ESG PRESENTATION
APRIL 09 & 10, 2020
ESG
presentation
April 09 & 10, 2020
01.Michelin sustainable development and
mobility
02. Environment
03. Employees’ well-being and development
04. Governance & Say On Pay
05. Appendices
ESG
presentation
April 09 & 10, 2020
Michelin sustainabledevelopment and mobility
April 9 & 10, 2020 – ESG presentation4
At Michelin we are convinced that mobility is a factor of human
progress but we are aware of the challenges it represents
A population growing from 7 to 9 billions worldwide
Mobility: a human right
• SAFETY
• UNIVERSAL ACCESS
• EFFICIENCY
• GREEN
&
April 9 & 10, 2020 – ESG presentation5
Our response has been in our purpose for over 130 years
BECAUSE WE CARE ABOUT GIVING
PEOPLE A BETTER WAY FORWARD
&
April 9 & 10, 2020 – ESG presentation6
Our growth and value creation model
Everything will
be sustainable
at Michelin
April 9 & 10, 2020 – ESG presentation7
Coordinated management of the Sustainable Development and
Mobility approach
Environment Ethics Committee
Operational Committees
Human RightsEmployee Health
and Safety
Stakeholders Committee
Governancebodies
Decisions
Recommendations
Group Executive Committee
Sustainable Development
and Mobility Committee
At the corporate executive level, a
Stakeholders Committee set up in 2016
brings together 12 people representative of
the Group's leading stakeholders, including
suppliers, investors, unions, customers and
NGOs. Four continents are represented on
the Committee, which meets with the
Executive Committee for a full day at least
once per year
April 9 & 10, 2020 – ESG presentation8
A constructive stakeholder dialogue
April 9 & 10, 2020 – ESG presentation9
6 Group ambitions for 2020 in line with United Nations
Sustainable Development Goals
INNOVATE TO WIDEN OUR LEAD IN
PRODUCT AND SERVICE PERFORMANCE
SET THE INDUSTRY STANDARD FOR
RESPONSIBLE MANUFACTURING
MOVE FORWARD TOGETHER IN PERSONAL
WELL-BEING AND DEVELOPMENT
CONTRIBUTE TO THE DEVELOPMENT OF
OUR HOST COMMUNITIES
CONTINUOUSLY IMPROVE CUSTOMER
SATISFACTION
DELIVER A ROBUST FINANCIAL
PERFORMANCE
1
2
3
4
5
6
April 9 & 10, 2020 – ESG presentation10
6 Group ambitions for 2020
2
3
4
5
6
By 2020, 100% of the targeted customer groups reach
the intended Net Promotor Score (NPS)
2019 result : 67.4%
CONTINUOUSLY IMPROVE CUSTOMER
SATISFACTION
1
April 9 & 10, 2020 – ESG presentation11
6 Group ambitions for 2020
MOVE FORWARD TOGETHER IN PERSONAL
WELL-BEING AND DEVELOPMENT2
1
3
4
5
6
Health & Safety : Total Case Incident Rate (TCIR) <2
2019 result : 1.4
75% of managers promoted from within
2019 result : 74%
30% women in management and supervisory roles
2019 result : 27.4%
85% of employees engaged
2019 result : 81%
80% of top managers in the growth regions were born
there
2019 result : 75%
April 9 & 10, 2020 – ESG presentation12
6 Group ambitions for 2020
INNOVATE TO WIDEN OUR LEAD IN
PRODUCT AND SERVICE PERFORMANCE
3
1
2
4
5
6
Save 3 billion liters of fuel over the lifespan of our
tires, representing 8 million tonnes of CO2 avoided
2019 result :
• Fuel savings estimated at 2.9 billion liters
• Avoided CO2 emissions astimated at 7.3 million tonnes
Improve the overall performance of our products by at
least 10% vs 2010, while using less raw material in
their production
2019 result : 9.9%
Use 30% renewable or recycled materials in our tires
2019 result : 26%
April 9 & 10, 2020 – ESG presentation13
6 Group ambitions for 2020
SET THE INDUSTRY STANDARD FOR
RESPONSIBLE MANUFACTURING4
1
2
3
5
6
Ensure that 70% of the 400 leading suppliers assessed
by EcoVadis are confirmed as compliant with Michelin
standards
2019 result : 715 suppliers assessed / 84% compliant
Reduce CO2 emissions from logistics activities by 10%
vs 2010
2019 result : -10.3%
Reduce the environmental impact of our sites
measured through Michelin Environmental footprint
(MEF) by 50%, notably by improving our energy
efficiency by 38% vs 2005
2019 result :
MEF reduction : -51.2%
Energy efficiency : +31.5%
April 9 & 10, 2020 – ESG presentation14
6 Group ambitions for 2020
CONTRIBUTE TO THE DEVELOPMENT OF
OUR HOST COMMUNITIES
5
2
3
4
6
Create 2,000 local jobs per year with the support of
Michelin Development
2019 result : 1,702 jobs created
Reinforce our advocacy of road safety with a strong
focus on driver education in emerging countries
In 2019 the global partnerships and local programs
deployed by Michelin with its employees and its foundation
directly benefited more than 330,000 people
Dedicate 30.000 work days per year to local
communities
2019 result : 32,850 work days
100% of Michelin plants are deploying a community
involvement program
2019 result : 110 sites
April 9 & 10, 2020 – ESG presentation15
6 Group ambitions for 2020
DELIVER A ROBUST FINANCIAL
PERFORMANCE6
1
2
3
4
5 €1,400M in structural free cash flow per year from 2020
2019 result : €1,615M
> 15% Return On Capital Employed (ROCE) in 2020
2019 result : 13.7%
April 9 & 10, 2020 – ESG presentation16
5 commitments for Biodiversity for 2020
April 9 & 10, 2020 – ESG presentation17
5 commitments relating to ethics and human rights
Act against corruption in all its forms, including the bribe and extortion of money
Contribute to the elimination of any discrimination in respect of employment and
occupation
Contribute to the effective abolition of the child labor
Contribute to the elimination of all the forms of forced or obligatory labor
Respect freedom of association and acknowledge the right of collective bargaining
April 9 & 10, 2020 – ESG presentation18
Michelin ESG Roadmap
2020
AMBITIONS2050+ AMBITIONS
2020
BIODIVERSITY
COMMITMENTS
commitments relating to ethics and human rights
Environment
E&S&G
Social
2030
COMMITMENTS
April 9 & 10, 2020 – ESG presentation19
New 2030 commitments to achieve ambitions by 2050+
● Reduction of the amount of energy used by
a tire in use by 20% by 2030 compared to
2010.
● Elimination of purchased steam from coal-
fired plants and of coal-fired boilers in all of
the production facilities by 2030
● As awareness of the climate emergency grew,
in 2019 it set a new, more ambitious mid-way
target of a 38% reduction of CO2 emissions
in 2030 versus 2010 and submitted it to the
Science Based Targets initiative, which was
still assessing it at year-end
● 80% of material used by the
Group will be sustainable
(recycled or renewable)
● In 2015, the Group committed
to reducing CO2 emissions
from its plants by 50% over
the period from 2010 to 2050
● Meeting this stricter target
would prepare us to aim for
carbo neutrality across our
manufacturing base by 2050.
● Do everything in
our power with
external partners
to ensure that
100% of end-of-
life tires are
recovered.
Global engagement and partnerships
20 April 9 & 10, 2020 – ESG presentation
Ellen MacArthur
Foundation
CE100 member
Entreprises pour
l’Environnement
Member
International Life
Cycle Chair
Partner
UN Global
Compact
Signatory
World Business
Council for
Sustainable
Development
Member
Global Platform
for Sustainable
Natural Rubber
Founding memberWWF
Partnership
Task Force on Climate-
related Financial
Disclosure Supporter
Science Based Targets
Committed
Tire Industry
Project
Co-chair
21
Michelin’s CSR ratings: a leading & recognized player in
sustainable mobility
CDP
2019
ECOVADIS
2019
ISS-OEKOM
2019
MSCI
2019
VIGEO EIRIS
2018
SUSTAINALYTICS
2018
Status
Rating A- 78/100 B- 7.4/10 68/100 77/100
Ranking /
Distribution of
ratings
● Major sustainability rating (As of April 2020)
Top 1%(natural rubber)Climate change
MICHELIN score
MICHELIN score
Water security 8%
21%24%
16%
24%
5%3%
CCC B BB BBB A AA AAA
1er of 31 in the sector 7ème of 54 in the
sector
-Light
manufacturingEurope Global
Average
Light
manufacturingEurope Global
Average
April 9 & 10, 2020 – ESG presentation
ESG
presentation
April 09 & 10, 2020
Environment
April 9 & 10, 2020 –ESG presentation23
Focus on climate change strategy
GreenHouse Gas emission inventory in 2018
► ~3M tons CO2 (-25% vs 2010)
88% 12%2018
► ~140M tons CO2
1.49 M
tons
CO2
1.51 M
tons
CO2
2018
CO2 emission on Scope 1 & 2
Own operations
CO2 emission on Scope 3
Activities in the value chain
Purchased goods and services_____ 54%Capital goods ________________________ 6%
Fuel and energy-related activities ________ 4%
Upstream transportation and distribution ___ 7%
Waste generated in operations __________ 3%
Business travel _______________________ 0.5%
Employee commuting___________________ 1%
Downstream transportation and distribution__ 5%
End-of-life treatment of sold products _______18%
Franchises____________________________ 1.5%
10 other value chain categories
April 9 & 10, 2020 – ESG presentation24
Focus on climate change strategy
Michelin’s commitments are comprehensive and long term
Reducing CO2 emissions
from our operations as
well as from activities in
our supply chain in line
with the Paris Agreement1
Providing products,
solutions and services for
our customers that reduce
their carbon footprint2
Advocating at a
global level for the
decarbonization
of the transport sector3Supporting the
introduction of a global
pricing system4
The strategy is comprised of four areas of action:
April 9 & 10, 2020 – ESG presentation25
RAW MATERIALS
Michelin is responsibly developing its natural rubber
supply and other sustainable materials.
USE OF PRODUCTS
AND SERVICES
REPRESENTS 63 to 96% OF LIFE
CYCLE IMPACTS*
Michelin’s innovations mean longer distances and higher
performance with fewer materials and a smaller carbon
footprint. Our services and solutions optimize tire use.*depending on type of vehicle and environmental impact category
LOGISTICS
Michelin applies multiple levers to reduce
its carbon footprint for transporting semi-
finished and finished products
ENERGY
RECOVERY
MATERIALS
RECYCLINGLehigh Technologies, a Michelin company,
produces high-performance materials from end-of-
life tires and other post-industrial rubber.
MANUFACTURINGMichelin strives to continuously reduce the
environmental impact of manufacturing
through its environmental management
system and performance targets.
END OF LIFEMichelin actively supports resource
recovery and recycling systems for end-
of-life tires with its stakeholders and
industry partners around the world.
Focus on life cycle impact
Actions throughout the entire life cycle of our offers
April 9 & 10, 2020 – ESG Presentation26
Focus on life cycle impact – Raw materials
RAW MATERIALS
Biodiversity
commitments
Development of
recyclable materials
Renewable materials
projects
BioButterfly
BioImpulse
Natural rubber
…
Sustainable materials
Michelin aims to use more sustainable materials: those coming from renewable resources* or
recycled feedstock**, including end of life tires. Our short term target is to reach 30% by 2020.
We are currently building our long-term road map for increasing amounts of sustainable
materials over time.
April 9 & 10, 2020 – ESG Presentation27
Focus on life cycle impact - Manufacturing
Coal exit strategy
Renewable energy
purchasing ramp-up
Recycle energy
Action plan under
validation by Science
Based Targets initiative
…
MANUFACTURING
Carbon footprint
Our ambition is to achieve a 50% reduction of CO2 emissions by 2050 in line with a 2°C climate
change scenario (base year 2010). We are currently revising our 2050 target in response to the
urgent need to halt global warming. CO2 emissions were reduced by close to 25% in absolute
value from 2010 to 2019.
April 9 & 10, 2020 – ESG Presentation28
Focus on life cycle impact - Manufacturing
Coal exit strategy
Renewable energy
purchasing ramp-up
Recycle energy
Action plan under
validation by Science
Based Targets initiative
Biodiversity
commitments
…
MANUFACTURING
Michelin Environmental Footprint (MEF)
The MEF is an overall indicator of our most material environmental impacts represented by 6
components measured against tire production volume. In 2005 the MEF was set at 100. Since
then, Michelin has reduced its environmental footprint by 51.2%, already surpassing the initial
2020 target of a 50% reduction. We have set a more ambitious 2020 target of -52% or MEF=48
April 9 & 10, 2020 – ESG Presentation29
Focus on life cycle impact - Logistics
LOGISTICS
Carbon footprint
Our ambition is to achieve a 10% reduction of CO2 emissions per metric ton of tires sold by
2020 (base 2010). By end 2019, this goal was met CO2 emissions were reduced by 10.27%.
April 9 & 10, 2020 – ESG Presentation30
Focus on life cycle impact - Use of products
USE OF PRODUCTS
AND SERVICES
Tire performances
Services & Solutions
Hydrogen fuel cell
development
Action plan under
validation by Science
Based Targets initiative
Creation and participation
in mobility ecosystem
Uptis & Vision projects
…
Reduce rolling
resistance
Long lasting
performance
Lighter tires
Product performance
We have improved the sustainability performance of our tires by 9.9% since 2010, as
measured by energy efficiency (reducing rolling resistance), safety (improving dry and wet
grip), road noise (reducing the noise generated by contact with the road), longevity (improving
tire wear resistance and robustness) and resource use (reducing the mass of tires). Our target
is a 10% improvement by 2020.
April 9 & 10, 2020 – ESG Presentation
* Source: Deloitte TIP 2019
31
Focus on life cycle impact – End of life
Collective approach:
collect and recover tires
Individual approach :
TIP
Regional associations
ELT companies
END OF LIFE
Recycle tires: Lehigh
Technologies
Use tires into tires:
pyrolysis R&D project,
Lehigh Technologies
Recovery rate
Michelin contributes to the collection and recovery of tires at the end of their life, in cooperation
with competitors and local stakeholders.
Michelin has the will to do everything in its power with external partners to ensure that 100% of
end-of-life tires are recovered by 2050+ .
Worldwide recovery rate of end-of-life tires *
Biodiversity
commitments
Renewable
materials projects
Vision project
….
April 9 & 10, 2020 – ESG Presentation32
Focus on circular economy
Tire performances
Services & Solutions
Hydrogen fuel cell development
Uptis & Vision projects
Coal exit strategy
Renewable energy purchasing
ramp-up
Global engagement & partnership
(SBTi, Movin’On…)
Biodiversity commitments
Less transport, better transport
and transport in a different way
…
BioButterfly
BioImpulse
Natural rubber
Recycle energy
Collective approach:
collect and recover
tires
Individual approach :
Vision project
…
TIP
Regional associations
ELT companies
Recycle tires: Lehigh
Technologies
Use tires into tires:
pyrolysis R&D project,
Lehigh Technologies
Repair, regroove
and retread tires
Vision project
…
ESG
presentation
April 09 & 10, 2020
Employees’ well-being and development
April 9 & 10, 2020 – ESG presentation 34
« Moving Forward Together » study
74 7780 80 80 81 85
2014 2015 2016 2017 2018 2019 Cible 2020
● Listen to employees: implementation of an annual engagement study in 2013
● 2020 ambition : reach and maintain an 85% employees’ engagement rate
● 2019 response rate to the study : 87% of the employees
● Evolution of the employees’ engagement rate:
April 9 & 10, 2020 – ESG presentation
* Manufacture Française des Pneumatiques Michelin
35
MFPM* rated 93/100 on the gender equality index
● Creation of a gender equality index by the French State Secretariat for Gender Equality and the French
Ministry of labor in 2018.
● MFPM obtains the maximum score on almost all 5 measurement indicators :
Max MFPM
Pay gap between women and men 40Gap
Rating
1.1%
38
Difference in the rate of individual salary increases (excluding
promotions) between women and men20
Variance
Rating
0.5%
20
Promotion rate gap between women and men 15Gap
Rating
3.2%
15
Number of employees of the gender underrepresented among the
ten employees who received the highest remuneration10
Number
Rating
3
5
Rate of female employees having benefited from a salary increase
in the year following their return from maternity leave15
Rate
Résultat
100%
15
Result 100 Base 100 93/100
April 9 & 10, 2020 – ESG presentation
* “Ambitions 2020” scope of reporting excluding the dealership networks and recently acquired companies and representing 93,807 employees.
36
Michelin’s employees training
4.6 million training hours in 2019, representing:
● 2.9 % of total working hours
● 49 training hours per employee per year
● 98% of employees trained*
April 9 & 10, 2020 –ESG presentation37
Human Rights : identify and prevent risks
● A human rights governance at the highest level of the company
● An annual action plan
● Human rights impact assessments made in 6 countries
● 9 human rights risks identified in our Duty of Care plan 2019
● A human rights guide in preparation
● CSR risk in supply-chain integrated in 2019/2020 in internal control procedures
April 9 & 10, 2020 – ESG presentation38
Participating in local community life through our employees
of volunteer work by
employees in 2019
to or invested in outreach initiatives in
the communities around the Group’s
plants and offices in 2019
education, local employment, diversity, health, road safety, environment…
April 9 & 10, 2020 – ESG presentation39
Michelin makes a positive contribution towards Safe Mobility
● Each year, Michelin invests around €5 million in support of Safe Mobility through
forming global strategic partnerships
Parternships Actions
UNRSC
April 9 & 10, 2020 – ESG presentation40
Creating local jobs and businesses with Michelin
Development
● Since 1990, more than 38,000 jobs (27,000 in France)
● In France, Spain, Italy, the United Kingdom, Canada and the United States
● 2 supportive actions for SMEs:
– provides local companies with expertise and technical support in a wide variety of areas
– provides funding in the form of subsidies or five-year, low-interest, collateral-free loans,
designed to create a dynamic process of local job creation
● In France:
– 27,000 jobs created since 1990
– In 2019: 170 agreements signed to support 1,346 jobs in local companies, backed by
around €4.2 million
April 9 & 10, 2020 –ESG presentation41
Since Dundee, a new 3 level approach
ESIC
ATP
RevitalisationRecreate jobs on the
territory
A professional project for
each Mi staff member
Stimulate future regional
economic growth
Economic, Social and Innovation Center
Professional Transition Workshops
MSIP | Creating a new future for people, place and planet Michelin Scotland Innovation Parc (MSIP): Creating a new future for people, place and planet.
MSIP is an ambitious joint venture between Dundee City Council, Michelin, and Scottish
Enterprise.
www.msipdundee.com
● Creation : 2014 January, under the sign of «Helping people move forward »
● Vocation : bear general interest projects in the long term in every country where the Group
is implanted, in five fields:
‒ Sustainable mobility,
‒ Sport and health,
‒ Education and the community,
‒ Protecting the environment,
‒ Heritage and the arts
● 113 projects have been backed by the Foundation in 2018 with a total budget of €16.5 M€
– Global Road Safety Partnership
– „„Croix-Rouge française
– Médecins du Monde
– Maison de la vie
April 9 & 10, 2020 – ESG presentation42
Michelin Corporate Foundation
– WWF
– Yellowstone Park Foundation
– …..
April 9 & 10, 2020 – ESG presentation43
● CSR assessments of suppliers:
‒ 715 suppliers assessed in 2019 (EcoVadis desktop assessment)
‒ 84% obtained a satisfactory score
‒ About 90% of Raw material spend from suppliers operating in countries at risk of human
rights are being assessed
● Mandatory training « Responsible Purchasing » for every member of
the Purchasing department
● Purchasing Principles translated in 14 languages, included in all
contracts with suppliers
● CSR criteria integrated in internal audits of suppliers
● Distinctions:
– Responsible Supplier Relations and Procurement Label : obtained again in 2019
– Certification of alignment with ISO 20400 sustainable purchasing standard
– Score of 80/100 for “responsible purchasing” by Michelin EcoVadis assessment
Supplier assessment and promotion of good practices in
the supply chain
April 9 & 10, 2020 – ESG presentation44
Michelin is committed to help natural rubber supply chain
be transparent
Civil society and clients requires a clean and transparent Natural Rubber
supply chain
Michelin, as a corporate social responsible company, is committed to
zero deforestation and a supply chain without human and labor
rights violation
Michelin wishes to purchase from trustworthy sources → Improve
Supply chain transparency
Natural Rubber supply chain is highly complex, uncharted and not fully
transparent (~6M farmers, ~100 000 dealers, over 500 NR processors in tropical countries)
April 9 & 10, 2020 – ESG presentation45
Natural rubber’s essential role for sustainable mobility
● Reforestation of 88,000 hectares (o/w ~ 45,000 with hevea’s tree) in Indonesia through a joint
venture with Barito Pacific Group. This project had led to the creation of some 4,500 jobs by
end-2019
● Ouro Verde Bahia, Michelin Ecological Reserve in Brazil: a nature reserve, a research center
on rubber plant varieties and a pilot project to improve living conditions for small growers
● Projects and initiatives in support of responsible natural rubber farming led by the Group or its
joint ventures to address a broad range of sustainable natural rubber production issues
● GPSNR: A Global Platform for Sustainable Natural Rubber, launched in
Singapore in October 2018
─ Project was impelled by the Tire Industry Project (TIP), which brings together Michelin and ten other
tire manufacturers under the auspices of the World Business Council for Sustainable Development
(WBCSD)
─ All the stakeholders in the natural rubber value chain were gathered for the occasion
─ The ambition is to improve the environmental and socio-economic performance of the natural rubber
industry
April 9 & 10, 2020 – ESG presentation46
Rubberway: CSR risk assessment via smartphone
Factories
Intermediaries
Smallholders / Farmers
Estates / plantations >50 Ha
Comprehensive supply chain questionnaires
User friendly data collection
Automatic data compilation on web-based dashboard
Interactive map
Thai English Brazilian (Portuguese) FrenchBahasa Indonesia
ESG
presentation
April 09 & 10, 2020
Governance& Say on Pay
48
A solid governance - characteristics of a partnership limited
by shares
Michelin’s governance is robust, stable, and focused on the long-term responsibility of senior
executives. Operating as a partnership limited by shares, as defined by law, regulations and
the Bylaws, offers the Company a number of key advantages
● Meets the fundamental principle of a clear segregation of management and supervisory powers
● Offers shareholders a rarely found level of assurance that the Group is run in their medium- to
long-term interests, particularly during times of volatile markets or economic crisis. The
General Partners have unlimited personal liability for the debts incurred by Michelin
● Fosters direct and transparent ties with shareholders
April 9 & 10, 2020 – ESG Presentation
A solid governance - structure of the Partnership limited by shares
Managers
• Florent Menegaux – Managing Chairman and General Partner
• Yves Chapot – General Manager
Statutory
AuditorsSupervisory Board
Compensation
and
Appointments
Committee
Audit Committee
● Unlimited joint and personal liability for the Company's debts
● Say on pay resolutions are subject to their approval (Ordinary
general meeting) as well as extraordinary resolutions
“Profit shares” allocated under the Bylaws Share of profits in the form of a dividend
● Liability limited to the amount of their investment
● Ultimate decision-making power in the event of a
disagreement between the General Partners and
the Limited Partners
Approve the appointment
of the Managers
Elect the members of the
Supervisory Board
Adopt the financial
statements approved by
Management
Appoint the Statutory
Auditors
Exercises permanent oversight of the Company’s management
and reviews the financial statements approved by Management
Reviews strategic roadmaps and advises without intervening in
management
Ensures that shareholders’ rights are respectedAdminister and manage the Company
Term:
4 years
• 9 members of which 1 Lead independent member
Term:
4 years
Compensation for serving on the Supervisory Board
(previously referred to as « attendance fees »)
SAGES - Société Auxiliaire de Gestion
General Partners Limited Partners
ShareholdersFlorent Menegaux
49 April 9 & 10, 2020 – ESG Presentation
─ Guarantees permanence and is responsible of ensuring Company’s continuity
of leadership in the position of CGEM’s manager were to fall vacant
─ In association with the Supervisory Board, ensures management continuity
through the implementation of a succession plan
─ Recommends candidates for election as Manager of CGEM at the
Shareholders Meetings, and, as applicable, submits recommendations to the
Supervisory Board for the re-election of Managers or their removal from office
50
A solid governance - the General Partners, a complementary role
A long-term Commitment
Chairman : Mr. Jacques de Chateauvieux
Shareholders: members of the founding family, current and former Michelin
executives and qualified persons from outside the Group
SAGES - Société Auxiliaire de Gestion
Non-Managing General Partner
Florent Menegaux
Managing General Partner
Unlimited joint and personal liability for the Company's debts
April 9 & 10, 2020 – ESG Presentation
51
The Supervisory Board - 9 members
Independent member
Member of the Compensation
and Appointments Committee
Chairman of the Audit
Committee
Non-independent member
(non-executive)
Independent member Independent member Independent member
Independent member Independent member Independent member
Member of the
Compensation and
Appointments Committee
Chair of the
Compensation and
Appointments Committee
Senior independent
member
Member of the Audit Committee
Member of the
Audit Committee
Member of the
Audit Committee
Member of the
Audit Committee
Thierry Le Hénaff Cyrille PoughonMonique LerouxAnne-Sophie de la Bigne
Aruna JayanthiBarbara Dalibard Jean-Pierre DuprieuOlivier Bazil
Michel Rollier
Non-independent member (non-executive)
Chairman of the Supervisory Board
Member of the
Audit Committee
Member of the
Compensation and
Appointments Committee
April 9 & 10, 2020 – ESG Presentation
The Supervisory Board - overview
52 April 9 & 10, 2020 – ESG Presentation
The Group Management - internal organization
53 April 9 & 10, 2020 – ESG Presentation
The Group Management - the Executive Committee, 10 members
● The Managers and the Executive Committee of 8 members
Managing Chairman and General partner: Florent Menegaux
General manager and Chief Financial Officer: Yves Chapot
DB1 : Executive Vice President, Automotive, Motorsport, Experiences, and Americas Regions: Scott Clark
DB2 : Executive Vice President, Road Transportation and European Regions: Laurent Bourrut
DB3 : Executive Vice President, Specialties and Africa/India/Middle East, China, East Asia & Australia Regions: Serge Lafon
DB4 : Executive Vice President, Services & Solutions, High Tech Materials: Sonia Artinian-Fredou
Executive Vice President, Manufacturing: Jean-Christophe Guérin
Executive Vice President, Research & Development: Eric Philippe Vinesse
Executive Vice President & Chief HR Officer : Jean-Claude Pats
Executive Vice President, Engagement and Brands: Adeline Challon-Kemoun
April 9 & 10, 2020 – ESG Presentation54
55
Say on Pay 2019 - preliminary note on compensation policies
applicable to Management in 2019
Compensation policy for 2020 will be disclosed on the 2019 URD as of April 17, 2020
Press release, April 6, 2020
The health crisis has caused a noticeable slowdown in the activities of the Michelin Group, which has led to some
employees having to undergo partial unemployment measures. In this context, and as a demonstration of solidarity with
the entire employee community, the Managers, the Executive Committee, as well as the Chairman and independent
members of the Supervisory Board are reducing their remuneration.
Florent Menegaux and Yves Chapot, the Managers of the Michelin Group, have expressed their will to give up
part of their 2019 variable compensation paid in 2020, once submitted to the vote of the shareholders at the
Annual general meeting to be held behind closed doors on June 23, 2020.
Apart from these adjustments, there are no changes in the
2019 compensation policy compared to the presentation made
on the 2018 registration document.
As a reminder, the 2019 compensation policy is applied to three
Managers during only part of the year.
April 9 & 10, 2020 – ESG Presentation
Say on Pay 2019 - Florent Menegaux, Managing Chairman,
Managing General Partner
Annual variable compensation
(awarded)
Fixed compensation
(paid and awarded)
Quantifiable and qualitative
criteria:
1. Growth in the Michelin share price vs. CAC 40 (from 0 to 11 %
of Profit Shares)
2. CSR Performance (from 0 to 8 % of Profit Shares)
- MEF
- Employee Engagement
3. Growth in Segment Operating Income(3) (from 0 to 11 % of
Profit Shares)
Fringe Benefits(1) : -
0 of 4 % Profit Shares
€900,000
Annual variable compensation and the Long-term incentive bonus will be deducted from the Profit Shares(2)
Long-term incentive bonus (awarded)
Subject to performance conditions on 3 years
Quantifiable criteria:
1. Level of Consolidated net income
0 of 10 % of Profit Shares
2. Annual growth in Sales
(1) Company car
(2) Based on calculation of Annual variable
compensation and Cash-settled deferred variable
compensation: 0,6 % Group’s consolidated net income
(3) SOI : based on current business scope and
comparable accounting methods, excluding changes in
exchange rates.
-0 to 20 % of Profit Shares
4. Efficiency project SG&A/ gross margin
3. Annual free cash flow (excluding
acquisitions)
1. Digital strategy
2. CSR/Human rights
3. Group transformation support
> Cap : at 2.5x annual fixed compensation of 2019
> Profit Shares payable out of distributable income for 2021 under conditions:
- Approval of the corresponding resolutions by the Annual Shareholders
Meeting called to approve the 2021 financial statements and the
compensation concerned
- Profit Shares payable out of distributable income for 2021
- Subject to the availability and amount of Profit Shares for distribution in
2022 out of 2021 profit, after deducting annual variable compensation due
for 2021
> F. Menegaux will have to invest in Michelin shares 20% of the long-term
incentive bonus received at the end of the three-year period
-0 to 30 % of Profit Shares
6 % of Profit Shares
The following will be applied to each criterion except for the one
concerning net income:
• a trigger point below which no compensation will be due;
• an intermediate tranche between the trigger point and 100% of the objective,
with the compensation prorated to the achievement rate for the objective;
• 100% of the objective, corresponding to the level at which the maximum
compensation for the criterion would be payable.
56 April 9 & 10, 2020 – ESG Presentation
Say on Pay 2019 - Yves Chapot, General Manager
Quantifiable and qualitative
criteria:
1. Growth in the Michelin share price vs. CAC 40
(from 0 to 35 % of criteria results)
2. CSR Performance (from 0 to 30 % of criteria results)
- MEF
- Employee Engagement
3. Growth in SOI(2) (from 0 to 35 % of criteria results)
€600,000
Quantitative criteria:
1. Growth in SOI(2)
(1) Company car
(2) SOI : based on current business scope and
comparable accounting methods, excluding
changes in exchange rates.
-based on 150% of fixed compensation
2. CSR/Human rights
3. Group transformation support
> Ceiling : 120% of the annual average of the annual variable compensation
paid to Mr. Chapot for 2019, 2020 and 2021
-Based on 100 % of fixed compensation
Maximum 80 % of the base Maximum 20 % of the base
Fringe Benefits(1) : -
3. Annual free cash flow (excluding
acquisitions)
4. the Efficiency project SG&A /gross margin
Fixed compensation
(paid and awarded)
Annual variable compensation
(awarded)
Long-term incentive bonus (awarded)
Subject to performance conditions on 3 years
57
The following will be applied to each criterion:
• a trigger point below which no compensation will be due;
• an intermediate tranche between the trigger point and 100% of the objective,
with the compensation prorated to the achievement rate for the objective;
• 100% of the objective, corresponding to the level at which the maximum
compensation for the criterion would be payable.
2. Annual growth in Sales
1. Digital strategy
April 9 & 10, 2020 – ESG Presentation
Say on Pay 2019 - JD- Senard, Managing Chairman and
General Partner (until May, 17th 2019)
-
Fringe Benefits(1) : -
-(prorated to the period served in 2019 on a
basis of €1,100,000)
Long-term incentive bonus
-From 0 to 18 % of Profit shares
(prorated to the period served in 2019)
Annual variable compensation and the long-term incentive bonus will be deducted from the Profit Shares(3)
(1) Company car
(2) Based on calculation of Annual variable compensation and
Cash-settled deferred variable compensation : 0,6 % of
Group Consolidated net income
Quantifiable and
qualitative criteria relative to:
From 0 to 4 % of Profit Shares
Quantitative criteria relative to:
1. Level of Consolidated net income
From 0 to 6 % of Profit Shares
2. Annual growth in Sales
3. Annual free cash flow (excluding
acquisitions)
2. CSR/Human rights
3. Group transformation support
8 % of Profit Shares
4. Efficiency project SG&A/Gross margin
Fixed compensation
(paid and awarded)
Annual variable compensation
(awarded)
58
The following will be applied to each criterion except for the one
concerning net income:
• a trigger point below which no compensation will be due;
• an intermediate tranche between the trigger point and 100% of the objective,
with the compensation prorated to the achievement rate for the objective;
• 100% of the objective, corresponding to the level at which the maximum
compensation for the criterion would be payable.
1. Digital strategy
April 9 & 10, 2020 – ESG Presentation
59
Say on Pay 2020 - preliminary note on Compensation policies
applicable to Management in 2020
Compensation policy for 2020 will be disclosed on the 2019 URD as of April 17, 2020
Press release, April 6, 2020
The health crisis has caused a noticeable slowdown in the activities of the Michelin Group, which has led to some
employees having to undergo partial unemployment measures. In this context, and as a demonstration of solidarity with
the entire employee community, the Managers, the Executive Committee, as well as the Chairman and independent
members of the Supervisory Board are reducing their remuneration.
Florent Menegaux and Yves Chapot, the Managers of the Michelin Group, have chosen to reduce their
remuneration by around 25% for the months of April and May 2020.
In addition, the members of the Group’s Executive Committee have voluntarily decided to reduce their remuneration by
around 10% during the same period.
Finally, the Chairman of the Michelin Group Supervisory Board, Michel Rollier, and its independent members are joining
this effort by donating 25% of their attendance fees received in 2020 to foundations in their respective countries, which
are part of the fight against Covid-19.
These reductions will be continued as long as Group employees are in partial activity due to the Covid-19 health crisis.
April 9 & 10, 2020 – ESG Presentation
€1,100,000
Multi-Criteria
Annual Variable Annual Fixed
Single-Criterion
Annual Variable
€796,6218% of the Consolidated
Calculation Base**
€965,903For up to 14% of the Consolidated
Calculation Base**
3 quantitative criteria
- Annual growth in sales
volume
- Efficiency project
- Annual free cash flow
excluding acquisitions
4 qualitative criteria
- Digital strategy
- CSR/Environment &
human rights
- Manager transition
- Group organization
€1,362,465Base: €1,800,000***
4 quantitative criteria
- Growth in Michelin's share price
compared with that of the CAC40 index
- MEF measurement
- Employee engagement rate
- Growth in consolidated
operating income
*Company car
**Consolidated Calculation Base:
0.6% of the Group’s consolidated net income
***As increased or reduced to reflect the percentage gain or loss in Michelin’s share
price over the three-year period from 2016 to 2018, namely 10.5%
Achievement in 2018:
62.90/100
Achievement in 2018:
44.58/50
Fringe benefit*: €8,470
(in €, before payroll and other taxes)
Paid to the General Partners for
the risk incurred by virtue of
their unlimited joint and
personal liability for the
Company's debts
Ceiling: 150% of the average of the Annual
Variable Components paid to Jean-Dominique
Senard for 2016, 2017 and 2018, and amount
of Profit Shares available for distribution after
deducting the Variable Compensation due for
2018Achievement in 2018: 107/150,
or 87.80% of Annual Fixed Compensation
Long-term incentive
Performance conditions over 3 years
Fixed
26%
LTI
32%
Multi-Criteria
23%
Single-Criterion
19%
LTI due LTI awarded
-Base: €1,080,000
The Variable Components and the Long-term incentive are paid out of the Profit Shares allocated to the General Partners under the Bylaws,
capped at 0.6% of the Group’s consolidated net income and approved at the Annual Shareholders Meeting as part of the appropriation
of net income
Say on Pay 2018 - 2018 compensation (cash-settled and fringe benefits)
Jean-Dominique Senard, Managing Chairman (until May 17, 2019)
60 April 9 & 10, 2020 – ESG Presentation
€554,672Base: €900,000
(Prorated to reflect the period served in 2018)
Multi-Criteria
Annual Variable Annual Fixed
Single-Criterion
Annual Variable
€312,3745% of the Consolidated
Calculation Base**(Prorated to reflect the period served in 2018)
€356,106For up to 8.50% of the Consolidated
Calculation Base**(Prorated to reflect the period served in 2018)
3 quantitative criteria
- Annual growth in sales
volume
- Efficiency project
- Annual free cash flow
excluding acquisitions
4 qualitative criteria
- Digital strategy
- CSR/Environment &
human rights
- Manager transition
- Group organization
Achievement in 2018:
62.90/100
Achievement in 2018:
44.58/50
Fringe benefit*: €5,392 The Variable Components of compensation are paid out of the Profit Shares
Paid to the General Partners for
the risk incurred by virtue of
their unlimited joint and
personal liability for the
Company's debts
Multi-Criteria
Achievement in 2018: 107/150,
or 64.20% of Annual Fixed Compensation
*Company car
**Consolidated Calculation Base:
0.6% of the Group’s consolidated net income
Long-term incentive
Performance conditions over 3 years
LTI due LTI awarded
-Base: €720,000
-
Ceiling: 150% of the average of the Annual
Variable Components paid to Florent
Menegaux for 2018, 2019 and 2020, and
amount of Profit Shares available for
distribution after deducting the Variable
Compensation due for 2020
Fixed
45%
Multi-Criteria
29%
Single-Criterion
26%
4 quantitative criteria
- Growth in Michelin's share price
compared with that of the CAC40 index
- MEF measurement
- Employee engagement rate
- Growth in consolidated
operating income
Say on Pay 2018 - 2018 compensation (cash-settled and fringe benefits)
Florent Menegaux, Managing General Partner(in €, before payroll and other taxes)
61 April 9 & 10, 2020 – ESG Presentation
€372,808Base: €600,000
(Prorated to reflect the period served in 2018)
Multi-Criteria
Annual VariableAnnual Fixed
€263,763Maximum of 120% of fixed compensation(Prorated to reflect the period served in 2018)
3 quantitative criteria
- Growth in consolidated
operating income from
recurring activities
- Level of consolidated
inventories of finished and
semi-finished products
- Level of Automotive segment
tire sales volume
2 qualitative criteria
- Organizational transition
- Customer Service initiative/
Net Promoter Score
Say on Pay 2018 - 2018 compensation (cash-settled and fringe benefits)
Yves Chapot, General Manager
*Company car
**Liability recognized for the LTI: €94,200
Achievement in 2018:
37.61/70
Achievement in 2018:
20.78/30
Fringe benefit*: €4,352
(in €, before payroll and other taxes)
Achievement in 2018: 58.39/100,
or 70.75% of Annual Fixed Compensation
Long-term incentive
Performance conditions over 3 years
LTI due LTI awarded
-Base: €600,000
-
Fixed
59%
Multi-Criteria
41%
Ceiling: 120% of the average of the Annual
Variable Components paid to Yves Chapot
for 2018, 2019 and 2020
4 quantitative criteria
- Growth in Michelin's share price
compared with that of the CAC40 index
- MEF measurement
- Employee engagement rate
- Growth in consolidated operating income
62 April 9 & 10, 2020 – ESG Presentation
Say on Pay 2018 - 2018 compensation (entitlement to additional benefits and other
advantages)
Jean-Dominique Senard, Managing Chairman
Florent Menegaux, Managing General Partner
Yves Chapot, General Manager
● Compensation for loss of office as a result of a change of strategy or a change of control,
subject to performance conditions decided by the Supervisory Board
● Non-compete indemnity
● No other benefits
● No stock options
● No performance shares
● No attendance fees
No additional benefits were paid in 2018
63 April 9 & 10, 2020 – ESG Presentation
Say on Pay 2018 - 2018 compensation (supplementary pension benefits)
=> Applicable to all senior executives of the two main French companies who have served for
at least five years as a senior executive
1.5% of benefits vest each year, entitling participants to an
annuity representing a replacement rate of up to 15% of the
reference compensation
The replacement rate, including entitlements under compulsory
plans, is capped at 35%, which is well below the 45% ceiling for
fixed and variable compensation recommended in the
AFEP/MEDEF Code
Payment of a gross annual maximum annuity after 10 years of
service, conditional on participants ending their career with the
company
Estimated amount of annual income at
December 31, 2018
Mr. Senard, Managing Chairman €165,000
Mr. Menegaux, Managing General Partner €135,000
Mr. Chapot, General Manager €110,544
Mr. Senard, Managing Chairman
Mr. Menegaux, Managing General Partner
Mr. Chapot, General Manager
64 April 9 & 10, 2020 – ESG Presentation
Attendance fees for 2018
€90,000
Individual attendance rate in 2018
100%
60% of the fee is tied to his attendance rate at
meetings of the Board and its Committees
Say on Pay 2018 - 2018 compensation
Michel Rollier, Chairman of the Supervisory Board
● No compensation is awarded to Michel Rollier aside from attendance fees, consistent
with the policy applied for the top executives of other CAC 40 companies
● Most of the fee is contingent on his attendance rate at meetings of the Supervisory Board
and the Committee of which he is a member
April 9 & 10, 2020 – ESG Presentation65
ESG
presentation
April 09 & 10, 2020
Appendices
XXXX67
Our growth and value creation model
April 9 & 10, 2020 – ESG Presentation68
Materiality matrix has revealed a general convergence among external stakeholders
and Michelin employees concerning the relative importance of the various social
responsibility issues
Our Commitments to Sustainable Development and Mobility
1 Transparency
2 Staff commitment to Sustainable Development
3 Commitment to accessible, clean, sustainable and responsible mobility
4 Sustainable, responsible governance
Ethics and compliance
5 The safety of users of Michelin products and services
6 High-performance, competitive, responsible products and services
7 Business ethics
8 Responsible purchasing
Human rights
9 Respecting human rights and duty of care
10 Diversity of teams
11 Staff development
12 Contribution to the development of local communities
13 Impact on local communities
14 Reasoned/balanced development in emerging countries
15 Dialogue with stakeholders
Employee health and safety
16 Health and well-being of staff
17 Impact of digital technologies on our working methods
Environment
18 Environment (as a Group performance indicator)
19 Energy transition and carbon reduction
20 Eco-design of our products and services
21 Sustainable, responsible operations
4
7
1
2
10
12
15
189
5
3
62119
8
16
11
14
13
20
6,5
7,0
7,5
8,0
8,5
9,0
9,5
10,0
6,5 7,0 7,5 8,0 8,5 9,0 9,5 10,0
Imp
ort
ance
fo
r e
xte
rnal
stak
eh
old
ers
Importance for internal stakeholders
Less important Important Priority
Prio
rityIm
po
rtant
Less
imp
ortan
t
April 9 & 10, 2020 – ESG Presentation69
Michelin, an unifying body of the Global sustainable mobility
● Some initiatives to decarbonize the transport sector:
Movin’On Summit: an ecosystem initiated by Michelin, which aims at
identifying practical solutions in order to meet major mobility challenges.
Michelin, co-founder of Paris Process on Mobility & Climate : creation of a
global macroeconomic roadmap to handle the transport sector transformation
into a « zero-emission » economy.
In 2019 October, the Global Roadmap of Action towards Sustainable Mobility
(GRA) is launched by SuM4All (group initiated by the World Bank)
Florent Menegaux : “The GRA is the first actionable toolbox for public decision makers, designed to help them identify policy measures that best apply to their
own country’s needs. As a member of the Sum For All steering committee, Michelin is proud to support the GRA, by bringing the business perspective, and
funding - through the Michelin Corporate Foundation - a GRA-based digital tool, designed to help countries take appropriate actions.”
April 9 & 10, 2020 – ESG presentation71
Michelin « Supporter » of Task Force on Climate-related
Financial Disclosure
● Since 2018, the Group has applied the recommendations issued by the TCFD
organization operating under the aegis of the G20 Financial Stability Board
● A summary of Michelin’s answers is published in the Registration Document (cf.
chapter 4 of Michelin – 2019 Universal Registration Document). They relate to:
– Governance (Roles, responsibilities and control)
– Strategy (Time horizons, Main risks and opportunities, Climate scenarios used)
– Risks and opportunities (Identifying, assessing and managing risks and opportunities)
– Metrics and targets
● Further information may be found in the public answers to the CDP Climate
Change 2019 questionnaire (see https://www.cdp.net/en/responses)
April 9 & 10, 2020 – ESG presentation72
Michelin is involved in TIP Tire Industry Project, a WBCSD
Sector Project
● Since 2005, TIP drives research on potential human health
and environmental impacts of tires throughout their lifecycle.
● TIP is a global CEO-led initiative undertaken by leading tire
manufacturing companies.
● Together, TIP member companies work towards solutions for
a sustainable future on topics including end-of-life tire
management, tire and road wear particles, and sustainable
natural rubber.
April 9 & 10, 2020 - ESG Presentation73
What are TRWP (Tyre and Road wear Particles) ?
● Tire and Road Wear Particles (TRWPs) are tiny debris produced by the friction
between tires and the road, ensuring grip and safety on the road
● These particles are a mixture of rubber and minerals coming from the road
● They have specific characteristics and behaviors ‒ High density: 1.8
‒ Big Diameter: average size 100 mm
‒ High degradability rate
● Scientific studies available to date have not identified risks related to TRWP on human
health and fauna/flora in fresh aquatic water
● Scientific studies made to date at the request of TIP and ETRMA found that 2 to 5% of
TRWP emitted would reach estuaries and that in the order of 1% of PM10 and PM2.5
present in the air would be issued from TRWP
April 9 & 10, 2020 - ESG Presentation74
The Group is strongly engaged on the topic of TRWP working
in 3 different areas
● Proactively with the industry and the TIP (Tyre Industry Project) in order to increase
the scientific knowledge and analysis of potential impacts related to TRWP
(repartition in the different environmental compartments, degradability, composition,
impact analysis, etc…). In parallel, the Group pays very close attention to all related
studies that may serve to enhance and expand current scientific knowledge.
● Alongside the rest of the industry and the European authorities to develop a
standardized test method for measuring tire abrasion rate (particulate emissions
in g/100 km).
● With our teams, to continue to develop always more performing tyres, optimizing
the use of materials and limiting the emissions.
April 9 & 10, 2020 – ESG Presentation75
Reminder: Scopes 1, 2 and 3
Michelin has established and regularly
updates its greenhouse gas (GHG)
inventory according to the most widely
used international accounting tool
known as the Greenhouse Gas
Protocol
(http://ghgprotocol.org/).
The inventory covers Michelin’s own
operations (Scopes 1 & 2) and the
relevant activities in its upstream and
downstream value chain (Scope 3).*
Michelin’s carbon footprint is the sum
of CO2 emissions in Scopes 1, 2 and
3.
* The inventory boundary is consistent with the scope of Michelin’s
financial reporting.
Scope 2INDIRECT
100% under Michelin
responsibility
Michelin has influence
over these activities
Scope 1DIRECT
Scope 3INDIRECT
Scope 3INDIRECT
1.
purchased
goods and
services
2. capital
goods
3. fuel and
energy
related
activities
4.
transportation
and
distribution
5. waste
generated in
operations
6.
business
travel
7. employee
commuting
8. leased assets
purchased electricity, steam,
heating & cooling for own
use
company
vehicles
company
facilities
Upstream activities Reporting company Downstream activities
9.
transportation
and distribution
10. processing
of
sold products
11. use of
sold
products12. end-of-life
treatment of
sold products
13. leased
assets
14.
franchises
15.
investments
April 9 & 10, 2020 – ESG Presentation76
Analyzing tire life cycles to help protect biodiversity
April 9 & 10, 2020 – ESG Presentation77
Biosourced materials: with its unique expertise in materials and its culture of
innovation, Michelin is breaking new ground with BioButterfly and BioImpulse
Construction of France’s first demonstrator unit capable of producing
butadiene using biosourced ethanol
Project in partnership with IFP Energies Nouvelles and Axens
With support from ADEME*
Creation of a new adhesive resin without any Substances of Very High
Concern (SVHC)
Collaborative project coordinated by Michelin
through ResiCare, that brings together France’s FCBA**, INRA**, INSA** and Leaf, a business unit of Lesaffre.
With support from ADEME*
April 9 & 10, 2020 – ESG Presentation78
The BioImpulse project is giving new impetus
to the use of biotechnology in materials
● Coordinated by Michelin through its ResiCare entity, the project aims to replace Substances of
Very High Concern (SVHCs) in resins
Development and scale-up to
mass production
of a biosourced molecule
● The high-potential worldwide market targeted by the substance replacement project is
concentrated in the automotive and construction industries
years of
project work
Budget in M€
Partners
Incremental investments through
modularization and ramp-up of
processes
Design and development of a
range of non-toxic glues and
resins
Wood Insulation Tires Molding
compoundsLaminates
April 9 & 10, 2020 – ESG Presentation79
Michelin, IFP Energies nouvelles, and Axens give a new
dimension to the BioButterfly project
Tonnes / year of
production
capacity
Budget in €M
between
2012 and 2022
Partners
● The construction of France's first industrial demonstrator capable of producing butadiene from
ethanol, aims to replace the oil-based raw materials used in the company's tires with bio-
sourced molecules
*
* 2nd generation, non-competing with
food) made from forest or agricultural
residues (straw, woodchips, etc.)
April 9 & 10, 2020 – ESG Presentation80
2017: Lehigh Technologies acquisition
2018: A new plant in Europe
● Lehigh Technologies MRP
(micronized rubber powder) for
areas inside and outside of
Michelin’s applications – high
technology materials
● Research and Development to
find innovative solutions in the
form of new products, such as
roads (rubber asphalt)
● Lehigh Technologies won the
Innovation Award from the ICIS*
2018
*ICIS is the world’s largest provider of market intelligence in the fields of petrochemical, energy and fertilizer industries.
April 9 & 10, 2020 – ESG presentation81
Innovation leader with Uptis: the airless concept, an
essential step towards more sustainable mobility
- From ambition to action -
Benefits for car
owner
Benefits for fleet
owners and
profesionnals
Benefits for all
More serenity during
the journeys
Material savings and
waste reduction
Co-developed
with General Motors
(Connected, Autonomous,
Shared, Electric)
Productivity optimisation
April 9 & 10, 2020 –ESG presentation82
Uptis airless concept, a major advancement toward achieving
Michelin’s VISION concept, illustration of the mobility in the future
Connected
3D-printed rechargeable
Renewable
& bio-sourced materials
Airless
April 9 & 10, 2020 –ESG presentation83
Ever more sustainable offers for more value with less impact
TIRES
PROVIDING LONG LASTING PERFORMANCE
MORE FUEL EFFICIENT
INVOICING PER KILOMETER TRAVELED, PER TONNE
TRANSPORTED, PER LANDING.
FULL PRODUCT LIFECYCLE MANAGEMENT
LIGHTER
SERVICES NEW PLAYGROUNDS (4R)
April 9 & 10, 2020 – ESG presentation84
● By offering customers tires that deliver high performance until 1.6mm wear indicators appear
Michelin is improving consumer
purchasing power
by increasing
the time
between tire
changes
by improving, with
worn tires, the fuel
efficiency*
Michelin is improving the tire
industry’s environmental
footprint
by avoiding raw
material waste
by reducing
carbon
emissions
The European
Parliament
approves worn tire
testing
In Europe, long-lasting
performance will be a
prerequisite for every
tire
● Michelin’s approach is supported by:
‒ The automotive industry
‒ The European Parliament
20192024-2026
* Up to a 20% reduction in rolling resistance
Recognition for the economic and environmental benefits of
Michelin tires’ long-lasting performance
April 9 & 10, 2020 – ESG presentation85
Tire design: a matter of choice
Technologies are available for a long lasting performance tire:
April 9 & 10, 2020 – ESG presentation86
Michelin Tires : Performance over the time in every conditions
Tier 1 market portfolio by range (in %)** Performance of the MICHELIN Pilot Sport 4 SUV
tire compared with competitors
17% 14% 9%Green RR and
A-Wet portfolio*
1st
Top 6 competitors
average 6th
27%
*Range whose rolling resistance (RR) rating is A, B or C
and wet grip (WG) rating is A
**Source: Lizéo, May 2019 50
60
70
80
90
100Dry Braking
Wet Brakingnew
Wet Brakingworn
Longevity
Rollingresistance kg/T
Dry Lap time
MICHELIN Pilot Sport 4 SUVEU market averageLeading competitor in Europe
April 9 & 10, 2020 – ESG presentation87
Michelin is meeting the EV chalenge
Ho• Renault Zoé – MICHELIN Energy E-V
• Tesla, en position de leader – MICHELIN Pilot Sport
• Renault Kangoo Z.E. et Z.E.H2 – MICHELIN Energy Saver
• GM Bolt / Volt
• Peugeot e-2008 – MICHELIN Primacy 4
• Mercedes EQC – MICHELIN Pilot Sport 4 SUV…
Consumer and commercial
EVsAsia
• Certified by a large number
of Chinese OEMs*
• Partnership with Hyundai for
its EV line
Ho• Formula E –
MICHELIN Pilot
Sport
Racing
* Xiaopeng, WM Motors, Human Horizons,Iconiq, SAIC, BAIC, Guangzhou Autos, FAW
Increasing rangethe major challenge for EVs
Supporting heavy
batteries
Reducing cockpit
noise
Coping with torque
By reducing rolling resistance, with the right
materials, and aerodynamic drag, with the
right tire design (Slimline)
By designing tires capable of both carrying
heavier loads and reducing rolling
resistance
By using Michelin Acoustic Technology and
adjusting tread design
By improving tread rigidity and contact patch
friction
April 9 & 10, 2020 – ESG presentation88
Services & Solutions’ functional economy and pay-per-use
approach: a virtuous model
A global footprint
Connected
services
vehicles under contract
For the transportation industry and beyond
Infrastructure Insurance
* Including Truck and Mining tire maintenance
Monetization of
data analyses
Predictive
maintenance
Usage-based
billing*
April 9 & 10, 2020 - ESG Presentation89
2 questions about Hydrogen
● storing intermittent energies (wind,
solar…) electricity production surplus,
through electrolysis
● helping decarbonize transportation.
Hydrogen vehicles only reject water
Water electrolysis
From fossil
sources
Hydrogen mobility is the unique
solution to meet the three
challenges simultaneously :
pollution, greenhouse gases
and energy transition
● H2O & ElectricityH2
ZERO CO2 EMISSION
* To day more than 90% of the global H2 production is from Hydorcarbon
Steam reforming*H2● Hydrocarbon
April 9 & 10, 2020 - ESG Presentation90
3 questions about fuell cells
+ +
Electric transmission
Stack
Air system
Cooling system
+ transformer and controller
April 9 & 10, 2020 - ESG Presentation
* Estimation Michelin
91
500 km
257 km
90 km
500 km
Fill-up of hydrogen Autonomy
X2-X33min
Michelin has decided to target first
professionnal markets before
approaching passenger cars.
● A fuell cell car will be able to cover longer
distances and offer constant availabilty for a
lighter and smaller system
The hydrogen mobility, which growth perspectives are significant, a solution
particularly adapted to the professionnal needs
● 2030 market *
2million
vehicles
‒ 80% light vehicles(commercial and particular)
‒ 20% trucks and bus
April 9 & 10, 2020 - ESG Presentation92
Michelin has for ambition to become a world leader of hydrogen
systems
● With its expertise in the hydrogen fuel cell, notably with Symbio, Michelin is accelerating the
deployment of zero-emission mobility:
‒ by partnering with Faurecia to create a leading hydrogen fuel cell system
‒ by participating in the Zero Emission Valley project (Hympulsion) in France, involving public-private
partners
‒ by being a key stakeholder playing as a trusted third party in hydrogen mobility (Hydrogen Europe,
Hydrogen Council, MOVIN’ON…)
employees in 2020 will be engaged by
Michelin and Faurecia
industrial sites
eventually: Europe,
Asia and USA
÷the price of a battery &
components in the future,
(due to growing demand)
2030 perspectives
of market shares
of sales
April 9 & 10, 2020 - ESG Presentation93
Disclaimer
"This presentation is not an offer to purchase or a solicitation to recommend the purchase
of Michelin shares. To obtain more detailed information on Michelin, please consult the
documents filed in France with Autorité des marchés financiers, which are also available
from the http://www.michelin.com/eng/ website.
This presentation may contain a number of forward-looking statements. Although the
Company believes that these statements are based on reasonable assumptions as at the
time of publishing this document, they are by nature subject to risks and contingencies
liable to translate into a difference between actual data and the forecasts made or inferred
by these statements."
April 9 & 10, 2020 - ESG Presentation94
Contacts
Investor Relations :
Edouard de Peufeilhoux
Humbert de Feydeau
Pierre Hassaïri
Sustainable Development and Mobility
Nicolas Beaumont
Sophie Perrier
+33 (0) 4 63 21 56 90
27, cours de l’île Seguin
92100 Boulogne-Billancourt - France