Non-financial performance indicators

Our performance is reflected not only in our financial results, but also in the sustainability of our actions. We develop efficient solutions that conserve resources and protect the climate and the environment. For this we need capable employees – so we place strong emphasis on training and development and health and safety.

Sustainability

For ThyssenKrupp, sustainability is a core business responsibility and a key driver of innovation. To ensure the company remains viable in the future, we work hard to constantly improve our economic, ecological and social performance. More information on our sustainability- and value-based strategy can be found in the section “Profile and strategy”. Sustainability and responsibility are firmly entrenched in our corporate culture and have long been part of our day-to-day practice. Sustainability management performs an important cross-cutting function in the Group, enabling us to utilize business opportunities and minimize risks. In the reporting year ThyssenKrupp AG underlined its commitment to sustainable development by joining the United Nations Global Compact (UNGC) initiative. We will work even more systematically to implement the ten principles of the UNGC and report on them transparently.

In the following we report on our main sustainability activities in the areas of innovation, employees, environmental and climate protection, and corporate citizenship:

• Our new corporate headquarters in Essen was awarded the German Sustainable Building Council’s gold certificate.
• In the reporting year, for example, our company presented innovative solutions for electric vehicles and the iwalk moving walk (more under “Innovations”).
• We made further improvements to health and safety: In the last five fiscal years, the number of accidents in the Group fell by more than 17% (more under “Employees”).
• With an adjusted figure of around 1.7 tons of CO₂ per ton of crude steel produced, emissions from our steelmaking operations are well below the global average. We are further intensifying our Groupwide environmental and climate management activities – e.g. through the introduction of a new Group policy (more under “Environment and climate”).
• ThyssenKrupp once again supported three regional heats of the “Jugend forscht” young scientists competition in 2011 (more under “Corporate citizenship”).

Innovations

Innovations and new technologies are a key element of the Group’s Strategic Way Forward and therefore also feature strongly in our corporate program ‘impact’; a detailed report on this is provided in the section “Profile and strategy”. We develop new materials, products and processes, identify and explore promising areas of innovation, and improve our technology position. We are also expanding our innovation management systems.

Our 3,000 research and development employees demonstrate their strengths in the areas “Material“, “Mechanical” and “Plant”. Their outstanding engineering expertise enables us to develop cost- and resource-efficient solutions in response to global challenges such as rising consumption or sustainable infrastructure. The following examples represent a selection of the wide-ranging innovation activities of our Group companies.

Electromobility: StreetScooter development partnership

ThyssenKrupp is expanding its capabilities in the area of electromobility. In collaboration with research institutes and industrial partners we are jointly developing body and chassis solutions for the electric vehicles of the future. As part of a consortium of industrial partners and institutes of Aachen University of Technology we are working on the development of a low-cost electric city vehicle called the StreetScooter. ThyssenKrupp has developed and prototyped the floor assembly, which will accommodate the batteries for the electric vehicle. For the crash-relevant parts we use both high-strength lightweight steels and other materials combining high strength and high elongation. In the event of a collision, this allows impact energy to be absorbed effectively. A prototype of the StreetScooter was presented at the 2011 Frankfurt Motor Show.

Eco-friendly material for vehicle construction

We have developed a new material with a tensile strength of 1,000 megapascals. It is currently our strongest cold-formable steel and is particularly suitable for thin-walled, low-weight parts. Safety-relevant structural parts for automobile bodies can be made up to 20% thinner using this material. This reduces vehicle weight, saves energy and thus lowers CO₂ emissions.

New coatings for cost-efficient production

In collaboration with a lubricant manufacturer, our surface specialists have developed LubriTreat^®, a new coating process that significantly improves the forming behavior of galvanized steels. Moreover, the new coating is free of heavy metals and allows nickel-free, eco-friendly processing. LubriTreat^® reduces friction during the forming process, resulting in lower die wear and reduced scrap rates. Good paint adhesion and optimum finishes are guaranteed. The product has been patented by both companies and is suitable for all hot-dip and electrolytically galvanized steel sheet materials.

iwalk – new moving walk sets standards

Our newly developed iwalk requires much less space than conventional moving walks. With the same outside dimensions, the passenger area is wider and provides greater space and comfort. The significantly lower pit depth also greatly reduces the amount of civil work required. The iwalk can even be installed on an existing floor without the need for any additional construction measures. Thanks to the new modular design, individual segments can be added or removed as required in the shortest possible time, and it is even possible to move the entire installation to a new location. The iwalk is particularly suitable for metro stations, railway stations, airports and exhibition centers – both as new installations and to upgrade existing systems. In addition the iwalk can be equipped with a new energy saving system which optimizes power consumption depending on passenger numbers without reducing operating speed. The new moving walk was awarded first prize in the 2011 ThyssenKrupp Innovation Contest.

Cylinder head cover with integrated camshafts

Second prize in this year’s Innovation Contest went to the development team behind a new cylinder head module with integrated camshafts. Our engineers and technicians used the proven Presta joining process for assembled camshafts to produce a complete cylinder head cover with integrated camshafts. This allows us to supply customers with a ready-to-install module rather than just individual camshafts. Modular designs with integrated camshafts were previously unavailable on the market. We have already received the first production order. As well as reducing costs for cylinder head machining, our solution is also easier to install. Integrating the individual, finish-machined camshaft parts in the cylinder head cover makes it possible to dispense with bearing caps. This results in improved hydrodynamics, and antifriction bearings can be integrated simply and without deformation.

Bio-based plastics made from succinic acid

In order to make sustainable use of resources we need to explore new ways of utilizing renewable raw materials. Since 2006 we have been developing biotechnology processes to produce plastics from renewable raw materials. One focus of the chemical industry has been the use of succinic acid as a raw material for bio-based plastics. In collaboration with a US company we have now developed a production process for this. Following successful trials on a pilot plant in Mexico, the world’s first industrial-scale biotechnology succinic acid plant is now being built in Louisiana/USA. Start-up is scheduled for late 2012.

Increasingly efficient gearless conveyor systems

With demands on conveyor systems for open pit mines rising all the time, conventional gear units are reaching their limits. Ever greater mining depths and increasing volumes call for longer, steeper and more powerful belt conveyors. For one of our customers we have now developed a gearless drive station for a 6.5 km conveyor system. ThyssenKrupp is the world’s only supplier of conveyors with such high-power direct drives. They offer great dependability, low-cost maintenance and high energy efficiency. In future development projects we will standardize the drive stations, modularize them and further optimize their design.

More than €500 million for research and development

In 2010/2011 we spent €524 million on product, process and service innovations. Of this, research and development costs of €188 million were expensed immediately, €39 million was amortization of development costs capitalized in previous years, and €297 million was for order-related development costs. Expenditure for research and development was thus 19% higher than a year earlier, with particular increases in order-related development in the areas of “Mechanical” and “Plant”.

Reporting in prior years related to the costs of basic research and development comprising non-capitalized research and development costs and capitalized development costs. With immediate effect we will report only on expenditure recognized in the reporting period, i.e. the non-capitalized research and development costs including amortization of capitalized development costs as well as order-related development costs. The prior-year comparatives for order-related development costs have been adjusted. Expenditure for technical quality assurance is no longer included.

Employees

We have outstanding employees, and we do a lot to make sure it stays that way: Intensive apprenticeship training, continuing development in all areas of the Group, high standards of health and safety, targeted support for young managers, greater diversity and internationality – including at management level.

Our workforce grew in the reporting year. On September 30, 2011 ThyssenKrupp employed 180,050 people worldwide, a year-on-year increase of 2,704 or 1.5%. All the growth took place outside Germany, where the headcount rose by 4.4% to 110,928. By contrast, employee numbers in Germany fell by 2.7% to 69,122. The expansion of the new steel making and processing mills in Brazil and the USA in particular created a large number of new jobs.

At €9.0 billion, personnel expense in 2010/2011 was 2.8% higher than the year before. The graphic on the left shows our personnel expense over the past five years.

Apprenticeship training

In Germany ThyssenKrupp is training 4,239 apprentices in more than 55 occupations, most of them industrial or technical. 1,312 young people started an apprenticeship with ThyssenKrupp in 2011. 170 full-time trainers and numerous training officers provide high-quality, practical training which resulted in 92% of apprentices passing their final exams in the reporting year.

In addition to traditional apprentice training, integrated degree programs are now well established at ThyssenKrupp. More than 70 such programs are currently available to our apprentices. We have also been running the TOPSIM business management game for 20 years, in which several teams of apprentices take over the management of a virtual company. The game enables them to acquire and strengthen a business mindset and social skills.

Health and safety a priority

Our Groupwide “zero accidents” initiative is aimed at making working in our production operations and offices even safer – and it is paying dividends. The accident rate in the reporting year fell by 17% compared with the prior year to 8.5 accidents per 1 million hours worked. Accidents have decreased by 42% over the past four years.

We provided management training for the first time in China in 2010/2011; a similar program is now being prepared for Brazil. A new health and safety management manual provides valuable information on how Group companies can provide even better protection from accidents for their employees and systematically develop their health and safety programs.

In the future we intend to integrate our global health and safety activities more closely. To this end, standard international healthcare structures and processes are being developed at several centers of competence under the coordination of corporate headquarters. One example is the bowel cancer screening campaign, which took place simultaneously at all German locations for the first time in 2011. Around 14,000 employees took part.

Successful graduate recruitment

More and more, it is important to have a presence at universities so as to attract talented graduates. We present ourselves as an attractive employer and establish contacts with students at an early stage. We have maintained close relationships for many years with seven German universities in Aachen, Berlin, Bochum, Dortmund, Dresden, Freiberg and Hamburg-Harburg, and also with universities in China and Russia. In addition we have activities at other institutes and higher education establishments such as the Karlsruhe Institute of Technology, and Südwestfalen and Dortmund technical universities, for example through support groups and business management games.

Our entry programs are tailored to the specific needs of the different target groups. The best of our interns are included in our “Next Generation” intern retention program. They attend selected events to acquaint themselves better with ThyssenKrupp and are then supported systematically when starting their career in the Group. For graduates with an interest in research, the doctoral student program “Your Innovation” provides an opportunity to be involved in work on the latest technologies in the Group. In addition to our engineering graduate programs, a program for business graduate trainees called “Create (y)our future” was also launched in the reporting year.

Nowadays, the internet is the most important medium for gathering information and submitting job applications, so our careers portal is a very important way of addressing interested candidates and good applicants. The Swedish consultancy Potentialpark ranked ThyssenKrupp’s careers website the best in Germany in 2011. Our portal provides up-to-date information in an attractive design with numerous multimedia elements; navigation has been optimized to make it easier for young people to gain an overview of our Group. One important success factor is the systematic link to the application process.

Management development

We regard developing our employees and executives as a key management task. We have already reported many times on the PerspActive process, in which we systematically assess our managers and conduct targeted development interviews. This process is now firmly established and is paying dividends: Last year we were able to fill more than 90% of vacancies at the level below business area management boards with internal candidates.

In the reporting year we also started to introduce Groupwide programs for managers with potential for positions in the three highest levels below the business area management boards. The aim of these modular development programs is to increase transparency into management talent in the Group and develop it more effectively. It also enables managers to network across business areas, regions and functional areas.

The Talent Brokerage system launched just over a year ago has proven successful. It is directed at executives throughout the Group at the third management level below the business area management boards as well as those with the potential to fill such positions. Standard Groupwide development centers also help identify high potentials in Germany and abroad.

Higher participation in Academy programs

Founded in 2006, the ThyssenKrupp Academy is now an established place of teaching, learning and internal networking for the Group’s top managers. More than 100 programs were available in 2010/2011, and the number of participants doubled from the prior year. Both the reach and penetration of our programs among the 2,000 top executives have increased significantly. Alongside the development of management competencies, this year saw a focus on strategic change and business transformation. The new programs to prepare our managers for a move up the career ladder were also well attended.

Diversity as a goal of personnel policy

The project ‘diversity@thyssenkrupp’ was launched in fall 2011 to promote diversity in all areas of the Group, focusing on gender, internationality, capabilities and experience. The aim of the project is to gradually and sustainably increase diversity within the workforce as a whole and especially at higher management levels throughout the Group. The new program integrates existing initiatives and HR tools and promotes a common understanding of diversity. The aim is to increase the proportion of women in our non-pay-scale managerial staff in Germany from the present level of 7.6% to 15% by the end of 2020. This target is based on the percentage of women in our overall workforce.

As a technology company, ThyssenKrupp is very interested in recruiting female engineers to specialist and management positions. We are particularly looking to attract students of the so-called STEM subjects. For this reason we support the Femtec university career center for women in Berlin and give female engineering students the opportunity to contact us directly and find out more about our technology company.

In order to help balance family and work commitments we are currently building a child daycare center on our campus in Essen. From August 2012 we will offer full-day places to over 100 children aged from four months to six years to support parents working at ThyssenKrupp. Our daycare center “Miniapolis” will nurture children’s natural curiosity and joy of discovery, in particular in the areas of science and technology.

Environment and climate

The Executive Board has identified responsible environmental and climate protection as an important corporate objective. To implement this goal we have further expanded our Groupwide environmental and climate management system. In addition our international environmental and climate protection activities will be coordinated by corporate headquarters in the future.

Our environmental and climate management system defines uniform requirements to be met by our Group companies around the world, improves internal reporting, and promotes Groupwide knowledge sharing. The Group’s environmental and climate protection experts meet up regularly. In addition current developments, best practices, and environmental and climate legislation are discussed at regional meetings.

The Group companies have environmental management systems tailored to their specific requirements. Those companies whose production has a major environmental and climate impact generally already have environmental management systems certified to the international ISO 14001 or a comparable standard. Continuous improvements are made in the areas of waste and recycling, air, noise, energy and climate, soil, water and nature to ensure responsible environmental protection at our locations. In the reporting year priority was given to measures to increase resource and energy efficiency.

Environmental and climate protection expenditures higher

We spent €352 million on new environmental protection facilities in the reporting year, while operating costs totaled €539 million. In the prior year these figures were €238 million and €532 million respectively. The start-up of Steel Americas’ new plants in Brazil and the USA was one of the main reasons for the increase in spending. We employ state-of-the-art technology at these plants to meet our high environmental standards.

High energy efficiency

Climate protection and energy efficiency are established components of our Group strategy. Our engineering capabilities enable our customers to use innovative products to save energy and conserve resources.

Our steelmaking operations utilize the most advanced technologies available and have lowered CO₂ emissions significantly. The sophisticated energy management systems in place at our steel mills in Duisburg create an energy network that substantially cuts emissions, for example by utilizing byproduct gases from steel production, as well as waste heat and steam. The use of reducing agents in our blast furnaces in Duisburg is already close to the chemical-technical optimum. With an adjusted figure of around 1.7 tons of CO₂ per ton of crude steel, ThyssenKrupp is well below the international steel industry average. In addition, the energy saving program introduced at our German steel sites in 2009 has identified further savings potential of almost 350,000 tons of CO₂ and around €59 million per year which is gradually being exploited. We are working to create a similar energy network in Brazil.

Corporate citizenship

ThyssenKrupp supports the people in the communities in which we operate. We help create a positive environment and promote education and enthusiasm for technology especially among the younger generation – all this is a matter of course for us and creates value for both company and society. In line with our long-standing traditions, we regard ourselves as an active corporate citizen and support initiatives around the world through donations, sponsorships and other means.

Long-term and trusting partnerships are central to our successful cooperation with various groups in society. This includes numerous longstanding major projects such as the “Discovering Future Technology” initiative, cooperation with the “Jugend forscht” young scientists’ competition and membership of the “Initiativkreis Ruhr”. In 2010/2011 we once again staged regional heats of “Jugend forscht” in Dortmund and Duisburg and acted as a partner to the regional heat in the Saarland area. We also organize donation appeals in response to major natural disasters or other emergency situations – this reporting year in East Africa, for example – to allow our employees and companies to provide united support.

Contents of this page

• Sustainability
• Innovations
• Employees
• Environment and climate
• Corporate citizenship