SEnSO Definitions

Strength. Performance. Passion.

Sustainability Enhanced Solutions SEnSo Definitions

© 2015 Holcim Country Company Name 1

SEnSo definitions

© 2014 Holcim Technology Ltd 2

Content

Content 2 1. SD Ambition 3 2. General SEnSo definition 4

2.1 Definition 4

2.2 Pre-requisites 5

2.3 SEnSo label 5 3. Sustainability Enhanced Solutions categories 6

3.1 Overview of Sustainability Enhanced Solutions categories 6

3.2 Selection criteria 6

3.3 Categories definition 7 3.3.1 Inclusive business (qualitative) 7 3.3.2 Water solutions (qualitative) 8 3.3.3 Urban mining solutions (secondary mat.) (quantitative) 9 3.3.4 Waste services (qualitative) 10 3.3.5 Energy efficient solutions (quantitative) 11 3.3.6 Resource efficient solutions (quantitative) 12 3.3.7 Low CO2 materials (quantitative) 13 3.3.8 Others (qualitative) 14

3.4 Solutions not classified in any SEnSo category 15

SEnSo definitions


1. SD Ambition Within Holcim’s Sustainable Development (SD) agenda, Holcim established a future vision framing long-term sustainability targets until 2030. As one of the world’s leading suppliers for cement and aggregates, Holcim’s goal is to anchor sustainability in all its operations and along its value chains, thus going clearly beyond its own plants’ boundaries. Holcim plans to increase cement production significantly by 2030 and aspires to grow its portfolio of Sustainability Enhanced Solutions (SEnSo) up to a significant share of the overall 2030 revenues. This ambitious goal asks for substantial innovation, bringing to the construction market sustainable solutions that improve significantly the use of primary resources, create value for society and reduce GHG emissions along the product life cycles.

Figure 1. The overarching goal of the SD Ambition is to capture growth from SEnSo.

SEnSo definitions


2. General SEnSo definition 2.1 Definition Regarding Holcim’s vision to provide foundations for society’s future, the SD ambition promotes the development of Sustainable Enhanced Solutions (SEnSo) which will allow the company to achieve the goals defined for 2030 and beyond. A Sustainable Enhanced Solution is a product and/or service with superior environmental and social performance compared to common market reference with sustainability benefits occurring

in the manufacturing phase

E.g. LC2, low CO2 cement

thanks to their intrinsic properties in the construction, use and/or disposal phases of buildings and other infrastructure

E.g. Ecoterm, SpeedCrete, high strength concrete

in the application it was designed for E.g. Water solutions, services (CDW, AFR)

Figure 2. SEnSo products compared to market solutions.

Benchmarking:

Sustainability

Enhanced Solutions

outperform common

practices, and may

or may not be better

than competitors’

ones

Sustainability

performance

Competitor X –

Solution X

Holcim – Solution C

(SEnSo)

Range of

Sustainability

Enhanced

Solutions

Holcim – Solution D

(not SEnSo)

Threshold -

according to

criteria

Common market reference solutions

Holcim – Solution B

(SEnSo)

SEnSo definitions


2.2 Pre-requisites Those products or services declared by Holcim as SEnSo must be:

Products and services that generate a turnover Manufactured or provided by facilities which have implemented the Holcim

Environmental, Social and AFR policies E.g. EMR, CEP, BAP…

Trade-offs1 should be considered in the definition of SEnSo. If material trade-offs are detected, the product / service does not qualify as SEnSo unless the company communicates about the negative impact created as much as it does about the positive contributions made. 2.3 SEnSo label

According to their properties, products and services qualifying as SEnSo will be granted a label highlighting their superior environmental and/or social performance. In the absence of major changes, the label is awarded for a period of three years, after which it should be checked if products/services are still meeting the updated criteria.

Note: This label will be included in Holcim Branding Directive upon final approval of SEnSo definitions.

1 Trade-offs occur if a desirable positive sustainability impact is achieved to the detriment of another area of impact, i.e. if a product performs better on energy efficiency but cannot be recycled anymore

SEnSo definitions


3. Sustainability Enhanced Solutions categories 3.1 Overview of Sustainability Enhanced Solutions categories Considering Holcim’s worldwide products and services different SEnSo categories have been proposed to address the defined goals in the 3 main focus areas of the SD Ambition. These categories integrate different solutions which may contribute in one or more of the areas of interest.

Figure 3. SEnSo categories contribution to SD Ambition interest areas. 3.2 Selection criteria Depending on the products and services, SEnSo declaration can be qualitative or quantitative, according to each of the mentioned categories. These categories have been defined considering:

• Definitions and criteria should be as simple but exhaustive as possible • Criteria will be reviewed every 3 years to reflect the latest status • Only sales to third parties will be measured (no intra or inter company sales) • No double counting is permitted. It can happen that solutions fall into multiple

categories, but they should only be counted once. In the absence of major changes to the production process or service delivery, a solution that qualifies as SEnSo is considered as such for the subsequent three years. Every three years it is necessary to check if the solution meets SEnSO requirements.

Others

SEnSo definitions


3.3 Categories definition Each of the categories is explained in detail below. 3.3.1 Inclusive business2 (qualitative)

Type Products or services

Sustainability benefit

In addressing societal problems and goals

Definition Initiatives based on core business and expertise that include base of the pyramid populations as producers or consumers in initiatives that address social needs while providing tangible business benefits

Criteria Products or services from profitable inclusive business solutions, addressing shelter and livelihood needs for people at the base of the pyramid. The following criteria apply:

• Shelter products or services are specifically designed and targeted to low income people. They aim to provide access to improved housing OR adequate sanitary facilities OR other basic services (e.g. water)

• Livelihood solutions include low income people as business partners for Holcim, resulting in higher income (e.g. provision of waste biomass to the plant) OR better business performance (e.g. supplier development, retailer networks) OR a decent job (e.g. municipal solid waste sorting or transportation) OR better employability (e.g. through masons training)

Examples • Low income housing, Shelter for Livelihood, Micasa, Solushi Rumah

• Sanitation for Life

Accounting Turnover from solutions meeting criteria above, sold to third parties

2 This category qualifies at the least for the community attribute; additional attributes can be attained if their respective

requirements are achieved.

SEnSo definitions


3.3.2 Water solutions3 (qualitative)

Type Concrete products and integrated solution


The application of these solutions preserves water resources

Definition Products specifically designed to decrease fresh water demand, increase water availability, improve water quality or preserve natural water flows

Criteria • Products designed for water treatment • Products designed for rainwater or storm water management • Products designed for natural water infiltration

Examples • Humesguard, Humeceptor, Stormtrap • Pervious concrete


3 This category qualifies at the least for the resource attribute; additional attributes can be attained if their respective


SEnSo definitions


3.3.3 Urban mining solutions (secondary mat.) 4 (quantitative)

Type Aggregate and concrete


Less primary resources in manufacturing phase

Scope Cradle to gate

Definition Alternative aggregates or concrete which include a high proportion of alternative aggregates

Criteria • Concrete which contains > 25% alternative >4mm • Aggregates from industrial waste and by-products (sold to third

parties) • Recycled aggregates (sold to third parties) • Recycled asphalt (sold to third parties) or asphalt containing more

than 20% of recycled content • Solutions which enable the recycling of concrete into new

construction material (e.g. mobile crusher)

Examples Alternative aggregates: Construction Demolition Waste, glass, copper slag, bottom ashes, china clay stand

Accounting Turnover from products meeting criteria above, sold to third parties



SEnSo definitions


3.3.4 Waste services5 (qualitative)

Type Service


Provide waste treatment solutions in accordance with the waste management hierarchy and respecting the triple bottom line (social, economic, ecological)

Definition Waste management services provided by Geocycle, Holcim or one of its waste management brands that contribute to social progress, economic growth and environmental performance

Criteria • Solutions to treat (re-use, recycle, pre- and co-process) various types of wastes (industrial waste, municipal waste, agricultural waste, construction and demolition waste CDW)

• AFR and waste management services including alternative raw materials and fuels sold to third parties

• Waste management services including but not limited to logistics, warehouse management, administration, consulting, laboratory analysis

• Recycled material sold to third parties (such as steel, plastic, etc…)

Examples Waste management (hazardous and non-hazardous wastes, services), treatment (pre- and co-processing, incl. segregation, recycling, etc.)

Accounting Gate fees for pre- and co-processing of wastes (e.g. contaminated soils, hazardous wastes, CDW) Revenues from waste management services provided to third parties (e.g. logistics, laboratory analysis) not related to co-processing



SEnSo definitions


3.3.5 Energy efficient solutions6 (quantitative)

Type Concrete products and integrated solutions


Lower needs for energy in the use phase of buildings

Definition Solutions decreasing energy needs in buildings, providing better thermal energy efficiency, compared to common market reference

Criteria • Thermal insulating concrete with lambda value λ ≤ 0.6 W/(mK) • Thermal insulating concrete for foam applications with lambda

value λ ≤ 0.2 W/(mK) • Concrete applications which increase thermal inertia in buildings • Concrete applications with high thermal conductivity which increase

efficiency of geothermal systems for heating/cooling"

Examples Insulating concrete (Ecoterm, Lightweight concrete, Thermicimo…) Insulated Concrete Formwork (ICF-Crete) Indoor Climate Solution Heat storage


6 This category qualifies at the least for the climate attribute; additional attributes can be attained if their respective


SEnSo definitions


3.3.6 Resource efficient solutions7 (quantitative)

Type Concrete products and integrated solutions


Lower needs for natural resources in the construction and disposal phases of buildings and other infrastructure and potential reduction in social costs

Definition Compared to common market reference: • Solutions with longer service life and decreasing needs for

maintenance • Solutions requiring less material to achieve the same performance

Criteria • Higher strength concrete (28d strength > 60MPa), resulting in higher performance using less material

• Concrete reaching the structural and durability performance criteria required for a longer service life (>50 years) according to international standards (EN 206-1:2000), or 20% better than minimum standards.

• Lightweight concrete applied to save resources, with density 20% below market average of lightweight concrete or <1600 kg/m3

Examples Higher strength concrete (High Rise-Crete) Higher durability concrete Lightweight concrete Cement/aggregates sold for high performance/durability concrete production


Note: For an appropriate durability performance the exposure conditions have to be characterized and the concrete has to be designed to resist these conditions for the targeted service life. The resistance of the concrete in reinforced concrete structures to the major deterioration mechanisms related to

• corrosion of reinforcement i.e. carbonation, chlorides • deterioration of the concrete i.e. freeze/thaw action, alkali-aggregate reaction and

chemical aggressiveness such as sulphate attack have to be proven based on local or international accepted standards (EN/ASTM), mainly using performance based tests and limits associated with it.



SEnSo definitions


3.3.7 Low CO2 materials8 (quantitative)

Type Cement, concrete


Less CO2 in manufacturing phase

Definition Products (cement or concrete) have specific net CO2 emissions lower than regional benchmark:

• Cement benchmark (at product level) is set based on regional GNR data (kg CO2 / t cementitious). Reference is 20% better than the GNR average in the region for 2012

• Concrete benchmark (at product level, in kg CO2 / m3 concrete) is calculated from cement, based on assumption of 195 kg clinker per m3 of concrete

• MIC which include a high proportion of industrial by-products and waste

Criteria kg CO2/t or kg CO2/m3

Region Proposed CEM Proposed RMX

Africa 480 135

Asia (excl. China, India, CIS) + Oceania 530 150

Brazil 440 125

Central America 485 135

China 500 140

CIS 575 160

Europe 460 130

India 480 135

Middle East 545 155

North America 555 155

South America ex. Brazil 465 130

Examples Low (embodied) carbon cement Low (embodied) carbon concrete (e.g. LC2) Industrial by-products: slag, fly ash… as MIC (sold to third parties)


Note :

Embodied carbon is calculated here as: (net CO2 emissions to produce one ton of clinker) x (clinker content in product)

Group average clinker factor of 69.8% The CO2 thresholds will be updated every year to reflect most recent progress

8 This category qualifies at the least for the climate attribute; additional attributes can be attained if their respective


Product Carbon

Footprint Aproach:

Even if at this stage

benchmarking on life

cycle data is not

possible, companies

are encouraged to

calculate the

environmental

impacts of their

products (with a PCF

or EPD) and to be

transparent about

them.

SEnSo definitions


3.3.8 Others9 (qualitative)

Type Products and services


Provide solutions that improve resource and environmental management

Definition Consulting services aimed at improving resource and environmental management Products and services aimed at constructing or repairing building and infrastructure faster than common market practices Energy from non-traditional fossil fuels

Criteria • Environmental services (incl. water and biodiversity) • Engineering services related to water, energy and resource

efficiency • Consultancy on sustainable construction • Trainings on sustainable building • Solutions increasing speed in construction and maintenance • Power or energy from renewable sources and alternative fuels • Responsible Sourcing Schemes certifying cement, concrete,

aggregate, asphalt with a significant better performance/more rigorous criteria than typical market average

Examples Green building label services, urban development services Fast road repair (SpeedCrete, FastCrete,…) Power from wind, solar, etc…


9 This category qualifies for any of the respective attributes, combination of attribute are also possible as long as their

respective requirements are achieved.

SEnSo definitions


3.4 Solutions not classified in any SEnSo category The following products do not qualify as SEnSo:

Standard concrete, even if delivered to a building getting a green certification, or to a dam for hydro power production

Standard concrete used for wind mills foundations or similar applications Products with an Environmental Product Declaration (EPD) that do not satisfy to

SEnSo criteria OpCos may identify products or services which could potentially be SEnSo, but whose sustainability advantages have not been considered in the definitions above. In this case, the OpCo should contact HTEC-SD with the rationale for the product to qualify as SEnSO. HTEC-SD will assess if the solution is a SEnSo and accept or reject the categorization as SEnSo.

SEnSo definitions


Holcim Technology Ltd

Im Schachen 5113 Holderbank Phone +41 58 858 58 94 Fax +41 58 858 58 09 www.holcim.com

Documents

SEnSO Definitions