CORPORATE ENVIRONMENTAL POLICY

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INDEX

Chapter 1 PURPOSE/SCOPE

The purpose of this policy is to establish the major principles for improving the environmental performance and permitting ST to become one of the best industrial companies with regard to the environment, and to obtain recognition from governments and our stakeholders for our environmentally friendly operations.

Chapter 2 ORGANIZATIONAL UNITS AFFECTED

This policy applies to all ST activities, mainly: Design, Manufacturing, Purchasing, Logistics, Sales & Marketing and generic administrative activities (Legal, Human Resources, Accounting etc).

Chapter 3 POLICY STATEMENT

Environmental care is an integral part of ST "existence". It is therefore always present in all Company activities through the following ST commitments:

ENVIRONMENTAL MISSION:
To eliminate or minimize the impact of our processes and products on the environment, maximizing the use of recyclable or reusable materials and adopting, as much as possible, renewable sources of energy, striving for a sustainable development.
ENVIRONMENTAL VISION:
Following our "Environmental Decalogue" (see appendix 4) to be recognized by all our stakeholders as a leader in environmental care, by exceeding regulatory requirements in both degree and timing wherever possible; and as a reflection of this commitment, to acquire the "Eco Management and Audit Scheme" (EMAS) validation, or equivalent, in all communities in which we operate.
ENVIRONMENTAL POLICY:
To aim, in addition to providing for compliance with all relevant regulatory requirements regarding the environment, at the reasonable continuous improvement of environmental performance with a view to reducing environmental impacts to levels not exceeding those corresponding to economically viable application of best available technology (EMAS art. 3a).
To take a proactive approach in our environmental activities, built on the TQM principles, being guided by the 16 principles of the ICC (International Chamber of Commerce) "Business Charter for Sustainable Development".
To be a world leader on the basis of: - Moral obligation towards the environment
- Economic importance (to invest in environmental protection gives a significant strategic advantage over those companies who wait; the financial efforts will, to a large extent, be repaid if we are capable of designing and implementing processes that are pollution free and which also reduce the use of valuable material resources and energy).That means that investments for environment must have priority.
- Human resources (to attract the best young people, and to motivate the Company's employees in the challenge for a better quality of life).
In addition to the Local Regulation, we will strive to adopt the most stringent ecological standards of any country in which we operate.
To apply the most stringent regulations at least 1 year before their implementation deadlines.

Chapter 4 GENERAL PRINCIPLES

Total Company environmental awareness is the base for meeting these goals.
The 16 principles of the "Business Charter for Sustainable Development" are the guideline for continuous improvement
The Council regulation (EEC) 1836/93 of 29 June 1993 (Voluntary participation by companies in the industrial sector in a Community Eco-Management and Audit Scheme - EMAS) gives an excellent guideline for what we have to implement in our sites to manage the environmental issues (including the environmental audit activities/methodologies);
The ISO 14000 series, in the emission phase, gives, at world wide level, guidelines similar to EMAS.
The TQM approach is the practical way of working and managing all the aspects of a business to achieve the best results. In the environment world it is named TQEM (Total Quality Environment Management)
Our suppliers will be involved to adopt similar approaches in respecting the Environment.

APPENDIX 1
BUSINESS CHARTER for SUSTAINABLE DEVELOPMENT

The 16 principles promotes the concept to satisfy the present needs without compromising the possibility for future generations to satisfy their own needs.

1. Corporate Priority
To recognize environmental management as among the highest corporate priorities and as a key determinant to sustainable development; to establish policies programmes and practices for conducting operations in an environmentally sound manner
2. Integrated Management
To integrate these policies, programmes and practices fully into each business as an essential element of management in all its functions
3. Process of Improvements
To continue to improve corporate policies, programmes and environmental performance, taking into account technical developments, scientific understanding, consumer needs and community expectations, with legal regulations as a starting point; and to apply the same environmental criteria internationally
4. Employee Education
To educate, train and motivate employees to conduct their activities in an environmentally responsible manner
5. Prior Assessment
To asses environmental impacts before starting a new activity or project and before decommissioning a facility or leaving a site
6. Products and Services
To develop and provide products or services that have no undue environmental impact and are safe in their intended use, that are efficient in their consumption of energy and natural resources, and that can be recycled, reused, or disposed of safely
7. Customer Advice
To advise, and where relevant educate, customers, distributors and the public in the safe use, transportation, storage and disposal of products provided; and to apply similar considerations to the provision of service
8. Facilities and Operations
To develop, design and operate facilities and conduct activities taking into consideration the efficient use of energy and materials, the sustainable use of renewable resources, the minimisation of adverse environmental impact and waste generation, and the safe and responsible disposal of residual wastes
9. Research
To conduct or support research on the environmental impacts of raw materials, products, processes, emissions and wastes associated with the enterprise and on the means of minimizing such adverse impacts
10. Precautionary Approach
To modify the manufacture, marketing or use of products or services or the conduct of activities, consistent with scientific and technical understanding, to prevent serious or irreversible environmental degradation
11. Contractors and Suppliers
To promote the adoption of these principles by contractors acting on behalf of the enterprise, encouraging and, where appropriate, requiring improvements in their practices to make them consistent with those of the enterprise; and to encourage the wider adoption of these principles by suppliers
12. Emergency Preparedness
To develop and maintain, where significant hazards exist, emergency preparedness plans in conjunction with the emergency services, relevant authorities and the local community, recognizing potential transboundary impacts
13. Transfer and Technology
To contribute to the transfer of environmentally sound technology and management methods throughout the industrial and public sectors
14. Contributing to the Common Effort
To contribute to the development of public policy and to business, governmental and intergovernmental programmes and educational initiatives that will enhance environmental awareness and protection
15. Openness to Concerns
To foster openness and dialogue with employees and the public, anticipating and responding to their concerns about the potential hazards and impacts of operations, products, wastes or services, including those of transboundary or global significance
16. Compliance and Reporting
To measure environment performance; to conduct regular environmental audits and assessments of compliance with company requirements, legal requirements and these principles; and periodically to provide appropriate information to the Board of Directors, shareholders, employees, the authorities and the public

APPENDIX 2
Council Regulation (EEC) No 1836/93

Council Regulation (EEC) No 1836/93 of 29 June 1993, allows voluntary participation by companies in the industrial sector in a Community Eco-Management and Audit Scheme established for the evaluation and improvement of the environmental performance of industrial activities and the provision of the relevant information to the public.

The objective of the scheme is:

to promote continuous improvements in the environmental performance of industrial activities by the establishment and implementation of environmental policies, programmes and management systems by companies, "specific" of their sites.
to audit whether or not environmental management activities conform to the environmental programme and are implemented effectively.
Each site participating in the scheme, will prepare a specific "Environmental Statement" that shall be validated by the external accredited environmental verifiers (similar to ISO 9000 scheme).
Each Member States of European Union (EU) shall designate the competent body responsible for carrying out the tasks provided for in EMAS regulation.

APPENDIX 3
TQEM (Total Quality Environmental Management)

The well known ST TQM five principles are obviously applicable to Environment too. TQM becomes TQEM with the following objectives:

To incorporate the ecological culture into the Company management (Management Commitment)
To design products and processes in order to minimize their environmental impact from "cradle to grave" (Management Commitment)
To benchmark the world's leading companies in order to equal or exceed their environmental performances (Management Commitment and Management by Fact)
To apply the most advanced statistical tools (SPC - DOE - FMEA ..etc) and environmental tools (Environmental Impact Analysis -EIA-, Life Cycle Analysis -LCA-, Eco-Balance ..etc), to the environmental parameters management (Management by Fact)
To strive towards continuous reduction of disposal, waste, pollution and energy consumption, in our quest for Sustainable Development (Continuous Improvement)
To implement training to raise all personnels' levels of environmental awareness and programs which ensure that personnel are given adequate empowerment to perform the job correctly from the environmental point of view (People Empowerment)
To inform customers in such a way that they are able to manage correctly, from the environmental point of view, the products they buy from ST up to their end of life (Customer Focus)
The ST Environmental Policy enlarges the "Customer Satisfaction", requested by TQM, into "Stakeholder Satisfaction" through proper actions, lead by the "Ecological Decalogue", and information (Customer Focus)
As in TQM "Quality is Free", in TQEM "Environment is Free"

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