airlifted more than 70 tons of urgent supplies to Monrovia, Liberia on 10 October to assist in ongoing efforts to combat the West Africa Ebola outbreak. The airlift was chartered by the U.S. Agency for International Development—the lead government agency coordinating U.S. Ebola response efforts—which has been working to expand the pipeline of medical equipment and supplies to the region. Included in the shipment were infrared thermometers, disinfectant backpack sprayers, tents and plastic fencing to be used in the construction of Ebola treatment units.

The supplies were sourced by USAID from multiple locations around the world and delivered to CEVA Charter Services in Belgium where CEVA loaded the cargo onto a Global Africa Cargo aircraft for a direct flight to the Liberian capital of Monrovia.

Response to Events

Storms, floods and droughts can disrupt almost any planned economic activity. To prevent or limit impact of such events we have put in place effective response management to deal with pandemics and climate change events.

Empowerment

At CEVA everyone, from shop floor to top-tier management, is included in its sustainability programs and is empowered and encouraged to propose and introduce sustainability-related initiatives.

All are responsible for the provision of HSE (Health, Safety and Environment) performance, facilitated by the professional and comprehensive HSE staff of the company in close consultation with our customers, stakeholders, CEVA management and employees.

Those efforts have a positive impact on the intrinsic motivation of people involved and our HSE performance improvement, which leads to the results in this report.

In 2014, CEVA won several awards for its HSE approach.

Global Health, Safety and Environment Council

The HSE Council is comprised of senior HSE leaders from across CEVA and is supported by the Executive Board and cluster managing directors. The council guides our sustainability agenda and safeguards consistency with Executive Board priorities and the strategic direction of the company per functional area.

Winner of three internationally recognized ROSPA Gold awards.

RoSPA (Royal society for the prevention of accidents) Gold Award winners have achieved a very high level of performance, demonstrating well developed occupational health and safety management systems and culture, outstanding control of risk and very low levels of error, harm and loss.

Sustainability is everyone's job and everyone’s responsibility at CEVA. As a result of joined sustainability efforts, we booked significant and tangible environmental and social results.

Winner of the Best Green Logistics Operator Award

by Cargonews Asia, at the 28th Asia Freight and Supply Chain Awards AFSCA event held in Shanghai, China. The award recognizes CEVA’s ability to incorporate environmental requirements in our strategic planning and operations.

Winner of the Environmental Improvement Award at the Chartered Institute of Logistics and Transport’s (CILT) Annual Awards for Excellence

CEVA got awarded for its well thought holistic approach to all aspects of distribution management including waste, carbon emissions, generation of renewable energy, waste minimization, and induced travel and trip demand.

The company’s approach lends itself to wider applicability for Companies in the distribution and warehousing sectors

We are proud of being recognized by the industry through numerous awards, including:

In 2014 we achieved: • reduction of injuries with 32% • lost time reduction due to injuries with 37% • more than 3,487,000 kg of packaging materials recycled worldwide • more than 52,700 tons of CO2 emission reductions

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Environment

How we are organized

Sustainability governance begins with senior management oversight and commitment and follows through into management systems and processes that integrate sustainability into day-to-day decision making.

The global Health, Safety and Environment (HSE) Council together with the cluster management teams and members of the global Executive Board of the company are responsible for the provision of professional and comprehensive sustainability services to the company, including the development, implementation, monitoring and review of CEVA’s sustainability policy statements, manuals and management system.

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Included in the sustainability arrangements are assessments to identify the appropriate measures necessary to comply with relevant statutory provisions and to ensure the sustainability of processes, assets and other persons affected by our activities to protect the environment in which we operate. The measures identified are incorporated in procedural arrangements as part of CEVA’s global and regional sustainability policy manuals.

All our clusters have signed up to our global sustainability policy. It is a binding document for how we manage sustainability across the business.

In 2013, CEVA already put its sustainability governance structure in place, which allowed us in 2014 to improve sustainability and operational efficiencies at the same time. In 2014, CEVA continued to improve environmental sustainability by reducing carbon emissions from business travel and commuting, reducing energy consumption by reducing use of offices and meeting rooms and lowering the use of printers, paper and toner. CEVA deployed Microsoft Lync as a single interface that unites voice, audio and web conferencing and aims to get all sites connected in 2015. It enables CEVA to minimize business and commuter travel and allows employees to work more efficiently and sustainably.

Our commitment to sustainability helps us to reduce waste across the entire supply chain and share the benefits with our customers.

It permeates the way we do business, driving us to innovate and be creative in everything from warehousing operations and transportation, from solution design to procurement policy. It benefits our customers, our communities, our people and our planet. It is ethically right and commercially smart.

CEVA’s global sustainability governance management

To drive sustainability performance and added value within the strategic context of CEVA, the global HSE council reviews, develops, deploys and manages:

• standards of regulations and law • contracts of customers and suppliers • policies of the company • sustainability performance • the sharing of best practices

The CEVA Executive Board and Cluster Management develop their strategy in compliance with global and local sustainability policies and regulations as well as the corporate policy manuals for health, safety and environment.

Local ownership

CEVA’s site managers are required to have continuous improvement management in place with the aim of having zero incidents negatively impacting health, safety and environment, such as injuries, lost time or environmental damage.

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There are many areas where we achieve progress and success in sustainability. The key focus areas are:

• customer supply chain carbon emissions reduction programs • eco-sustainable warehouse facilities • CEVA supply chain optimization and sustainable redesign • fleet and driver efficiency (equipment and behavior) • better use of resources (like recycling) • certifications and carbon footprint reporting.

CEVA’s site managers are required to have continuous improvement management in place to with the aim of having zero incidents negatively impacting health, safety and environment.

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Customer carbon footprint dashboard In 2014 CEVA further developed its customers CO2 reporting capability to provide CO2 measurement for the customers’ supply chains across a range of transport modes. Carbon emissions are recorded for each air and ocean transaction and calculated automatically in the different types of standards, including GHG, DEFRA and EN16258 . Customers have access to emission data related to their logistics operations and can request CEVA to work with them on additional calculations for transparency purposes. We provide our customers with: • dashboards with monthly and quarterly results; • standardized reports with agreed-upon measured

results. If needed, they can request CEVA to work with them on additional calculations for transparency purposes.

Carbon Dioxide (CO2):

Carbon dioxide is the primary greenhouse gas emitted through human activities. The CO2 accounted for is for more than 80% greenhouse gas emissions from human activities. The main human activity that emits CO2 is the combustion of fossil fuels (coal, natural gas and oil) for energy and transportation, although certain industrial processes and land-use changes also emit CO2. The main sources of CO2 emissions are described below.

• Electricity

Electricity is a significant source of energy and is used to power homes, businesses and industry. More than 33% of the global amount of man-made emissions, the combustion of fossil fuels to generate electricity is the largest single source of CO2.

• Transportation

The combustion of fossil fuels such as gasoline and diesel to transport people and goods is the second largest source of CO2 emissions of the CO2 emissions with about 30%. This category includes transportation sources such as highway vehicles, air travel, marine transportation and rail.

• Industry

Many industrial processes emit CO2 through fossil fuel combustion. Fossil fuel combustion in various industrial processes accounted for about 10% of the total CO2 emissions worldwide. Note that many industrial processes also use electricity and therefore indirectly cause the emissions from the electricity production.

Ongoing results of independent environmental research and publications provide the basis for CEVA’s carbon emission reductions activities.

Eco-sustainable logistics hubs in Italy CEVA Italy is aggressively reducing its ecological footprint through new measure and adjustments in its 121 warehouses. Some of the results are: • recycled materials: 85% of total waste produced • source of electricity: 100% hydroelectric • electricity saved: ≈30% • high-frequency battery chargers: €200/300 yearly saving per

unit

Italian operations have built and modified 10 warehouses with state-of-the-art solar panels generating in total 18,980 MWh per annum, reducing CO2 emissions by 10,000 tons per year and producing enough power for more than 6,700 households.

CEVA Dubai: LEED Gold Certification CEVA maintained the LEED Gold certification of its CEVA facility in Dubai (ref. CEVA 4 Unit-1) in 2014, amongst others by managing: • a 6% reduction in electricity consumption in

comparison to 2013 • a 11.3% reduction in water consumption in

comparison to 2013. The warehouse is fitted with an efficient lighting system which uses a combination of motion sensors to optimize the lighting inside the warehouse. The exterior lighting is powered by solar panels.

Many of our sites around the world have been designed as eco-sustainable facilities. These warehouses have been built and/or refurbished according to our eco-sustainable logistics principles:

• Always support actions with a strong business case.

• Focus on impact-sensitive areas where a difference can be made.

• Work closely with the customer and other involved parties.

• Take ownership at a local level.

Environment: what we have achieved

CEVA’s Eco-sustainable facilities

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In October 2014, CEVA won the Environmental Improvement Award at the Chartered Institute of Logistics and Transport’s (CILT) Annual Awards for Excellence. The Awards promote and encourage best practice within the logistics and transport sectors and are supported by organizations and individuals throughout the industry. The CILT Organization noted that: “A notably well-thought approach from CEVA included a holistic approach to all aspects of distribution management including waste, carbon emissions, generation of renewable energy, waste minimization and induced travel and trip demand. CEVA went beyond mere compliance in a number of areas, including self-generated power and the creation of an in-house facility to treat Waste Electrical Equipment known as WEEE. CEVA also has an outstanding approach to monitoring and evaluation, including the control of energy use both on and off site. The company’s approach lends itself to wider application by companies in the distribution and warehousing sectors.”

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Environment: what we have achieved

CEVA Supply chain optimization and sustainable redesign

CEVA Italy implemented a flexible rail solution to offer customers an alternative transport system, a wide flexibility and the opportunity to reduce their carbon footprint. Transport by rail is a low carbon transport mode. Since its implementation, CEVA’s railway solution has significantly contributed to reduce its carbon footprint in Italy: • number of truck shipments replaced: 11,000 • CO2 saved: 16,000 tons per year • fine particles saved: 4 tons per year.

In 2014, CEVA rolled out a major fleet investment program within the UK. The investment - worth US$ 20 million - added 120 tractor units, 40 rigid vehicles and 180 new trailers to CEVA’s UK ground transport fleet. All of the vehicles have telematics and the rigid vehicles will have a load restraint system to enable use across multiple CEVA operations. CEVA and its customers will also benefit from some weight-saving enhancements to the trailers which increase their carrying capacity to 29.2 tons. The telematics will measure, monitor and continually improve the behavior of our drivers in terms of safety and efficiency. The innovations in sustainability, efficiency and environmental credentials are calculated to reduce carbon dioxide emissions by 6,000 tons in 2014.

In the United States, CEVA continued its commitment to the Environmental Protection Agency’s SmartWay Excellence program in 2014.

CEVA was a recipient of the EPA’s SmartWay Excellence award in 2013, given to the top one percent of supply chain environmental achievers. The award is the EPA’s highest recognition for demonstrated leadership in the movement of goods via freight transport.

In 2014, the CEVA fleet performed about 4% better on average than the competition, saving more than 5,100 tons in CO2 emissions.

Cleaner, more fuel efficient engines and equipment are central to the company’s sustainability strategy and operations. At CEVA, we have made great strides to improve the fuel efficiency of vehicles and equipment. Additional specifications for engines and equipment and in-cab software modifications to better monitor idle times and top line speeds have contributed to a decrease in overall fuel consumption and helped CEVA reduce its carbon footprint.

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Environment: what we have achieved

Sustainability in fleet performance

In Italy, CEVA organized a training course developed specifically for truck drivers. Through the training, CEVA achieved two main goals: 1. Improve the safety and prevent accidents and

risks 2. Improve awareness with regards to fuel

consumption and the environment. The training combines theory and practical lessons focused on fuel consumption and greenhouse gas reduction. The lessons learned can dramatically reduce the impact of transport on environment. CEVA estimates the following savings to be realized: • drive at optimal speed: 10-15% fuel consumption • minimize the use of air conditioning: 10/15% fuel

consumption • remove unnecessary weight: 5-8% fuel

consumption • check the tire pressure: 3-4% fuel consumption.

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UK: Truck driver training for top performance In the UK, every CEVA truck driver is trained in road safety and has a handbook to consult to operate their truck in compliance with CEVA’s health, safety and environmental standards. The training includes information about personal protective equipment, personal accident reporting procedures, environmental impact, safe manual handling, truck driver delivery guidelines, quality, driver duties and responsibilities, environmental and awareness training, safe and fuel efficient driving, spillage training and waste management training. The results of the course are impressive with savings of 2,234 tons in CO2 emissions, a reduction in vehicle wear and tear and a rise in driver retention.

The safe and fuel efficient driving course aims to improve the driving techniques of our employees and is designed to both safe fuel, and therefore reduce the associated carbon emissions, and reduce blameworthy road incidents.

Environment: what we have achieved

Sustainability in driver behavior

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Environment: What we have achieved

Better use of resources by means of automation and recycling

USA: • 1,975 tons of packaging materials recycled Australia: • 3,909 tons of waste reduced • 15.6 kilotons reduces in the emissions of greenhouse

gases emissions (CO2) • 57.7 terajoules in energy savings • 124.2 million reduction in water consumption United Emirates: • 50 tons of packaging materials recycled Malaysia: • 226 kg of waste collected. Note that waste collection in

Malaysia started in 2014.

UK Waste Management

The UK improved waste management at all CEVA sites through Dry Mixed Recycling (DMR) facilities which allow the sites to segregate and recycle paper, cardboard, plastic bottles, vending cups and drinking cans. The results of these and other efforts: • 1,612 tons of plastic, cardboard and paper recycled • 84.2% reduction in environmental incidents compared to 2013 • 5.9% reduction in carbon footprint • 33.7% reduction in packaging materials used • 16.5% reduction of paper used.

Customer supply chain innovations in Benelux

For a telecom customer CEVA in Benelux developed an innovative packing alternative replacing boxes with re-usable crates. The design incorporates a nesting system to optimize use of space (thus reducing carbon emissions for transport) and reduces paper waste with 100%.

In the summer of 2013, CEVA signed the IATA multilateral agreement for the use of electronic Air Waybills (e-AWB). This agreement laid the legal groundwork to replace the printed terms and conditions with electronic alternatives . In 2014 CEVA reached 20.4% e-AWB penetration across its global business, placing itself firmly among the leaders in e-AWB implementation. In September 2014, CEVA achieved the fastest growth of e-AWB use of any logistics company.

CEVA has ISO 9001 (Quality), 14001 (Environment), and/or 18001 (Health and Safety) certifications in: • Australia • Belgium • China • Czech Republic • Germany • Hungary • Luxemburg • Italy • Malaysia • Netherlands • New Zealand • Poland • Romania • Singapore • Spain • United Kingdom • USA And more….

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Certification highlights 2014: • CEVA in the UK added two new sites (1,167 employees)

to its ISO14001 certificate

• CEVA in Benelux became Corporate Social Responsibility performance ladder level 3 certified (MVO)

• CEVA improved its ability to support customers to comply with WEEE, REACH and CFR Hazardous goods regulations required for customer supply chains in 2014 and beyond.

Environment: What we have achieved

Certifications

Our employees are passionate, committed and live and breathe supply chain excellence. In return, we recognize their efforts, empower them to be supply chain masters and encourage a culture of collaboration.

The core of our business, the core of our success:

Our people

As outlined in our Code of Business Conduct, CEVA strives to maintain a working environment that allows our employees to achieve their full potential and encourages creativity and productivity. All of our employees have the right to be treated with consideration and respect. We do not allow any form of workplace violence, intimidation or harassment. Our employees and the relationships they build with our customers and other stakeholders are key elements of CEVA’s continued and sustainable growth.

Diversity – what are we doing?

We focus on three specific company-wide programs, each of which is actively sponsored by a member of the Executive Board:

1. Gender: To promote fair recruitment and development opportunities for all, we hold regular listening events, have internal women’s networks that span the globe, have established gender-specific mentoring programs and invested heavily in leadership training. Our Gender Working Group continuously identifies areas for further progress to ensure we keep moving forward.

2. Disability: We value the unique skills of every individual. We want to increase the number of employees with disabilities by removing the barriers – physical or social – to work for CEVA.

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CEVA in Brazil and Latin America undertook a highly successful Diversity & Inclusion (D&I) Initiative in early 2014. The overall goal was to increase awareness of diversity topics and change behavior in terms of dealing with differences. Events included 250 lectures given in every Latin America country, attended by 6,462 employees. Engagement campaigns for the D&I initiative included “Wear Green Day” on the Friday of D&I Week, organized book donations (almost 700 books were contributed to public libraries), book exchanges, photo contests and distribution of CEVA’s D&I policy to all employees.

In South Africa, CEVA’s initiatives to support the community included supporting the Alma School for the blind and hosting the Casual Day celebration in the form of a lunch to mark the national day of people with disabilities. The funds raised are used to provide material relief to persons with disabilities and promote their right to accessibility, education, housing, employment and full inclusion into society.

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Our Disability Working Group promotes and supports this effort with initiatives such as: a disability E-Community for mutual support, disability awareness campaigns, awareness training on inclusive recruitment and reasonable adjustments/accommodations and partnerships with disability groups, including Employers Forum on Disability (Europe), BizLink and SPD (both Asia-Pacific region).

3. Lesbian, Gay, Bisexual, Transgender, Transsexual and Questioning (LGBTQ): We ensure that all employees, regardless of their sexual orientation, can be fully engaged with the company and bring their ‘whole selves’ to work. Our LGBTQ network, established in 2010, works to create a workplace where sexual orientation equality is a familiar concept and where LGBTQ staff feel able to contribute and participate fully.

To drive progress and monitor our performance we have established a global LGBTQ network of active management and employee working groups and incorporated global diversity in our HR policies and processes.

During the 2014 World Cup, CEVA promoted diversity by encouraging celebrations through employee competitions and incentive campaigns. The Word Cup 2014 may be over, but the spirit and celebration of diversity remains.

Recognition from external parties

Over the years, we have won several employment awards and are pleased that our efforts have been recognized:

• One of the best companies to work for in Asia, 2014, HR Asia Awards, Singapore

• Reliable employer of the year, 2013, Poland

• 2010 Select 50 Diversity Employers, Best Jobs, USA

• Best Employer 2008/2009/2010/2011/2012, Large Companies category in Turkey

• Company most sensitive to equal opportunities, Spain.

Child and forced labor

We are committed to ethical employment practices throughout the world and to the International Labor Organization (ILO) conventions and principles protecting children and vulnerable adults from exploitation in the labor market.

We aim to comply with all applicable local and international labor regulations, treaties, conventions and principles relating to protection, welfare, health and safety.

This approach is reinforced and underpinned by our Code of Business Conduct; our global policy that sets out one consistent approach to fair conditions and responsible business conduct in all CEVA locations.

In June 2014, CEVA in Turkey organized the CEVA Junior Event.

Children of CEVA employees had a chance to see their parents’ workplace while entertainers taught them handicrafts. After eating a delicious Smurfs cake, the kids took a tour around the CEVA office, singing to let their parents know they were there. The kids had a lot of fun visiting their moms and dads at work!

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CEVA in Singapore has been recognized as one of the Best Companies to Work for in Asia, at the HR Asia Awards, 2014. This award is presented to a select number of Singapore companies with leading best practices in three key areas - employee engagement, workplace cultures and development opportunities.

Organizing Customer & Stakeholders HSE Events

CEVA organized HSE events in 2014 with customers, NGO’s and other stakeholders in Asia, Middle East/Africa, Europe and the US. Workshops were done to develop and improve safe driving/ riding, lifting safety, Safety Timeout and MHE safety. For some events more than 300 people attended.

Benelux: New safety Induction programs

The buddy program is specifically designed for new employees to get a personal warehouse tour and a safety introduction training. This ensures safety awareness from the start and allows the new employee to be acquainted with the surrounding and rules faster and better.

Employee empowerment and ownership

Our people are our most valuable assets, which makes safety as one of the core priorities of the company embedded in our company culture and supported through values and rules. All management, employees and sub-contractors are expected to live these values and rules in their daily work routines.

This Behavioral Safety program is called: The road to ZERO HARM, ZERO BLAME.

This program has three focus areas:

• leadership by example • expected safety behavior • understanding WHY things happen in the way

they do and KNOW what to do to improve.

Leadership by example

Hazardous situations and HSE incident reviews are monitored on a frequent basis with the VP and Senior Managers to understand trends and root causes and assess if improvement actions do work effectively.

Sign off of all lost-time accident investigations at senior management level, to assure (personal) commitment to new improvements.

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Rules • I know the safety rules for the site I work at and have completed the

site safety introduction, before I enter the site. • Before I do my work, I check if my environment is safe, my

equipment is safe to work with and I wear my Personal Protection Equipment

• For any unsafe working conditions, risks or doubt, I contact my supervisor or the local HSE contact persons timely for follow-up.

• When I do my work, I am FIT for work (no alcohol, drugs or fatigue) • When I do my work, I make sure my work is done safely at all times

Values • I am responsible for my own safety at all times • I actively approach others to work safely • I take action in case of unsafe operations. If I am

unsure I will stop and ask how to work safe • I accept feedback about my safety behavior regardless

of rank and position • I report all incidents, including near misses, to the local

HSE responsible person, to inform others and build on lessons learned

Behavioral Safety Management

Zero Harm – Zero Blame

Behavior

We ensure everyone ‘gets’ HSE. We do this with simple communications, interactive HSE dialogues and a full implementation of safe manual handling with ongoing on-the- floor behavioral HSE training.

Understand WHY and KNOW what to do

Robust accident investigations using cause analysis are done to continuously improve HSE performance in our daily work processes. We ensure that the importance to do so are fully understood, that safety measures are assured by the relevant stakeholders and that personal protection equipment is up to standards.

What results did behavioral safety program the “road to ZERO HARM, ZERO BLAME” bring?

At the start of 2014, the global HSE council found that more than 80% of the lost time incidents were caused by strains and sprains injuries on the sites. In 2014 CEVA reduced its lost-time injuries rate with 37% globally.

To reduce lost time due to these injuries the global HSE members developed local culturally accepted HSE initiatives to prevent these lost time incidents by taking local risks out (like for example removing potholes) and physically train employees in areas of lifting or stretching by athletes or specialized trainers. These improvement actions reduced injuries lost times to zero hours at the sites where these programs were done and made daily work more fun to do, as less people go home and family with strain and sprains pains after work time.

This program will continue and expand within CEVA.

UK: “Keep the Jam in Your Doughnut”

The UK delivered in 2014 First Line Management and employee training at sites were injuries due to strains were high (more than 60 work days lost time). During 7 months, ‘Olympic games’ weightlifters trained the CEVA staff in various lifting techniques ( 400 staff) These training sessions also included the management perspective and guidance on hands-on monitoring and coaching of their teams and brought the lost time due to this injury to zero. Keep the “Jam in your Doughnut” was the theme explaining the cause of injuries in simple hands-on training (see pictures).

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CEVA in Turkey: Reduction of blind spot incidents by installing blue lights at the top of the forklift, so others are able to spot a forklift truck coming from a blind spot.

CEVA is a responsible global corporate citizen meeting all legal, ethical and economic responsibilities we have. The aim is to improve the quality of life in the communities in which we operate, while still preserving profitability for stakeholders.

We promote sustainability by investing in and supporting a robust Compliance and Ethics program, which makes CEVA a better place to work, enables our business to be successful and helps protect our company, our employees, our customers and all our stakeholders.

Code of Business Conduct

Our Code of Business Conduct1 is our governing ethics document. It embodies our high standards of integrity and provides guidelines for legal, regulatory and ethical compliance. The entire document is focused around respect: for each other; our shareholders; our customers, suppliers and other business partners and our communities. Four key themes underline the Code’s requirements: appearances matter; independence and quality; no conflicts; and fairness, honesty and transparency.

In 2013 we re-launched our Code, following a benchmarking exercise and study of best practices. It is now written in much plainer language, is simpler to understand and easier to apply, and is available in 26 languages from our global website. Why don’t you take a look? 2

Anticorruption

Corruption is one of the key legal and compliance risks that CEVA faces. We are subject to the United States Foreign Corrupt Practices Act, the UK Bribery Act and various other corruption laws and requirements, all of which have strict prohibitions on bribery and corruption. Our Code clearly sets out our expectations when it comes to anticorruption, as does our Anticorruption Policy. Put simply, we prohibit bribery in all forms, including facilitation

payments, and we require accurate books and records. Additionally, we aggressively manage risks posed by third parties working on our behalf, such as customs brokers. We have implemented a comprehensive third party due diligence process to thoroughly vet our customs clearance agents and subcontractors. We use compliance covenants to mitigate risks presented by other third parties. Finally, we provide clear guidance in other areas that implicate corruption concerns, such as gifts and entertainment.

Antitrust

Another of our core compliance risks is antitrust and competition law. As with anticorruption, our Code clearly sets out our rules and requirements on antitrust and fair competition. In 2013, we overhauled our Antitrust and Competition Law Policies and Procedures (also available on our internal and external websites) to make them more understandable and easy to use. On a more tactical level, we require internal senior management approval for participating in trade associations, which can present risks of anticompetitive behavior, and for certain surcharges, to ensure they are set compliantly and properly documented.

On each of these and other key areas (such as Global Trade Compliance) we train and communicate widely. We have web-based training that we deploy to key audiences, require annual compliance webinars for management and use our own internal channel – Connecting CEVA (boss-led, two-way communications modules) – to cascade key messages through the organization. Our Compliance and Ethics team visits various CEVA sites around the world each year for dedicated compliance interviewing, auditing and training and works closely with our Internal Audit team.

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How we deliver performance:

Corporate citizenship

1 Available at www.cevalogistics.com

We also issue a quarterly compliance newsletter called Compass Points which uses simple language and real-life examples to bring compliance to life.

Supplier relationship management

We operate a centrally led procurement function: a global team at the center which provides guidance and strategic direction to a network of country procurement specialists. In addition, we have an innovative, all-encompassing approach to procurement called One Logic. One Logic’s mission is to maximize value creation by reducing supply chain costs, improving transactional processes and enhancing efficiency, while providing sustainable fit for purpose solutions that responsibly consider CEVA’s environmental and social impacts. This approach is embodied throughout the procurement function, which has a common vision to deliver excellence in procurement practice through the development of world class people, operational effectiveness, cross-functional collaboration and savings transparency.

In addition to the overarching Procurement policy which applies to all CEVA locations, we specifically have green procurement guidelines, which recognize our responsibility and commitment to continuously improve our environmental credentials through responsible supplier sourcing, waste management, pollution prevention, use of renewable energy, energy efficiency and supply chain efficiency.

.

Combining the best economic solution with environmental criteria, CEVA Italy adopted a green procurement policy in 2007.

The policy promotes purchasing of goods and services which have the most beneficial environmental, social and economic impact, considering not only the source of materials, but also their longevity in the work place and ultimate disposal. Through a questionnaire, CEVA evaluates the green side of its potential suppliers asking details on:

• quality and environmental certifications • management of the separate collection of waste • use of recyclable packaging • training courses on environmental issues

Thanks to this CEVA policy adopted in 2011, about 60% of total CEVA Italy’s suppliers are considered green in 2014.

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We have green procurement guidelines, which recognize our responsibility and commitment to continuously improve

our environmental credentials.

Prevention

We are committed to a clear, proactive approach to security in close consultation with our customers and stakeholders and have invested substantially in secure facilities, vehicles and freight handling policies.

CEVA’s global security organization can meet any security-related request or issue through the employ of professional security experts. CEVA security advises CEVA customers on specific security issues, develops custom-made security solutions, delivers awareness training and carries out investigations.

Compliance

CEVA complies to industrial security standards such as TAPA (Transported Assets Protection Association) and local government security certifications like C-TPAT, AEO and STP.

Innovation

CEVA is committed to innovation in logistics security. CEVA has been a TAPA member since 2002 and has active board membership within the board of directors for TAPA EMEA membership.

Examples of CEVA ‘s security solutions proven to be successful in 2014: For trucks operating in a high-risk country, we implemented a system that will automatically shut-down the engine at the first stop location when the GPS signal is lost or jammed. The system blocked all subsequent hijacking attempts and discouraged hijackers, resulting in a drop in attempts. Mobile GPS systems hidden in the freight resulted in a number of arrests.

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Security: The FBI estimates at least $40 billion is stolen per year within the global supply chains. CEVA Logistics is committed to manage security as an integral part of our business by the principles:

Prevention, Compliance and Innovation

With the logistics arranged by CEVA, Goodman Fielder donated 1,272 liters of fresh low fat milk to 2,300 students in Philippines in October 2014.

In May 2014, a number of CEVA employees in the US participated in the Walk for Babies organized by the March of Dimes Foundation, US.

In December 2014, CEVA in Thailand and its customer SCG organized a series of safety awareness and anti-drug campaigns for local communities.

CEVA employees in Malaysia donated money, food grains and other relief materials to people in the flood-hit areas of Malaysia in December 2013.

In 2014, CEVA’s Roparun team 2015 in Europe raised €6,400 to support people who suffer from cancer.

July 2014, employees at CEVA Singapore helped to distribute 150 boxes of provisions for the underprivileged in the MacPherson area.

Since 2011, in the village of Dan Dabo 100 goats have been vaccinated and delivered to 50 families, as part of a CSR program supported by CEVA.

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A few examples for all

Community engagement With a presence in over 170 countries, CEVA recognizes the importance and value of being engaged in the local communities it operates in.

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These present both risks and opportunities for environmental, social and economic performance and have made corporate governance to manage these risks and promote sustainability a priority for our Executive Board.

Corporate governance

CEVA is governed by a Board of Managers and managed on a daily basis by our Executive Board. Our CEVA Business Rules set forth authority limits, approval requirements and procedures related to making investments and capital expenditures, rules on entering into commercial contracts and other business transactions, as well as a host of other activities.

Our Committee on Corporate Conduct reviews and monitors compliance reports and problems. We actively encourage employees to report compliance concerns in whatever way they feel most comfortable with (including anonymously) and provide a compliance hotline and web-based reporting tools to do so. The Committee on Corporate Conduct consists of representatives from Legal, Human Resources and other departments, and is chaired by the head of Internal Audit, who reports periodically to the Audit Committee. Our Internal Audit group routinely audits various aspects of the business as part of our ordinary course audit program and also looks into particular problems as they arise.

CEVA’s Chief Legal Officer and Chief Compliance Officer oversee our global Legal/Compliance and Ethics team, which consists of lawyers and paraprofessionals around the world, dedicated

compliance managers in each of our regions, Global Trade Compliance personnel and others. Finally, CEVA has an Insurance Risk Management group that oversees our insurance program and handles insured claims and losses.

Enterprise Risk Management (ERM)

At CEVA, we categorize Enterprise risks into five key areas:

External risks: These are the climate change and macro economical risks, i.e. Hurricanes, heavy winters, rainfall, as well as energy price changes, social evolutions (like the rise of “superfoods”) or political, economical and social instabilities impacting business continuity.

Strategic risks: These are the risks related to the markets en customers in which CEVA operates, impacting CEVA’s revenues.

Operational risks: These are the risks that could impact continuity of operational execution, quality of delivery of goods and services to customers.

Compliance risks: These are the regulatory changes which impose risks to operations which could result in claims when they are not managed well.

Financial risks: These are the risks related to financial management like tax, cash and liquidity-related exposures to the company

How we manage risk

We guide the development and ensure the implementation of our sustainability strategy and programs globally, addressing the strategic, operational, compliance, reporting and materiality

How we ensure performance:

Governance No organization can operate as it did a decade ago. All our stakeholders are facing the challenges and effects that the climate can have on our operations, with increasing environmental regulation and taxation and declining natural resources. Increased visibility into corporate business practices and a better understanding of the interconnectedness of the work we carry out are called for.

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risks outlined before. We place high importance on providing guidance and leadership on management of Enterprise risk to all CEVA employees and our stakeholders worldwide, to ensure that the strategy and programs are accepted, understood, bought into and being complied with.

We achieve this through a number of different approaches:

• We lead the organization in the development, implementation and maintenance of sustainability, risk governance and management systems.

• We define and implement the global sustainability risk management process together with CEVA’s ERM & Executive Board, including sustainability risk identification, analysis, objectives and appropriate response and control.

• We have global and regional operations management working proactively to drive improvements in key areas as identified through enterprise risk management analysis. We evolve and assure that global sustainability policies are adhered to in the development of regional and local sustainability policies and work procedures for all locations.

• CEVA’s global HSE Council together with involvement of CEVA management prepares, maintains and updates the sustainability policy manuals as required and develops, implements and maintains the operational sustainability audits of CEVA worldwide.

• We lead sustainability crisis and incidents management and report performance status on appropriate and frequent basis to the Executive Board and regional presidents.

• Our leadership behavior is in accordance with good sustainability standards and our Code of Conduct.

Process governance and performance

CEVA works closely with its customers get the best solutions in place in terms of performance, commercial results and from sustainability perspectives. Our experience with extended supply chains allows us to handle the challenges of working with multiple suppliers and service providers across the world. We provide the visibility customers need to monitor and control their flows and operate in compliance with relevant industry, sustainability standards or generic standards like ISO.

Our commitment: People, Environment and Performance Throughout the organization, from our leadership to every single employee, we are committed to deliver sustainable value to our customers , stakeholders and we are doing so through respectful behavior to the earth’s natural resources.

Global Head Office

CEVA Logistics Siriusdreef 20

2132 WT Hoofddorp The Netherlands

Tel: +31 23 799 8000 +31 23 568 3300

sustainability@cevalogistics.com

www.cevalogistics.com

2015 CEVA Logistics