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APM Terminals 2010 Sustainability Summary Report

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APM Terminals Sustainability Summary Report 2010 APM Terminals Sustainability Summary Report 2010

Dear Reader

We are pleased to present you with APM Terminals 2010 Sustainability Summary Report. This is the first time that APM Terminals has chosen to compile our activities in such a report, which reflects our recognition of the importance of sustainability and being transparent with our stakeholders about our performance and overall vision.

We recognize that responsible management of social, environmental and ethical challenges arising from business practices increasingly is key to the sustainable growth of our business. More of our customers are asking about our performance in this area, from container lines to regulators and local communities. Equally, we as a company are requiring our suppliers to improve their sustainability performance. We do not only see this as necessary risk management but also as an opportunity to drive value – for our business and for the communities in which APM Terminals operates.

Winning in high growth markets, operating as efficiently as possible and being the best partner to work with sustains success. Taking a partnership approach is the best way to fully address the sustainability issues across the logistics value chain. We also recognize the job satisfaction that being a good employer and a good neighbor makes to our people. Through this report we want to communicate how we are doing across these areas.

Going forward we will continue to focus on eliminating safety risks, reducing the environmental impacts of our operations and on implementing improvements across a variety of responsible business practices, such as responsible procurement and anti-corruption programs.

2010, like any other year, provided challenges for us to learn from too. In our annual Sustainability Review meeting we reassessed our focus areas to ensure that we learn from these lessons for continuous improvement through 2011. This includes raising the bar on safety leadership and eliminating risk of fatalities, labor standards compliance including our contractors; investing in low carbon technology and working with our business partners and other stakeholders to create more sustainable logistic supply chains.

We invite you to read this report as an invitation for further dialogue and welcome your feedback.

About the Report This report provides a summary of APM Terminals sustainability performance over 2010. The report compliments the content of the A.P. Moller-Maersk Sustainability Report 2010, with specific elaboration to APM Terminals topics and performance. As a summary report we have captured the key information for users here, and refer readers to our website www.apmterminals.com/sustainability for a deeper dive into our activities and performance.

The report is designed for our stakeholders including employees, executive management, local communities, regulators, customers and our suppliers. We want this report to serve as a milestone update on how sustainability issues relate to our business, how we manage them, and where we are intending to go, as well as a platform for further dialogue with the people which our operations touch every day.

In compiling this report, we observed good practice reporting guidance such as the GRI reporting framework, including the GRI transport and logistics sector supplement, the principles of the AA1000 Assurance Standard, and advice from BSR, a global business network focused on sustainability.

The scope of this report covers all APM Terminals’ operations for the period of 2010 unless otherwise stated. The data reported and our sustainability management systems over all, where reviewed by DNV during the A.P. Moller-Maersk Sustainability Report 2010 assurance work. DNV provided feedback to APM Terminals performance management which can be found on page 22.

Contact details We welcome your feedback. If you have any comments about this report or about APM Terminals sustainability activities, please contact Henrik Kristensen, Head of Corporate Responsibilities [email protected]

Kim FejferCEO

Contents

4 About the Business

6 Sustainability at APM Terminals

10 Our People

14 Operational Footprint

18 Sustainability and New Terminals

19 Quantifying the Socio-Economic Value

20 Global Port Network

22 Awards and Engagement

23 Metrics

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About the Business

Revenue generated and distributed

Cashflow distributed by stakeholder group for APM Terminals

Revenue split per region

Excluding inter-company related sales from A.P.Moller-Maersk companies.

Suppliers Employees (salaries)Investments (net)Public Sector (taxes)

Europe and Eurasia Asia & PacificMiddle EastAmericasAfrica

Our ambition is to become the leading port operator in the world, not necessarily the biggest but the best

50

19,000

6410%

15%121

9

Number of ports and terminals in our global network

Number of locations APM Terminals Inland Services* operates

The world’s geographically most balanced port and terminal portfolio

Number of employees worldwide across 5 continents

Number of New Terminal developments and expansions underway

Independent port and terminal management and operating division within the A.P. Moller-Maersk Group

APM Terminals revenue accounted for 7.6% of total A.P. Moller-Maersk 2010 revenue

Number of countries APM Terminals operates across

Corporate target for relative carbon reduction

Corporate target for reduction in Lost Time Injury Frequency (LTIF)

* in 2010 we integrated the Container Inland Services Unit which includes inland transportation, container lifecycle management, equipmemt maintenance and cargo support

25%

22%

12%

6%

36%

8.1%

30.8%

58.3%

2.8%

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Sustainability at APM Terminals

The Corporate Responsibility function was set up at APM Terminals to ensure we effectively manage and continuously improve our sustainability performance.

At APM Terminals, the Corporate Responsibility function provides oversight for sustainability issues that include: Health, Safety, Security, Environment, Community investment, and corporate governance for global A.P. Moller-Maersk Group led programs, including the company’s commitment to the UN Global Compact, and other initiatives.

Through dialogue with business owners and external stakeholders, we develop strategic approaches to addressing sustainability challenges and integrating them in everyday business practices.

To manage performance improvements, we set global objectives and targets, monitor performance and build awareness through training and engagement, with our employees, business partners, regulators and societies in which APM Terminals operates.

Being Focused – How we Prioritize Topics Compiling this report served as an opportunity for us to consider how we see the sustainability areas that matter most to our business success and to our stakeholders. As a high level assessment this type of analysis allows us to see the big picture as well as drill down into key items and ensure that we are addressing the right issues. You can find information about how we are managing these areas in this report as well as more details on the website.

When assessing impact to the business we consider significance in terms of ‘if this issue is not well managed, it could cause damage to the business’ through iether: higher financial costs; damage to the company reputation; damage to the A.P. Moller-Maersk Values.

Reading the matrix – this graphic shows the top quartile of a traditional 4x4 matrix, where this segment represents issues of medium to high importance to stakeholders and impact to the business.

We recognise the diversity of our stakeholders and that they have specific interests. In this report we provide insights to some of the engagement that we carry out with our stakeholders. Going forward APM Terminals is commited to continue such dialogue and to reflect their feedback in our sustainability efforts and reporting.

“APM Terminals commits to becoming the preferred employer, business partner and neighbor, and we will achieve this through creating sustainable partnerships and challenging ourselves to continuously advance” Henrik Kristensen – Senior Director, Head of Corporate Responsibilities

Impo

rtan

ce t

o Sta

keho

lder

s

Impact to the Business

Transparency, Accountability & Measurement• Reporting • Targets• Performance tracking• CEO Reviews

Responsible Business Conduct • Responsible procurement • Anti corruption• Supply chain standards

Global Stewardship• Climate Change• Disaster relief

Being a Good Neighbour • Health and environment • Social projects and engagement

Our People• Safety• Engagement• Labour standards• Training & mobility

+–

+

Being Organised - How sustainability is governed:

Top level leadership responsibility for sustainability • APM Terminals undertake

periodic reviews of Corporate Responsibility performance

• Serious casualty reviews take place at CEO level

• Reports quarterly to CEO on sustainability

• Member of A.P.Moller-Maersk Group Sustainaility Council

• Lead global development of CR Governance for APM Terminals

• Responsible for global execution of CSR / HSSE strategy, driving targets and global objectives

• Responsible for regional performance reporting and disseminating guidance and tools for programme implementation at local level

• Responsible for implementing Corporate Responsibility programs at each operating site, driving performance and reporting progress

A.P. Moller-Maersk Executive Board CEO APM Terminals Kim Fejfer and five other

CEOs of A.P. Moller-Maersk business units

Executive Responsible for SustainabilityTiemen Meester

Head of Corporate ResponsibilitiesHenrik Kristensen

Regional HSSE Managers

Local HSSE Teams

A.P. Moller-Maersk Group Sustainability Council

A.P. Moller-Maersk Group Sustainability Function

Suppliers

Community

Empl

oyee

s Pub

lic S

ecto

r

Customers

Investors

For 2010 the main objectives concentrated on three global themes:• Become Recognised Safety Leader• Deliver Environmental Efficiency• Mature Compliance (across the

Responsible Business Conduct agenda)

Henrik KristensenHead of Corporate Responsibilities

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At APM Terminals we have developed sustainability reporting guidelines across the business, and collect HSSE data from our operations on a monthly basis.

Our annual sustainability performance against objectives is reviewed with Senior Management Team, including the CEO, who all have sustainability performance goals.

During the review performance results are discussed and new objectives and targets signed off for the coming year.

2010 priorities

Global Themes Objectives Targets 2010 Performance

Become Recognised Safety Leader

Deliver Environmental Efficiency

Mature Compliance (Responsible Business Conduct agenda)

• Continue to develop a strong safety culture

• Integrate safety into all work processes

• Increase accountability and consequence management

• Drive CO2 reductions

• Promote best practice sharing

• Build environmental mindset

• Improve data quality

• Engage with corporate functions to mitigate risks

• Commence to integrate compliance tools into management processes

• Zero fatalities

• 15% reduction in injury frequency

• Improve near miss reporting

• Maintain Employee Engagement Score (EES) on Safety

• Reduce emissions 10% per TEU

• Lift EES score on Environment by 3%

• Increase environmental communication

• Mature data reporting structure

• 10 fatalities, including external contractors

• Injury frequency reduced 26%

• Near miss reporting increased 26%

• EES 90% favourable score

• APM Terminals safety performance commended with several awards (see page 22)

• Reduced emissions 16% per TEU (9% related to direct reductions and 7% to scope changes)

• Expanded environmental cataloge and innovation labs

• EES score on environment achieved

• Recognised increase in communication

• Data reporting improved, commented by DNV at audit process

• Awareness raised through workshops, training programs

• Programs under development, expected for implementation during 2011

Being Accountable - Performance Reviews

Our progress on performance against these objectives will be reviewed and presented in our 2012 reporting cycle.

This process allows us to be clear on where we can improve and reset focus for 2011 to further mature sustainability successfully. The overall themes remain unchanged, however objectives and targets for 2011 have been raised:

2011 priorities

• Define the roadmap and lift safety leadership to 2.0

• Implement Environment Management System

• Secure further GHG reduction

• Develop and implement UN Global Compact self assessment tool

Safety

Environment30%

50%

Compliance20%

ObjectivesFocus

Becoming Recognized Safety Leader: Safety Leadership 2.0 is the working title for initiatives that will effectively lift the safety performance in each business unit ‘to the next level’.

Despite work safety procedures and safety management systems established throughout the port activities, there is a need to redefine the tools and metrics being used to avoid risks and look outside the port industry to learn from companies in the petro chemical and oil exploration industry, where safety leadership is more mature.

We will throughout 2011 focus on improving the tail performance, meaning the business units with higher risk factors and at the same time focus to advance safety leadership by implementing new leading metrics and introduce severity matrix and risk factor based measurements for the business units. We believe this will lift the focus towards eliminating high potential risks (HI-PO) that can lead to fatalities or serious injuries.

Leading indicators could be: Lost working days per injury per department or number of safety talks conducted per week, time (days) to close action points per injury, employee training completed versus target or action items completed on monthly safety committee meetings etc.

Delivering Environmental Efficiency:Progress will include the establishment of an ISO 14001 compliant Environment Management System (EMS), tailored to APM Terminals business activities. We believe that having a formalized EMS will secure a robust foundation to mitigate environmental risks and lift our global operational performance beyond compliance, in every geography in which we operate.

The EMS will include expectations around innovation such as implementing low carbon technology.

Maturing Compliance across the Responsible Business Conduct Agenda:Progress will include the development of a UN Global Compact self assessment tool, which will enable our business to improve compliance through a globally structured approach. The system is based on a methodology developed by the Danish Institute for Human Rights, Danish Investment Fund for Developing Countries, Danish Ministry for Economic and Business Affairs and the Confederation of Danish Industries.

The online response system incorporates a methodology to demonstrate progress towards UN Global Compact and other relevant standards. Our tailored tool will include APM Terminals specific targets across the sustainability agenda, and allows legal, financial, corporate responsibility functions to enter information to demonstrate performance in mitigating risks and increasing governance.

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On average, 95,000 people pass through our Terminals on a daily basis. APM Terminals makes a committed effort to engage in spreading a strong Safety Culture

For the past four years, APM Terminals celebrates its commitment to safety by holding a Global Safety Day – the event engages employees and their families, including executive management, customers, suppliers, local community and regulators throughout the world, with activities that promote safety awareness.

The aim of Global Safety Day is to proactively emphasize the global vision towards zero injuries and demonstrate the company-wide commitment to preventative action.

In 2010 we estimate APM Terminals Safety Day was celebrated with 150,000 people world-wide.

You can learn more about global safety days at www.APM Terminals.com

Our People

At APM Terminals, people come first. With representation in more than 50 Terminals world-wide and many successful business integrations in local markets, we recognize the value of adjusting to local circumstances and cultures while utilizing the benefits of our global network. We see local differences as opportunities to strengthen our company culture through diversity, and that investment in training the local labor market is necessary for us as a responsible business to develop the talent needed for a sustainable future presence in each market.

APM Terminals strives to be the “Employer of Choice” to its employees by offering market competitive compensation, benefits, extensive career opportunities and mobility through APM Terminals and A.P. Moller-Maersk Group inter-affiliate international employment opportunities. APM Terminals strives to be a progressive high performance organization that nurtures and develops its people on a continuous basis, develop a stimulating and supportive work environment that enables everyone to realize their full potential and provide the opportunity to make a difference.

We are committed to employing the most competent people and ensuring that every employee is treated with dignity and respect, in a fair, consistent and equitable manner. Our Group-wide Principles of Conduct are available in 34 languages and serve as the minimum standard to which all of our employees are held accountable.

The following overview provides a snap-shot of our people performance over 2010 on key focus areas – we invite you to read more on the website.

Safety for LifePreventative Action and establishing a Safety Culture are priorities for APM Terminals. A key success factor is imbedding accountability throughout the organization. We have done this by requiring all staff, including senior leadership to prepare personal safety plans and evaluate safety performance in every ones annual review and merit related performance targets.

Whilst we are proud to say that our performance on LTIF continues to exceed industry benchmarks, and showed reduction of 26% between 2009-2010, we recognize that no accident is acceptable.

In 2010, 10 fatalities were recorded across the business. This is unacceptable and we deeply regret the loss of life of these people. We need to learn more from the fatalities, correct work habits and implement changes based on the learnings’.

Near miss injury reporting continues to increase and we see this as an indication that all of our staff are taking personal responsibility to improve safety performance.

Although improvements can be made we must recognize the hard work of our global teams in supporting the efforts to improve safety world-wide. Many of our terminals won safety awards during 2010 (see page 22), and the company as a whole won the Safety at Sea International Award - Management and Operations category in 2010 - APM Terminals Safety Culture program was commended as “an initiative that demonstrates improved safe working practices or attitudes as a result of its implementation, either onshore or aboard-ship”.

“We have to continue to over invest in Talent”

Tiemen MeesterVice President Human Resources and Labor Relations

APM Terminals

Inland service

Fatalities (inland and port business)

2008 2009 2010

8

5 56

45

APM Terminals

Inland service

Combined

LTIF performance

2008 2009 2010

7.1

19.9

9.2

4.1

12

5.8

3

9.4

4.4

26%Reduction in Lost Time Injury Performance

12,832

Near miss reporting

2008 2009 2010

2,600

10,151

APM Terminals Annual Global Safety Day

Kim Fejfer, CEO and Labour Union President, William Bernard speaking at the APM Terminals Global Safety Day

Yeswork within the rules!

Our safety rules are here to protect you

Our safety rules are here to protect you

NoDon’t break the rules!

STOP

We also launched our cardinal rules for Safety for Life during Global Safety Day 2010

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Striving to establish high standards and accountability throughout our supply chain We have been active as a port operator in India since 2000. In 2006, we won a concession to build and operate a container terminal in Mumbai, in Nava Shave Port. This facility is branded Gateway Terminals India (GTI). GTI as a port’s business has been very successful, recognized by customers, stakeholders and employees to out perform other peer facilities in India, as well as winning 7 industry awards in its 4 years of existence, of which Lloyd’s List Terminal of the Year and Best Smart Workplace from the Economic Times were global awards. GTI directly employs approximately 700 people. Additionally, hundreds of contract staff are employed by sub contractors for services such as maintenance and inland transportation.

During 2010 a contractor employed by GTI was accused of intimidating behavior. The workers involved raised their concerns through the International Transport Workers’ Federation (ITF), also informing GTI and APM Terminals.

Through dialogue with labor organizations, employees and regulators in India, APM Terminals, with GTI, developed an action plan to address concerns raised.

Lessons learned from this incident have been shared across our operations to mitigate risks of re occurrence. Guidance includes:

• How your contractors treat their employees is as important as the welfare of your own employees

• When selecting (sub)contractors, their standards relating to workers’ rights and welfare should be assessed as part of your pre-selection process

• Don’t try to solve the issue outside the country – work with relevant stakeholders in the location to understand all the issues

Anti Corruption and Whistleblowing In 2010, approximately half of our white collar staff were trained on the A.P. Moller Maersk Group-wide anti-corruption policy and training. Our aim for 2011 is to train all of our inland services management staff on the program also.

APM Terminals established the Maersk whistleblower system during Quarter 1, 2011, which is a reporting system available in 140 countries in more than 40 languages. We will raise awareness about the system with our staff during 2011 through awareness raising activities.

In 2010 the world was shaken by several natural disasters, to which our teams provided support.

For example in Chile, CONTOPSA, our APM Terminals operations collaborated with the Chilean Red Cross to transport medicine and food in a BITSA owned truck and a CONTOPSA owned container. The container is still available if the Chilean Red Cross or any other institution requires it for relief efforts.

In Haiti, APM Terminals Americas donated container handling equipment to the World Food Programme to assist in relief efforts.

To formalize our approach to disaster relief A.P. Moller-Maersk joined the UN Logistics Emergency Teams (LET) program in 2010. LETs is a group formed under the World Economic Forum five years ago that assists the UN World Food Program (WFP) in case of large scale natural disaster, where WFP always serves as logistics center for the UN.

LET provides logistics specialists (e.g. shipping experts, port managers and warehouse managers), assets (e.g. warehouses and containers) and transportation services (shipping and trucks). LET will intervene for the first three to six weeks following a natural disaster.

APM Terminals is please to be part of this coordinated network approach. We nominated one person to join LET training in April 2011 and anticipate to train more staff, ready for emergency relief support.

Disaster Relief – using our infrastructure to support global relief efforts

Employee Engagement Employee engagement surveyIn 2010, 98% of APM Terminals staff completed the group-wide annual employee survey. We are pleased to see that our employees perceive our commitments to safety and environmental management as high and growing year on year:

Engaging employees on their understanding of Corporate Responsibility issues– During 2010 we deployed a game which has been developed by Responsible Business Solutions, with A.P.Moller-Maersk amongst the co sponsors.

The game is about how to run businesses in good compliance to UN. Global Compact and serves to engage and train our employees in understanding issues and dilemmas.

In 2010 we hosted 3 workshops to train HSSE Managers in Asia Pacific, Middle East and South Africa regions.

My company is committed to employee safety

My company is making a genuine effort to protect the environment

Employee engagement survey result

2008 2009 2010

90% 91% 90%70% 72% 75%

GM population - gender diversity

15%

85%

Male Female

GM population – cultural diversity Director population – cultural diversity

14%

25%

12%

49%

30%

35%

19%

16%

DenmarkNetherlandsUSAOther

DenmarkNetherlandsUSAOther

Director population - gender diversity

4%

96%

Male Female

Diversity Increasing diversity across APM Terminals is a long term objective for the company. All female directors in APM Terminals today have been appointed since 2007. This is good progress but the pipeline for female leaders is weak - one of the key challenges we face is attracting female talent to the ports sector. Our Human Resources team has targets on increasing gender diversity and we will continue to monitor our efforts in this direction.

With regard to cultural diversity, APM Terminals performs well, with strong representation across the management grades. Today 3 nationalities make up 70% of the director band, however diversity in the General Manager (GM) band is far greater, and with APM Terminals career development and mobility programs in place worldwide, we are confident that cultural diversity in leadership roles will continue to increase.

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Absolute C02 emissions CO2

(1000 tonnes)Reducing our footprint contributes to improved local environmental conditions for communities around ports as well as addressing global challenges such as climate change.

Environmental issues arising from port activities that affect local communities most significantly include:

• Air emissions – NOx and SOx (mainly generated through the fuel burnt in equipment and on ships at berth)

• Waste management • Noise pollution • Water pollution

One of the most significant global challenges that APM Terminals can directly address through environmental efforts is climate change. By reducing

our greenhouse gas emissions (to which carbon dioxide (CO2) is the most significant contributor), we can also assist container lines to reduce their own, using electric facilities at port side instead of burning fuel for energy. Lower carbon fuel also means low sulphur fuel, which positively benefits local air quality.

We have a long journey ahead to address these challenges worldwide, but we are committed to continue working with ambitious internal improvement goals and engaging with our stakeholders, business partners and peer group to innovate and implement strategic solutions throughout the logistics value chain.

Our performance against environmental indicators as well as accounting principles can be found on page 23.

2007 2008 2009 2010

607 568511

Goal Progress update

• Reporting started in 2007

• Relative CO2 footprint measured per TEU has reduced 15.8% over past 3 years

• Switch to CO2 neutral energy continues

• In 2011 electrification of RTG’s commenced

• APM Terminals developed an ‘Idea catalog’ which engages employees to innovate and share experience

• Communications about global environmental challenges continues to raise awareness

• New terminal projects must be designed to deliver minimum 20% less environmental impact vs. existing business levels

• During 2011, APM Terminals EMS will be implemented (see page 9)

• 12% electricity is sourced from carbon neutral power

• Other investment in solar and wind energy options are being studied.

1. Reduce CO2 footprint per TEU by 15% over 2007 base line

2. Reduce diesel dependency

3. Improve sharing and global engagement

4. Low carbon solutions for new projects

5. Implement certifiable Environmental Management System (EMS)

6. Explore carbon neutral options

APM Terminals Environmental StrategyAPM Terminals Environmental Strategy was approved in 2009. Our ambition is to reach ‘Eco-Efficiency – Beyond Compliance’ across our operations by 2012. Our strategic commitments to meet this goal include:

Our customers want to know, what’s in it for us?We talk to our customers regularly and conduct an annual customer survey so we can continually understand how to become and remain a preferred partner. The key question we get related to our environmental performance is, how can our improvements help our customers reduce their own footprint?

Through 2011 we will look to quantify and communicate performance responding to this question, as well as continue to engage to develop innovative joint approaches to improving environmental performance of terminals, as part of the logistic supply chain. The main ways that we currently do this include:

• Enhancing on-dock and regional rail capabilities

• Speeding up operations (automation, gate and berth improvements)

• Reducing congestion (extend/ off-peak terminals hours)

• Implementing hybrid or cleaner fuels for port equipment

• Implementing shore side electricity (where high utilization is enabled)

Peer group environmental performanceIn 2010 we began dialogue with other terminal operators to establish global industry benchmarks for environmental metrics at terminals.

We plan to continue the work during 2011, which will improve the transparency of reporting environmental performance to our customers and stakeholders, as well as provide a platform with our peers to share best practices in reducing environmental impacts.

Creating Sustainable Partnerships: navigating the course ahead

Operational Footprint

We are striving to reduce our environmental footprint and enable our customers to reduce their impacts too

782

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2009Equipment Electrification

2009Environmental Catalogue

2010Oil Filtration Project

2010Local Innovation

20102009

2011Low Carbon Electricity

2011Electrify RTG’s

2010Testing Gas Trucks

2011Relative CO2 Target:

-6%2011

35%

30% 34%

$36,000

12%

80%

Electricity sourced from carbon neutral energy increased from 4% of the electricity consumption in 2009 to 12% In 2010

APM Terminals converted 400 diesel-powered Rubber Tired Gantry Crane (RTG) units in 2011, which will reduce CO2 emissions from RTG operations by 60-80%

APM Terminals Algeciras switched to carbon neutral energy and reduced overall CO2 emissions per TEU by 35%

Implementation of water saving devices at the Port of Salalah in Oman helps the terminal reduce water consumption by 30% and contributes to cost saving of $60,000 annually

Environmental efficiency can improve operational excellence through taking costs out and driving performance improvements

Since 2009 over 100 initiatives have been implemented that help us to reduce our environmental impacts

Port Industry footprint is estimated 3.5-4% of the full logistic supply chain

Shanghai East Terminal – 20 reefer energy saving devices were installed saving approximately $36,000 in annual energy costs and reducing carbon emissions by 370 tons; return on investment 6 years

Shanghai East Terminal – 34 mast light energy saving devises were installed saving approximately 30% CO2 emissions and $57,000 in annual energy costs; return on investment 1.5 years

Electrifying port equipment helps to reduce CO2 emissions as well as significant reduction in SOx, NOx and noise pollution

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Sustainability and New Terminals

Today, emerging markets represent the largest share of global seaborne trade with approximately 60% of all goods loaded and over 50% of all goods unloaded in ports in emerging markets. Clearly, access to global markets and competitive transportation infrastructure are key factors for any nations’ economic growth. The challenge is that many ports in emerging markets face congestion and bottle necks with infrastructure deficiencies that can limit their further growth. Handling more than 2/3rds of global container throughput it is easy to see why. Such ports also tend to be dangerous places for the workforce as well as suffering from local pollution that affects the societies living by the ports.

APM Terminals New Terminal Investment and Development team are responsible for identifying opportunities to build new terminals or retrofit existing terminals that will improve their operational effectiveness and increase their throughput capabilities. The role that APM Terminals will play as a partner for the regulators and local communities stretches wider than just the structures that we build. We are dedicated to a total cost of ownership approach that includes meeting our commitments to:

• Recruit locally where possible – and continually investing in a sustainable local workforce, providing safety training as well as ongoing career opportunities

• Reduce local health and environmental impacts – including commitment to reduce environmental impacts by 20% on all new projects

• Invest in relevant social development projects for wider community benefit

APM Terminals strive to become a responsible neighbor in the communities where we operate.

How we will contribute to the socio economic well being of communities is part of the business case

Peder SondergaardSenior Vice President and Head of New Terminal Investments and Developments

Social Development Projects – Monrovia We hired a 3rd party expert to engage with the local community to work out what type of social projects would be most beneficial for employees, the local community around the port and wider societal needs. The findings were layered against decision factors including the connection to our business as well as employee interests. The projects we chose were:

• Building a training centre to run courses for own employees during the day and allowing use of the centre in evening hours for public training courses• Sponsoring a series of local football tournaments • Constructing public toilets

To stay updated with APM Terminals work in Liberia, find APM Terminals Liberia on Facebook.

Quantifying the Socio-Economic Value

61%

15%

13%

15%

-4%

Suppliers

Employees

Investors

Management

Public Sector*

Total Turnover Distribution

72% of our total turnover is channelled back into the local economy

(* A tax adjustment was made in 2009, due to an overpayment in 2008).

72%

1.000 people engaged in daily operations

3,500 dependants

3,500 dependants

Indirect job creation 31,393 (2009 data)

Expats(1%)

Promotions (96 since‘06)

Fatalities (3 in 2008/09)

Females(4%) Training (4,5 hrs./FTE)

To better understand the economic and social value generated from container terminal developments, APM Terminals embarked on a Socio-Economic Study for the Apapa Container Terminal in Lagos, Nigeria. The study included interviews with close to 30 stakeholders from the public and private sector to increase our understanding of the social and community impacts, as well as a structured economic analysis to quantify the impacts.

The results, lessons learned and feedback are vital in developing long-term business benefits that also create multiple benefits to society. We anticipate socio-economic studies will be integrated into all new project developments.

What we found in Nigeria was evidence that since APM Terminals assumed operational responsibility in 2006, we have created significant sustainable returns, contributed to improved societal standards and prosperity, and reduced environmental impacts.

The study, and video of field work with stakeholders, is available for download on www.apmterminals.com.

“Overall the cost of doing business in Nigeria has been reduced as an affect of APM Terminals management practices” Chief Shonekan - Former President of Nigeria and Chairman APM Terminals Nigeria

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45

54

10

84

5

14

34 3536

3839

28 30

19

26

48

46

4954

55

52 53

15

11

7

18

29

40

56

21

2427

222520

23

47

51

16

37

3132

4244

43

3

12

22

17

13

9

6

41

58591

57

33

50

Key colorsHead OfficesOperational terminalsTerminals with expansion projectsNew terminal projectsOffice

Americas1 Port Elizabeth, New Jersey, USA2 Americas Regional Office Portsmouth, Virginia, USA2 Portsmouth, Virginia USA (Leased to VA Port Authority)3 Charlotte, North Carolina, USA4 Charleston, South Carolina, USA5 Jacksonville, Florida, USA6 Miami, Florida, USA7 Mobile, Alabama, USA8 Houston, Texas, USA9 Los Angeles, California, USA10 Tacoma, Washington, USA11 Moin, Costa Rica12 Panama City, Panama13 Pecem, Brazil14 Santos, Brazil15 Itajai, Brazil16 Buenos Aires, Argentina

Europe17 Le Havre, France18 Zeebrugge, Belgium19 Rotterdam, Netherlands20 Maasvlakte II, Netherlands21 Europe Regional Office Rotterdam, Netherlands22 Bremerhaven, Germany23 Wilhelmshaven, Germany24 World headquarters, The Hague, Netherlands25 Aarhus, Denmark26 Oslo, Norway27 Algeciras, Spain28 Vado, Italy29 Gioia Tauro, Italy30 Tangier, Morocco31 Port Said (SCCT), Egypt

Africa – Middle East32 Monrovia, Liberia33 Abidjan, Ivory Coast34 Tema, Ghana35 Cotonou, Benin 36 Apapa, Nigeria37 Onne, Nigeria38 Douala, Cameroon39 Pointe Noire, Congo40 Luanda, Angola41 Aqaba, Jordan42 Salalah, Oman43 Bahrain, Bahrain44 Africa, Middle East Regional Office, Dubai, UAE45 Colombo, Sri Lanka

Asia – Pacific46 Pipavav, India47 Mumbai, India48 Laem Chabang, Thailand (2 terminals: LCB1 and LMCT)49 Cai Mep, Vietnam50 Tanjung Pelepas, Malaysia51 Kobe, Japan52 Yokohama, Japan53 Guangzhou, China54 Xiamen, China55 Shanghai, China Asia Pacific Regional Office56 Qingdao, China (2 terminals: QQCT and QQCTU)57 Dalian, China (2 terminals: DCT and DPCT)58 Tianjin, China (2 terminals: TACT and TECT)

Serving global trade and economic growth

Global Port Network

22 23


Metrics

Unit 2007 2008 2009 2010

Number of full time employees (FTE) 22,571 25,179 20,135 19,022

Safety

Lost time injury frequency (LTIF) frequency 9.6 9.24 5.82 4.36

Fatalities number 10 14 9 10

Energy consumption

Diesel 1,000 tonnes 108 133 122 112

Electricity 1,000 MWh 519 597 310 270

Environment

CO2 1,000 tonnes 304 407 391 359

CO2 Indirect GHG emissions 1,000 tonnes 303 375 177 152 (Scope 2 GHG Protocol)

Other air emissions

SOx 1,000 tonnes 0 0 5 4

NOx 1,000 tonnes 0 1 10 9

Other environmental impacts

Waste total 1,000 tonnes – – 23 27

Water consumption 1,000 m3 – – 905 862

Economic performance

Revenue USD million – 3,119 4,240 4,215

Electricity cost USD million – – 60 49

For a full list of our 2010 Metrics please refer to the website

CO2 footprint methodology explanations

Footprint includes Port and inland activities

• Inlandactivitiesaddedfrom2007

Financial control scope applied from ’09

• Calculationmethodologyfollowstheprinciples determined by A.P.Moller‐Maersk Group.

Reefer electricity consumption

From 2009, reefer electricity is transfered to operator with largest opportunity to lower emissions. Thus decided to allocate to shipping lines, where possible to seperate.

Reporting standards and audits

• ComplianttoGHGprotocol.

• SustainabilitymetricsalignedtoWRI(World ResourceInstitute)reportinglevelC+.• ResultsaresubmittedannuallytoCDP (CarbonDisclosureProject).• DatareportingauditedbyDNV (DetNorskeVeritas).

Awards and Engagement

AwardsIn 2010 many of APM Terminals operating terminals received awards related to safety performance, environmental excellence and social responsibility. Some of the awards received in 2010 include:

• APM Terminals won the Safety at Sea International Award in June 2010

• Terminal Tangier in Morocco won the largest of the three categories of entries to the 6th Edition of the national “Safety at Work” Award for 2009

• For the third year in a row, the New York Shipping Association recognised APM Terminals Elizabeth with an award for “Lowest Lost Time Accidents Frequency” in the Port of NY and NJ – Group A.

• APM Terminals Pipavav won EPC World award for “Outstanding Contribution as a Port” 2010

• Port of Salalah, Oman, honoured with receiving the Special Jury Award at the Oman Green Awards recently held in Muscat 2010

• APM Terminals Zeebrugge recently received the ‘Company with a heart’ award from the Red Cross Society in 2010

• Pier 400 in Los Angeles was awarded first place for Safety for Container Class A Terminals for both Southern California and the West Coast for the fourth consecutive year.

• Tacoma was awarded second place for Accident Prevention for a Group C Terminal for the fifth consecutive year.

PartnershipsAPM Terminals engages in a number of partnerships aimed at elevating sustainability issues, such as:

• UN Global Compact • Caring for Climate Initiative - Caring

for Climate – a complementaryaction platform for UN Global Compact participants. Caring for Climate provides a framework for business leaders to advance practical solutions and help shape public policy as well as public attitudes. Through this platform, Maersk is involved in the Low-Carbon Leaders Project in cooperation with WWF. In 2010, among other things, we contributed to the publication of a report on ‘Smart Goods Transport’, including a new model for calculating carbon impact.

• Global Compact LEAD – which supports leading UN Global Compact participants in their efforts to achieve higher levels of corporate sustainability performance and given them proper recognition for doing so. Maersk was accepted into this group at the end of 2010.

• International Cargo Handling Coordination Association (ICHCA) - a membership organization dedicated to the promotion of safety and efficiency in the handling and movement of goods by all modes and during all phases of both national and international transport chains.

• TOCOFO/3 EG is a roundtable forum established amongst container terminal operators to discuss and share possibilities to reduce environmental impacts and collaborate to establish global standards for environmental reporting of container terminals.

• BSR – Business for Social Responsibility – a global business network focused on sustainability. Maersk is a corporate member of BSR and participates actively through BSR led working groups and annual conference attendance.

What DNV Said As part of the A.P. Moller-Maersk Group Sustainability Report 2010 assurance work, DNV reviewed APM Terminals at Corporate level. DNV provided the following internal feedback on what they found:

Sustainability management• APM Terminals has demonstrated:• Strong commitment to sustainability

with senior management support• A robust and pragmatic approach

to managing, improving and communicating their sustainability performance

• APM Terminals has incorporated sustainability principles in their management systems and practices, in some cases exceeding expectations from Group

• Integration of inland services has presented challenges that APM Terminals are currently resolving

• DNV commends the innovative approach to measure implementation of the principles in the UN Global Compact (self assessment tool)

Data reporting and management• APM Terminals have put in place

robust routines and systems for safety- and environmental reporting

• Further adoption of Synergi in Joint Ventures and inland services will enhance the reporting of safety data

• DNV commends the clear environmental reporting guidelines and communication with those responsible for reporting

• APM Terminals reports the full data set for units under APM Terminals management control. However, the Group consolidation principles leads to the exclusion of associates where APM Terminals has management control and that have significant environmental impact.

www.APMTerminals.com

World headquarters

APM TerminalsAnna van Saksenlaan 712593 HW The Hague The NetherlandsTel: +31 70 304 3100

Regional offices

Africa – Middle East APM Terminals AMI Management DMCESTSuite 1809, Executive HeightsTECOM Site C, Al BarshaP.O. Box 361007 Dubai United Arab EmiratesTel.:+9714 4327550Fax: +9714 4327540

Americas APM Terminals1000 APM Terminals Blvd.Portsmouth, Virginia23703-2631United StatesTel: +1 (757) 686-6400

Asia PacificAPM Terminals No. 166, Lujiazui Ring RoadMirae Asset Tower, Unit C - E, 8/FPudong New AreaShanghai 200120ChinaTel: +86 21 2306 2888

EuropeAPM TerminalsRivium Boulevard 3012909 LK RotterdamThe NetherlandsTel: +31 (10) 440 1900

For further information contactAPM Terminals Corporate Responsibility Department, The Hague:[email protected]

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