Comprehensive Analysis of Siemens' Organization Sustainability and CSR

This report examines Siemens' approach to organization sustainability and corporate social responsibility (CSR). It details Siemens' commitment to sustainable development, encompassing environmental, social, and economic aspects. The company's CSR strategy includes a diverse workforce, community engagement, and environmental initiatives. Siemens focuses on key performance indicators (KPIs) to measure the impact of its projects and partnerships with various organizations. The report highlights Siemens' sustainable development goals (SDGs), emphasizing its contributions to infrastructure, health, climate action, and gender equality. It also covers Siemens' financial performance, corporate governance structure, and commitment to employee health and safety. Siemens’ sustainability strategy is driven by the principles of planet, people, and profit, contributing to its customers' competitiveness, environmental protection, and social responsibility. The report analyzes Siemens' financial performance, corporate governance, and commitment to employee health and safety, emphasizing its commitment to long-term growth while balancing profit, environment, and people.

Running head: ORGANIZATION SUSTAINABILITY AND CSR 1
Organization sustainability and CSR
Name
Institution

ORGANIZATION SUSTAINABILITY AND CSR 2
Organization sustainability and CSR
Siemens is an automation company whose headquarters are located in Berlin Germany. It
is considered the largest industrial company in Europe, with branches all over the world
("Industrial Manufacturing - Siemens", 2018). The company’s strategy is to have a sustainable
plan that every stakeholder takes a personal responsibility for the company’s success. At
Siemens, sustainability is a core principle that involves more than utilization of natural resources;
it is also comprised of the sustainable development of communities, states, and businesses.
CSR stance
Siemens has a Corporate Citizenship whose main purpose is ensuring that the company
shall set aside adequate funds to spend on CSR activities as indicated in the 2013 Companies act.
All projects of Corporate Citizenship are done using a predefined framework. The first step is
conducting a baseline study for initiating any program ("Siemens Corporate Social
Responsibility", 2018). For it to achieve the CSR objectives, the company has to partner with
other organizations like training institutions, Governments, NGOs and other stakeholders
necessary form implementing and facilitating the project. All partners are selected based on the
company’s internal policies and the applicable rules and regulations. The progress of all projects
towards achieving the preset objectives is measured using key performance indicators. The
impact and the relevance of the project are assessed periodically to determine whether the project
is worthy.
CSR decisions made by the organization
Siemens has made a decision of fostering a diverse workforce that brings together people
with different experiences, skills, and backgrounds. Recruiting different kinds of people can help
to create value and strengthen the company’s sustainability goals. To facilitate progress in the

ORGANIZATION SUSTAINABILITY AND CSR 3
area of equality, job creation and providing educational opportunities, the role of chief diversity
officer is given to a managing board member. The company’s geographic reach facilitates its
diversity strategy. Siemens has taken a number of steps to promote and strengthen its
workforce’s diversity. These steps involve fostering the value of being global, addressing the
issue of unconscious bias, and ensuring an inclusive culture that values the contribution of
individuals from different backgrounds. Through the above policies, the company aims to
encourage and develop a richly diverse channel of people who are ready to grow within the
organization.
The Siemens’ sustainable development goals (SDGs) of societies aim to improve the
quality of life of everyone by being actively involved in dealing with the economic, social and
environmental problems (Marnewick, 2017). The organization impacts SDGs through four
important ways; by operating its business responsibly, through the corporate citizenship activities
and engaging the community, through the company’s products and solutions and through its
expertise in leadership.
Environmental and social focus
Siemens rates its SDGs as either high or medium impact (Marnewick, 2017). The first
high impact goal is the company’s commitment to building infrastructure to promote inclusive
and sustainable industrialization and set platforms for innovation. To promote the well-being of
all people and ensure healthy lives, Siemens provides production technology to pharmaceutical
companies.

ORGANIZATION SUSTAINABILITY AND CSR 4
("Siemens’ sights on sustainability", 2004).
Siemens is also in the front line to combat the changes in climate and their impact by
being the first to set the target of becoming CO2 neutral in all of its operations by the year 2030.
The company also offers solutions across numerous infrastructure domains to make cities safe,
efficient and sustainable.
("Siemens’ sights on sustainability", 2004).
One medium impact goal is to empower all girls and women by recruiting more female
into top positions to achieve gender equality (Ricotti, 2003). Siemens believes that quality
education is key for its employees and promoting innovation; it aims to inspire the youth to have

ORGANIZATION SUSTAINABILITY AND CSR 5
careers in engineering, science, and technology via numerous citizenship engagements all over
the world.
To Siemens, being a sustainable business means that its activities are profitable and there
is long-term growth while balancing profit, environment and the people ("Siemens’ sights on
sustainability", 2004). The SDGs are not just responsibilities but also opportunities to work with
the local and national governments that are willing to re-shape their own development agenda.
The sustainability strategy is driven by 12 main principles which are clustered under three major
headings; planet, people, and profit. Under profit, Siemens contributes to the competitiveness of
their customers through their products and services. The company also partners with its
stakeholders to identify and initiate business opportunities related to sustainability. Under planet,
the company helps its customers to save on resources and protect the environment by increasing
energy efficiency. Siemens develops its products and services using sound eco-design standards
with an aim of minimizing the environmental impact of its operations. Under people, the
organization fosters long-term relationships with the local societies by jointly partnering with
them in corporate citizenship projects. The company also contributes to sustainable development
of societies through leadership and local operations.
The corporate social responsibility of Siemens Limited aims at contributing to sustainable
communities to build on the company values of being innovative, excellent and responsible
("Energy - Siemens", 2018). The company has always been committed to sustainably improve
the living standards of as many individuals as it can. The strategy focuses on issues like the
environment, science, education, and social. The main aim of the strategy is to address the
challenges faced by the community by leveraging its competencies and solutions; it is inclined
towards the United Nations Millennium agenda and the UN global compact principles.

ORGANIZATION SUSTAINABILITY AND CSR 6
Skills and knowledge are the key driving forces of development and economic growth in
every nation. Currently, there is a huge gap existing between the industry’s need for an
employable workforce and capacity of development programs to produce the skills required.
Siemens applies its competencies to promote education and training so as to produce technicians
and engineers who are industry ready. Siemens also offers scholarship programs that are aimed
at supporting the deserving engineering and technology students from needy families to achieve
a sustainable career in technology or engineering ("Siemens begins tooling education initiative",
2017). The company has initiated a program to encourage employee’s engagement in addressing
the need of the communities on education. To enable the students to be ethical in all works of
life, Siemens promotes ethical education in schools and training institutions.
In Siemens’ sustainability principles and practice, occupational health and safety
management is an important element. The company is responsible for ensuring that the
environment of a workplace is safe for every worker. In the efforts for occupational health and
safety, Siemens launched a program known as zero harm cultures which are guided by three
basic principles. The first principle is that everyone should be able to work at the company
without being harmed by anything. Secondly, the company does not compromise safety by
ensuring that employee safety is given the highest priority. Finally, all workers have a
responsibility of taking care of each other and themselves by avoiding risky behavior and
informing their colleagues when they recognize a risky situation. In case a serious incident
happens, the CEO of the business unit is responsible for reporting the incident and the report
must contain a comprehensive analysis of the factors that contributed to the incident. To
strengthen the brand, Siemens has maintained a strong reputation by offering quality services to
ensure that all customers are satisfied.

ORGANIZATION SUSTAINABILITY AND CSR 7
Corporate governance
Being a subject to German corporate law, Siemens has a two-tier board structure that is
comprised of a supervisory board and a managing board. The supervisory board is composed to
be such that all members have the knowledge, skills, and experience required to carry out their
functions efficiently (Boytsun, Deloof & Matthyssens, 2010). The supervisory board has seven
main committees which have a responsibility of fulfilling all requirements of German stock
Corporation act. These include the chairman’s, compensation, audit, compliance, nominating,
mediation, and the innovation and finance committee. The managing board has a responsibility
of serving the interests of the company and developing strategies to achieve sustainable growth.
The members of the management board decide the basic issues of the business policy and the
short term and long term goals of the company. The management also prepares the financial
statements of the company and consolidates them to form a combined report of the Siemens
group. The board also ensures that the company adheres to the statutory provisions and complies
with the international regulations.
Financial performance

ORGANIZATION SUSTAINABILITY AND CSR 8
("Financial Results & Presentations - Siemens Global Website", 2018)
In the 2017 financial year, the company recorded a total revenue of 28, 464 million euros,
which is a 3% improvement compared to the previous year’s revenue which was 27, 195 million
Euros. The total assets stood at 133, 804 million euros; this was a 6% increment ("Financial
Results & Presentations - Siemens Global Website", 2018). The total equity ratio stood at 33%
while the debt ratio stood at 67% meaning that the company has a high ability to pay its debts on
time. The capital structure decrease from 1.0 to 0.9 due to a decrease in obligations in provisions
for pensions. The company had a free-cash-flow of 4,819 million euros for continuing activities
and -50 million euros from discontinued operations.
Siemens’ profit margin of its industrial business increased from 10.8 to 11.2% thus
reaching its forecasted target which ranged between 11.5 – 12.0%. The net income of the fiscal
year rose by 11% and basic EPS from net income increased by 10%. In fiscal 2018, the fixed
investments are anticipated to grow by 3.6%. The company also expects a modest growth in
revenue since the development of the industrial businesses is expected to continue. In simple
terms, Siemens expects a mixed picture in the economic environment of the year 2018.

ORGANIZATION SUSTAINABILITY AND CSR 9
References
Siemens begins tooling education initiative. (2017). Metal Powder Report, 72(3), 216-217. doi:
10.1016/j.mprp.2017.04.033
Siemens’ sights on sustainability. (2004). Strategic Direction, 20(10), 18-20. doi:
10.1108/02580540410562125
Siemens.com (2018). Retrieved from
https://www.siemens.com/annual/14/en/download/pdf/Siemens_AR2014_CorpGov.pdf
Marnewick, C. (2017). siemens Sustainability Information 2017. International Journal Of
Project Management, 3(6), 112. doi: 10.1016/j.ijproman.2017.02.014
Industrial Manufacturing - Siemens. (2018). Retrieved from
https://www.industry.usa.siemens.com/industry/us/en/pages/industry.aspx
Energy - Siemens. (2018). Retrieved from https://www.energy.siemens.com/us/en/
Financial Results & Presentations - Siemens Global Website. (2018). Retrieved from
https://www.siemens.com/investor/en/publications_calendar.php
Siemens Corporate Social Responsibility. (2018). Retrieved from http://www.siemens-home.bsh-
group.com/hk/en/discover-siemens/special-and-excellent/corproate_social_responsibility
Boytsun, A., Deloof, M., & Matthyssens, P. (2010). Social Norms, Social Cohesion, and
Corporate Governance. Corporate Governance: An International Review, 19(1), 41-60.
doi: 10.1111/j.1467-8683.2010.00829.x
Ricotti, P. (2003). Corporate Responsibility and Sustainable Development. Symphonya.
Emerging Issues In Management, (1). doi: 10.4468/2003.1.08ricotti

ORGANIZATION SUSTAINABILITY AND CSR 10