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ESG Update

Dec 14, 2021

Olivier Lepick
Group General Secretary and ESG Lead, Capgemini

Good afternoon, everyone, and welcome to our Capgemini ESG Investor Webinar, live from Les Fontaines in the outskirts of Paris. My name is Olivier Lepick, Group General Secretary and ESG Lead, and I look forward to guiding you today through the presentation of our ESG policy, which was published last week. If you have not already done so, I invite you to download it from the Capgemini Investor website. We will, together, for approximately one hour, including time we set aside for a Q&A session, answer the questions you may have. Before we proceed, allow me to mention that all the appropriate COVID measures for this event, including procedures, distancing, and testing, are, of course, enforced. Without further ado, let's jump in. To start, I would like to let our CEO, Aiman Ezzat, say a few words on our ESG ambition.

Aiman Ezzat
CEO, Capgemini

Hello, everyone. I'm very happy to be with you today. My story today is a pretty simple one. It's a three-letter story, in fact. ESG has been in Capgemini's DNA in the last 50 years. At Capgemini, we have always been deeply convinced that we have a key role to play in ensuring that the future fulfills all its promises. We know what responsibility truly means. Our history, our values, our culture inspire us. For over 50 years, we have been pursuing the goal of making a positive impact on the world. Together, with our 300,000 employees in 50 countries, we are committed to contributing to the Sustainable Development Goals defined by the UN. We stand for inclusion, diversity, and equal opportunity, and we will act against climate change.

Our purpose, which was published last year, fully reaffirms our commitment: unleashing human energy through technology for an inclusive and sustainable future. Why share with you today our ESG ambitions? We have one conviction: there has never been a better time. There has never been a better time to leverage technology and human energy to tackle environmental, social, and governance challenges. We are perfectly aware of what's going on in the world. The challenges are huge, and the urgency is obvious. We are convinced that we, as a business, can play a role and that we can accelerate the transition to a more sustainable world. The next 10 years will be crucial, starting today. We are driven by three clear ambitions. First, accelerating the transition to net zero. We are committed to becoming a net zero business.

As early as 2025, we want to reach a first important milestone with our own carbon neutrality. We aim to be carbon neutral all across our supply chain, no later than 2030. Our objectives have not changed. We aim to be a net zero business well ahead of 2050. We can do much more by helping our clients achieve their own environmental commitments. We are working with most of the Fortune 500 companies. Every day, we are helping them transform their businesses and get prepared for the future. Technology can play an important role to help them reduce their own emissions. As such, Capgemini can have a huge impact. That is why we have committed to helping our clients save 10 million tons of CO2 equivalent by 2030. The second ambition is about human capital. We are a talent business. Talent is our greatest asset.

We are relentlessly investing in human capital because it is absolutely natural for us. We are recognized by our clients for our ability to always have the skills of tomorrow that they need today to drive that transformation. We are recognized by young graduates for the expertise and qualification that Capgemini is able to offer them. We are a training ground for technology. We develop talent, not only for us, but also for our clients, our partners, and for society at large. The training we provide has increased the employability of more than 1 million Capgemini employees over the last 15 years. I'm also convinced that diversity and inclusion are critical to our performance, notably in areas like talent attraction, innovation, or creativity. A diverse and inclusive company is now a must.

Diversity might start with gender and gender identity, but it also relates to cultural identity, ethnicity, social origins, sexual orientation, beliefs, working methods, skills, experiences, disabilities. Not only are we committed to promoting and enhancing a diverse and inclusive work environment for our people, we also aim to improve our collective performance by leveraging this inclusive environment. Third ambition is about leading with trust and transparency. For us, being a trusted partner is of utmost importance. All across our operation, we foster responsible behaviors in business for mutual growth. Sound ethics and responsible behaviors are an essential foundation for profitable and sustainable business. Capgemini's founder, Serge Kampf, was deeply convinced of it, and it's something that Paul Hermelin perpetuated. Capgemini has grown under their mentorship and their uncompromising stance on this matter, and I intend to follow their path.

Client trust might look intangible, but it must be built on very solid grounds. It includes maintaining a best-in-class and diverse and accountable governance, which serves the long-term interests of the group. Cybersecurity and data protection are also key to earning their trust. It is a duty for every company, all the more so when you're a service business. We want to be recognized as a front leader in cybersecurity and data protection. We will persistently continue to scale up our investment and train our people. Now, behind these three ambitions, I am sure you have recognized us. I'm sure you have recognized Capgemini. This policy is really about setting a clear focus on what really matters to us. It's eight priorities and a set of objectives to align all energies throughout the group in our day-to-day operation and investments. A lot has previously been done.

We have always been empowering local initiatives in our geographies. Now, we want to prioritize and organize our actions for maximal impact. We aim at scaling up our collective impact with all our stakeholders. We team up with our clients, partners, suppliers, and public institutions to make that happen. We work with large corporations to transform and reinvent their businesses by harnessing the power of technology. We intend to be role models, change influencers, leaders. We are convinced that there is a business case for ESG. This policy is a powerful engine to engage all our stakeholders and notably our talent about the challenges that are dear to them and to ensure that digital and technological transformation is a source of long-term sustainable growth. This policy will be implemented across the group at all levels. We have put in place a clear and consistent organization to deliver our objectives.

We will also disclose our progress on a regular basis to make sure we are on track. I would like to take the opportunity to thank Olivier Lepick. He will coordinate our efforts together with our leadership team and, of course, with the valuable support of our Board of Directors. I am really proud of our new ambitions. They are truly us. I am proud of our teams, the 300,000 women and men of Capgemini who work hard every day to bring these commitments to life. Together, we are determined to leverage technology for the benefit of all. Thank you very much for your attention.

Olivier Lepick
Group General Secretary and ESG Lead, Capgemini

Thank you very much, Aiman. As you pointed out, the ESG policy needs to be embedded in our day-to-day operations and investments. Allow me to introduce our leadership team and speaker agenda for today. On the E of ESG environment, James Robey, Global Head of Environmental Sustainability, will explain our environmental sustainability agenda. Ashwin Yardi, CEO of India, will share initiatives from India. Cyril Garcia, CEO of Capgemini Invent and Global Head of Sustainability, will tell us about how new sustainability offerings help our clients deliver on their environmental commitments. Regarding social, the S of ESG, Anne Lebel, Group Chief Human Resources Officer, will tell you about our continuous investment in talent, followed by Shobha Meera, Group Chief CSR Officer, for an overview of our diversity and digital inclusion objectives and programs.

Finally, on governance, after a short video introduction on our values and ethical standards, we will host a roundtable discussion with Marie-Cécile Collignon, Head of Compliance and Governance, Maria Pernas, Group General Counsel, and Cédric Thévenet, Group Chief Cybersecurity Officer. Let's jump in with James Robey. We will detail our environmental agenda. James, the floor is yours.

James Robey
Global Head of Environmental Sustainability, Capgemini

Thanks, Olivier. Our commitment to environmental sustainability is nothing new at Capgemini. We started our journey nearly 15 years ago now with the establishment of our first local initiatives. We've remained committed to reducing our own environmental impacts through our use of energy, our travel, and the goods and services we buy. In fact, in 2016, we were one of the first companies in our sector to set two-degree-aligned science-based targets in line with the Paris Agreement. We delivered our headline reduction target in January 2020, a full 10 years ahead of our plan and also ahead of the lockdowns associated with COVID. Last year, we raised our ambition, setting new targets aligned with one and a half-degree climate science and committing to reach carbon neutrality for our operations by 2025 and across our supply chain by 2030.

Ultimately, we are committed to being a net zero business well ahead of 2050. In addition, we have committed to switching to 100% renewable electricity by 2025 and to a 100% electric car fleet by 2030. To accelerate our delivery, we have established a new executive governance structure, creating a net zero board including both our CEO and our CFO, as well as other group executive board members. I am happy to say we are making strong progress. In five years, we have increased the share of renewable electricity from around 25% to over 55% of all the electricity we are using across the group. This year, we also launched one of the first green lease frameworks in our sector, for which we won a Green Lease Leader award.

This framework ensures that we factor in a wide range of sustainability criteria when selecting new buildings, criteria such as energy efficiency, the availability of EV charging points, as well as the proximity of offices to public transport. Our transition to a 100% electric car fleet is underway. Since June, all new company car orders are now either pure electric or hybrid. Alongside that, the installation of the necessary EV charging infrastructure in our offices is in progress, and we've more than doubled our EV charging capacity this year. Also in June, we launched our new global travel policy, enabling travelers to consider carbon when making travel choices. We recognize also that commuting is a significant component of our environmental impact. We recently conducted our largest ever employee commuting survey to understand our people's current and pre-COVID commuting behaviors.

Responses from over 42,000 of our people have helped us to establish plans to reduce our commuting impacts. Focusing on our supply chain emissions, our global procurement team have started the not insignificant task of baselining the carbon impact of all the goods and services we purchase. This is the first important step in delivering our science-based supply chain target to halve the absolute emissions from our supply chain by 2030. Finally, our people are critical to our net zero transition. To help bring over 300,000 colleagues onto our journey, we've launched a new learning pathway this year together with an internal mobilization campaign, Capgemini Climate Circles, to spark new ways of thinking about sustainability within the organization.

To conclude, we remain more committed than ever to environmental sustainability, and we are delighted to have recently been included on the CDP Climate Change A List that recognizes organizations leading on this critical agenda. Now, I'd like to hand over first to Ashwin Yardi, CEO of Capgemini India, to introduce some of our sustainability initiatives in India. Following Ashwin, Cyril Garcia, CEO of Capgemini Invent and Global Head of Sustainability, will explain how we're engaging with our clients on sustainability.

Ashwin Yardi
CEO, Capgemini India

Thank you, James. Season's greetings. I hope you are all well and staying safe. India represents nearly 50% of Capgemini workforce, giving it a significant role in reaching our group objective of carbon neutrality by 2025 and becoming a net zero business. We believe that a sustainable future rests on three pillars: collective action, bolder leadership, and smarter technologies. To reduce our operational greenhouse gas emissions, we are converting our facilities with energy-efficient equipment and low-carbon technologies. We've also installed 9.5 MW of captive solar plants and plan to double our on-site generation of solar power by 2025. We've also taken programs that focus on water conservation and recycling, a key issue for us in India. Consequently, all our campuses across the country are now Green Building Council Platinum certified.

Further, Capgemini's Bangalore campus, which generates all the energy necessary for its operations from renewable resources, is the first corporate campus in India to receive Net Zero Energy Platinum certification. Automated equipment monitoring to optimize consumption, the development of a carpooling app to connect riders and reduce traffic, and the conversion of a 1,000+ India vehicle fleet to electric and hybrid vehicles are the various initiatives which contribute to enhance our green practices. Notably, last August, we reached our goal in just one year to plant 1 million trees across our offices and other locations. We will continue to plant many more trees over the next several years. We strongly believe that the time to act is now. At Capgemini India, we are committed to working passionately to secure a better planet for all of us through our collective and bold efforts.

Cyril Garcia
CEO and Global Head of Sustainability, Capgemini Invent

Thank you, Ashwin. These examples in India do demonstrate our commitment to sustainability. Our plan is also to bring our ambition to the next level by making sustainability a cornerstone of our value proposition and assist our clients on their path to carbon neutrality and long-term value creation. The matter is more pressing than ever. At this stage, in order to limit global warming to 1.5 degrees Celsius, carbon emissions would need to decrease by 8% annually until 2030. Only 10% of companies use climate scenario planning to help limit global warming or are on track to become truly sustainable manufacturers. Only 15% of these companies have taken steps to reduce the carbon footprint of their IT hardware. We believe that we can help our clients transform their business.

This is why we have set an ambition in this transformation: -10 million of CO2 and a structured approach with a portfolio of offers to support them on their entire net zero journey. We have launched three dedicated offerings so far: Net Zero Strategy, stakeholder management, and sustainability. We are on track to push others in 2022. Capgemini is also unique in the creation of sustainable products with its Green by Design offer. It enhances product sustainability starting at the conception phase and also through circular economy incentives. Innovation is vital to shape solutions for our clients and help them progress on their trajectory from pledges to actions. Our unique capacity to innovate allows us to address the challenges our clients face from designing their strategy to implementing concrete actions. Now, examples.

First, we have been selected to steer a consortium for major cosmetics players over the next 18 months. The goal is to build a common tool to ease the measurement of the environmental impact of products and set consistent communication means. It proves how we at Capgemini are able to combine access to the highest levels of management sponsorship with strong expertise and collaboration to raise an entire industry standards. In addition to the cosmetics consortium, we are also working with the automotive industry. We MAN to get ahead in the global e-mobility race by building, testing, and homologating 10 electrical EV trucks from initial requirements. MAN create value in a booming electric vehicles market driven by very tough CO2 regulations and government incentives. Aside from those two examples, we also conduct industrial projects within the energy sector.

We are currently working to accelerate the industrialization of a new concentric solar power system for an energy company in the south of Europe. We are organizing feasibility studies and roadmaps to assess the competitiveness of the solution within a 20-year horizon. We also industrialize an innovative academia R&D prototype leading to a 25% cost reduction and leveraging both virtual reality and 3D scanning. Capgemini is very proactive on R&D and matters that shape innovation and enhance decarbonization capabilities and circularity systems. As you can see, we have fully embarked on our sustainability business journey now, and we are ready and equipped to undertake the challenge of this next economy.

Olivier Lepick
Group General Secretary and ESG Lead, Capgemini

Thank you very much, Cyril. Teaming up with our clients and partners to help them reduce their environmental footprint will no doubt reinforce our positive impact related to climate change. Let's now move to the second pillar of our ESG policy. As Aiman said, we are definitely a talent business. This is why it matters to present our social priorities, beginning with Anne Lebel, Group Chief Human Resources Officer, to discuss how we manage and grow our human capital.

Anne Lebel
Group CHRO, Capgemini

Thank you, Olivier. Get the future you want. That is our people promise. As a talent-centric company, living up to our people promise, get the future you want, is essential internally and externally. As Aiman said, we are recognized by our clients for our ability to always have the skills of tomorrow that they need to drive that transformation. That is why leaders and managers of Capgemini engage in and encourage the growth of the skills of their teams. By doing this, we create value for our clients and for the wider society, and we raise our people's employability. Let me shed some light on what we do in terms of learning, career development, employee engagement, and the initiatives we take for our people in today's hybrid work environment. We invest in the skills development of our teams, and learning is a central element of our people agenda.

Our learning approaches are designed for our people to take ownership of their learning journey and to continuously improve their expertise. We believe in giving our talents the possibility to grow and, above all, to own their professional development. We pledged to increase average learning hours per employee by 5% every year to reach, on average, 67 learning hours per employee by 2030 across the company. Since last year, most of the skills training programs, certifications are available to our global workforce on our digital learning platform called Next, be it for technical, digital, leadership and management, and soft skills. Today, over 300,000 learners acquire training on the platform. In addition to Next, we created 16 professional communities, online communities, that our talents can join to grow specific expertise and learn by exchanging with their peers.

Architects, engagement managers, business analysts, but also data managers, for example, share knowledge, grow their skills, and innovate in these communities. Lifelong learning and skills progression are a key part of our working culture. They are embedded in the daily work of our employees, and they are linked to their performance and rewards. We believe talent mobility is a great lever for employee engagement. Beyond learning, many initiatives are taken to increase people's knowledge and awareness of the different business areas of the company, to provide visibility on career opportunities across the organization, and accelerate job rotation. Let me point out that we attract a significant number of young graduates, more than 36,000 over the first nine months of 2021. We are just as committed to helping them grow their skills and build their future with us.

All these learning and career development initiatives fit the new normal, the digitally enabled flexible hybrid model we work in. As we continue to adjust to our hybrid work model, we are keeping the emphasis on creating a safe, caring, and inclusive environment, a trust-based managerial culture, ensuring high-quality interactions and emotional connection. That's why we have introduced team rituals and revisited our leadership model and key learning programs to adapt leadership and management practices to the new work environment. In addition, we developed the virtual global well-being hub for everyone to be inspired and learn new ways of self-care in an informative, safe, and social space. At Capgemini, as talent magnets, we aim to grow our people's employability, creating value for our clients, our employees, and the wider society. Because of its size and diversity, Capgemini offers a wide horizon to current and future employees.

By providing a highly engaging and flexible people experience, we encourage employees to share their views, take initiatives, and engage in meaningful work. Now, Shobha Meera, Chief CSR Officer, will tell you how diversity and inclusion are fully valued and embedded in every part of our people experience.

Shobha Meera
Group Chief Corporate Social Responsibility Officer, Capgemini

Thank you, Anne. As Aiman has said, it is our strong conviction that a diverse workforce and an inclusive and equitable culture are integral to being a high-performance company. Diversity and inclusion boost innovation and creativity and are essential to our group identity and our value proposition. We have a richly multicultural workforce, and our definition of diversity goes beyond being compliant to local laws and regulations. It encompasses all differences, including those of cultural identity, race, ethnicity, social origins, sexual orientation, ideologies, working methods, skills and experiences, gender identity, and disability. Gender diversity underlies and intersects with other dimensions of diversity and is particularly challenging in the technology and consulting industry. It is therefore a key focus for us to have more gender-balanced teams shaping our culture and developing the right solutions for our clients.

Therefore, one of our key objectives is to have more than 40% of women in our teams by 2025. We have been making steady progress on this front. In 2020, the most recent full year, the percentage of women in our workforce improved by almost 2 percentage points. We have deployed several practices and initiatives that represent the strength behind the numbers. On the recruitment front, our teams are trained and equipped with the practices and tools to bring diverse slates of candidates for all roles and to enlist well-balanced and diverse panels for the selection process. Our talent and leadership development approach includes specific, thoughtfully designed mentoring and sponsorship programs for high-potential women colleagues and certain other underrepresented groups. These programs are designed to ensure that our women employees fully take part in both corporate life and decision-making processes at all levels as equals.

We strongly believe that promoting equitable access to opportunities and to leadership positions alongside equal pay for equal work and promotion equity is key. Our goal is to have 30% of women in executive leadership positions in 2025. We continue to strengthen our culture of inclusion through education and training, employee resource groups, allyship, and leadership-led conversations. I'm happy to say that more than 80% of our vice presidents have either completed or are scheduled to complete training on unconscious bias during the course of this year. This is a training that helps each one of us recognize our biases and our presuppositions and allows us to put this awareness to work in moments that matter. I hope this gives you a view of some of the actions and efforts fueling and supporting our diversity and inclusion objectives.

Our commitment to diversity and inclusion does not end at the boundaries of our organization. This commitment extends to the communities we live and work in and the broader society through our digital inclusion initiatives. As a leader in the digital and technology industry, we benefit from the digital revolution. We also have a deep understanding of both the positive impacts of digital technology and the associated risks of further widening the digital divide in an increasingly connected world. Therefore, we have a strong conviction that it is our duty to ensure that digital and technology transformation benefits all of society. Here is a short video that will present how our digital inclusion program comes to life in our communities.

We're living through a digital and automation revolution that can widen inequalities and social divides. We must act to foster digital inclusion for all parts of society.

Digital inclusion is the focus of Capgemini's work in the community. As a global technology leader, we aim to make digital an opportunity for everyone.

Our responsibility is to make sure that we are leveraging digital for the good of our world and for the good of our community.

The pace at which everything is moving, people who do not keep up pace with technology will get left far behind.

That's why it's very important that you start including them, making them basically educated in digital ideas, technology, so that they can be part of the new society.

Digital inclusion is really about helping people to be able to cope with technology.

We need the diversity of the society within these people that are building the world of tomorrow.

The potential is there, and all needs to just those gaps need to be bridged.

It's fresh. It gives you life, and it's full of life. Yes, I want to be a coder. I want to be a geek woman.

That is amazing that by people's passion and innovative skills that we can contribute to something like that.

With the passion and the contribution of our colleagues worldwide, we want to enhance digital inclusion in our communities.

Olivier Lepick
Group General Secretary and ESG Lead, Capgemini

I think we all felt the sense of positive energy running through all these digital inclusion initiatives. Thank you very much, Shobha, for that. Let's move now to our third topic, governance. In our line of business, trust and transparency are key. They are essential to our sustainable growth and the safeguards of our assets. Being a responsible global leader in consulting, digital transformation, technology, and engineering services entails maintaining ethical behaviors at all times with our partners and our communities and protecting data, infrastructure, and identity. Marie-Cécile Collignon, Head of Compliance and Governance, Maria Pernas, Group General Counsel, and Cédric Thévenet, Group Chief Cybersecurity Officer, have joined me on stage to present our governance priorities. Before that, let's watch this short video on our value-based ethical framework. Our values and our ethical behaviors are what guide and give meaning to our collective of aligned entrepreneurs.

At Capgemini, we share seven values chosen by our founder, Serge Kampf. These values are central to our culture and identity, guiding and inspiring us in our daily business practices. These values are the foundation of our code of business ethics, a set of principles for conducting business with ethics at its heart. It provides us with guidance and best practices in five key areas to sustain high ethical standards.

As leaders, we must be exemplary. Our code equips us to be role models, demonstrating ethical, values-driven behavior every working day.

Ethics at the workplace always has been a crucial topic, both at our own workplace and the workplaces of our clients. Nowadays, in the era of data-powered enterprises and AI, the topic has definitely taken center stage, and it is more relevant than it ever has been before.

Ethics at the workplace means for me that my home base is a safe base and that ethical behavior is the behavior that leads to success.

For me personally, ethics at the workplace means demonstration of our seven values through words and action.

Doing what is right includes flagging any misconduct we witness. Speak Up is our hotline for reporting ethics concerns and seeking advice on ethical dilemmas. This is why we have been acknowledged as one of the world's most ethical companies, a recognition we can all be proud of.

It's always an immense honor to be recognized for the ethical practices that are at the heart of our corporate culture. Receiving this accolade for the ninth time highlights our long-standing achievement of putting our values into action. Guided by these seven core values, we will continue to forge sustainable business relationships and maintain governance best practices that serve the long-term interests of Capgemini and of our shareholders. We strive for a diverse and accountable governance, one that promotes constant constructive dialogue with shareholders and stakeholders, as was the case in 2020 during the discussion on the group purpose. With a diverse and accountable governance comes the responsibility of monitoring and safeguarding our assets by managing all group risks, including those related to ESG. Now let's talk about how we protect our assets by embracing responsible behaviors in business and protecting data, infrastructure, and identity.

Marie-Cécile, my first question is for you. When we claim to foster responsible behaviors in business with our suppliers, what do we really mean?

Marie-Cécile Collignon
Head of Compliance and Governance, Capgemini

Olivier, responsible behaviors in business means maintaining high ethical standards at all times in our daily business practices. Our code of business ethics was created in 2009 at the initiative of our board of directors specifically for that purpose. Since 1967, Capgemini's success is founded on its core values, including honesty and trust. These values are at the heart of how we operate, our ethical culture, and our approach to compliance. The group has zero tolerance for bribery and corruption. We are also committed to fair and open competition and to protecting and preserving human rights. To answer specifically your question on what it means for Capgemini to foster responsible behaviors in business with our suppliers, it is fundamental for us to make a positive environmental and social impact when partnering with local and global suppliers to deliver value to our clients.

Since 2015, Capgemini has implemented a supplier standard of conduct, which our suppliers must adhere to. To say it clearly, it is critical to us that our suppliers are committed to preserving the environment, maintaining the highest ethical standards, and adhering to all applicable laws, including human rights and anti-corruption laws.

Olivier Lepick
Group General Secretary and ESG Lead, Capgemini

Thank you very much, Marie-Cécile. You said the group is committed to complying with all applicable laws and regulations, including those on data protection and data privacy. Maria, as General Counsel for Capgemini, strengthening digital trust is, of course, key. What is it we concretely do to protect data and data privacy?

Maria Pernas
Group General Counsel, Capgemini

Capgemini has, indeed, a deep commitment to protecting all personal data entrusted to it as part of its activities, both for our collaborators as a data controller and on behalf of our clients as a data processor. Capgemini's core business is not about hosting massive amounts of data, but Capgemini is still accountable to its clients and other stakeholders for how it processes any personal data. In order to have a global and officially recognized approach to data management, Capgemini chose to implement Binding Corporate Rules, which were approved by the European authorities in 2016 and updated in accordance with the European General Data Protection Regulation. It is our global data protection policy, the rules and procedures to ensure Capgemini's compliance with all the applicable legislations. Particularly relevant within our global data protection policy, I would like to mention Privacy by Design and our end-to-end maturity assessment.

Privacy by Design seeks to ensure the protection of individuals by integrating privacy from the very beginning of the development of products, services, business practices, and physical infrastructures. Our digital end-to-end maturity assessment monitors privacy throughout the entire contract lifecycle. We all know that continuous employee training on data protection is key to strengthening digital trust. That is why we provide mandatory e-learning modules to our global staff and targeted training for specific functions. To say it very simply, data is a key pillar of Capgemini's strategy, and we intend to remain a leader in data protection.

Olivier Lepick
Group General Secretary and ESG Lead, Capgemini

Thank you, Maria, for this ambition. Cédric, Capgemini Group Cybersecurity Organization, by, of course, securing internal activity and preventing external threat, strongly contributes to building an ecosystem of trust with our employees, clients, but also partners. How is that done?

Cédric Thévenet
Group Chief Cybersecurity Officer, Capgemini

That's correct, Olivier. Cybersecurity is key to our operations and ESG policy. Group Cybersecurity addresses the surge in cybersecurity risks with a comprehensive, board-sponsored strategy and governance. Capgemini's own growth and the pandemic have also intensified the centrality of our IT infrastructure and cybersecurity program. Today, I would like to mention three key concrete illustrations of our action plan. First, recent cyberattacks have shown the risks within the digital supply chain, given today's global development of work-from-home models and transition to the cloud. At Capgemini, we are conducting a comprehensive plan to enhance overall security with our clients, our suppliers, and partners. Second, we are enhancing our protection and defense mechanism with best-in-class solutions. Our program is built on the concept of Zero Trust: never trust, always verify, whether inside or outside the company, to protect what is the most critical: identities, applications, and data, and always verify accesses.

Finally, employees' awareness to cybersecurity is essential to mitigating cyber risks. That's why we are leading multiple initiatives such as mandatory awareness courses with specific focus on new joiners, phishing simulations targeting hundreds of thousands of people, and conducting annual Capgemini's Cybersecurity Culture Challenge. As you can see, Group Cybersecurity is a strong contributor to building a trusted ecosystem with our employees, clients, and partners by securing internal activities and delivering trusted digital services. Also, when considering acquisition, specific attention is consistently paid to security assessment in the due diligence phase. In addition to implementing our action plan, our ambition is to be recognized as a front leader on data protection and cybersecurity, for example, by sustaining the top 3% performer on CyberVadis.

Olivier Lepick
Group General Secretary and ESG Lead, Capgemini

Thank you very much, Cédric. This brings us to the end of the roundtable on trust and transparency. I would like to thank all the speakers that shared this telling overview of all the activities and initiatives we have already put in place in Capgemini. As General Secretary and Secretary of the Board, it's an honor to be coordinating this ESG strategy and policy. I will take this opportunity to add a few words focusing on two key principles: our organization and the quality of the stakeholder communication. First, our organization. We set up a clear ESG governance and organization to structure and implement both group and local programs. The Board of Directors has the duty to monitor and steer the group ESG strategy and ensure ESG is fully embedded in the group's main strategic orientation.

More specifically, the strategy and CSR committee is ensuring consistency in the consideration of social environmental aspects. Because a global strategy would be nothing without local implementation and initiatives, all function, and all local teams are responsible for their own local actions. A centralized ESG team coordinates all key stakeholders to align on our ESG priorities, monitor our performance, guide local teams, and accelerate both clients and corporate innovative solutions. Secondly, with respect to stakeholders, communication. It is very, very important. We have a clear communication on ESG. Let me explain this in three points. First, we will communicate in a regular and transparent manner on our extra financial performance in our universal registration document, which is in line with GRI, SASB standards, as well as TCFD recommendation. We are also working on the adoption of the EU Green Taxonomy.

Second, we are deploying an ESG IT system to ease the disclosure process and centralized reporting. The ESG IT system will provide internal and external stakeholders with detailed information on our ESG policy, initiatives, but also performance. Lastly, we maintain a consistent dialogue with our stakeholders as trust is key for strong performance and success. This dialogue enables Capgemini to offer solutions, constantly improve and fulfill its vision. This is what I wanted to share with you today. I'm grateful to handle this important topic and play a role in making ESG a foundational pillar of Capgemini. To conclude this session, I will leave the floor to our CEO, Aiman Ezzat.

Aiman Ezzat
CEO, Capgemini

Thank you very much for your attention today. After these sessions, you now better realize what makes our commitment so unique. This policy is truly us, powered by the collective energy of our people and a high level of ambition. I am proud of where we stand, and I'm really excited about where we're going. There's never been a better time to leverage technology and human energy to tackle environmental, social, and governance challenges. As I said, the next 10 years will be crucial, and our responsibility is huge. Thank you very much.

Olivier Lepick
Group General Secretary and ESG Lead, Capgemini

Thank you very much, Aiman. This marks the end of our presentation, and it's now time for the last part of our event, the Q&A session. First, I'd like to thank all the analysts and investors who shared their question ahead of the event. If you have not already, you can submit your question using the Q&A feature on the bottom left of your screen. Please note that we may not be able, of course, to answer today all questions received. If so, we will do our best to get back to you after the event. Okay, I think we received quite a lot of questions. Of course, the first one will be for you, Aiman. The first question is, why did we decide to put together this ESG policy now?

Aiman Ezzat
CEO, Capgemini

We have already been doing a lot of things around ESG in the group, so there is nothing new about it. We felt that it was important to be able to formalize in a policy what are our priorities and objectives because it enables us to be able to maximize really the impact on everybody in the group and to provide the framework as well to be able to work with our external stakeholders, our clients, our partners, our investors, or society at large, and know exactly what are we aiming for. It also provides something measurable that we can display across the organization to be able to see how we are progressing.

Olivier Lepick
Group General Secretary and ESG Lead, Capgemini

Thank you, Aiman. James, environment is, of course, one of the main pillars of our ESG policy, so not surprising there are questions on this topic. We would like to know how the revised SBTi standards are changing our Net Zero Strategy.

James Robey
Global Head of Environmental Sustainability, Capgemini

Thanks, Olivier. A great question and a really important question as well. Let me start by saying that Capgemini has been part of the pilot group of companies working with SBTi over the last 12 months to really road-test and establish this new net-zero framework. We think it's really important. We fully support it, and we really feel it's important that we now have this clarity and transparency in terms of what the net-zero concept means. From a Capgemini perspective, we know within the new framework, net-zero has a requirement for near-term targets to 2030, long-term targets of 90% absolute reductions by no later than 2050, and a need to compensate the final 10% using carbon offsets. For us, our announcement last year, we announced a Net Zero 2030 Strategy.

That announcement, that ambition from last year is broadly in line with what SBTi have defined as the near-term targets. Our scope one, our scope two, and our scope three supply chain targets are all in line, or actually in some cases slightly more ambitious than the requirements of the new framework. The scope three targets we have on business travel and commuting, we're just adjusting slightly to bring them fully in line. We are currently going through the process of finalizing the final date at which we will claim to ambition to be net zero. That is the process we're going through. We are looking to submit our final targets to the SBTi in January when they open the validation process. Just to conclude, essentially, we just reiterate our commitment to carbon neutrality as a business. As Aiman mentioned earlier, we will be carbon neutral across our operations.

That's travel, energy, commuting, waste, and water from 2025. We will be carbon neutral across our supply chain as well from 2030.

Olivier Lepick
Group General Secretary and ESG Lead, Capgemini

Thank you, James. Aiman, you often tell me that execution is everything. We have now a solid and ambitious ESG policy, but how do we make sure that ESG is embedded at every level of the organization?

Aiman Ezzat
CEO, Capgemini

I think the first thing that we have clear targets. Of course, these clear targets are going to be coming down as objectives for our operation at every level in our organization, at every country with the country board. They have clear objectives in terms of what they need to deliver. In addition to that, we have in our VP compensation plan objectives as well for people to meet. Finally, we're setting up, as Olivier mentioned earlier, a new IT system to be able to measure our progress. We'll be able to use that platform to see basically how we're progressing in every country around each one of these objectives.

Olivier Lepick
Group General Secretary and ESG Lead, Capgemini

Thank you, Aiman. Aiman said earlier that we are a people company, a service company. One of the main assets of Capgemini are the employees of Capgemini, their knowledge, their know-how. How do we ensure regular training of our talent base?

Anne Lebel
Group CHRO, Capgemini

I mean, first, learning is at the heart of our people agenda. For that, we promote a wide range of learning opportunities and formats across the year to all our employees. As I said, I mean, first of all, all our employees have access to a digital learning platform that's Next, and that's accessible to anybody from anywhere and any time. That gives our employees unlimited access to world-class updated content from the best universities, but also content that is being built with our alliance partners. Just this year, we have more than 200,000 of our employees who have used this opportunity to learn, and 90% of them have returned to learn more. We also design and launch programs that are clearly focused on our strategy and our business strategy. For example, last year, we launched the AI Academy.

This year, we completed it with the Cloud Campus. In just two months, we had more than 22,000 people joining the program. We are also completing this digital offer by a virtual learning event offer that any employee can attend each year. Finally, we are also promoting and enabling peer-to-peer learning through the professional communities that are expert communities, but also by using a specific platform for that. More than 150,000 of our people have attended a peer-to-peer session this year.

Olivier Lepick
Group General Secretary and ESG Lead, Capgemini

Thank you, Anne. Cyril, sustainability is, of course, a must for the planet, for the community as a whole, but it's also a business for Capgemini. There are a few questions on this aspect. What is today the size of our business in sustainability, and what is the growth potential, and how big can become your sustainability business because you are driving it within Capgemini?

Cyril Garcia
CEO and Global Head of Sustainability, Capgemini Invent

Yes, that's a key question, indeed, Olivier. We have sold around 30 projects and are currently delivering them in 2021. What we see in our sales funnel is a couple of hundred opportunities. I would say, more importantly, we see the number of conversations growing because as we speak, our clients are appointing new leaders to cover this topic, or they are empowering the existing function, namely the supply chain one. We see a huge number of conversations, and frankly, it's a very promising business for Capgemini and in all dimensions for the next years.

Olivier Lepick
Group General Secretary and ESG Lead, Capgemini

Thank you, Cyril. Maybe I will ask Cédric to join on stage because there is a question on cybersecurity, not surprising, by the way. Cédric, would you be kind enough to explain to us what is really the Zero Trust approach we have in cybersecurity?

Cédric Thévenet
Group Chief Cybersecurity Officer, Capgemini

Yes, thank you, Olivier. Clearly, today, we have to answer to a change in the paradigm, and also we have to face a fast-evolving cyber threat landscape that requires a more evolved security architecture, particularly given the new ways of working that we experience today with the work from home. End users also demand freedom of choice in their devices and location. This with no degradation in the performance due to cybersecurity measures. In response to that, Capgemini Group has designed a security architecture based on the Zero Trust principle. First one, protect what is most important. The second one is to only allow access when necessary and always check before providing access. Implementing a Zero Trust architecture is key for us to build a trusted environment.

Olivier Lepick
Group General Secretary and ESG Lead, Capgemini

Thank you, Cédric. Maybe coming back to Aiman, focus is also very important. There are two similar questions that I will group. The questions are, what is the most important ESG challenge for Capgemini, and what is the number one priority for the group?

Aiman Ezzat
CEO, Capgemini

As a group, we are a talent business. I have to say that basically, talent is our business, and this has to be one of our most important priorities. Definitely, we have to develop and preserve our human capital because this is our greatest asset. That means developing a lot of things around our people. I mean, a lot of the pillars we talked about, ESG, are very important for our people if we want to preserve our human capital, whether we talk about environment, diversity, and inclusion, or even how we support overall the communities around us. Beyond human capital, I have to mention, especially in today's environment, what Cédric talked about, which is basically the cybersecurity issues, or what my area is really protecting for us is the data part. Data protection is a very, very important subject which is growing in importance.

We are basically continuing to invest and improve around how we are able to ensure ourselves protected both around cyber and basically be able to protect the data of our people and our clients, of course.

Olivier Lepick
Group General Secretary and ESG Lead, Capgemini

Thank you, Aiman. I think Shobha Meera is connected to this conference, and I hope because there is a question for her. The question is, Shobha, are our gender diversity targets ambitious enough? 40% for workforce and 30% for leadership, is it ambitious enough?

Shobha Meera
Group Chief Corporate Social Responsibility Officer, Capgemini

Thank you, Olivier. I hope you can hear me. Hello, everybody. I think the answer is certainly yes. To be clear, the targets that we've set for ourselves are targets and ambitions. They are not ceilings. On gender diversity, we've been making good progress over the last few years, and we are absolutely committed to continuing with this progress. In 2018, less than 30% of our workforce was comprised of women. At the end of 2020, that number was 34.9%. That is not including Altran. Including Altran, of course, that is 33%. As you're aware, the talent for the women in technology, the talent pool is quite challenging in many countries. In the context of that challenge, we certainly think the ambitions we've set for ourselves are good ambitions to have.

In countries where there is better talent pool availability, we already have a much better representation of women. When it comes to leadership, in 2018, we had about 14% of our leadership represented by women. At the end of 2020, that number stands at 20.3%. You can clearly see that we are committed to this topic, and we are making good progress. Again, not a ceiling by any means. It is a target and an ambition. With all the initiatives we have in place and the investments we make, we are looking to make this progress and continue to get to that number, get to that milestone, and go beyond in the coming years.

Olivier Lepick
Group General Secretary and ESG Lead, Capgemini

Thank you, Shobha. A question that somebody that probably followed closely the group, because the question is the following: How does this policy fit with your Architect of Positive Future program? This is a good question. I will take it, by the way. Capgemini approach to ESG is really ancient and deeply rooted in our DNA. As Aiman said before, we started a long journey a long time ago on these issues. Indeed, in 2016, we launched a CSR program called Architects of Positive Futures, which was focused on three pillars: environmental sustainability, diversity and inclusion, and digital inclusion, things you have found in our current ESG policy. Indeed, our ESG policy is just an extension of our past program on ongoing CSR initiatives, but of course, now with a much larger scope. Another question for you, Cyril, about the business.

Can you give us a concrete example of how we help our clients to face their challenge in terms of ESG?

Cyril Garcia
CEO and Global Head of Sustainability, Capgemini Invent

Yes. A lot of projects around the definition of the net zero roadmap, not only in terms of trajectory, but in terms of governance and which are the components we involve in this trajectory within each client. On the brownfield part, assessment of the IT footprint. A lot of clients became aware of this impact. On the supply chain, how to reduce waste all along the supply chain. This is really on the, how can I make my brownfield, if I may say, cleaner? On the other side, new businesses, implementation, definition and implementation of solar plants, for instance, distribution, setting up a new solar plant on retailer roofs. Those are examples on the so-called greenfields.

Olivier Lepick
Group General Secretary and ESG Lead, Capgemini

Thank you.

Cyril Garcia
CEO and Global Head of Sustainability, Capgemini Invent

It is important just to finish because we start to see one element that you did not mention, which is important, is that our clients start to consider and assess the impact of those operations in terms of CO2, of course.

Olivier Lepick
Group General Secretary and ESG Lead, Capgemini

Of course, of course. Aiman, two last questions for you before we close this Q&A session. Maybe a tricky one because there is a question on how we will balance ESG and economical results. The question is, by increasing our average training per employee by 5% per year to 2030, we will have 24 hours of training to each employee. It will, of course, probably the question is, how will we manage that without impacting profitability and utilization?

Aiman Ezzat
CEO, Capgemini

Listen, it's a very good question. As you know, we're working very efficiently to see how we can improve the deployment of our resources. We are really working on the virtualization of our labor pool globally and deploying a new platform to be able to enhance deployment of people. As we do that, we're going to improve utilization, and we're going to reinvest part of that improvement in utilization in terms of basically building our human capital, which we think will basically provide more value and more growth for the future.

Olivier Lepick
Group General Secretary and ESG Lead, Capgemini

Thank you. Last question, as Secretary of the Board, of course, I know how the board is involved in these issues. To what extent are the board of directors and the top management of Capgemini involved in the group ESG strategy and performance, Aiman?

Aiman Ezzat
CEO, Capgemini

The first thing, when you look at this framework that we have shown you with our priorities and objectives, this has been reviewed and validated by the board of directors, both the priorities and the objectives. In addition to that, we have two areas. We have the strategy and CSR committee of the board, which basically has the responsibility to oversee and follow the CSR strategy of the group and its implementation and report, of course, to the board of directors on advancement and recommendations they might have. We have the CG, the Group Ethics and Governance Committee, which is basically addressing and ensuring that we have proper governance across the group and, again, being able to report and provide additional recommendations to the board of directors.

Very heavily involved, dedicated session at the board in both cases to be able to review and ensure that the ESG policy is progressing and on track.

Olivier Lepick
Group General Secretary and ESG Lead, Capgemini

Thank you, Aiman. We are now at the end of our webinar. I would like to thank the speakers, of course, but all the people that made this event possible. We are very happy and proud to have this conversation with you today on ESG, and we are looking really forward to maintaining it in the future. Thank you very much. Take care and see you soon.

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