SAUDI RESPONSIBLE

COMPETITIVENESS INDEX

What is Corporate Social Responsibility (CSR)?

CSR is the business-wide approach to managing environmental, social, economic and

governance issues.

What is Responsible Competitiveness? A Global Agenda

• Responsible Competitiveness is the strategic application of Corporate Responsibility which includes leadership, and policies and practices that build sustainable development.

• Evidence from 115 countries shows that Responsible Competitiveness is driving the performance of companies, sectors and nations.

• Responsible approaches to doing business are increasingly recognized as routes to:

– new sources of value creation– driving reputation– managing risks– enhancing productivity– unlocking both product and process innovation

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What is the Saudi Responsible Competitiveness Index (RCI)?

Assess how companies in the Kingdom are creating responsible business practices to build competitive advantage while supporting social development and building enduring economic competitiveness for the Kingdom.

The Saudi Responsible Competitiveness Index aims to:

Saudi RCI Overview

• Started by SAGIA in 2009 with the prestigious King Khalid Foundation (KKF) and AccountAbility, the global leader in CSR research.

• The RCI was launched to respond to the growing demand for a measurement tool for environmental, social and governance issues in the region.

• Participation in the index has shown that Responsible Competitiveness performance is increasing, as returning applicants have shown marked improvement.

The King Khalid Awards for Responsible Competitiveness

Saudi RCI Overview The King Khalid Awards

for Responsible Competitiveness

Funding & Advisory Services

Experience and Expertise

Regulatory Framework

Saudi RCI Structure in 2012

1. BAE Systems Joins as a New Strategic Sponsor• Brings global multinational

expertise in quality management and CSR best practice to Saudi RCI

2. New Additions to Advisory Board• KSU NCB CSR Chair – Academic Seat• King Abdullah Economic City (KAEC)

– Corporate Competitiveness Seat

Saudi RCI Focus 2012

1. Growth in Number of Participating Companies• Increasing Brand Equity• Augmenting Awareness

2. Identify Partnerships with Key Organizations to Expand Reach• KSU NCB CSR Chair• KAEC• Chambers of Commerce

3. Continuous Evolving Methodology• More relevant indicators to KSA• Simplified application process• Face to face workshop to share outcomes

Saudi RCI 2012• The King Khalid Awards for Responsible Competitiveness

Saudi RCI Impact• Changing the way in which Saudi

businesses operate – encouraging a decrease in environmental footprint, rewarding community enhancement, innovating through knowledge-sharing etc.

• Creating competitive advantages that give an edge over peers

• Ensuring companies are held liable for their actions/activities and rewarded for strong performance

• Making Saudi Arabia’s businesses environment more responsible

Why Participate in the Saudi RCI?

• Participation builds awareness and improves business practices thereby directly impacting the economy.

• Public recognition in a prestigious index for your efforts toward becoming a Responsible Competitiveness leader in KSA.

• Exclusive Strategy Seminars where you will be able to learn directly from global sustainability experts and engage with other Saudi companies to share best practices, discuss challenges, and build relationships.

• Scorecard outlining your strengths, and areas with room for improvement, with suggestions on how to improve your performance.

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Saudi RCI 2012 Performance Analysis

• The fourth cycle took the Award to the “next level”, by incorporating feedback from companies participating over the previous 3 years.

• We have:

1. Further focused on how company practices can serve the socio-economic needs of Saudi Arabia

2. Integrated the Award with other complementary measures (Such as the Nitaqat Index).

Resp

onsi

ble

Com

petiti

vene

ss II. Innovating Solutions for Social Development

III. Empowering Local Vendors

IV. Making a Commitment to High Quality

V. Responsible Environmental Management

I. Building a Nationally Competitive Workforce

Saudi RCI’s Core Areas – Reasons for Core Changes

Performance Analysis

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SectionSection Weight

25th Percentile

50th percentile

75th Percentile

Top 10 winners

1. Building a Nationally Competitive Workforce 25% 44% 54% 66% 77%

2. Innovating Solutions for Social Development 15% 16% 29% 57% 88%3. Empowering Local Vendors 20% 48% 65% 79% 89%

4. Making a Commitment to High Quality 20% 69% 85% 92% 96%

5. Responsible Environmental Management 20% 4% 14% 31% 66%

TOTAL 42% 50% 62% 83%

Identifying areas of improvements

Top 10 Trends in Saudi RCI 2012

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1. Companies are taking “Saudization” very seriously and the vast majority of participants have achieved “excellent” or “green” ratings on the Nitaqat Index.

2. Many companies have made significant efforts to attract and develop local talent through partnerships with local universities and technical schools to hire and train fresh graduates.

3. Although Saudi companies have a strong tradition of generous charitable giving, more companies are developing an approach towards strategic community investment.

4. Companies are interested in the principles of CSR, and more are linking their CSR activities to their overall business strategy and competitiveness

5. The vast majority of participants are prioritizing purchasing from local vendors, and some companies are also prioritizing vendors who adhere to international environmental standards

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6. Nearly all companies prioritize customer & vendor satisfaction, but few have undertaken processes to regularly measure it.

7. Many companies have developed internal ‘green’ initiatives that encourage employees to conserve resources and recycle and reuse materials.

8. Particularly in the power and utility sector, many companies are engaged in spreading environmental messages throughout the community.

9. A key area for improvement and growth in the next year is responsible environmental management. Very few companies have developed rigorous processes to measure and reduce resource consumption.

10.More companies are working for international certifications in health, safety, and environmental standards.

Top 10 Trends in Saudi RCI 2012

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The Way Forward for Responsible Competitiveness in the Kingdom

What can your company do?

The Way Forward

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What your company can do:

• Work to close the remaining gaps in environmental management,

governance systems, and labor practices – build upon the momentum

already building in KSA

• Embed a culture of compliance with Environment, Health, and

Safety standards in all workplaces, and consider adopting and

engaging with international standards

• Transfer good practice on leading firms to the family-owned and

small/medium sized businesses

• Continue to invest in product and service innovation: become a

global innovator

• Scale up initiatives on building talent for future sustainability and

stability - rise to the challenge of addressing the Kingdom’s

employment needs

إي آيه لبي بالنسبة السعودية تعني ماذاسيستمز؟

•. الميالدية الستينات في للطائرات مبيعات أول

للسعودية – المحلي السوق في الطويل المدى على ووجودها سيستمز إي آيه بي أنشطة نواحي جميع عن مسؤولة–: الشريكة السعودية الشركات إلى إضافة السعودية سيستمز إي آيه بي شركة

من • موظف7,800أكثربقيمة • سنوية سعودي 14مبيعات ريال مليار

إي آيه لبي بالنسبة الشركات مسؤولية تعني ماذا سيستمز؟

األداء – ثقافة بتطوير ملتزمة كشركة Aعرف ن أن نريد نحنكيف بل به نقوم ما على ليسفقط التركيز و الكلي،

. G أيضا به نقوم

بعض – باستخدام الشركات مسؤولية أهمية سنشرحالتحكيم :SARCIمعايير

الوطني • الصعيد على المنافسة على قادرة عمل قوة بناءاالجتماعية • التنمية لتحقيق مبتكرة حلولالمحليين • الموردين تشجيعالعالية • بالجودة االلتزاممسئولة • بيئية إدارة

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منافسة وطنية عاملة قوى بناء

القطاعات • أكبر أحدفي للسعوديين الموظفة

المملكةسعوديين% 60حوالي –

و • بالتدريب كبير إلتزامالتطوير

سيستمز – إي آيه بي موظفيأخرى – قطاعات في العاملينمن – الطاقم 2,000أكثر وأفراد طيار

الجوية القوات وفنيي األرضيالسعودية الملكية

القوى • تطوير في خبراءالعاملة

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االجتماعي للتطوير مبتكرة حلول

في • مهما1 نمارسدورا1 نحنالمجتمع

التعليم – دعمالسالمة – و الصحة لقضايا الترويجالبيئة – شئون دعم

والهندسة • البحث دعمالدكتوراه – بعد ما بحث برنامج

المعارف • بنقل اإللتزاموالقدرات والخبرات

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التموين • سلسة إدارة

أي % 90• ايه لبي األساسية التكلفة منوالخدمات بالبضائع مرتبطة سيستمز

المحلية

على • يزيد ما ريال 18أنفقنا مليارالمملكة في الموردين مع سعوديالخمس خالل السعودية العربية

الماضية سنوات

المحليين الموردين تشجيع

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العالية بالجودة االلتزام

جوانب • من جانب كل الكلي األداء يعنيعملنا أسلوب

العميل – على التركيزالمالي – األداءالبرنامج – إنجازالمسئول – السلوك

والحوكمة • التجارية للعمليات تنظيمي توجه

للبرنامج • فعال إنجاز

وأفضل • والمهارات المعرفة في المشاركةمن للرفع المشاريع ومساعدة الممارسات،

الدولية قدراتنا

بنتائجها • التنبؤ يمكن والتي بها الموثوق الحلول. لعمالئنا المنافع تقدم والتي وتكرارها

البيئية للشئون مسئولة إدارة

في • ممارساتنا بتطوير متصاعد نحو وعلى نقوممساعدة وكيفية البيئة على التأثير من الحد كيفية

. بالمثل القيام في الموردين

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الشركات مسئولية أهميةالشركات • لمسؤولية استراتيجيتنا بتطوير ملتزمون نحنعليها • والحفاظ شركاؤنا مع قوية عالقات بناء على الشركات مسؤولية تساعد

العمالء–المنظمون–المستثمرون–الموردون–الموظفون–المجتمعات–

أعمالنا • على المخاطر من والحد التشغيلية والفعالية اإلنتاجية رفع في والمساهمة السمعة تحسين شأنه من وهذا

ونـقــاش حــوار