Letter from the Chief Executive Officer

Dear stakeholders,

Through the pages of this year’s Sustainability Report, we are renewing our commitment to operating sustainably. Although there has been a change in corporate structure, our long-standing commitment to employees, the environment, customers, suppliers, local communities and all others with whom we interact on a daily basis remains unchanged.

The annual Sustainability Report provides an opportunity for us to describe the actions taken and results achieved during the year and to demonstrate our commitment through the targets for continued improvement we have set for the future.

This year’s Report adopts a new structure that goes beyond the traditional three dimensions of sustainability to focus on the life cycle of our products (from concept to end-of-life) and those aspects having the greatest relevance for CNH Industrial, based on the results of our first materiality analysis. That analysis, which led to a ranking of sustainability-related aspects as a function of their importance for both stakeholders and business strategy, clearly showed that the areas of greatest importance are those directly related to our business activities: innovation related to the safety and environmental performance of our products, product quality, and customer engagement and support. Other aspects identified as material were: health and safety in the workplace, attention to the environment, management of the supply chain and dealer network, professional development of employees and local community initiatives. The analysis process involved the entire organization and the resulting materiality matrix was reviewed and approved by the Group Executive Council.

In addition to ensuring alignment of sustainability priorities with our strategic guidelines, the analysis has also led to more effective reporting driven by a focus on materiality.

In line with this materiality-based approach, we have also adopted the Global Reporting Initiative’s new G4 guidelines for this year’s Sustainability Report.

During 2013, our proven commitment to sustainable development led to significant results in several areas. CNH Industrial was reconfirmed as Industry Leader in the Dow Jones Sustainability Indices World and Europe . We reduced the accident frequency index for employees by 24%, which also reflected the benefits of some 386,000 hours of training. Our focus on R&D – which has consistently enabled the Company to meet emissions performance targets well in advance of regulatory requirements – continued in 2013 with €934 million invested and our intellectual property portfolio now totaling more than 7,000 patents. We continued to offer new, more efficient products in all segments that consume less and pollute less. In addition, continued efforts to reduce the environmental impact of our plants led to improvements in several key performance indicators, in line with our targets: -5% in energy consumption, -9% in CO2 emissions, -16% in water withdrawal, -22% in the generation of hazardous waste. Contributing to these improvements were the World Class Manufacturing initiatives and some 375,000 suggestions from workers at plants worldwide. Engagement with stakeholders is also fundamental to the process of continuous improvement and, to date, 98 supplier plants have implemented WCM with the support of CNH Industrial’s experience and know-how.

We are fully aware that these results are not an end in themselves. We consider them a challenge to set our sights even higher knowing that we can count on the commitment and passion of everyone at CNH Industrial in the fulfillment of those objectives.

Richard Tobin

Tobin

Chief Executive Officer of CNH Industrial

 

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