8 18 - mof.gov.il · Infrastructure Company achieves a breakthrough in smart transportation leading in the national economy, driving the social and economic growth for better productivity

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18Corporate responsibility and sustainable development 8

Sustainability and corporate responsibility guideline 10

Sustainable development strategy 12

Identifying the stakeholders 13

Materiality subjects 14

The materiality matrix 15

Leadership forum 16

The Maala 17

Responsible management 18

Principle financial performance 19

Ethics 22

Quality standards 23

Knowledge management and international relations 24

Road users 26

Citizen service vehicles 27

Public relations and community ties 28

Traffic management and control system 30

MANA 32

The infrastructure life cycle 33

The bikers club 34

Giro Italia 35

Protection of bus stations 36

Preparations for stormy weather 38

Cooperation with the Israel Police 39

Designated and task-oriented projects 40

Camels crossing 41

The airport construction administration 42

260 kilometers of public transportation 46

Congestion basket 47

Sustainability strategy

Managing with responsibility

Table of Contents

Road users and the community

26

48

3

6055

Successful cooperation with the

supply chain 55

Paperless processes 57

Suppliers database 58

Procurement and logistics 59

Our commitment to the employees 60

Enchancing healthy and safe work environment 61

Promotion of employees 62

Reinforcement of team work 62

Employees segmentation according to age and gender groups 63

Leaders 64

Social leadership 65

Acting with responsibility

Environmental quality

Employment environment

Our commitment to environmental protection 48

Biological diversity 48

Light pollution 49

The first green road in Israel 50

Mitigation and prevention of environmental hazards 52

Energy consumption 52

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Summary Sustainability Report 2018

Infrastructure Company achieves a breakthrough in smart transportation

leading in the national economy, driving the social and economic growth for better productivity and quality of life, and enables the accessible, safe, geographical and occupational mobility of every citizen in the center and periphery of Israel.


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Director General and Chairman of The Board of Directors

Netivei Israel is the largest national transport infrastructure company in the State of Israel.

Since its establishment, it has been acting out of a sense of national responsibility on all levels of its activity, to the benefit of the residents of the State of Israel, their welfare and safety.

The adoption of the concept of corporate social responsibility, which the company made its trademark, takes into account a commitment towards values that are beyond the law, and that are used as the gatekeepers of the company and its employees in the present and in the future.

We believe that corporations that apply their corporate responsibility towards their stakeholders are corporations that are more stable, that manage their risks better and with forethought.

The year 2018, the subject of this corporate responsibility report, highlights the importance of the activity of the company as the execution arm of the government of the State of Israel in developing transportation infrastructure that connects the periphery areas to the center, in improving accessibility to housing, to employment centers, in saving lives in the framework of handling road sections at high risk and in increasing the quality of life of the residents of the State of Israel as an economic and social growth engine.

This corporate responsibility report is being published for the third consecutive year in three languages: Hebrew, Arabic and English. It represents the activity of Netivei Israel in this field, and expresses the commitment of Netivei Israel as a national company to the development of society, the economy and the environment in the State of Israel.

We perceive this report as another important measure of reporting for all the stakeholders in the company.

We will be happy and thankful to receive any feedback on your part through which we will be able to improve and do better to the benefit of all the residents of the State of Israel.

On behalf of the Board of Directors and senior management

Mr. Nissim Peretz

Director General Chairman of the Board of Directors

Mr. Oded Shamir

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The Corporate Social Responsibility Report of Netivei Israel for 2018The current report is the fourth report that the company is publishing. It reviews the activity of Netivei Israel during 2018 in matters that pertain to the values common to us and to our stakeholders, that form an integral part of our corporate responsibility and of sustainable development. The report provides a glimpse, an insight, a snapshot of the state of affairs, of the main activities that were carried out by the various divisions of Netivei Israel during the report year 2018.

This report pertains to the essence of activity of the company and its responsibility in its realms of influence to save the lives of road users, whereby the board of directors and the management of the company that are acting on behalf of the Ministry of Transportation are acting at all times to promote the projects that may save lives.

In the previous reports we presented a materiality matrix that marked for us as a company the common values that we, Netivei Israel, have with our stakeholders. In this report we review the actions taken to promote the subjects that arose in the materiality analysis. The report is subject to the periodic reports of the company and does not replace them. The report reviews various projects that are being managed by way of outsourcing, and that, in the opinion of the company, include sustainability aspects that are essential to the promotion of the field.

The framework of this report is considered the most advanced sustainability reporting framework in the world and is being used by many business companies that publish an annual responsibility report. The information presented in this report describes the impact of the organization on the material subjects and is based upon the joint work of many agents in the company and its stakeholders.

The information used to prepare the report was produced from the information systems and from other sources of the various divisions, and includes documents, procedures and written work processes, data and information. Netivei Israel started publishing its public sustainability reports last year, whereas this is the third public corporate responsibility report that the company is publishing, which reviews the activity during 2018, upon the presentation of the data, or some of it, there is no reference to multiannual information.

It is likely that in future reports of the company will present additional indices or other indices, comparisons with relevant data and multiannual trends in the cumulative, pursuant to lessons learned from the process of preparing and publishing this report. Netivei Israel intends to continue and expand this reporting in the future - to produce and publish a report on an annual basis close to the publication of the financial statements.

As part of a deep strategic thought process and in the framework of its ongoing commitment to transparency in the field of corporate responsibility the company began to publish sustainability reports in 2016 once a year on its activity, in three languages, Hebrew, Arabic and English.

Strategy and Management of Corporate Responsibility

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The company believes that retaining the know-how in the company and the development of the professionalism of its human capital will yield greater value than employing advisors, and therefore, similarly to the previous report, the collection of data, writing the report and making the information accessible were

all carried out by the employees of the company, that represent the various divisions. The information corresponds to the information that is presented in the financial statements of the company for the report year and the definition of goals for the current activity was emphasised for the purpose of follow up and effectiveness. Internal due diligence inspection is being carried out by the authorised division representatives in the company that inspect the information set forth in it. Additional control is being carried out by the division heads.

The contents of the report

Materiality - the most important subjects for the business growth of the company in the long term and that are most important to the stakeholders.

Reference to the stakeholders - providing a response to the expectations and to subjects that are close to the heart of the stakeholders.

Sustainable context - presentation of performance in the context of issues in the field of corporate responsibility.

Completeness - covering the material subjects and their boundaries in a form that reflects the economic, social and environmental impact.

Management and sustainability strategy

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Corporate responsibility and sustainable development

Management and assimilation of the field includes a wide variety of activities in con-junction with all the divisions and the sections of the company allows for integration of the subjects into the annual and multi-annual work plans of the divisions.

This is an ongoing challenge in our activity as the national transportation infrastructure company, and we strive to provide the best results to the public, for whom we exist and operate. We inspect our steps, continuously, and lead significant processes out of a sense of national responsibility.

Our approach to corporate responsibility management is pragmatic managerial that assists us in managing risks more accurately and in identifying opportunities in the area in which we operate, and to generate constant value.

In 2018 we dedicated much effort and resources to the promotion of corporate responsibility matters and sustainable development in a number of ways. Above all, our responsibility as the national transportation infrastructure company is the delivery of projects that save lives of road users on the roads under our responsibility. The board of directors and the management of the company that are acting on behalf of the Ministry of Transportation are acting at all times and incessantly to pro-mote the projects that may save lives.

We are preparing in 2019 to face the challenges that are before us as part of the multiannual work plan, with emphasis on streamlining the use of energy, mapping gaps between the green infrastructure standard and the task definer for our planners. We will continue to act vigorously to promote subjects pertaining to safety and saving lives while maintaining the best management of performance and promotion of sustainability as part of our impact on the economy, the environment and society, in the areas in which we operate.

We will continue to expand the establishment of organizational capabilities, we will integrate the sustainability goals of the State of Israel that are derived from the goals of the UN in the strategy of the company, we will promote the management and assimilation of this field in a better way, together with creating extensive measurement infrastructure that we will use as a mirror for the purpose of continuous study and improvement. We must continue to challenge ourselves also in the future for a higher level of compliance with environmental and social issues that are beyond the “compliance level” in the letter of the law.

I thank you for your interest in the report and invite all our stakeholders to contact us to promote new relevant and sustainable ways in the areas in which we operate to the benefit of all the residents of the State of Israel.

Adi Gamliel

Head of Corporate Responsibility and Sustainable Development

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Herein below are some of the activities that the company was engaged in during 2018:

• For the first time in Israel, the pilot stage of road 77 from Tel Kashish to Ramat Yishai was completed as part of the qualification of the project as the first green road in Israel by Green Roads.

• We qualified at Platinum rating on the Maala rating, we translated into Hebrew and published the goals of the UN for sustainable development to the benefit of the entire economy in Israel.

• We promoted the field of biological diversity in the assimilation of research on invading plants, and we commenced research in the field of mitigation of light pollution.

• We acted to the betterment of designated infrastructure for management and collection of data both in the maintenance operation division as well as in the engineering and development division.

• We developed training programs for the executive backbone of the company as part of promoting excellence.

• We deepened our social leadership and the involvement of the employees in the community.

• We managed the activities in an integrative manner and expanded the progress of our activity in fields such as streamlining the use or energy, an inclusive work environment, a dialog with the supply chain.

• We improved the risk management processes of the company in order to handle the challenges of the ongoing activity, aiding in promoting experiments as part of improvement of performance in the field of sustainability in the future as well.

• We initiated the establishment of the corporate responsibility and sustainability executives forum for all the governmental companies in collaboration with the Governmental Companies Authority. At the meetings of the forum we share information and create collaborations between the companies. In 2018 the forum met at Netivei Israel, Ashdod Port and Rafael.

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Sustainability and corporate responsibility guideline The board of directors and the DG of the company are responsible for approval of the strategic outline of the company in the field of sustainability and corporate responsibility. They are responsible for determining guidelines for such activity, approve the annual and multi annual work plan in the field, outline the managerial way to carry out assimilation of the field, and are responsible for determining the rules of supervision and control of this application. The board of directors and the DG of the company approve the external reports to the Governmental Companies Authority and the corporate social responsibility reports disseminated to the public once a year.

The DG of the company receives ongoing reports on the progress of performance and compliance with themultiannual strategic plan. The board of directors of the company receives quality reports from the head of corporate responsibility.

The head of corporate responsibility is entrusted with the professional forming of the outline of the strategic plan in the field of sustainability and corporate responsibility, and is responsible for the application of the policy and the multiannual plan pursuant to the resolutions of the board of directors and the DG of the company.

The duty of the head of corporate responsibility is to promote in the best way the assimilation of the field in the ongoing activity of the company while cooperating with all the divisions. He is responsible for creating measurement and control infrastructure, for following up on the progress and performance in the field pursuant to the strategic plan approved by the board of directors and the DG of the company. The board of directors of the company carried out independent assessments in relation to social and economic matters out of its responsibility for the comprehensive vision of the impact of the company, identification and management of economic, social and environmental subjects, their impact, the risks and opportunities while carrying out control with all the agents of the company.

Inter alia, the duty of the head of corporate responsibility is to form the annual work plan in the field of sustainability which includes integrated activity of the various divisions, to act to promote standards of environmental protection in the projects and permanent sites of the company, to promote

training with the training wing and organizational development for the employees of the company and for the supply chain, to act to integrate means and tools for better environmental management, inter alia by way of promotion of processes and new initiatives in the field of sustainability, to promote a dialog with the supply chain, to act to promote employment variety, employment environment, participation in research in Israel and worldwide, while aspiring to keep Netivei Israel a learning organization in the field of corporate responsibility and sustainable development.

The head of corporate responsibility manages the periodic reporting system to the Governmental Companies Authority, including responsibility for writing and producing the sustainability and corporate responsibility report of the company and its dis-semination among the stakeholders of the company. Part of the assimilation of the field in the ongoing activity of the company requires an understanding of it and in-volvement in daily processes. Therefore, in each of the divisions of the company there are representatives that engage also in the promotion of sustainability matters as part of the ongoing activity, assist in collecting and controlling of the periodic data in collaboration with the head of corporate responsibility of the company. The head of corporate responsibility reports directly to the DG of the company and to the manager of the headquarters units.

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The Board of Directors

DG

Head of DG’s Staff

Corporate Responsibility Manager

DG’s Staff

Projects’ Quality

Assurance Field Manager

Legal Bureau Contracts Division

Accounting Department

Manager

Control and Obedience

Maintenance Division

Division Deputy Director

Deputy Director

Accountancy Section

Internal Audit field Manager

Legal Advice and Organization and

Headquarters unit Manager

Information Systems

Unit Assistant Manager

Spokesmanship field Manager

DD’sAssistant

Regions Representatives

Central Region Manager

North Region Manager

Tracking and Control Appointee, Judea and

Samaria Region

Deputy Manager Southern Region

Finance Division

Resources and Administration

Division

Development Division

Deputy Director Structure Design Planning Section

Statutory Projects

Department Manager

Division Deputy Director

Organization and Methods Unit Manager

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Sustainable development strategy Netivei Israel adopted the sustainability approach as a business strategy approach. The vision of the company in the field of sustainability is to be a leading governmental company, that acts while integrating innovation into sustainable development in traffic management and control, planning, construction and maintenance of advanced transportation infrastructure.

As a national company for development of transportation infrastructure, Netivei Israel acknowledges its impact on the economy, society and the environment in the State of Israel. Netivei Israel believes that only a comprehensive and sustainable view, cooperation and dialog with its stakeholders, will allow achieving the challeng-es of sustainability in its activity.

In view of this approach, in 2015 the management of the company and the board of directors approved a multi-annual plan for sustainable development and corporate responsibility. In the framework of the multiannual plan, goals and indices were set in each one of the subjects raised. The head of social responsibility leads the execution of the plan and the adoption of his approach by managers of all levels in the company. At present Netivei Israel follows a sustainable way of thinking because it is best way to deal with the challenges in the operation environment under its responsibility pursuant to the prudence principle that is being driven while assimilating ad-vanced international norms, adopting standards and implementing advanced technologies. The adoption of sustainability values focuses on the core activity of the company and necessarily provides benefit not only to the economic performance but also to the community and the environment in which it operates in the projects under its responsibility.

The main layer in the concept of sustainability and corporate responsibility of Netivei Israel is based upon creating common value, a value that provides a response to the activity of the company and of its stakeholders, this is a step up that includes a vision of the entire life cycle, a way of thinking about development of products with environmental as well as social added value within a global vision and sharing of information in a variety of sustainability aspects that lie at the core of the company’s activity. As a management company, the solutions for the common values are manifested in the management chain of the supply chain as well, through which we continue to develop the transportation infrastructure throughout the State of Israel.

Netivei Israel continues to develop, promote and manage the dialog with all the stakeholders. The integration of this dialog forms an integral part, which weaves into the global trends and processes of learning which include identification and understanding of the needs, the expectations and the opportunities of the company.

Strategic cooperation, involvement of the employees in the community, a creative and innovative way of thinking on the development of sustainable transportation that includes a wide variety of solutions, create leverage for improvement of the lives of the residents in the State of Israel and the reinforcement of the satisfaction from the company.

In our work as reflected in this report we manifest our responsibility to continue to support advanced transportation systems and to promote the subject of sustainability.

Extreme climate changes that we experience frequently in recent years, global warming, environmental regulation, the everchanging business environment, technological changes including cyber risks and information security create a new and more complex reality. This reality requires a different way of thinking to create advantages when handling the challenges that the company is facing in the field of transportation infrastructure and traffic control and management.

We see it as our duty to carry out our business in a manner that will bring about sustainable growth. For that purpose, we investigate ourselves and act continuously to deepen transparency, increase safety and improve the quality of life of road users.

Our purpose is to defend and empower the activity of the company to the benefit of the environment, to safeguard its resources and balance between the needs of the current generation and those of the next generations.

The policy of Netivei Israel in the field of sustainability is not to rate the parent fields. The company believes that all the fields must be handled concurrently. Never-theless, in order to identify the subjects that are material to the stakeholders, all the subjects reviewed by the external stakeholders were investigated in relation to the GRI reporting standard. If a subject repeated more times among those sources, its rating was higher, out of the understanding that the more a subject appears, the more it represents the wish of the stakeholders that the company take it into closer consideration and attention. The subjects that received the highest rating were de-termined as the principle and most important subjects to the stakeholders. There are no significant changes in relation to the last reporting period in the list of material subjects and the borders of the matter.

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Identifying the stakeholdersNetivei Israel is acting with many stakeholders that impact its activity and are directly or indirectly affected by it, and therefore along the life of the projects under its responsibility the company is maintaining a dialog by way of various means, such as surveys, dissemination of information, consulting in order to coordinate expectations, listening and responding to contact with the company with all the means at its disposal.

The dialog is being carried out in a variety of means of communication: The radio, television, social networks, round tables and meetings between the representatives of the company and the general public in the activity in projects under the responsibility of the company, in order to achieve better management of its activity to the

benefit of the residents of the State of Israel. In 2015 the strategic plan for sustainable development and corporate responsibility was approved, in the framework of which the head of corporate responsibility acted in conjunction with agents from within and without the company to identify the stakeholders of Netivei Israel.


Stakeholders

Companyemployees

Broad Public

Road users GovernmentalMinistries

Statutoryauthorities

and planning committees

Environemtal organizations

Governmental Corporations

Authority

Local andregional

authorities

The Ministry of Finance

and the Ministryof Transportation

The supplychain

Research andacademic entities

Media andCommunication

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Materiality subjectsNetivei Israel Company acts simultaneously in all fields with a broad and integrative vision in the sustainability field. However, in order to identify the Materiality subjects for the stakeholders and the Company's management, all of the subjects reviewed with the external stakeholders in reference to the GRI reporting instructions, were reviewed during the year 2016.

During the year 2016 Netivei Israel Company completed the Materiality Assessment through a broad survey to evaluate subjects, as were reflected in a dialogue with various stakeholders. The survey included more than 400 stakeholders, external and Company internal. In the framework of the survey, stakeholders were approached including employees, regulatory entities, social and environmental organizations, the supply chain, and the road users who are our customers. 70% of the stakeholders that were approached by the Company, responded to the survey.

The more often a subject repeated itself among those sources, so was higher the ranking determined for it. The subjects that reached the highest ranking were determined as the most important subjects for the stakeholders. For each filed a separate survey was conducted with an internal ranking for the importance of each field. The survey's findings and its analysis assisted the Company in posting the most essential subjects in the eyes of Netivei Israel Company and the view of the stakeholders who influence and are influenced by its activity.

The policy of Netivei Israel Company in the sustainability field is not to rank the essential fields. The Company believes that all fields must be handled simultaneously. However, in order to identify the subjects that are essential for the stakeholders, all the surveyed subject with the external stakeholders were examined in reference to the GRI reporting standard. The more often a subject repeated itself among those sources, so was its ranking determined as higher. The subjects that received the highest ranking were determined as the most important ones for the stakeholders.

The following is the list of the Materiality subjects

35%

16%

6%

7%

21%

15%

Road users

Supply chain

Environmentalists

Associations

Working

Media

Environmental Quality Employment Environmental design management of an environmental system, biologic variety, green construction, energetic efficiency and coping with climate changes

Environmental Quality Employment Environmental design management of an environmental system, biologic variety, green construction, energetic efficiency and coping with climate changes

Corporate GovernanceSustainability development and corporate responsibility policy, strictness with ethical values, reporting and transparency, risks management, external relations and cooperation

Society and Community Cooperat ion , d ia logue and pub l i c involvement, accessibility and linkage, knowledge promotion and strategic cooperation, employees’ involvement in the community

Road UsersInformation communication and image improvement, intermodule transportation outlook, road safety and danger centers, road users’ satisfaction, loads management, technological improvements

Supply ChainResponsible procurement, performances c o n t r o l a n d t r a c k i n g , d i a l o g u e , empowerment processes and satisfaction management, further ing of branch innovation

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Analysis of Materiality matrix

Important

Company's internal Ranking

Ranking by the company's stakeholders

Important

The materiality matrix Upon completion of the investigation of the material subjects with all the stakeholders of the company, the material subjects were rated according to their importance, a rating that aids the management of the company and its board of directors to focus the managerial and financial resources of the company for the purpose of promotion and a positive impact on the subjects that were found to be of the highest impact.

In this framework, sixteen subjects were identified as material in the activity of Netivei Israel that have

paramount importance to the stakeholders as well as to Netivei Israel. Other than that, there are additional fourteen subjects that have secondary impact in such rating, however they are important to the activity of the company and therefore efforts will be invested in them in the long term.

The findings of the survey and its analysis are presented in the chart below and include the subjects that were defined as most material to the stakeholders of Netivei Israel and to the management of the company.

Employment environment1 Career tracks and employee promotion

2 Health and safety of employees

3 Personal development

4 Professional development and satisfaction

5 Ethical climate

6 Occupational variety

Society and community12 Promotion of knowledge and strategic cooperation

13 Sharing, dialog and public involvement

14 Involvement of employees in the community

15 Accessibility and connectivity

Chain of supply27 Promotion of branch innovation

28 Performance monitoring and control

29 Responsible procurement

30 Dialog, empowerment processes and satisfaction management

Environmental protection7 Environmental planning

8 Environmental protection system management

9 Biological diversity

10 Efficient use of energy and handling change

Climate

11 Green construction

Road users16 Road safety and hazardous locations

17 Technological improvement

18 Satisfaction of the road users

19 Intermodal traffic concept

20 Congestion management

21 Communication of information and public relations

Corporate governance22 Foreign relations and cooperation

23 Ensuring ethical values

24 Reporting and transparency

25 Risk management

26 Sustainable development policy

1

2

3

4

5

6

7

8

910

11 12

13

14

15

16

1718

19

20

21

22

23

24

25

26

2728

29

30


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Leadership forum for corporate responsibilityDuring 2017 Netivei Israel established a leadership forum for corporate responsibility and sustainable development in order to create effective sharing and allow efficient communications and a flow of information between the head of corporate re-sponsibility in the company and the various units.

About 20 employees and managers from all the divisions and the executive levels constitute change agents and contacts to assimilate the various processes throughout the company in order to allow effective management of the activity in the field. These representatives were trained during 2017 by way of a unique international course that was developed by the global GRI, which provides to its participants tools that allow for a better understanding of the reporting world, pursuant to the international reporting standards of the organization.

The head of corporate responsibility led, together with the Governmental Companies Authority, the establishment of a forum for managers of corporate responsibility in governmental companies. The purpose of the forum is to promote the field of sustainability in governmental companies. In 2018 the forum met at Netivei Israel, Ash-dod Port and Rafael. During these meetings, the forum focuses on a test case for the purpose of sharing know-how and expanding the knowledge on the activity being carried out in governmental companies in this field.

During 2019 the forum members will integrate into professional meetings of the Maala organization, the Green Construction Council and will hold meetings once every six months that will include tours in similar governmental companies, in the framework of which the corporate responsibility trustees will meet, exchange notes and information, and undergo training and receive enrichment contents in relevant fields.

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The Maala rating


A general score over the years

Average overall rating

NETIVEI ISRAEL

2017 2018

Gold Platinum

“Maala” is the umbrella organization of the leading companies of the Israeli economy in the field of corporate responsibility. The main purpose of the forum is to increase the awareness of the business sector to the significance of corporate responsibility, it is acting to promote subjects in this field and to develop standards of responsible management in Israel. “Maala” operates a methodological tool which rates the performance

of corporate responsibility and sustainability among public companies, governmental companies and private companies. In 2016 Netivei Israel participated in a shadow rating process.

In 2018 it participated in a public rating process and was rated in the Platinum category. The goal of the company for 2019 is a Platinum+ rating.

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Responsible management

Netivei Israel is committed to the principles and arrangement under applicable law and complies with the provisions of applicable law anywhere that it operates.

In the framework of its activity, Netivei Israel conducts cooperation with companies and ensures that also its business partners are committed to maintaining fair and appropriate principles in their corporate and business conduct.

The company is acting to institutionalize the field of risk management, while highlighting the proper administration and the personal integrity of its emploees, by assimilating a mitigation plan for all the risks pursuant to their severity and impact.

Netivei Israel stands firmly against bribery, corruption and any activity that involves a conflict of interests. Accordingly, the company adopted a policy of zero tolerance towards acts

contaminated with bribery and corruption. The employees of Netivei Israel are committed not to offer or receive bribes or any other illegal incentive, directly or indirectly, or by way of brokerage by a third party.

In order to realize its corporate responsibility, the company is acting to promote an organizational climate of ethical conduct by way of the institutions of the company and assisted by the ethics commissioner, the ethics committee, the auditor of the company and the compliance officer.

The company acts to promote a dialog with its stakeholders and to implement it by way of a procurement policy in the supply chain, environmental protection, employment environment, investment and involvement in the community, assimilation of relevant procedures and work processes.

Corporate governance principles in Netivei Israel

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Multi-annual segmentation of the distribution of the budget of the company in points

The figures show Principle financial performance

201720182019

68%63%65% The develop-ment division

29%33%31% The maintenance division

3%4%4% Organizational budget

Company and risk management while forming appropriate mitigation plans. In the framework of its activity pursuant to applicable law, the company relies upon the multiannual budget approved by the Ministry of Finance and the Ministry of Transportation. The company has no subsidiaries and the financial statements review the activity of the company only.

The person in charge of market risks management in the company - Mr. Nissim Peretz, the DG of the company, is serving since July 2016 as principle risk manager (hereinafter: “CRO”) of the company. The market risks are being managed under the responsibility of VP finance of the company as a first line of defense in the field.

The company is acting by virtue of multi-annual plans, the last of which was signed in August 2016 for the years 2017-2021. Concurrently, and in order to prepare towards the challenging five-year plan, a new financing operation agreement was signed in November 2017

between the government of the State of Israel and the company. The agreement regulates the conduct of the company during the current five-years period, and is in force commencing from January 1, 2017 through Decem-ber 31, 2021. The company is negotiating with the state to add a sixth year to the five-year plan. For additional details about the five-year plan and the financing op-eration agreement see the periodic report of the company for 2018. In 2017 a resolution was adopted by the board of directors of the company to transition to the IFRS international standard. The date of transition to the IFRS international standard is January 1, 2016.

Multi-annual segmentation of the main points of the profit and loss statement

201620172018

4,892,0315,397,6285,200,295 Revenues

4,708,9255,189,5254,970,635 Cost of works

189,473206,013224,383 General and administrative expenses

-6,3672,0905,277 Profit before financing

-606-608- 516 Financing income

-6,9731,4824,761 Profit after financing

5731,899- 597 (Other revenues (expenses

-6,4003,3814,164 Net profit

Multi-annual segmentation of the budget of the company

201620172018

3,1533,5063,338 Development

1,6241,7881,756 Maintenance

178206226 Organizational

4,9555,5005,320 In total

Multi-annual segmentation of the direct economic value generated by the company

201620172018

4,708,9255,189,5254,970,635 Operating costs

115,524138,551151,620 Wages of employees

115,028117,588123,044 Accrued profit

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Intersections

Lighting points

Roads’ lengthBridges and tunnels

Traffic signs and signposts

Gardening areas

Traffic cameras Interchanges

Railings length

Facts and figures

8,2818,473

139155

5,6056,019

196227

97,86298,768

96,66197,001

20172018

24,70026,517

1,4551,515 meter

meter 2,6132,396 unit km

unit unit

unitAcres

unit

unit km

unit unit

unitAcres

unit

meter

meter

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Managing with responsibilityManaging with responsibility

Company headquarters

Northern Region

Southern Region

Central Region

Eastern Region

Company headquarters Or Yehuda

Operating and maintenance areasNorthern Region, NazarethCentral Region, Control Center, Highway 431 Ein Hakore InterchangeEastern Region, Mishor AdumimSouthern Region, Beer Sheva

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EthicsForming the ethical code of Netivei Israel was carried out in collaboration with the employees and the executives of the company and was approved by the board of directors in 2013. The purpose of the code is to serve as a compass and a guide to the proper conduct expected from the employees and executives of the company. The ethical code cannot provide an express response for each and every case or situation that may arise during the work, and is intended to be used as a compass for appropriate behavior, to aid in events and situations where a decision has to be made as to the proper conduct, and there is no express guideline in legal guidelines or in the procedures of the company. In addition, there is the option to consult with the ethics commissioner of the company in any matter, both directly as well as anonymously, through the designated contact box for that purpose located at the headquarters of the company. During the recruitment stages of new employees, the employees receive a copy of the code of ethics.

The ethics committee - during 2016 the company established an ethics committee. The main purpose of that committee is to drive the ethical discourse in the organization, serve as an address in lateral ethical issues, bring to the attention of the employees of the company their commitment to act pursuant to the code of ethics of the company, to discuss ethical issues in principle, across the organization, pertaining to systemic, cross organizational aspects of any issues raised.

The committee includes agents from all the divisions of the company. The committee chair is the head of corporate responsibility the ethics commissioner of the company that serves as the professional agent on the committee and as acting chair of the committee, the head of the training and organizational development wing as the agent entrusted with the ongoing assimilation of the field pursuant to the approved work plan.

The committee convened during 2018 a number of times and acted to assimilate the values of the code of ethics and a behavioral change at the general level by way of an annual ethics plan that was approved by the DG of the company. During 2018, lectures were given in the ethics field by the chair of the ethics committee, in the framework of the activity of the training wing and the organizational development of the managerial backbone of the company.

During the first quarter of 2019, the work products of the team will be brought to the approval of the DG. After approval of the products and the assimilation plan, a division into applicative action teams will be carried out in order to assimilate such values and the code of ethics under the leadership of the training and organizational development wing.

• The auditor of the company • The ethics commissioner • The compliance officer

• The hotline • The ethics committee• Direct contact with the DG of the company

The reporting and consulting mechanisms relating to ethics existing in the company.

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Quality standardsThe organization and methods wing manages the entire array of quality standards, whereby during the year the wing carries out internal audits for all the wings of the company, promotes with the divisions activities on the subjects of the standard, acts to remedy any incompatibilities of the company and prepares the company for the annual supervision audits for each one of the standards. In 2018, 36 internal audits were carried out as well as four external supervision audits.

The company was qualified under four quality standards:

ISO 9001:2015 quality management system: The main purpose of the standard: To ensure that the products of the company and its services are adjusted to the quality requirements of the clients and to bring about constant improvement in all the business activity of the company, while measuring performance, focusing on the client and improving processes.

Israeli Standard OHSAS 18001 - safety and health management in employment: This standard determines the requirements of the safety and health management system in employment and its adoption allows the company to form and realize a policy and goals in this field while taking into consideration the requirements pursuant to applicable law and the information on safety and health risks.

ISO 14001 - environmental management system: This standard determines the requirements from the environmental management system that the company may use in order to improve its environmental performance. Adopting this standard allows the company to methodically manage the fields of environmental responsibility of the company and to achieve the results that are expected of its environmental man-agement system.

Standard 9301 for management of safety and quality in transportation: Qualification for the standard and application of the standard’s requirements bring about a decrease in the number of malfunctions, accidents and in handling vehicle damage and bodily harm and even brings about substantial financial savings and streamlines the ongoing operations of the vehicle array and the quality of conduct of the company.

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Knowledge management and international relationsNetivei Israel puts great emphasis on knowledge management in the company, which forms part of the learning array of the company. The knowledge management and foreign relations section forms part of the training and organizational development department and as its name indicates, it is acting on two levels: The first, knowledge management within the company, and the second international relations with bodies outside the company (both in Israel as well as international bodies) for the purpose of exchange of knowledge and information.

The activities of the section are varied and many and include inter alia: debriefing, preparation of retirement files and position commencement files for new employees, risk management in the aspect of loss of knowledge in the company, bookkeeping, research, databases and information science, tests of qualifications and knowledge quizzes, carrying out focus groups, discussion and learning forums, management of conferences and lectures in order to share knowledge, management of the research array, surveys and statistics in the company.

Knowledge centers: A central aspect in the knowledge management in the company is the establishment of knowledge centers according to themes of the various units such as: the maintenance division, the airport administration, the railway division, the legal department, the customer service center, the designated projects and tasks wing and more. The knowledge center binds all the “lore” of a certain field of activity pursuant to the relevant fields of study for each field of activity. Each knowledge center binds parent

documents that explain the operation lore of the field, maps, charts, drawing and other aids that are required for deep acquaintance with the field as well as insights of professionals within and without the company. The con-tents in the knowledge center are made accessible pursuant to classification to the employees of the company and/or to other interested parties. In the framework of the project to establish the knowledge centers, meetings will be held to share information across the company and outside the company.

In 2018, the employees of Netivei Israel took part in activities of several main associations including: The Israeli association of Construction & Infrastructure Engineers, the legal database Nevo, Maala, the Green Construction Council, membership in professional forums (people and computers) - chief information officer, business in-telligence and information technologies, information security, knowledge management, Zionism 2000, membership in the International Tunneling Association - ITA, and the Israeli ITS Association.

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International cooperation and initiatives: Netivei Israel, through the knowledge management and foreign relations department, is a partner in a number of international ventures of cooperation and exchange of knowledge and information. The cooperation in the framework of which the activity of the company is the most extensive are by way of the following frameworks: COST and Horizon 2020 funded by the European Union.

These frameworks form a host to ventures of exchange of information and learning in various fields by way of a number of programs:

AEROBI - in the framework of this project a method was developed to review bridges by way of an unmanned aerial vehicle (drone) with a robotic arm, that will aid in review of bridges with limited access.

Infravation - an international call the purpose of which is to promote technological solutions that will provide a response to the common challenges of national roads authorities in Europe, the United States and Israel.

Fox - a joint project for all types of transportation, the purpose of which is to identify common challenges and technological solutions with an application potential until 2030.

Resist - a project that integrates the effort of researchers from academia, from the industry and from transportation authorities to characterize and develop a technological platform that will provide a swift and optimal response in emergency situa-tions. In the framework of the project products of other projects will be assimilated, including AEROBI.

INFRA4DFUTURE - development of an integrative strategy for modernization - renewal and upgrade of transportation infrastructure that complies with the require-ments of road users in the 21st century in aspects of sustainability and service level.

TAIEX - another platform for sharing information by way of the program Technical Assistance and Informational Exchange, which includes workshops with designated contents experts, in which a variety of EU countries participate, in order to facilitate the way to share best practices between countries and create a larger added value in the adaptation of EU acquis and best work methods applied in its implementation in EU by neighbouring countries.

It is noteworthy that beyond such programs the company holds additional knowledge sharing meetings with transportation infrastructure bodies worldwide, and every year there are a number of symposiums being held in the company for delegations of ministries of transportation from developing countries in order to learn about the transportation system in Israel.

In order to make the know-how and information accessible, the department is being aided by several tools, the most prominent of which is the organizational portal, including the organizational Wikipedia - for the employees of the company, and the Internet website of the company - for suppliers, road users and other interested parties.

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The road users are the material stakeholder of the company. The principle commitment of Netivei Israel is to the road users, and it is manifested in a wide variety of aspects, commencing from an efficient and safe road grid, sensitivity and understanding of their needs while providing information in transparency, reliability, availability and courtesy, all as part of a respectful dialog.

The main mission of Netivei Israel is to act to the benefit of the road users out of an understanding that the projects that are being carried out under the responsibility of the company are saving lives. For that purpose, Netivei Israel is investing considera-ble resources in advanced technologies, innovative way of thinking, and creating a dialog in a number of communications channels which include traditional media, the Facebook page that serves as a platform for communications with the road users. In addition an option to contact the company was created using the

Facebook chat op-tion which provides a quick response to contact of road users in various matters: Reports on road hazards, obtaining information regarding the status of projects of Netivei Israel, cooperation were created with the largest engineering portal in Israel in which articles are being published, the new Internet website of Netivei Israel was launched in 2018 in a new configuration and includes a variety of innovations the main part of which is the traffic cameras of the company for direct viewing.

Cooperation with the Road Safety Authority

Out of the wish to improve road infrastructure safety by way of obtaining information on lessons learned from road accidents that are set forth in the surveys of the Road Safety Authority, the operation and maintenance division initiated cooperation with the Road Safety Authority. The lessons arising from the surveys of the au-thority are analyzed by the professional agents of the division and if necessary and possible improvements are made pursuant to such lessons. All out of an understand-ing that simple improvements may prevent road accidents in the future and thereby save lives of road users.

Road users

At the joint meetings that were held, a meetings methodology was determined, commencing from the operation and maintenance regions level at Netivei Israelup to the headquarters of the company, the meetings were headed by the maintenance management wing that coordinates the activity on behalf of the company with the Road Safety Authority. It is noteworthy that the joint activity and the pro-active approach in finding solutions and engineering and safety improvements of the road grid of the region, which includes improvements pursuant to the recommendations of the Road Safety Authority after road accidents.

Joint work/status meetings bring about the best results in improving the safety of road users and saving lives in the transportation sector for which Netivei Israel is responsible.

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Citizen service vehicles The Ministry of Transportation and Netivei Israel invest managerial and financial resources in multi-disciplinary activity in the matter of road accidents. In the framework of these efforts the company operates 13 service vehicles that act to increase the safety of the residents on the roads and to assist in better and more efficient traffic management throughout Israel. During the second half of 2018 three new vehicles were deployed into service thereby the response for the north of the country was improved on the routes towards Jerusalem and in the Negev region.

The vehicles that have been operating since 2015 were refitted with new and advanced equipment, which provides initial response for malfunctions on the road for the various vehicles traveling on the roads that are under the responsibility of Netivei Israel. Vehicles that are in distress, that need initial assistance receive such assistance from the service vehicles with the purpose of decrease as much as possible the hazards on the side of the road, thereby significantly improving the safety of

all road users. The vehicles assist, inter alia, in replacing a tire, adding air, light mechanical failures, in aiding and calling a tow vehicle. In 2018, about 14,414 events were handled in all the roads under the responsibility of the company, in 2018 the Ministry of Transportation and Netivei Israel will inspect the impact of the service on the safety of road users as part of improvement of the service and the safety to the benefit of all the residents of the State of Israel.

Total calls The nature of assistance

2,790 Assistance with replacing atire

2,319First aid

1,810A vehicle waiting for a tow

1,697 Abandoned vehicles withoutowners

1,647Marking of a vehicle

1,312Other events

896Assistance with gas

861Assistance with water

728 Evacuating a vehicle to theroad shoulder

205Assistance with cables

156No service vehicle

14,414 Total

1%1%

5%6%

6%

9%

12%

12% 13%

16%

19%

Here are details on the nature of assistance of the service vehicles during 2018

Assistance with replacing a tire

First aid

A vehicle waiting for a tow

Abandoned vehicles without owners

Marking of a vehicle

Other events

Assistance with gas

Assistance with water

Evacuating a vehicle to the road shoulder

Assistance with cables

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Public relations and community ties

The public relations and community ties wing at Netivei Israel is responsible for creating the media envelope that supports the activity of the company and acts as a connecting thread between the public and the engineering, infrastructure and planning divisions of the intercity road and train grid under its responsibility.

In recent years the wing made the value of transparency its trademark out of an understanding that sharing the ventures of the company with the public reduces the resistance of interested parties and encourages solidarity.

The public relations wing is acting in multistage processes and consults to the work processes of the various divisions from the inception of the project until its completion. The activity of the development and maintenance divisions personnel with the personnel of the public relations wing in the field of community ties allows a systemic view that creates awareness and a positive and promoting atmosphere among the public as to the activity of the company that will lead to the reinforcement of the positive image of the company as a professional, reliable and safe company. The activity of Netivei Israel in the projects under its responsibility includes cooperation between the personnel of the maintenance and development division and the public relations wing by way of dialog and personal meetings with the representatives of the adjacent settlements, alongside with consulting to the works in real time; Providing a response to calls from the residents during all stages of execution of the project, consulting the road users and updating them as to changes in traffic arrangements, and holding ceremonies to launch the roads.

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A major subject in the planning and design of the system is the importance of integration of the various management needs into a comprehensive and integrative infrastructure management system.

Traditionally, the subsystems of infrastructure management are: roadways, bridges and safety were separate and used independently by the engineers in charge of a particular field. The progress in information technology allows efficient, logical and costeffective merger of these subsystems into one unified system.

The merger is significant in order to be able to accrue detailed information from the level of a road segment to the level of an entire road, and from that point going forward information may be accrued up to the level of the grid and the strategic level.

Condition indices are used to evaluate the state of road sections and road structures so that optimal work plans may be produced and so that the management is informed and may make decisions on the strategic level. The information may be used by the management to evaluate the consequences of various investment levels on the state of the grid and exploit the defined maintenance budgets in an optimal way.

The following chart describes the construction of the information in the system for strategic purposes.

The targets and goals of the system are manifested in a number of ways, commencing from the extension of the life cycle of the infrastructure by way of a maintenance plan with a high costbenefit ratio, increasing the safety of the road users. Which includes an improvement of the state of infrastructure by providing a special tool to analyze the condition and the rehabilitation actions that are required to the decision makers, detecting critical or recurring faults and deficiencies in the execution of infrastructure and its safety, verifying infrastructure performance given the maintenance plans and the deterioration models.

Nevertheless, additional goals have an impact and are expressed in the ongoing activities of the company such as: management of road grid inventory in anything pertaining to the maintenance plans that were planned using the system, defining the survey content, defining the state and performance indices, defining activities and costs of repair, care and rehabilitation, defining deterioration models and condition models, defining decision trees models for costs and periodic maintenance, support and a tool for the process of planning of the maintenance plan, supply and

presentation of infrastructure data and its condition by way of geographical displays (GIS), simplifying and clarifying decision making, management of maintenance information - collection of engineering data and video footage of the entire road grid every year for the purpose of analysis as well as for updating the deterioration model of the condition of the road grid.

Using the information to construct a strategy

The integration into the multiannual work plan of the company is affected by the results of the MANA system that is dependent upon a number of surveys and annual data collection:

Benefits and savingsThe following savings and benefits will be obtained by implementing the system:

• Roadways condition surveys are being carried out on an annual basis. • Bridges and road structures surveys are being carried out at various frequencies according to the type of bridge and structure. • Inventory surveys are being carried out on a periodic basis. • An annual survey of average daily traffic is being carried out by the Central Bureau of Statistics.• Data on road accidents in the road grid is being obtained from the Central Bureau of Statistics.

• A clear definition of the service levels goals of the organization.• Implementation of a consistent method for prioritization of investment in infrastructure.• Implementation of a policy and maintenance methods based upon cost-benefit.• Transparency, control and follow-up on allocation of budgets. • Improvement in performance of infrastructure and its safety• Making the planning process shorter• Optimal utilization of the budgets• Decreasing the costs of damage to infrastructure as a result of higher levels of performance and safety.

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The field includes the traffic lights control system, the video management array and the traffic cameras, the patrol vehicles, the command and control center, as well as the video distribution array and the travel times distribution.

The multiannual budget for traffic management and control amounts to about 325 million NIS. The company is responsible for the operation and maintenance of about 562 crossroads with traffic lights in intercity roads throughout the country, out of which 534 crossroads under direct maintenance of the company and the others under the responsibility of the Hadera PFI concessionaire.

During 2018, three new crossroads with traffic lights were constructed as part of the response of the company to risk centers. The regional traffic lights control systems allow obtaining information in real time as to the good working order of traffic lights systems, the operation system pursuant to which the crossroads with traffic lights is being operated at any given time as well as update in real time of the traffic lights plans from the command and control centers or the company. In addition, the company is operating a command and control center for transportation 24 hours a day. This service provides a response for citizens that contact it in any matter pertaining to the activity of the company. Most of the calls pertain to hazards on the road and traffic congestion. These calls are transferred from the control center the maintenance teams deployed in the field.

Traffic management and control system

• Advice to the handling of the congestion projects basket • Analysis of travel times and discovery of events based upon floating sources• Expansion of the traffic cameras array and of electronic signage.• Transmission of the traffic cameras array to the Internet website• Establishment of traffic control systems in main roads• Construction, operation and maintenance of designated traffic control systems in projects of public transportation lanes.

During 2018, 30 new crossroads were constructed, 172 sckedules were updated, systems for people with sight disabilities were installed in fifty crossroads, and UPS systems were upgraded in essential crossroads. In addition to the ongoing activity, the activity of the company during the five-year plan will focus on new applications and tenders:

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Application and inspection of new technologies:

• The expansion of the monitoring systems of travel times to 500 kilometers - during 2018 a national monitoring array to obtain traffic data in real time along the main longitudinal and cross roads of the country, like the system operating on road 1. The planned roads for expansion of the system: Road 2, road 4, road 40, road 65 and road 22.

• Carrying out a pilot of a smart crossroads - during 2018 the manner of execu-tion of the pilot to test a variety of technologies that are derived from the operation of an adaptive traffic lights system was determined. Such system allows for optimization in real time of traffic in crossroads with traffic lights and an FRI was published as part of the pilot process.

• Cyber risks survey - during 2018, a cyber risks survey was carried out for the traffic control systems. During 2019 a tender will be published to construct a monitoring and cyber defense system for the systems.

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32323232323232322323232323222232222232232222222222223222223333

The MANA system - computerized road maintenance management systemThere a wide consensus that the costs of the life cycle and maintenance of road in-frastructure constitute a very substantial expense in the budget of local and national road authorities.

To the efficiency of road maintenance, the prolongation of life of infrastructure and correct correspondence between the operational use of the infrastructure and the service level of the infrastructure, long term impacts - in particular those that pertain to efficiency, service to road users and support in the expansion of the road grid.

In order to achieve an increased cost-benefit ratio in the maintenance of these road assets, the road authority must construct and maintain engineering/economic sys-tems based upon known and well proven strategies used worldwide. These methods are usually based upon surveys of the state of affairs and of safety, that are carried out for the infrastructure, and allow a rating of the various infrastructure components by way of analysis of the results of such surveys and creating a state and performance index for the road assets.

After determining the state of the road, these methods carry out a simulation of various repair and rehabilitation actions that may be required in order to achieve the best safety, performance and state of the infrastructure while observing various budgetary constraints. The maintenance manager uses the results of such simulation to plan and execute a maintenance plan that is based upon a high cost-benefit ratio and assists in accurate budgeting.

The system that is described below is operated as a main tool in Netivei Israel in the implementation of such strategy and is intended to serve the following agents. The executives and engineers of the maintenance division, the executives and engineers of the quality assurance wing, the executives and engineers of the engineering divi-sion, the executives and economists of the budget wing.

The maintenance management system (MANA) includes the following main and integrative modules (components):

BMS - bridge management system

PMS - roadway management system

SMS - safety Management System

The system is integrated into the organization management systems: The GIS geographical information system of the organization and in the future will interface with the core systems of the maintenance division and of the engineering division. Each year a summary of the recommendations of the system is being provided, as to the appropriate rehabilitation actions in the fields of roadway, bridges and safety. These recommendations are transferred to the maintenance division and its engineers for reference and after obtaining feedback from the maintenance engineers a final plan is produced for implementation and budgeting of the next work year.

333333333333333333333333333333333333333333333333333333333333333333333333333333333333333333333333333333333333333333333333333333333333333333333333333


The infrastructure life cycle The customary approach in road infrastructure management is that of a life cycle, and it is described in the chart herein below.

At the center is the main goal of the organization in the management of road maintenance: Assuring the benefits and the satisfaction of road users at the lowest cost for the long term.

The six elements in the inner ring represent the actions necessary in the field to develop and maintain the road grid.

The four components in the middle ring represent the strategic actions that are necessary. The components in the outer ring represent the maintenance management process.

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The bikers club Road users on two wheels are important stakeholders in Netivei Israel, a dialog with the representatives of the Israeli Bikers Club acting as a registered association for over 30 years, the managers of which are acting on a full volunteer basis, assures saving lives. The club has about 1500 members, whereas the main activity of the club to the benefit of the riders on two wheels is being carried out with the various authorities pursuant to the articles of the club.

In a dialog that was carried out with them as stakeholders the hazard arose in the event of sliding and losing control of the motorcycle and hitting the safety railing. For that purpose, the project to construct protective strips for protecting motorcycle riders was designated. At the beginning of the process, coordination was carried out with the bikers’ club while mapping the relevant locations prior to forming the guidelines and approval of the plan by the Ministry of Transportation. After obtaining approvals, in 2017, about 23 kilometers of protective strips for motorcycles were carried out and in 2018 about 22.5 kilometers of protective strips were carried out (a list is attached) in selected segments throughout the country. the total financial investment for this life saving activity is about 884 thousand NIS. accidents, severe accidents and light accidents as well, additional recommendations of the

police in events that occurred on roads of the south involving camels

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The main roads in which lifesaving railings were constructed during 2018

MetersRoad no.91690316899340727632885443048655144287

MetersRoad no.117913209855066761098952982775772total

Giro ItaliaThe Giro d’Italia is the second most important bicycle race in the world after the Tour de France. The Giro is taking place each year in Italy, the route of the Giro d’Italia varies each year, however it is mainly a circumferential route around and across Italy.

Sometimes the riders also pass in neighboring countries. The 2018 Giro d’Italia started in Jerusalem “as a symbol of friendship and peace” on May 4, 2018. In the entire 100 years of the Giro to date, the race never left the borders of Europe. The race started in Jerusalem and was held in Israel for three days, along 403 kilometers in various regions of the country. At the end of three days of racing the riders and the teams accompanying them left back to Italy to continue the race which ended in Rome.

As part of the importance of rider safety, Netivei Israel carried out several works along the route of the race that included layering, trimming, renewal of paint and cleaning. The roads through which the riders passed in the framework of the Giro d’Italia race in the north were: 2, 4, 70, 85, 652, 7012, 7013.

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Following the incidents in recent years an understanding is reinforced that the protection of the users of public transportation is an essential need. Guided by the Ministry of Transportation Netivei Israel acted in 2018 to protect bus stations for the purpose of safeguarding the lives of the users.

Number of stations Location 2Naala1Tapuah3Large Yakir2Yakir (small)2Emanuel1Karnei Shomron - Neve

Menahem2Karnei Shomron - industrial zone1Karnei Shomron - Pluga

34In total

Number of stations Location 3Susia crossroads2Asael3Adumim Village3Settlements Square2Magron2Beit Horon3Nili Square2Nili - Settlement

Protection of bus stations

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Preparations for stormy weather Stormy weather is an extreme event that may occur in cases such as fog, heavy rain, strong winds, icy roads, snow and flood. All these may impact driving conditions significantly and pose a hazard to road users.

Very year Netivei Israel prepares for the possibility of stormy weather in collaboration with all the relevant agents of the company as well as external agents in order to mitigate as much as possible the harm potential by prior preparation of the drainage systems for the winter season, notifying road users of weather incidents and providing a professional response during the event.

At the end of the winter season the maintenance division is carrying out a debriefing from last winter and commences intensive activity of preparing the road infrastructure for the next winter. Inter alia, a plan is formed to repair infrastructure, to provide solutions for weakness points that were discovered during the winter and to prepare the road infrastructure for the next winter by way of cleaning the ditches and the water conduits.

During the winter, the company prepares and deploys based upon current forecasts. Upon obtaining information of the possibility of stormy weather conditions a weather declaration document is produced which sets forth the readiness of the company for the event in question. Inter alia, the engineering division deploys posts of engineering tools at the weakness points. These tools will be dispatched as quickly as possible to handle any hazards that occurred as a result of stormy weather. All this in order to allow a safe journey on the road to all the users.

The weather reports that impact the traffic routes are managed in collaboration with a wide variety of agents such as: the Israel Police, the authorities, the meteorological service and so forth.

Each year, between October and March, the company appoints emergency deployment personnel from each division and holds a safety and preparation for the winter conference in collaboration with the maintenance division and the development division to which all the relevant position holders are invited.

The main activity at the conference focuses on:• Presentation of the interfaces with the internal and external agents of the company• Presentation of the weakness points that are known divided into regions and areas.• Presentation of the map of problematic locations along the main routes • Detailed reference to historical figures of snow amounts, tree problem, drainage ditches, floods and so forth.In addition, preparations take place for safety tours at a higher frequency, handling nuisances at the shortest possible time (bad visibility and rainy weather), transfer of updated telephone numbers of the project manager and those in charge on behalf of the supply chain to the call center of the company *2120.

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Cooperation with the Israel PoliceThe importance of cooperation with enforcement agents in the country is essential to save lives, the DG of the company and the head of the traffic wing of the Israel Police have tightened their cooperation during 2018 by way of continuous meetings that were headed by them, which include guidance to the professional agents in de-termining the orderly work processes between the organizations. During 2018 five status and preparations meetings were held.

The reinforcement of enforcement measures by way of observation means and varied activity to create deterrence were carried out in order to increase the safety of road users. In actual fact hundreds of thousands of shekels were invested in procuring and deploying the means in national deployment which includes a blue red device, a speed display device, warning signs, painting of enforcement posts, messages on electronic sign boards and so forth.

In addition, in 2018 the operation and maintenance division planned out of its budget a device / tripod for the operational enforcement cameras of the traffic wing, in-cluding the manufacturing and deployment of 61 tripods in the center region at a total cost of about 100 thousand shekels.

It was further decided to handle in a methodical and orderly fashion the organizational culture of both organizations, in issues of improvement of work processes on the Nativ system, simulations of traffic transfers and authority and hierarchy for approval and execution of actions and so forth, two work teams were appointed that constructed an assembly of issues to be handled, including the main understandings of both teams.

• Providing solutions for improvement of the road grid from the perspective of traffic and safety to be initiated and in full cooperation (bicycle riders, safety devices and accessories / safety railings).• Consulting with the Israel Police and its engineers in the matter of permanent and temporary traffic arrangements for maintenance projects.• Obtaining the terms and conditions of a permit for works on the road in conjunction with the works coordinators in the national traffic centers and the representatives of the region.• Works on the road (consulting and direction of traffic at work sites) in conjunction with the Israel Police.• Cooperation in the matter of stormy weather and solutions for maintaining traffic continuity.• An emergency command center• Transportation of loads, special operations of the police, special action to remove illegal signs, closing illegal entrances

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Designated and task-oriented projects In the framework of the policy of the Ministry of Transportation and Road Safety to decrease the number of road accidents in general and to decrease them in the in-tercity road grid in particular, the company prepared a comprehensive plan to locate risk centers on the intercity road grid, and to provide immediate solutions for the safety problems in these risk centers.

In 2015, 13 full projects were approved for execution and another about 60 projects, the purpose of which is to provide a response to the safety aspects on a local level, including the safety of pedestrians, with an allowance of 250 million NIS (out of which 50 million NIS from reserves of previous years).

In 2016, the company established a designated and task-oriented projects wing the purpose of which is to increase the safety level of the road grid under the responsi-bility of Netivei Israel, and to decrease as much as possible the number of injuries in road accidents. The wing handles three regulations pursuant to applicable law - left turns, crossing settlements and risk centers.

The company invests significant resources in promotion of handling of those regulations, the planned budget of the wing for life saving activity in 2018 was 334 million NIS, out of an understanding of the importance of saving lives, efficient, dedicated and uncompromising handling by the wing’s employees, supported on a systemic level by all the activity supporting divisions, the wing was able to carry out about 15 additional lifesaving projects, in an increase of 21% of the planned budget, that is to say during 2018 lifesaving projects were carried out in an amount of about 404 million NIS.

Road sections at high risk

In a joint committee of Netivei Israel, the Ministry of Transportation, the Israel Police and the National Road Safety Authority, a methodology was determined pursuant to which risk centers projects are selected. The methodology relates to the crossroads and road segments in which the safety level is lower than may be expected pursuant to the geometrical and traffic characteristics, that is to say sites with a prevalence of accidents that is “higher than usual” that comply with at least one of the following criteria:

Crossroads and road segments that are up to 1 kilometer long in which at least eight road accidents occurred in the last three years, and at least two road ac-cidents in the last year.

Road segments that are 2 kilometers long or more in which at least six road accidents in the average occurred per kilometer in the last three years, and at least two road accidents in the last year.

Crossroads and road segments in which the SUMPSI index is higher than 2 and at least two road accidents in the last year. The SUMPSI index weighs in road accidents, existing and expected traffic volumes, the severity of road accidents, and as a result weighs in the forecast of road accidents taking into consideration the road type (crossroads type, road type).

Projects that are required pursuant to a police report, or alternatively pursu-ant to a report of a safety supervisor, after a lethal road accident that occurred in the last three years. Projects that were selected pursuant to a report of the safety supervisor after a lethal road accident did not exceed 15 million NIS.

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Camels crossing The phenomenon of camels crossing roads in the south of the country is hazardous and known to all the road users and the organizations that engage in saving lives.


Left turns

There are crossroads that were constructed many years ago without auxiliary lanes. The main problem is the waiting lane for left turns. A project such as this comes to create a safe lane for waiting for a left turn until the vehicle coming in the opposite lane has passed and then the left turn will occur safely and in addition an integration lane for left turns when leaving the location.

In unregulated left turns there is a safety issue for the vehicle that is turning left.

During the past year the company approved the prioritization of the projects to construct a multiannual plan to handle left turns from the intercity grid

to settlements in the rural region. In this framework, the company inspected all the crossroads (about 1,100 crossroads) that are not regulated in the roads under its responsibility. In each compound engineering solutions are being investigated for left turns in crossroads, while taking cross impact into consideration. The plan budget for 2017-2021 is about 600 million NIS

Crossing settlements

The purpose of the regulation is the regulation of roads that cross settlements of mi-norities by way of improvements in traffic and infrastructure in application of the policy of the government to provide economic development to the minorities sector.

Out of a common purpose to save the lives of road users, Netivei Israel is acting in continued, continuous and close cooperation with the Israel Police, in this framework mapping was carried out of locations on the roads of the State of Israel under the responsibility of the company where accidents involving camels occurred. The maintenance division determined immediately an outline to forming a work plan to mitigate the phenomenon. In 2018, tours were made by traffic engineers in which the affecting parameters were investigated: The width of the road shoulder, the line of sight, the state of lighting, escape zones, the existence of natural obstructions (ledges or steep slopes) and the proximity to settlements / habitats.

The handling plan was determined pursuant to a priority order, the severity of the road accidents: Lethal road accidents, severe accidents and light accidents as well, additional recommendations of the police in events that occurred on roads of the south involving camels

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The airport construction administrationIn 2014 the government of the State of Israel decided to construct a new international airport, supplementary to Ben Gurion Airport, by way of a private contractor. Underlying this decision was the future capacity analysis of Ben Gurion Airport, which will reach full capacity already in 2025, as well as the fact that the air space and the scope of environmental nuisance created by Ben Gurion Airport will reach a level of exhaustion of what is possible within a few years. The new airport is intended to provide a response to about 4 million passengers already during the first stage and to gradually expand to a scope of about 20 million passengers in 2045. The project will be realized using the PPP method (construction and operation by way of a private contractor), in order to allow competition in the field of aviation services in Israel. With the long term in view, pursuant to the forecasts prepared for 2050 by the Ministry of Transportation, another supplementary airport to Ben Gurion Airport will be required.

In 2017 the government of the State of Israel appointed Netivei Israel to be the agent in charge of leading the preparations of two independent outline plans (one at Ramat David in the North and the other at Nevatim in the South). In view of this appointment, a designated administration was established in Netivei Israel for the realization of this project. The airport construction administration has the comprehensive responsibility for all the aspects of the project, commencing from the submis-sion of statutory plans to the approval of the national council, through the determination of an optimal operation model and the planning of the airport using the PPP engagement method and up to the management of construction and operation of the

first supplementary airport, all using the PPP method. All this, in close interdepartmental coordination and with maintaining controls until it is completed.

The new airport is planned to be for dual use, combining civil aviation activity as well as military aviation activity. For this reason, coordination and proper planning is required in the aspects of ground infrastructure designated to be jointly used in part, the regulation of the air traffic control mechanisms and the air space control and aspects of joint operation and security.

This is a first rate managerial, engineering, economic and infrastructure challenge.

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Major stakeholders:Governmental ministries: The Ministry of Transportation and Safety on Roads, The Ministry of Finance, The Ministry of Enviromental Protection, The Mnistry of Defence.Civil Aviation Authority: A regulatory body of civil aviation and airportsNational council: Preparing two national outline schemes for two airports (at Ramat David and at Nevatim)Local authorities: Municipalities, local councils, regional councilsAir Force: Preparing a plan for the operation of a dual, civil and military, airportCitizens: Involving the public in the process of preparing the national outline plans

Trends and impacting agentsThe capacity limits of Ben Gurion Airport: construction of the first supplementary airport to Ben Gurion Airport within the upcoming decadeA transportation challenge: Making the airport accessible by way of improvement and adjustment of infrastructure and public transportationAir space: an optimal response to civil aviation in conjunction with the needs of the Air Force and the IDFEnvironmental protection: Highlighting a sensitive issue from the public perspective that constitutes an integral part of the statutory processBuilding of new expertise: creating new knowledge and collecting information in constructing airports in conjunction with the private sector

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4444444444444444444444444444444444444444444

• Characterization of the information systems and the interfaces of the project - systems for the management of the project were defined, management of timetables and management of risks from the commencement of the project until its completion for the use of all its partners.

• Promotion of statutory plans for the two sites - an analysis of the current state including the investigation of urban building schemes and approved building permits in the areas of interest around the sites, a plan for carrying out an environmental impact survey pursuant to the instructions of the Ministry for En-vironmental Protection was prepared.

• Coordination with the Ministry of Defense and the Air Force - a statutory coordination and allocation of responsibility was carried out between the teams of Netivei Israel and the Air Force in order to determine the re-deployment plan of the Air Force, analysis was carried out of the air space in the two sites and the implication for the Air Force were presented, coordination was carried out to deploy an air monitoring station in the perimeter of the two Air Force bases.

• Preparing a tender for an international consulting team - a tender for the international consulting team the duty of which is to prepare an economic opera-tional model of the airport, to ensure that the statutory plan provides a full and comprehensive response to the needs of the airport, to prepare the tender for

the concessionaire using the PPP method, to manage the tender process and to provide advice to the concessionaire during the construction stage and the oper-ation in the first two years, all under guidance of the administration.

• Summary of insights and lessons from PPP projects - the personnel of the administration participated in a financing course for a PPP project of the Ministry of Finance as well as in a seminar of the construction wing of the Ministry of Defense on the subject of lessons learned from PPP projects in the IDF. In addition, materials from abroad on the subject of construction of airports using the PPP method were obtained using an information science company.

• Pooling and preservation of aviation know-how - a designated database was established for aviation information and know-how for the management of the project, the administration personnel participated in seminars and professional tours on aviation (the Civil Aviation Authority, the Israeli Pilots Association, the Israeli Airports Authority). Use was made of an information science company in order to carry out a deeper investigation of the relevant engagement fields such as trends in the aviation world, the impact of construction of the airport on the regional economic development and customary indices in the operation of airports

The main activities that were carried out in 2018:

4545454

• Management of the process of selecting the winner in the international consulting team tender - the tender has two stages. In the first stage the bidders will be required to present the consulting team that will consult to the project. The bidders that will pass the minimum grade during the first stage will pass to the second stage of preparing the operational economic model. A bidder that submitted the model that was awarded the highest score, weighing in the interview with such bidder by the tenders committee, will be declared the winner in the tender. This is a process that will take about a year.

• Promotion of readiness of the two statutory plans for deposit in 2020 - in order to be able to comply with the timetable for deposit of the statutory plans by the end of 2020, the administration is required during 2019 to approve the selected alternative of providing the airports, including all the components, at the national council for the two sites. Concurrently, the administration is committed to promote the environmental impact survey that forms part of the statutory planning of the airports. The entire process mentioned above must be coordinated with the Air Force and the defense system.

• Preparing a letter of understanding with the defense system for cohabita-tion - the supplementary airport to Ben Gurion Airport is intended to be a dual use airport that will be used for civil aviation as well as military aviation. For that purpose, an agreement is necessary with the defense system in the form of a let-ter of understanding that will define the allocation of space and responsibility of each of the acting agents in the dual use airport, while defining the mechanisms of activity on the ground as well as in the air space, from the aspects of security and safety, on issues of operation and maintenance, all during routine as well as in emergency.

• Further expansion and improvement of the professional know-how and cultivation of human resources of the administration in the field of aviation and PPP - in order to reinforce the know-how of the personnel of the administration in the aviation filed and in PPP, activity is planned to participate in professional conferences, to locate publications in the above mentioned fields, to analyze them and assimilate them in the ongoing management of the project, including bringing external professional lecturers to reinforce the know-how and information of the administration personnel.

• Regulation of a transportation accessibility array to the airport and update of the five-year plan accordingly - the administration will carry out mapping of the required transportation condition for the target year of opening the airport pursuant to the approved five-year plans. Concurrently the administration will act in coordination with the engineering division to determine principles for a complementary transportation plan for the airport including carrying out simulations in order to obtain the best response for the visitors of the airport.

Major challenges for 2019:


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260 kilometers of public transportationProper public transportation serves a variety of purposes: Public transportation is considered a tool to reduce congestion and air and environmental pollution, in particular in urban areas. Among the sustainable development goals of the UN the expansion of public transportation services in cities is mentioned, in order to promote accessibility to employment and creating sustainable cities and communities, these goals note indices pertaining to public transportation such as: the rate of people that have convenient access to public transportation divided according to gender, age and disabilities, the rate of those residing in the vicinity of public transportation operating in a high frequency, the rate of bifurcation, these 17 indices are supposed to serve as an international standard and allow follow up on the progress towards achieving the sustainable development goals in Israel as well as a more convenient comparison between the progress in Israel and the progress in other countries.

The public transportation lanes are intended to encourage the use of public transportation by providing it with priority on private vehicles. Most of the public transportation lanes in the State of Israel are intended for private vehicles with high capacity as well (mostly with four or more passengers), some of which are used as such throughout the day and night, some of them for most of the hours of the day and night, the delineation of the hours of activity to a narrower range is problematic because the public transportation lanes are intended to provide an advantage to public transportation during traffic congestion and as a general rule traffic congestion is difficult to forecast and does not occur on fixed times. A wide variety of events which attract the public, suspicious objects and any other unusual activity may create traffic congestion during hours to which road users are no accustomed.

The Ministry of Transportation through Netivei Israel and Netivei Ayalon invest much effort in finding solutions of mass transit. Until 2022 about 420 kilometers of public transportation roads are expected to be constructed in Israel with an investment of about 10 billion NIS.

About 260 kilometers of the intercity public transportation roads are under the responsibility of Netivei Israel and another 160 kilometers are under the responsibility of Netivei Ayalon, that established the “Quickly to the City” administration for construction of public transportation lanes in the urban area, that are spread across 17 municipal authorities

maintenance division determined immediately an outline to forming a work plan to mitigate the phenomenon. In 2018, tours were made by traffic engineers in which the affecting parameters were investigated: The width of the road shoulder, the line of sight, the state of lighting, escape zones, the existence of natural obstructions (ledges or steep slopes) and the proximity to settlements / habitats.

The handling plan was determined pursuant to a priority order, the severity of the road accidents: Lethal road accidents, severe accidents and light accidents as well, additional recommendations of the police in events that occurred on roads of the south involving camels

Here is the list of projects under the responsibility of Netivei Israel

Road 5: Morasha interchange

Road 5: Shomron - Kessem terminal

Road 40: Adanim - Ganim

Road 44 and Beit Dagan interchange

Road 57 to the east: Kfar Yona - Natanya

Road 4: Hadarim - Geha north segment

Road 4: Hadarim - Geha center segment

Road 4: Hadarim - Geha south segment

Road 4: Geha - Bar Ilan

Road 4: Pardesia - Hadarim

Rosh Haain south interchange

Road 2 to the south: Hasira - Kfar Shmaryahu

Road 44: Beit Dagan - Nir Zvi

Road 4: Ra’anana north - Hadarim

Road 60 Hativat Hanegev - Omer industrial zone

Road 60 Natav Omer - Kiryat Modiin / Um Batin Shoket

Road 471 Bar Ilan interchange

Road 461: Hatayassim - Messubim road

Road 444: Migdal Afek - Rosh Haain

Road 2 to the north: Shmaryahu-Shfaim

Road 4: Bar Ilan-Ganot

Road 4: Ganot-Ashdod

Offinder bridge - Bar Ilan

Road 5: Hakfar Hayarok interchange

Road 40: Shaaria - Hatayassim

Road 40: Bilu - Ekron - Hasan

Road 40: Ganim - Shaaria

Road 40: Lod - Ramla; Road 44

Hashiva interchange - Holon crossroads

Road 471: Bar Ilan - Nahshonim

Road 5 to the east: Kessem - Morasha

Road 5 east: Morasha - Gelilot

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Congestion basket The “congestion basket” is a new regulation that was approved by the Ministry of Transportation in 2016 the purpose of which is to mitigate traffic congestion at a minimal cost. The Ministry of Transportation approved to Netivei Israel in the five year plan a budget of 250 million NIS, up to 50 million NIS for each year. The essence of the project is finding creative solutions that can be realized quickly for problems of traffic congestion in national deployment, with minimal costs and with planning time that would be as short as possible.

The project is an important move that is expected to bring about significant improvement for the economy in a number of aspects:

• The safety aspect - a reduction of the number of road accidents in the treated segment.

• The economic aspect - a reduction of “lost hours to the economy”.

• The environmental aspect - a reduction of quantities and concentrations of toxic gas emissions from vehicles.

• The awareness aspect - a reduction of the duration of time of standing in congested traffic will bring about a decrease in the level of aggravation of the drivers and an increase in the quality of life.

In 2018, the administration commenced forming methodologies as to the nature of the activity and writing procedures with all the agents and partners. In addition, the administration carried out mapping of all the promoted projects in the regions, and promoted an initial investigation of additional projects that were received from the Ministry of Transportation.

The annual work plan for 2019 is comprised of 16 projects in national deployment, and currently a national mapping work is expected to be received to the benefit of initial investigation of further projects.

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Our commitment to environmental protection

Landscape rehabilitation and safeguarding the biological diversity

Biological diversity is plenty and wealth of species and the ecological systems in our world and the interaction between them which constitutes the “operating system” of the entire universe. We are highly dependent upon the biological diversity for our existence, and because the biological diversity is constantly deteriorating our existence is in jeopardy, as a result of our actions and in particular as a result of the accelerated development that impairs the good order of the ecological systems from which we benefit, in particular as a source of food and medicine.

There is research in the world that claims that almost half of all medicine used by man in the Western world came, until not long ago, from natural resources. Almost all the food for people, the source of which is the flora and fauna world, is based up-on wild species that existed in nature. With the sharp increase in the population of the world in the last decades the demand for food increases. The more the biodiversity is increased, the greater the potential to develop new strains of food and to be assisted by the wild strains in order to overcome the diseases of agricultural crops. This field is becoming more central in the balance of risks and opportunities of busi-ness companies and requires management of the business activity in the context of biological diversity as an integral part of the risk management of the company.

In the framework of the project under the responsibility of Netivei Israel, surveys are being carried out as to the assessment of the damage to the environment and to the biological diversity, as part of the landscape analysis with the Israel Nature and Parks Authority and the Ministry for Environmental Protection consultation with ecologists is being carried out as to the best way to preserve the biological diversity.

Extensive actions are planned in the development projects to rehabilitate the landscape, which include ecological bridges in order to prevent and mitigate unnecessary landscape damage and is manifested in the technical chapter and in the environmental impact survey.

The boundaries of the quarrying and backfill are meticulously marked to prevent deviations during execution. The rehabilitation works are being carried out using various means such as removal of top soil that is fertile and covering the road slopes with this soil, constructing retaining walls and rock gardens to mitigate overspill of backfill, sowing and planting works of trees, shrubs and cover plants are being carried out during the construction works and immediately thereafter.

Maintaining the biological diversity includes actions such as: Maintaining connectivity and preventing segmentation of the ecological corridors (by constructing passageways for animals), preventing and handling invading vegetation,

preservation of the top soil and preventing soil erosion, preservation of habitats and protected natural values, preservation of plants, such as: Trees, shrubs and geophytes

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Light pollution - maintaining darkness by using environmentally friendly lighting The management of the interface between the business activity and the ecological systems is considered an integral part of the management of sustainability and corporate responsibility in organizations. In view of this, there is a prominent need to develop designated and practical tools to assimilate ecological considerations in the activity of Netivei Israel as part of the management of sustainability.

Light pollution is light that is not required in terms of safety, security and operation. This light leaks towards the open spaces and changes the natural lighting regimes that existed for millions of years. As a result, light pollution causes disruptions in the functioning of the ecological systems, harming the animals, impairing the night sky experience and harming human health.

Road lighting is a main and important component accompanying the development of roadway infrastructure. Nevertheless, use of road lighting that is not well thought out increases the ecological light pollution and its impact.

Netivei Israel understands the importance of the matter and therefore the company submitted its candidacy and won the “call for innovation in the assimilation of biological diversity considerations in companies” of the Ministry for Environmental Protection and of the Society for the Protection of Nature in Israel. The project engages in the characterization and assimilation of procedures to mitigate light pollution from roadway lighting that are under the responsibility of the company, while providing priority to security considerations and safety needs of road users. The maintenance and operation division and the engineering and development division are partners in the project and it is being advised by the Society for the Protection of Nature in Israel, the Israel Nature and Parks Authority and the Ministry for

Environmental Protection. These days the project is about to be successfully completed and will include the following products:

• A document that is agreed upon between all the bodies, which characterizes the solutions required to mitigate light pollution during construction of light-ing in areas that are ecologically sensitive.

• A dynamic digital interface that is available to the planning team as well as the employees of the company. Which constitutes a tool to inspect the ecologically sensitive areas for this field.

• Development of a training array to assimilate the procedures in the field of mitigation of light pollution among the employees of the company and its contractors.

• A summary report presents all the components in which the project engages.

The implementation of the project will position Netivei Israel as an innovative com-pany that leads the field and will show its commitment to compliance with two of the sustainable development goals of the UN (SDG) because the project will lead to streamlining in the use of energy and to a decrease in the carbon footprint of the company, concurrently with safeguarding the biological diversity on land.


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Road 77 - the first green road in Israel Sustainable construction (green construction) is intended to mitigate the negative impact of the construction process on the environment. Global standards constitute the basis for evaluation, and contain criteria pursuant to which the level of environmental impact of any asset may be rated. These global standards are based upon a method of credit points by virtue of compliance with threshold requirements in various fields: energy, soil, water, materials, health and welfare, waste, transportation, management and innovation.

Constructing infrastructure is a complex field and green infrastructure includes aspects of sustainable development and corporate responsibility in particular, because the subject in its entirety needs to be observed from a wider perspective which includes the use of recycled materials, road construction method, accessibility to public transportation, bicycle routes, investigation of the impact on settlements in the area, employment of local contractors, empowerment of archaeological sites and points of interest by way of direction and accessibility, drainage systems that allow percolation of water to the aquifer, gardening and watering with recycled water and so forth.

In conjunction with Solel Bone from Shikun Ubinui Group the company is promoting a move with the American organization Green Roads in order to comply with their rating system for the road 77 project, which is under its responsibility.

During June 2018 Mrs. Jeralee Anderson, the CEO of Green Roads, came for a visit to teach and assimilate the requirements of the standard. In the framework of this visit tours were carried out to roads 77, 65-85, meetings with the planners team of the project were held, a meeting was held with the representatives of the 15th forum.

A forum was established that includes representatives of the development and engineering division and the head of corporate responsibility in Netivei Israel, the project manager and the consulting team from Solel Bone of the Shikun Ubinui Group.

This forum consults to the project in order to act to assimilate the standard in Israel. The ultimate purpose is to initiate a material change in the manner that infrastructure projects in Israel are planned and managed, include the subject on the agenda and provide means and standards for planning, evaluation, development and construction of sustainable infrastructure in Israel. The goal for 2019 is to map the planning requirements of Netivei Israel to the rating system of Green Roads.

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Mitigation and prevention of environmental hazardsSoil contamination may be created both during execution as well as during operation of the road by fuels and oils originating from vehicles and work equipment, from wear of tires and from road runoff that contain hazardous materials that might, under certain circumstances, pollute the soil or bodies of water above and below ground. Sometimes development works are being carried out in areas that were polluted in the past by various agents (such as military installations, landfill sites that are not regulated, industrial plants). In the framework of the environmental impact surveys, hydrogeological surveys are being carried out in order to diagnose and characterize the sensitivity of the area to soil and ground water contamination and the expected impact of the road on the area.

Right of way to the animals

The road lanes and the safety railing constitute an ecological barrier for the passage of animals and prevent the interaction between animal populations on both sides of the road. This may have an impact on the entire ecosystem. Animals that attempt to cross the bustling road are injured and run over by the passing cars and sometimes even cause road accidents. Netivei Israel is acting, in conjunction with the Israel Nature and Parks

Authority, to ensure safe passage of animals between both sides of the road. The road planning includes construction of designated or integrated passageways based upon the ecological planning and surveys. In this framework Netivei Israel is acting and investing considerable resources in finding solutions that will be used by the animals in the best way while highlighting the safety of road users.

Energy consumption Streamlining the use of energy is defined as well thought out use of the energy resources, that is to say production of products and economic benefits and maintaining the modern quality of life, while using less energy. In recent years there is a growing demand for energy, inter alia due to the increase in the population, the increase in the quality of life and the economic growth. The increasing use of energy requires investing financial resources and exploiting land resources that are scarce, and even leads to air pollution.

Many countries in the world promote processes that include energy savings and it became in recent years a subject of national importance, which brings about a decrease in dependency on import of oil products, to more efficient exploitation of financial resources and land resources and to mitigation of air pollution. The challenges of Netivei Israel in the field of energy are:

to investigate the ways to improve its energetic streamlining

to explore ways to improve the lighting of roads under its responsibility while using renewable energy sources

to make a transition to friendly lighting which impacts also the biological diversity under its responsibility

to find solutions in Israel and worldwide that are efficient and cost effective that will bring about energetic streamlining in the planning and execution of projects under its responsibility, concurrently with safeguarding the biological diversity on land

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9,552 9,291

331,587 348,691

2017 2018

8153

2016

27,720454,285

5175

2017

9,991468,012

1192

2018

2,772529,936Gasoline consumption by liter Diesel oil consumption by liter Diesel oil consumption by liter Diesel oil consumption by literGasoline consumption by liter Gasoline consumption by liter

Netivei Israel energy consumptionNetivei Israel has an internal expert in charge of energy consumption is significant in its operation. The Company consumes energy in a scope of an oil equivalent of about 32,975 ton per year. In the year 2016, the Company conducted a survey to find a potential for energy conservation and savings, through an outside company specializing in the field in Israel as is required in the Energy Sources Regulations 1993, once every five years.

Fuel consumption

Quantity of gasoline engine vehicles



Quantity of diesel engine vehicles



Quantity m3 Quantity m3

Water consumption m3

Water consumption m3

Water consumption in by the Maintenance Division

Payment in practice

Payment including VAT

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GJ

GJ

Power consumption in company buildings

Total electricity consumption of the organization

Kw/h

Kw/h

South Judea and Samaria Center North

South Judea and Samaria Center North

ArielBeit Lid Sub-DistrictJudea and Samaria AreaCentral spaceSouthern RegionNorthern spaceCompany headquarters

ArielBeit Lid Sub-DistrictJudea and Samaria AreaCentral spaceSouthern RegionNorthern spaceCompany headquarters

500,000

100,000

50,000

10,000

5000

2016

2016 2016 2016 2016

50,000,000 333,5166,,602

120,66659

661,77221

140,00051 141,22208

177,1444,,794

388,9033,,277 399,2244,,50432,714,411

119,435

65,179

139,356 141,638

19,060,912

38,347,531 39,207,63632,241,925

116,070

65,165

132,742 136,333

18,101,50636,872,950 37,870,281

10,000,000

5,000,000

1,000,0002016 2016 20162017

2017 2017 2017 2017

2017 2017 20172018

5,000,000

1,000,000

500,000

100,000

50,000

10,000

5000

1000

1,205,755

826,317

1,067,540

112,032

97,136

85,662

50,085

42,999

46,852

55,818

53,252

58,347

26,272

25,173

27,014

26,013

7,912

7,985

7,307 6,670

7,358

2016 2017 2018 2016 2017 2018 2016 2017 2018 2016 2017 2018 2016 2017 2018 2016 2017 2018 2016 2017 2018

5000

1000

500

100

50

102016

4,340.72

2,974.74

3,843.14

403.32

349.69

308.38

180.31

154.80

168.67

200.94

191.71

210.05

94.58

28.48

28.75 93.65

28.48

28.75

26.31

24.01

26.49

2016 2016 2016 2016 2016 20162017 2017 2017 2017 2017 2017 20172018 2018 2018 2018 2018 2018 2018

2018 2018 2018 2018

2018 2018 2018

5555

In a management company, the main activity of which is being carried out by way of outsourcing, clearly the engagements proceedings in the contracts and engagements division form a considerable part of the supply chain of the company, that must be responsible, professional and reliable. Therefore, all the processes of the engagements with the suppliers of the company (contractors / experts) including the publication of the database and ongoing update of such database, submitting applications for engagement, inspection of the application, its approval, tender committees, creating an engagement agreement and its ongoing management all constitute central and important processes that lie in the heart of activity of the division.

It is noteworthy that Netivei Israel carries out most of its core procurement in the local market. One of the main challenges in deepening and expanding the activity and the impact of corporate responsibility in the organization is the creation of a responsible supply chain, that fulfils the principles of corporate responsibility and sus-tainability.

In 2018 the division focused on inspection of the processes and in taking measures of streamlining in order to improve the service that the division provides to its clients and to make the timetables shorter in all the processes in the division, all this alongside the ongoing handling of about 300 competitive processes, about 600 obligations processes, about 1000 new appointments, about 3300 salary analyses for the planners and the project managers and handling about 26,000 bills.

Successful cooperation with the supply chain


Streamlining processesIn 2018, the contracts and engagements division focused its effort on improving the processes and streamlining the activity.

One of the main processes of streamlining that were carried out in 2018 was the internal service charter:

as an integral part of the streamlining processes in the division, it was decided to establish a service charter the subject of which is the establishment of standard time periods that will be binding upon the employees and executives of the division for all engagement processes. Inter alia the service charter is intended to regulate the expectations with the various divisions of the company (that are the main clients of the division). The service charter is based upon mapping of all the engagement processes in the division that were analyzed based upon the milestones of each process. The standard times were defined based upon research of the processes, a discourse of coordinating expectations with the professional agents and comparison with the execution times in fact in the past.

Concurrently with the completion of the mapping of processes and establishment of the service charter, extensive activity will be carried out to mechanize the service charter so that it reflects the total time of each process and the times of each agent in the process itself. The standard times were mapped and defined for a significant part of the main processes that the contracts and engagements division is entrusted with. The division is already measured for compliance with the standard times in the service charter commencing from the second half of 2018.

• In the test of the actual result, the service charter proved itself inter alia: in assimilation of the standard times in the contracts and engagements division that are inter alia: With the clients of the division - there is a coordination of expectations that allows correct preparations and planning.

• With the employees of the division - focusing the employees and incentivizing with clear and defined goals.

• With the view of the entire system - reflection of the processes from end to end, identification of barriers and bottlenecks and creating lateral learning processes based upon all the above.

The service charter model together with the streamlining of processes in the division brought about a significant decrease in the scope of engagements of the division and a reduction in handling times in all the processes.

Nevertheless, lessons and insights from the work year 2018 are that the planning resilience in the field of engagements must be continued and improved. Investment is required in the planning of engagements in conjunction with the engineering and development division at the annual planning stage, and cooperation in the “planning axis” significantly contributes to the improvement of the planning and execution processes and a wide response is required in the development of information systems for the purpose of seeing the whole and for process continuity.

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57575

Paperless processesCommencing from 2017, the contracts and engagements division characterized and led computerized developments that are intended to allow computerized submission of all the applications for appointment of suppliers from the databases of the company and retrieval of suppliers in a computerized manner. In view of these developments, most of the applications for appointment of suppliers from the databases of the company are being submitted using the paperless system. The submission of the applications using the system allows submission and inspection of applications from anywhere, in a computerized and uniform manner without unnecessary printing.

The system allows the users full control over existing applications in the system, shifting applications from one station to the other, ongoing updates in the matter of the application status and the ability to generate follow up and control reports that analyze trends and times.

In addition, the appointment of suppliers in the fields of planning, project management, surveying, appraisal and other planning consultants, for works with a fee scope that does not exceed 1.5 million NIS, is being carried out by way of automatic retrieval that the automation system is carrying out without human involvement and pursuant to the computerized loads report that is based upon the works that were assigned to each supplier, while disregarding other considerations that are irrele-vant to the appointment.

Using the automation system ensures a fair cycle in the assignment of works between the registered suppliers of each database. The combination between the automation system for selection of suppliers and the computerized system that is used to submit the applications allows the company an appointment process that is free of human involvement, that is being carried out in a uniform and controlled manner, so that an application that was submitted is being inspected prior

to its submission to the committee, the supplier and the minutes are produced by the computerized system after the application was inspected in terms of legal compliance and in terms of communication and was found appropriate, and the committee members are required to approve the appointment and sign the minutes remotely without convening.

The integration between the systems brought about a uniform process of submission and appointment, a huge saving in resources, significant reduction in the waiting times for appointments, transparency in the processes of appointment of suppliers and a fair distribution of the works based upon distributive justice.

Another paperless project that was regulated during 2018 was in the field of billing: the “digital invoice”. Planners and project managers are submitting bills digitally and attach all the requisite documents by way of the computerized system and not manually. The entire process is being managed without having to transfer any paper. Computerization the entire process of digital billing was intended to streamline the work processes and obviously to maintain the high payment ethics of the company. In 2019 the system is planned to be expanded also to the field of contractors.

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Suppliers database Another significant change that was carried out in the division during 2018 was in the field of databases. In the field of databases, the company changed the way that it operates and full regulation of this contents world was carried out. Inter alia an orderly policy was determined as to the manner of registration to the database and not less importantly the manner of its ongoing maintenance.

Each database is opened for an update and maintenance once a year. During 2018, 27 databases were published and updated in Netivei Israel pursuant to the annual work plan. In the framework of the activity, all the threshold requirements for the databases were inspected including modification / update, publication of the data-bases to the general public, receiving proposals and inspecting compliance with the threshold requirements of the suppliers that submitted their candidacy, at the end of the process establishment of new suppliers / update of existing suppliers. In addition, the suppliers in these databases were and are validated each time the database is opened for update (hundreds). In addition, 10 new framework databases in various fields were established, and published in the framework of public tenders. A methodology was constructed, new of its kind in the company, to balance loads on the databases that were updated.

During 2018, a computerized system for the management of the databases of the company was also developed and went live. The system allows transparency, direct contact with the suppliers, carrying out updates pertaining to them directly on the system, and above all submitting candidacy pursuant to the threshold requirements online for the first time in the company. In the framework of the activity of the sup-pliers databases about 400 suppliers of various kinds were established in the compa-ny; about 350 catalog items were established that were added to the services catalog of the company - which constitutes the database that underlies the contracts and engagements in the company; Management and handling of ISO standards in the databases and in framework tenders was carried out for about 200 suppliers across about 50 records; A suspension / resume / detraction of about 150 suppliers was car-ried out for various reasons.

The dialog with the stakeholders, operation team with contractors

The organization and systems wing, together with the engineering and development division, the operation and maintenance division and the contracts and engagements division acted to lead a discourse with the execution contractors of the company. With the purpose to improve work interfaces, improve communications channels, reducing the managerial time dedicated to the management of conflicts and reducing bureaucracy and streamlining work processes three teams were formed:

• A team to inspect guarantees and insurances • A team to inspect the process of completion of execution and completion cer-tificates • A team to inspect threshold requirements and contractor billing

Several discussions were held by each of the teams including the relevant represent-atives of Netivei Israel and contractors the work for the company in various types of projects (development, DB and designated). In the framework of these discussions bottlenecks were identified and as a result lessons were learned both of the work process level as well as on the commercial level. As a result, the process of delivery of a project from the engineering and development division and the operation and maintenance division was regulated, including the handling of completion certifi-cates to the contractor and the work processes were adjusted accordingly. In addition, the contracts and engagements division regulated the matter of guarantees and insurances for contractors in a manner that will simplify the work processes and will make it easier for the contractors in terms of cash flow.

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Procurement and logisticsThe procurement and logistics wing is responsible for forming and management of the logistics strategy (in routine and in a state of emergency) pursuant to the resolution of the company. The activity of the wing is comprised of several main fields: Organizational procurement, management and operation of the maintenance of the structures of the company (headquarters, regions and areas), readiness for emergency response, management of the vehicles fleet and the transportation services, operation of the communications systems, wired as well as mobile (cellular), supply of meals for employees and amenities, management and execution of construction and refurbishment projects, warehouse services and supply of equipment (office equipment, professional accessories and so forth).

Major projects carried out by the wing relate inter alia to: creating a quality, advanced, work environment for the employees of the company, carrying out organizational procurement adjusted to the needs of the various divisions, including reference to “green” procurement (consumables procurement, recycled procurement and so forth). As part of the work of the headquarters of the company that was carried out this year it was agreed to establish a fleet of vehicles that is based upon hy-brid models that include technological safety aspects.

In addition to the logistical activity that is derived from the work plans, the wing specializes in holding events and carries out ceremonies and external events, thus, for example, in 2018 over 10 ceremonies were constructed towards the opening of selected projects - 531, 1, 562, 38, 31 and more. The wing is proud of being relevant and every year creates added value with emphasis on creating an advanced work environment.

Communication as to opening roads that was carried out in 2018

• January 2018 - opening road 55 bypassing Nabi Elias• July 2018 - the launch ceremony of Hasharon railroad• August 2018 - the launch ceremony of the connection of road 531 to road 20 south• October 2018 - opening for traffic of road 562• December 2018 - opening ceremony of the Adam grade separators• December 2018 - the opening ceremony of the new road 531 that connects road 2 to the south of road 20 south

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Netivei Israel is acting to nurture a supportive work environment and team organizational culture, out of a commitment to safeguard human dignity and equal opportunities at all times and everywhere, and to bring about improvement in the lives of the employees that will empower them and contribute to their success.

The company believes that the employees are the main and principle resource that it has, and therefore attributes much importance to their development and to retaining them by way of creating a workplace that is inclusive, by investing in personal as well as professional development, in health and quality of life, and in assuring the existence of a lively, open and caring dialog. The company aspires to implement an organizational culture that creates a sense of identification among the employees with the values of the organization including mutual respect and fairness, responsible and sustainable management of the business, and action that is above all level of expectation to bring about the best results to all the stakeholders. The number of employees with Netivei Israel in 2018 is 425.

The number of employees that were personally evaluated and/or received built-in feedback as part of a conversation or a personal meeting as to their performance during the passing year is 425, that is to say 100% of the employees. The wages of the employees of the company is determined based upon the policy of the Governmental Companies Authority according to the position and regardless of gender.

During 2018, the welfare budget increased and was set at 2,200,000 NIS, the welfare budget was used according to the decisions of the welfare team headed by VP resources and administration with the participation of the chair of the employees committee and the head of the human resources wing. A survey as to the positions of the employees was carried out in order to determine the order of priority in the matter of distribution of the welfare budget. The survey was another index for the decision of the welfare team, alongside other considerations.

In the framework of the welfare activity events took place such as the Purim event for the employees of the company and their families, a women’s day event for the women in the company, a social evening for employees and an annual seminar at Eilat. Nevertheless, the pension market in Israel is one of the most complex and changes constantly by way of changes in law and regulation. In view of the changes in applicable law the company created in 2018 an engagement with an expert advisor on pension that gave a lecture on the subject to the employees of the company. ‘Netivei Israel’ is obligated to obey all the provisions of the labor laws, wherever it operates.

Our commitment to the employees

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Creating a healthy and safe work environmentA healthy, safe and hazard and safety hazard free work environment is part of the policy of Netivei Israel. Therefore, the framework of the activity of the safety array and of the position holders in it was defined in advance at the offices structure of the company.

IIn the framework of the safety management of the plant, a safety committee was established. The committee meets on eight occasions during the year and its members are six representatives of the employees that were appointed by the employees committee and six representatives of the management of the company that were appointed by the DG of the company. The safety supervisor participates at the meetings of the committee and serves as an advisor to it. The committee convened in 2016 eight times. The structure of the committee, the appointment of its members, the dates of its meetings and the principles guiding its work are pursuant to the Supervision Organization Law Regulations (safety committees and safety trustees). The frequency of training for the employees varies between one position holder and another, as the case may be, whereas the safety training for all the employees takes place once a year. Other than that, the company was certified under Israeli Standard 9301 - safety in transportation. First and foremost, we are talking about human lives and the concern for the safety of the employees of the company while driving a vehicle. In addition, the implementation

of the requirements of the standard reduces malfunc-tions and accidents, that require handling damage to the vehicles and even contributes to substantial financial savings and to streamlining of the ongoing operation of the vehicles array and to the quality of operation of the company.

In 2018, periodic inspections / survey testing were carried out to the employees of the company with a section according to age for employees with tenure of two years in the company. The company entered into an engagement with a medical survey clinic at the Sheba medical center, which operates as advanced array of periodic tests. The entitled employees were offered, whereas the testing day counted as a paid work day. In the framework of encouragement of sports activity, the employees were provided with a gym with a trainer that operates as the headquarters of the company Sunday through Thursday in the morning and in the afternoon. The goal for 2018 is to open a number of sports team according the choice of the employees at Netivei Israel.

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Promotion of employees in the company in an annual segmentation

menwomen2016 189190 50% 50%

men

men

women

women

2017

2018

202

212

204

213

50%50%

50%50%

menwomen2014 189179 49% 51%

menwomen2013 186162 47% 53%

187men

187women 50% 50%2015

Annual segmentation of employees according to gender in figures and in points

2013

84%(292)

16%(56)

(305)

2014

85%

15%(53)

2015

86%(321)

14%(53)

2016

84%(318)

16%(61)

2017

79%(319)

21%(87)

2018

78%(331)

22%(94)

Reinforcement of team workTIn the dynamic world in which we live high skills as well as know-how and qualifications are required. When the tasks are complex such as initiation, management and maintenance of road infrastructure team work is essential. The management of the company understands that many variables, personal as well as external, have an impact on the level of effectiveness of team work and the ability of a team to achieve its goals. Different tasks require different levels of cooperation and interdependence. The level of dependence among the members must be adjusted to the required task.

During 2018, the company promoted personal development in the organizational realm in the framework of the divisions for all the employees of the company.

By percentage

By percentage

Collective agreement

Personal contract

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Employees segmentation according to age and gender groups

Up to 30

Between 30-50

Above 50

2013 2014 2015 2016 2017 2018

727

96109

8326

422

102129

8136

817

119139

7548

227

94119

8432

519

105132

8039

59

124151

8353

2013 2014 2015 2016 2017 2018

2427

4448

11888

2536

4144

121106

2927

5256

121121

2341

4243

11495

4029

3250

117111

2517

7018

117118

Employees segmentation by seniority in the company

Employees with seniority of up to one year

Employees with seniority above one year and up to 5

Above five years

Employees segmentation by education

Employees with an academic degree in engineering

Employees with an academic degree not including engineeringEmployees with a Master's

degree Employees with no academic studies

2013 2014 2015 2016 2017 2018

7522

6880

6732

4361

7628

6898

6537

4462

8527

74114

6946

4363

7527

6190

6237

4562

7526

6698

6137

4562

8836

78114

4120

4668

Segmentation of employees turnover by gender

Employees that joined

Employees that left

Dismissed employees

2013 2014 2015 2016 2017 2018

1619

711

62

1617

109

36

2927

1715

02

926

1710

94

2415

2112

128

2517

117

21


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The path to etfective leadership

Leaders During 2017 the work teams convened in order to provide a response to the challenges facing Netivei Israel. The executives development team defined an acute need - the development of the managerial backbone of the company.

In view of that, a leadership development program, Leaderim, was developed, the duration of which is three years 2018-2020 and is intended to train the wing managers, the deputy wing managers and the department heads in the company, out of the view that the executive development program will contribute to the promotion of the organizational strategy and to the realization of the goals of the company by developing leadership of the managerial backbone and reinforcement of the synergy and the cooperation among the executive levels and the organizational units. The purpose of the program is to develop the leadership-managerial as well as personal abilities of the executives together with a wide organizational perspective, the assimilation of a leadership concept that will pass through all the meetings - a change in consciousness, deepening the acquaintance among the executives as a basis for cooperation and improvement of the interfaces between the units, providing know-how, tools and skills to the management of employees, in order to lead processes and improve managerial effectiveness and develop a common professional language that relies upon collegial learning.

The program includes diagnostics of the personal managerial style (Lumina - a British diagnostics model), development of psychometric tools for the evaluation of qualities, abilities, strong points, development areas and emotional intelligence. These tools for, the foundation for various organizational interventions, workshop learning meetings, learning through experience, learning tours at a business company, personal coaching, preparation of an organizational venture that will be assimilated in the organization. During 2018 40 executives out of 157 executives of the company participated in the program in two programs that ran concurrently.

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Social leadershipAs part of the social responsibility of the company, in 2017 the company invested economic and managerial resources to develop a multiannual strategy to promote social involvement in the community. This field is managed by the deputy VP of the resources and administration division.

A social leader was appointed in each one of the divisions that is the representative of the division to manage the field beyond the position such representative serves in the company. The committee discusses the goals, targets and fields in which the company wishes to make an impact on the social level.

The social leaders in Netivei Israel are responsible for maintaining and developing the connection between

each of the divisions and the community partners that were selected, for the execution of the social involvement strategy at the field level, for management of the volunteers in their division - recruiting, nurturing and support of the volunteers of the division acting together with the selected partner.


Good in your own way

66


Good in your own way

67


I thank you for your interest in the report and invite all our stakeholders to contact us to promote new relevant and sustainable ways in the areas in which we operate to the benefit of all the residents of the State of Israel.

Adi Gamliel Head of Corporate Responsibility and Sustainable Development

[email protected], 03-7355929

Documents

8 18 - mof.gov.il · Infrastructure Company achieves a breakthrough in smart transportation leading in the national economy, driving the social and economic growth for better productivity