Michelin : Réponse au questionnaire CDP Water security 2020 (en anglais seulement)

Michelin - Water Security 2020

W0. Introduction

W0.1

(W0.1) Give a general description of and introduction to your organization.

Since 1889, Michelin has constantly innovated to facilitate the mobility of people and goods. Today, the Group is setting the standard across every tire and travel-related services market, while leading a global strategy to drive responsible, sustainable and profitable growth. In short, Michelin is making mobility safer, cleaner, more connected and more accessible. Michelin enjoys exceptional geographic coverage and is stepping up its deployment in emerging markets. Currently operating in 26 countries at 117 production facilities and 9 research centers, and 7,600 dealerships and service centers in 30 countries. Michelin employs a total of 127,187 people worldwide. Net sales in 2019 were €24 billion. Michelin holds forefront positions in every segment of the tire market. Associated brands and services also include dealerships and service centers (Euromaster,TBC, TyrePlus), online retailing (Allopneus, Blackcircles), wholesalers (Euromaster and Ihle AG), truck driver assistance services (Michelin Euro Assist), fleet tire advice, maintenance and management services (Michelin fleet solutions in Europe and Michelin Business Solutions in North America), Michelin Travel Partner (maps and guides, ViaMichelin mobility assistance services) and Michelin Lifestyle products. In 2018 The Group expands its range of mining solutions and steps up growth in high-tech materials by acquiring Fenner PLC, a specialty manufacturer of conveyor belts and reinforced polymer products. Michelin strengthens its Specialty Businesses with the acquisition of Camso, a global leader in off-the-road mobility (farming, materials handling and construction industries). In 2019 Michelin acquires the leading Indonesian tire manufacturer Multistrada strengthening its presence in the Indonesian market. The Group also acquires Masternaut, stepping up the deployment of its telematics solutions across Europe. Faurecia and Michelin signed a joint venture that leads to the creation of SYMBIO, A FAURECIA MICHELIN HYDROGEN COMPANY, that will develop, produce and market hydrogen fuel cell systems for light vehicles, commercial vehicles, trucks and other applications.

Inspired by its founders, Michelin is dedicated to enhancing mobility through innovation and quality, by basing its development on the core values of Respect for Customers, Respect for People, Respect for Shareholders, Respect for the Environment and Respect for Facts. Our sustainable development approach, embodied in the 2002 Michelin Performance and Responsibility Charter, structures this corporate culture and coordinates our commitment to the principles of sustainable, balanced, responsible growth.

W0.2

(W0.2) State the start and end date of the year for which you are reporting data.

	Start date	End date
Reporting year	January 1 2019	December 31 2019

W0.3

(W0.3) Select the countries/areas for which you will be supplying data.

Brazil

Canada

China

France

Germany

Hungary

India

Italy

Japan

Mexico

Poland

Romania

Russian Federation

Serbia

Spain

Thailand

United Kingdom of Great Britain and Northern Ireland

United States of America

W0.4

(W0.4) Select the currency used for all financial information disclosed throughout your response.

EUR

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W0.5

(W0.5) Select the option that best describes the reporting boundary for companies, entities, or groups for which water impacts on your business are being reported.

Companies, entities or groups over which financial control is exercised

W0.6

(W0.6) Within this boundary, are there any geographies, facilities, water aspects, or other exclusions from your disclosure?

Yes

W0.6a

(W0.6a) Please report the exclusions.

Exclusion	Please explain
Tire distribution centers	Calculations show that this source represents less than 3% of the Group total. For this reason, and consistent with legal requirements for reporting Group-wideextra-financial
(retail and wholesale)	information under French law, this source is not included in the Group's consolidated annual report.

W1. Current state

W1.1

(W1.1) Rate the importance (current and future) of water quality and water quantity to the success of your business.

	Direct use	Indirect	Please explain
	importance	use
	rating	importance
		rating
Sufficient	Important	Important	Direct use: Michelin plants use freshwater to cool installations, intermediate products and produce steam and hot water. Sufficient water is necessary to conduct industrial
amounts			operations, which cannot continue for more than a couple of days if supply is cut off. Water is important for the continuity of operations even though on an intensity-basis,
of good			water use is relatively low compared to other industries. In some plants, water is used in the production of metallic cable reinforcements for tires in plating and cleaning
quality			processes, so water quality is extremely important. In the future, Michelin sites will be using less freshwater and more recycled water for cooling and heating purposes, driven
freshwater			by availability of supplies in 1) water-stressed regions and 2) localities with high water demand. Indirect use: Water quality and availability are also critical for the
available			manufacturing of intermediate products purchased such as raw materials. Indeed our suppliers also depend on water for their production whether it be to produce steam, cool
for use			products or their installations. In the future, we expect that our suppliers will continue to depend on water for their operations so we expect that they will manage their
			withdrawals responsibly as there is a global increasing pressure on the demand for water.
Sufficient	Not very	Neutral	Direct use: Our industrial sites currently draw mainly on freshwater supplies, for historic reasons. Michelin plants use recycled water primarily to cool installations and to
amounts	important		produce steam and hot water. Recycled water still accounts for less than 5% of all withdrawals and represents opportunities for diversifying our water sources in the future
of			where appropriate. Indirect use: Some of our suppliers can use recycled/brackish/produced water for their operations since the process does not demand high quality water
recycled,			(e.g., descaling process for steel or water for cooling purposes). There is potential for some suppliers to diversify their water sources in the future where appropriate. However,
brackish			others cannot use this type of water since water comes into direct contact with the product and must be of a very high quality to not to alter the product (e.g. washing the fibres
and/or			for textile reinforcements or water entering into the process for chemical products).
produced
water
available
for use

W1.2

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(W1.2) Across all your operations, what proportion of the following water aspects are regularly measured and monitored?

	% of	Please explain
	sites/facilities/operations
Water withdrawals - total	100%	100% of manufacturing facilities and research centres are monitored. The data, based on meters and bills, are entered and uploaded by sites on a quarterly
volumes		basis. They are consolidated and reviewed by the corporate EHS department on a quarterly and annual basis. The procedure is documented in an internal
		reference document.
Water withdrawals -	100%	All sites have the knowledge of their water sources as it is present on their water bill based on metering systems. At corporate level, this information is
volumes by source		collected in an annual questionnaire. The information is consolidated and reviewed by the corporate EHS department. 100% of the manufacturing facilities
		and research centres are monitored by this method.
Entrained water
associated with your
metals & mining sector
activities - total volumes
[only metals and mining
sector]
Produced water
associated with your oil &
gas sector activities - total
volumes [only oil and gas
sector]
Water withdrawals quality	100%	In some cases, water and/or steam can be in direct contact with the product. In these situations, the water used must meet strict quality standards. The
		frequency and the parameters monitored will depend on the water source, availability of pre-treatment at the plant and the criticity of the water usage. This
		information is collected during the implementation of Michelin's standardized water assessment method which began in 2016. By the end of 2019, water
		quality parameters had been collected at 20 sites during the water assessment. Corporate level monitoring by the EHS department is not focused on data
		collection, but rather on ensuring that the sites better measure and understand and manage any issues relating to the quality of their water sources.
Water discharges - total	100%	This information is collected in an annual questionnaire, 100% of the manufacturing facilities and research centres are monitored by this method and rely on
volumes		meters. The information is consolidated and reviewed by the corporate EHS department.
Water discharges -	100%	This information is collected in an annual questionnaire, 100% of the manufacturing facilities and research centres are monitored by this method. The
volumes by destination		information is consolidated and reviewed by the corporate EHS department.
Water discharges -	100%	This information is collected in an annual questionnaire, 100% of the manufacturing facilities and research centres are monitored by this method. The
volumes by treatment		information is consolidated and reviewed by the corporate EHS department.
method
Water discharge quality -	100%	The plants' discharges are subject to many regulatory requirements that vary in frequency and parameters to be followed (according to destination of the
by standard effluent		water discharge and the on-site fabrication processes). This information is meticulously followed by each site and reported to the appropriate regulatory
parameters		agencies as required. Furthermore, quarterly sites are required to enter the concentration of COD, TSD, Zn and residual hydrocarbons of their water
		discharges. This information is consolidated and reviewed by the corporate EHS department.
Water discharge quality -	100%	This information is collected in an annual questionnaire. 100% of the manufacturing facilities and research centres are monitored by this method. The
temperature		information is consolidated and reviewed by the corporate EHS department.
Water consumption -	100%	This information is calculated annually based on 1) water withdrawals collected quarterly and 2) total discharges collected from the annual questionnaire.
total volume		100% of the production facilities and research centres are monitored. The information is consolidated and reviewed by the corporate EHS department.
Water recycled/reused	51-75	The bracket reported does not take into account cooling towers. This information is collected in an annual questionnaire. 100% of the manufacturing facilities
		and research centres are monitored by this method. The information is consolidated and reviewed by the corporate EHS department.
The provision of fully-	Less than 1%	Michelin has signed the WASH pledge. The self-assessment tool proposed by the WBCSD was used by one pilot site. Subsequently, the tool was simplified
functioning, safely		for more rapid deployment. Other pilot sites are in the process of being identified.
managed WASH services
to all workers

W1.2b

(W1.2b) What are the total volumes of water withdrawn, discharged, and consumed across all your operations, and how do these volumes compare to the previous reporting year?

	Volume	Comparison	Please explain
	(megaliters/year)	with
		previous
		reporting
		year
Total	26985	Lower	100% of manufacturing facilities and research centres monitor their total withdrawals. The datas, based on meters and bills, are entered and uploaded by sites on a
withdrawals			quarterly basis. Water withdrawals have decreased by 2.7% between 2019 and 2018. This is thanks to water efficiency actions carried out in our sites. Examples of
			actions are the following: installation of a heating pump upstream of cooling towers to reduce evaporation ; leakage detection and repair ; increased return of
			condensates to boilers ; reduction of water used at cleaning posts via optimised procedures ; digitalized tracking of water consumption at various posts. Future
			volumes will continue to decrease on an annual basis in line with Michelin's commitment to reduce its environmental footprint by 50% between 2005 and 2020. A
			post-2020 ambition for reducing water withdrawals is being developed.
Total	21837	Lower	5% decrease in 2019 compared to 2018. This follows the trend of water withdrawal reduction and can also be explained by decreased precipitation compared to the
discharges			previous year. Future volumes will decrease as withdrawals will decrease.
Total	5148	Higher	8% increase in 2019 compared to 2018. The total water consumption is determined by subtracting the total discharges from the total withdrawals. The discharges
consumption			were high in 2018 due to increased precipitation compared to 2019. That is main factor that explains the difference. The figure reported accounts for the evaporation,
			leaks and other losses. Water is not incorporated into the tire or its components. Water is used in the manufacturing process for transferring energy (heating and
			cooling) - hence the losses by evaporation -- and for some limited washing applications or the electroplating process to produce metal cables at a restricted number
			of sites. Future volumes will most likely be slightly reduced over time, but this depends on the rate at which reductions in water use are achieved versus
			implementation of water recycling systems.

W1.2d

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(W1.2d) Indicate whether water is withdrawn from areas with water stress and provide the proportion.

	Withdrawals	%	Comparison	Identification	Please explain
	are from	withdrawn	with	tool
	areas with	from	previous
	water stress	areas with	reporting
		water	year
		stress
Row	Yes	11-25	Higher	WRI	The WRI Aqueduct tool was used at 100% of Michelin's manufacturing and research sites to determine those in water stressed areas. Water- stressed
1				Aqueduct	sites were defined as having a baseline water stress score of 3 or more. In 2019 the WRI Aqueduct tool was updated and led to 20 sites being located
					in water stressed areas compared to 14 sites with the previous version of the tool. The increase of percentage of water withdrawals coming from
					stressed areas comes from the additional sites which are above the threshold according to the updated tool. At a similar 2018 perimeter (14 sites),
					there is a 5,2% decrease of water withdrawals at water stressed sites which demonstrates our efforts in these regions. In these sites we look closely at
					reuse options of water within the site.

W1.2h

(W1.2h) Provide total water withdrawal data by source.

	Relevance	Volume	Comparison	Please explain
		(megaliters/year)	with
			previous
			reporting
			year
Fresh surface	Relevant	8647	Higher	Many Michelin sites have access to local surface water supplies for industrial purposes and as a complement to municipal supplies which meet
water, including				drinking water needs. Surface water supplies have been an inexpensive and reliable source of water to use in heating and cooling, which makes
rainwater, water				this source highly relevant. 97,2% comes from rivers and 2,8% from rainwater. In 2019 The volume has increased by 16%. This can be explained
from wetlands,				by a shift in water source especially in one facility which has increased its ratio of water withdrawn from fresh surface water rather than a historic
rivers, and lakes				withdrawal from groundwater. This has a significant impact for the Group value as the site is one of the biggest withdrawers and alone accounts
				for nearly 4% of withdrawals. Fresh surface water accounts for 31% of the withdrawals. Michelin will analyse in the future the feasibility to switch
				other groundwater withdrawals to fresh surface water withdrawals explaining that future trends will slightly increase.
Brackish surface	Not		<>	Michelin sites cannot use brackish water due to the corrosive effect this water has on equipment. This condition will not change in the
water/Seawater	relevant		Applicable>	foreseeable future.
Groundwater -	Relevant	7228	Lower	Many Michelin sites have access to site-based renewable groundwater supplies for industrial purposes and as a complement to municipal
renewable				supplies which meet drinking water needs. Groundwater supplies have been an inexpensive, convenient and reliable source of water of sufficient
				quality to use in heating and cooling, which makes this source highly relevant. The volume is 6% lower than the last reporting year. This is in link
				with our water reduction strategy and results. Renewable groundwater supplies account for 27% of water withdrawals. Future trend is to decrease
				as global withdrawals will decrease.
Groundwater -	Relevant	689	Lower	A handful of Michelin sites have access to site-basednon-renewable groundwater supplies for industrial purposes, and as a complement to
non-renewable				municipal supplies which meet drinking water needs. Groundwater supplies have been an inexpensive, convenient and reliable source of water of
				sufficient quality to use in heating and cooling, which makes this source highly relevant. In 2019 the volume is 3% lower than the last reporting
				year. This is mainly due to one facility who is increasingly switching from this water source to a freshwater supply. Non-renewable groundwater
				only accounts for 2,5% of the total water withdrawals. Withdrawals will be reduced as pressures mount to conserve non-renewable aquifers.
Produced/Entrained	Not		<>	Produced water is the result of the extraction, processing, or use of any raw material, this source is therefore not relevant for Michelin as we do
water	relevant		Applicable>	not process raw materials that liberate water. This will stay non-relevant in the future.
Third party sources	Relevant	10421	Lower	For historical reasons: 1) the necessity to provide drinking water to employees 2) the convenience and low cost of readily available fresh water,
				the majority of sites put in place and have maintained a single water connection to the local municipal water system for both industrial and
				drinking water purposes. Adding a second source to existing sites to meet industrial water needs would involve extremely high costs to install and
				maintain, with no benefits to manufacturing processes. This is why existing withdrawals from municipal sources are highly relevant. The volume is
				12% lower than the last reporting year due to water efficiency actions. Overall water intake is decreasing each year, despite increases in
				production, because of efforts to practice good water stewardship, via corporate target setting, site-level water assessment, and site-level actions
				to conserve and recycle water. The future trend will be to continue decreasing overall water intake at least through 2020.

W1.2i

(W1.2i) Provide total water discharge data by destination.

	Relevance	Volume	Comparison	Please explain
		(megaliters/year)	with
			previous
			reporting
			year
Fresh surface	Relevant	15488	About the	Every year a questionnaire is sent out to 100% of our sites to collect the data regarding water discharges by destination. This data is summed up by
water			same	our corporate EHS team and compared to the previous year. Slightly less than half of all sites discharge to a surface water body, and for half of these
				sites it is the sole discharge outlet, making this type of discharge highly relevant. The volume increased by 4% compared to the previous year which is
				about the same. The future trend is difficult to predict, as sites retain the flexibility to discharge between one or more points.
Brackish	Not		<>	No sites discharge to brackish surface water or seawater because they are not located near such water bodies. This situation will not change in the
surface	relevant		Applicable>	foreseeable future.
water/seawater
Groundwater	Relevant	173	About the	Every year a questionnaire is sent out to 100% of our sites to collect the data regarding water discharges by destination. This data is summed by our
			same	corporate EHS team and compared to the previous year. Only 2 sites discharge to groundwater, making this outlet relevant for these 2 sites only, but
				not in general. The quantity is about the same compared to the previous year. The future trend will remain about the same.
Third-party	Relevant	6176	Lower	Every year a questionnaire is sent out to 100% of our sites to collect the data regarding water discharges by destination. This data is summed by our
destinations				corporate EHS team and compared to the previous year. For historical reasons, the majority of Michelin sites were designed and built with a
				connection to the local municipal wastewater collection and treatment system, making this type of discharge highly relevant. The volume has
				decreased by 22% due to the reduction of withdrawals and lower precipitation which has reduced the discharges. The future trend is expected to be
				about the same.

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