United Nation Global Compact

Communication on Progress

2014

RASTGAR ENGINEERING COMPANY (REC)

ISLAMABAD, PAKISTAN

Communication on Progress

Rastgar Engineering Company [hereby referred to as Rastgar] takes pride in the fact that ever since its

inception in 1967, its dealings with all its customers, employees, suppliers and other stakeholders have

always been upright and based on universally accepted ethics and principles of human rights and green and

corruption-free environment. With this background, Rastgar found it reasonably comfortable to be one of

the first Pakistani companies to sign up for Global Compact in 2006. Since then, it continues to support

those principles not only within Rastgar Engineering Company but also in the business community around it.

Our most recent and distinguished achievement in this behalf is the 4th International Conference on UN

Global Compact held in Islamabad on 31 Jan 2013, with active participation of Rastgar Group, headed by

our Chairman Mr. Imtiaz Ali Rastgar, the Conference Convener. The group took leading active part in

arranging the conference under the auspices of the Pakistan Network of Global Compact, Employers'

Federation of Pakistan, and the Islamabad Chamber of Commerce and Industry. The conference was

attended by the Federal Secretary for Human Rights, various Senators and delegates from 70 companies.

Some pictures of the conference are also attached.

Remarkable success of this conference is evident from the fact that no less than 26 business organizations

signed up for the UNGC at the conference end. These companies are:-

1. Ovex Tech, Islamabad

2. A Company of Maqbool Enterprise Pvt Ltd

3. Karachi Steel Rerolling

4. Pearl Pharmaceutical

5. PowerTel

6. Petracon Engineering Pvt Ltd

7. Tariq Mustafa Ramzan & Co.

8. Quantum Geoservices Pvt ltd

9. Cyber Vision International

10. Hypercomp Pvt Ltd

11. Salman Mansoor & Associate

12. Shezan International ltd

13. Daud General Trading

14. ASTRO System. Inc

15. Wah Nobel Group

16. Taxila Cotton Mills Ltd

17. Sihala Four & General Mill Pvt Ltd

18. Elektro Control Industries

19. International Polymer Industries Pvt Ltd

20. Al karam Textile Mills Pvt Ltd

21. Iqbal Group

22. Dynamic Tooling Services

23. Global Group of Companies

24. Channel 7

25. Roots School System

26. Rastgar Engineering Company (Pvt) Ltd.

We, at Rastgar, firmly believe that the business world can play a pivotal role in eradicating poverty, helping

the cause of education, combating corruption and safeguarding our environment. We therefore continue to

strongly support all the 10 Global Compact principles. Achievements of Rastgar during the recent years

have regularly been communicated to all our stakeholders through various channels including:

Annual Report to share holders, creditors, bankers etc Declaration on our website www.rastgar.com Defined policies on Human Rights, manpower, environment and anti corruption Annually updated Employees Handbook Standard operating procedures Emails to our suppliers, customers and employees Prominent notices and posters in our premises Occasional written communication to all stake holders

Our policies on human rights, good labour practices, greener environments and corruption-free business,

besides quality and occupational hazards & safety management, are communicated thoroughly within

Rastgar - right from Managers to the workers - at all levels. These policies are displayed within our

premises through notice boards, audio-visual announcement, banners, objective statements and occasional

conferences and celebrations. Our adherence to the internationally accepted policies and principles has

enabled us to achieve recognition and certification under International Standards, including:

ISO 14001: 2004 - Environmental management OHSAS 18001: 2007 - Occupational Health and Safety management ISO 9001: 2008 - Quality Management SA 8000: 2008 - Social Accountability ISO/TS 19649: 2009 - Quality Management for Automotive Parts Manufacturers

Our employees, supervisors and managers agree on periodic targets and goals to be achieved and measured

periodically. We monitor our managers' performance against those targets. Production under ideal conditions

conforming to all the 10 principles of UN Global compact is a major target. Specific targets and goals

prominently displayed all over the work place include:

Reduce CO2 consumption by a certain percentage every year

Continue improvement in working environment free from all discriminations.

Encourage females employment to compete for suitable positions to improve their ratio to 40%

Plant trees exceeding a minimum number each season

Reduce consumption of natural and other resources.

Upgrade equipment and machinery to reduce harmful gases and wastes.

Training of unskilled & semi-skilled employees in skills improvement, and of all employees in

grooming sense of civil and humanitarian responsibilities.

Recycle as much material as possible.

Encourage employees' participation in daily floor meetings, cleanliness drives, safety programmes,

healthy activities, cafe management affairs, plantation drives,

Timely action on allegations, if any, of improper labour or corrupt practices, violation of safety

precautions and any discriminations etc.,

We ensure that everyone in Rastgar Engineering Company takes active part toward achievement of

prescribed goals. Non conformity, if any, of the policies and practices on human rights, labour, environment

and anti corruption is discussed and reviewed in higher management meetings. In case of non conformity

being established, strict action is taken and all necessary remedial and preventive measures are introduced.

Performance of our managers is also judged by their success in conforming to the standards and achieving

the goals / targets.

Some notable measures and practices, taken in adherence of the 10 principles of UNGC, as well as under

staff welfare policies and other goodwill designs are stated briefly below. Some pictures are also given in

illustration of the activities.

Convention at Hinopak

Human Rights

We are strong believers in the universally accepted human rights and we take special care to ensure that we do

not, even in a small way, indulge into the abuse of any human rights. As mentioned in our Corporate Social

Responsibility, we believe our workers to be our most valued and precious asset. We do not discriminate

between them on the basis of gender, race, faith or political beliefs etc. There is absolutely no concept of any

child or forced labour in Rastgar. All our employment is on mutual consent basis, and employees are at

liberty to quit as per defined terms and conditions. In genuine cases, even the notice period may be waived to

suit an individual. MR (Management Representative) meets regularly with WR (worker Representative) and workers to discuss

worker’s current issues and other work related problems. MR Meeting with Workers

Employment of Disabled People: We continue to give special consideration to disables persons who compete with others for employment / promotion. All walkways in the company have also been made friendly to facilitate movement of all disabled people.

RASTGAR

Equal Rights of Opportunity

Rastgar Engineering Company is committed to providing a working environment that is free from all form of

discrimination and conduct that can be considered harassing, coercive, or disruptive, including sexual

harassment, action, words, jokes or comments based on

individual’s sex, race, colour, national origin, age, religion,

disability etc.

We have an Inquiry Committee against Sexual

Harassment with main objective of making the work

environment harassment-free and as such more

professional and dignified, to make the organization

ultimately more efficient and productive.

Names of Committee person with contact numbers are

displayed on Notice Board for the knowledge of workers

at all prominent places of company.

Employees are free to express their views and suggestions.

All employees with questions or concerns about any type

of discrimination / harassment in the workplace are

encouraged to bring these issues, with full confidence, to

the attention of the Inquiry Committee. Employees can

raise concerns and make reports without fear of reprisal.

Inquiry Policy against Sexual Harassment

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Labour

There is absolutely no concept of any child or forced labour in Rastgar. We do not hire below 18 and do not discriminate on basis of gender, race, faith or political beliefs etc. Employees are given full rights and opportunities to reach high position. The company fully abides to all local laws such as Minimum Wage Rate, Overtime payment, Social Security, and Government Pension etc. Moreover, our company is shouldering other wider responsibilities towards the society in general and employees in specific. We believe in providing good working environments, training opportunities to improve the skills and salaries of our employees. The company subsidises canteen meals, and rewards teams for achieving distinction in their output. Financial assistance is provided for performing of Hajj and special financial assistance is provided in case of extraordinary medical bills. Company grants are made available for the employee’s children education. Similar financial assistance is also made available on occasions like marriages and death in the family. We keep in mind the services of our deceased team members also, and ensure that the needy dependents receive some regular financial support. Rastgar has introduced following workers benefits for the betterment of our labour: Educational Scholarship to workers children Scholarship for brilliant students of different universities Financial support/ pension to deceased worker’s dependants Special financial grants on dependant’s marriage Special paid leaves on employees marriage Special paid leaves in case of family bereavement Free meals to employees up to certain level and subsidized meal to others Reimbursement of extraordinary medical cost Distribution of special Ramadan gift packages Mark up free loan to workers for purchase of motor cycle Payment of Overtime

Training to all employees

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Environment

Reduction of CO2

Rastgar has taken technological advancement steps directly to reduce CO2 gas usage by certain percentage and

reduction in disposal of wasted sand in same percentage. Now Green Sand is used in preparation of moulds.

Another achievement is the introduction of routing hot air from furnace through shower tanks where smoke,

soot and heat are absorbed in water, instead of escaping in full in atmosphere.

Reduction in Paper Consumption

Rastgar has taken significant step to reduce paper consumption in company. We always prefer to use

recycled paper for stationary/ printing. We encourage our suppliers to use recycled paper to print the

company record books. In office paper consumption has been reduced by over 20% from last year. We also

use recycled paper in office. Separate recycle box is placed for the recycling the paper. Inter office memo is

also sent to all team members as a refresher. These steps have not only reduced the consumption but also

reduce our cost.

In pursuance of the ISO 14001 Environmental Management System all out efforts are made in Rastgar

for establishing and improve environmental friendly processes. All the machinery and equipments items are

calibrated periodically to ensure their efficient performance and least possible waste. A high standard of

hygiene is maintained in respect of all food and drink items, utensils and the canteen environment. Waste

items are disposed of properly to ensure they do not cause any ill effects on people’s health and the greenery.

Reducing consumption of resources

Rastgar has also reduced the electricity consumption by using Energy saving bulbs. LED lights have been

introduced on experimental basis at certain locations anticipating almost half reduction in electricity

consumption. These lights will be installed all over the premises if the experiment turns out to be successful.

We have reduced natural gas consumption by using Solar Geyser in Rastgar. Solar Geysers are being used in company

and it has reduced our natural gas consumption by 25%.

Solar Geyser in REC Solar Geysers at Rastgar

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New Assembly Line

New Plant in Machine Shop

New Sale Point for Local Market

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Exhibition in Dubai

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Plantation Activity

Fire Drill

Monthly Food Distribution Activity

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5S Activity

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Before & After Result of 5S Activity

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Anti Corruption / Bribery Policy

Reminding REC members to deposit gifts with

Administration to minimize conflict of interest

situation.

Certifications

Foreign Customers visit Rastgar

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Educational Institutes visit Rastgar

Female Employees Get-together

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Rastgar Celebrations

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Rastgar Celebrates Team Members Birthday

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Rastgar Recreational

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Rastgar Celebrates Merry Christmas

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Rastgar Celebrates Pakistan Independence Day

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Iftaar Party

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Educational Policy

1. In further pursuance of HR welfare

activities, we are pleased to expand the scope

of various benefits under our liberalized

Educational Policy to more of our members.

We trust that the extended benefits will

enable our members to afford good education

for their children and other dependents.

2. The policy has been broadened

mainly through enhancing the ceiling of

monetary benefits, and by reducing the

minimum employment period with Rastgar.

Salient features of the policy:

3. Eligibility: All those members with

monthly salary up to Rs.20,000 and with

minimum one year service with REC, are

now entitled to receive the educational

benefits for their children. Members may

also enrol for this policy in respect of their

wholly dependent brothers and sisters if their father is unable for any reason to support them.

2. Tuition fees: is reimbursable to the extent of Rs.500 per student up to Class V, and Rs.800 per

month per student of class VI to Matric.

3. Position holders: Students securing First, Second and Third positions in annual promotion

examination will be eligible for reimbursement of 100% fees for the next class.

4. Books / bags: Two grants of Rs.500 each (i) for school books / bag, and (ii) for uniform items will be

admissible in May each year for every student up to Matric class.

5. Post-matric studies:

(a) Female students: if enrolled in a college / institution for Inter / CT / Bachelor or a technical

course, will be granted Rs.1,000 per month. The amount will be enhanced to Rs.1,500 per month for

those taking up Masters courses.

(b) Male students: will be granted Rs.1,000 per month if they take up Inter or Bachelor of

Science in a college, or a technical course in the fields of Computers, Draftsman, Refrigeration &

Air-conditioning, Motor Winding, Welding, Auto Mechanic, Telecom Technician, Mobile Repairing,

Civil Lab Technician, Surveyor.

7. Reports: Members would have to produce a report every 4 months from the concerned school or

college or institute about attendance of the student for continuing the benefit uninterrupted.

8. Effective Date: This revision of policy is effective from 01 Dec 2013.

9. Disbursement: of admissible amounts will be made by the Finance department on 17th of every

month; or the next following working day. Admin department will be responsible to notify Finance

Department 3 days in advance of disbursement date.

Rastgar Suggestion Box

Online Suggestion Box is also available on our website

www.rastgar.com

Detail of CSR Activities is available on

www.rastgarblogspot.com

Thank

You

Rastgar Engineering Company (Pvt) Ltd. 307, Street 3, I-9/3, Industrial Area

Islamabad- 44790 Pakistan. Tel: +92-51-4433544-7, Fax: +92-51-4433548

www.rastgar.com