Sustainability Governance and Commitment to Stakeholders

Sustainability Governance

All areas of the Group have an active role in addressing the goals and challenges of sustainability. The sustainability management process is based on a model of shared responsibility that begins with the top level of management and involves every area and function within the organization. All employees worldwide are expected to conduct their activities responsibly.

Several entities within the organization are responsible for directing and coordinating sustainability activities across the Group’s businesses. Those entities include:

The Sustainability Team, through its offices in Italy, the U.S., Brazil and China, has a key role in promoting a culture of sustainability within the Group and facilitating the process of continuous improvement, while contributing to risk management, cost optimization, stakeholder engagement and enhancement of the Group’s image. The team collaborates with individuals within the business areas, regions and central functions that have operational responsibility for issues such as the environment, energy, innovation and human resources, and supports them in identifying key areas for action. It also manages relationships with international sustainability organizations, as well as sustainability rating agencies and investment analysts, with the support and coordination of the Investor Relations team.

The Cross-functional Sustainability Committee (CSC) consists of the heads of the principal central functions, operating segments and regions, who are often also consulted individually. The CSC evaluates and facilitates operational decisions, as well as serving in an advisory capacity for proposals submitted by the Sustainability Team to the Group Executive Council (GEC), the decision-making body composed of the Chief Executive Officer (CEO) and Chief Operating Officers (COOs) of the regions and operating segments, together with the heads of various central functions. The GEC is responsible for defining the strategic approach, approving operating guidelines and evaluating the alignment of the Sustainability Plan with business objectives. The CSC periodically updates the GEC on individual initiatives and the Group’s overall sustainability performance.

The Governance and Sustainability Committee (a committee of the Board of Directors) evaluates proposals relating to strategic guidelines for sustainability-related issues and, as appropriate, formulates proposals to the Board of Directors. This Committee also reviews the annual Sustainability Report.

Commitment to Stakeholders

Our ability to generate value through our business decisions is intrinsically linked to how effective we are in listening to and understanding the needs and expectations of our stakeholders. FCA has established a global target to expand and innovate the sustainability dialogue with our stakeholders, and to reach an increasing number worldwide each year.

The decisions made by many of our stakeholders - including customers, suppliers, dealers, employees, public institutions, trade and industry groups, investors and local communities - affect the Group’s activities. Similarly, the Group’s activities and results affect, to varying degrees, the actions and expectations of stakeholders.

For this reason, operating responsibly requires continuous engagement with stakeholders at the local and global levels, as indicated in the Group’s Stakeholder Engagement Guidelines.

Over time, our engagement has evolved and we have developed a variety of channels to communicate with each type of stakeholder. This has fostered a deeper understanding of stakeholder expectations and led to the implementation of initiatives that are more effective at addressing their specific needs.

In 2014, FCA conducted 14 internal sustainability-focused Stakeholder Engagement events in Italy, the U.S. and China. These events provided a platform for more than 400 employees representing the various business areas to express their views, needs and priorities. The participants took part in discussions and workshops that addressed the economic, environmental and social impacts of FCA’s activities. The events were also effective in identifying material aspects specific to each region.