Sustainability strategy

Our approach

Sustainability: an integral part of ST’s culture

Sustainability has been embedded in our business practices for more than 25 years and is a major factor in our effectiveness and long-term success.

It is integrated throughout our entire business, allowing us to maximize opportunities in areas such as Sustainable Technology, Innovation, and People Engagement, as well as helping us to predict and mitigate risks in our operations and business performance. Sustainability topics are diverse but all support ST’s vision to make a positive contribution to people’s lives.

Strategy focused on the priorities

At the heart of our sustainability strategy is an unceasing focus on what really matters for ST and our stakeholders.

In 2017, we conducted our third materiality exercise to identify our material topics. The materiality exercise comprised three steps (see our 2018 sustainability report available at www.st.com/company-reports):

• topic identification
• stakeholder consultation
• sustainability strategy validation

For each material topic, we defined a specific ambition and long-term goal. The related programs and performance indicators are presented throughout this report. I 102-46 I As sustainability challenges and opportunities are constantly evolving, we continually monitor external trends, emerging issues and perspectives, as well as ST’s changing needs.

In 2019, we analyzed studies and publications from across the electronics industry and business associations to identify any new material topics for ST. We also conducted an internal survey, asking more than 100 members of our Sustainability and Environment, Health and Safety (EHS) networks to review the evolution of the material topics identified in 2017.

Three topics emerged as being both more important for our stakeholders and having a significant impact on our business:

• Diversity and Inclusion
• Energy and Climate Change
• Supply Chain Responsibility

This analysis was presented to our President and CEO who reviewed and validated the prioritization of the material topics as illustrated in the matrix.

Top material topics I 102-47 I 103-1 I

Interview

Jean-Louis Champseix

Group Vice President, Corporate Sustainability and Staffing

What do you think are ST’s main strengths in terms of sustainability?

Our longstanding commitment to sustainability makes it an integral part of our culture and the way we manage business. Thanks to the policies and practices in place since ST’s creation in 1987, we have reached a certain level of maturity in many areas. For example, in the last 25 years we have reduced our energy consumption by 57% and our water footprint by unit of production by 76%. In terms of safety, we have decreased our accident rate by 83% over the last 17 years.

But sustainability is a never-ending journey for us, as we continually seek to offer new technologies and innovations to our customers. Transparency is another of our strengths. We recognize our weaknesses and work to improve them.

What does sustainability bring to ST?

Sustainability is a driver of our resilience, competitiveness and long-term success. It empowers value creation while reducing risks for us and our stakeholders. By anticipating and adhering to the highest standards, we progress together with our partners to achieve ambitious goals related to working conditions, ethics, employee experience, safety and environmental efficiency and in this way, we embrace dynamic sustainable growth.

With our Sustainable Technology program, which leverages the responsible aspects of our products, we offer our customers differentiated products and address new markets. Our environmental programs help us reduce our emissions and consume fewer resources, and so reduce our operating costs. Sustainability also delivers many competitive advantages to our business, such as:

• being a leading supplier for our customers, partnering with them on new initiatives
• having an engaged, sustainable and responsible supply chain, increasing our competitiveness
• creating a great workplace, retaining and attracting the most talented employees
• attracting investors

How do you think ST should keep moving forward?

In a complex and increasingly unpredictable world, risks are constantly evolving. We need to continue to adapt the way we tackle the health and safety of our people, and the social, environmental or economic challenges the world faces. We also need to continue to anticipate our stakeholders’ expectations, innovate to develop new responsible products and solutions, and continuously develop our whole ecosystem.”