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CORPORATE RESPONSIBILITY

We are a global supplier of semiconductor wafer processing equipment and process solutions, primarily for the semiconductor industry. Our customers include the world’s top semiconductor device manufacturers. Since 1968 we have helped the industry to create smaller, cheaper, and more powerful microchips. Our focus is on continuing to help our customers achieve their technology roadmap, by expanding our broad portfolio of innovative technologies and products.

Our corporate responsibility outlook is supported by our vision of ZERO HARM! This means we strive to (i) prevent all injuries to our employees and our customers' employees, (ii) reduce our environmental impact, and (iii) make positive contributions to society. We help create value for society through our technological innovations, and we try to meet the expectations of our stakeholders by engaging with them on the issues that matter to them.

We believe that our focus on sustainability not only creates value for our company, our stakeholders, and society, but also strengthens our brand and creates stronger relationships with our customers, employees, and investors. These strengthened relationships further drive our ability to innovate and bolster our product portfolio.

PRODUCT STEWARDSHIP AND PRODUCT LIFE CYCLE MANAGEMENT

Focusing on product stewardship and product life cycle (PLC) management involves taking responsibility to minimize the product's environmental impact along its entire life cycle.

Ultimately, this approach enables our customers to be more efficient and productive. It also means ensuring that our products are safe to use throughout their life cycle.

To achieve this, we rely on our manufacturing, management controls, and robust product and process design practices to produce high quality, reliable and innovative products. We extend these processes to our supply chain partners, and work closely to develop and qualify them as strong partners.

To reduce the environmental impact during the manufacturing phase of our products, we look for ways to conserve energy, conserve water, reduce air emissions, and apply strict control and management of the use of chemicals and hazardous materials with our environmental management system. You can read more about how we manage the environmental impact of our product manufacturing in the Environment section of our Corporate repsonsibility report.

To further improve the safety of our products, in 2016 we reevaluated the way we design for safety throughout our product life cycle. As a consequence, we updated our Global Product Safety policy. This policy strengthens the requirements, processes, and roles and responsibilities that support ZERO HARM! in product safety.

Our product safety requirements are established at the start of product development. The requirements include EHS standards appropriate to our industry. The designs are continually assessed through design reviews and safety risk assessments to verify that safety requirements are being met. Independent third-party validations are done both at a sub-component and system level, at various product maturity levels. This helps ensure that our products are safe to operate and maintain, both at our own locations as well as those of our customers. You can read more about our product stewardship and safety in the Innovation and Product Stewardship section of our Corporate repsonsibility report.

OUR COMMITMENT AND APPROACH TO CR

As an integral member of the semiconductor industry value chain, many of our customers are members of the
Electronic Industry Citizenship Coalition (EICC). We have adopted the Electronics Industry Citizenship Coalition
(EICC) Code of Conduct, which is a set of standards on social, environmental, and ethical issues in the electronics
industry supply chain. The EICC code references and principally follows multiple international expectations and
standards including the OECD Guidelines for Multinational Enterprises, the Universal Declaration of Human
Rights, the ILO International Labor Standards, and the International Organization for Standardization (ISO).
Differences between the EICC code of conduct and the OECD Guidelines include business to consumer aspects
which are not relevant for our business.

We have adopted the EICC risk assessment and framework for continuous improvement, and since 2012 have completed the self-assessment questionnaires (SAQ) for each of our engineering and manufacturing sites. In 2016 all our sites achieved a ‘low risk’ ranking, based on the EICC risk assessment criteria. This program is monitored by our governance body, the Global EICC Committee, and the results are reported to our senior management team several times every year.

As the EICC Code of Conduct is an industry standard, we have adopted it as our Supplier Code of Conduct, and have implemented a supporting risk assessment process withour critical suppliers.

You can read more about our Corporte responsibility report commitment and approach in the Integrated Corporate responsibility strategy section of our Corporate responsibility report.

TAX PRINCIPLE

Paying tax is one of our contributions to society and a part of our value creation business model. Our income is reported in the countries where value is created. We do not use artificial tax structures solely aimed at tax avoidance. Taxes are determined and paid in accordance with all relevant rules and regulations in the countries in which we operate. We aim to follow both the letter as well as the spirit of the law.

We apply the arm's length principle to determine transfer prices in accordance with domestic and international rules and standards, such as the OECD (Organization for Economic Cooperation and Development) guidelines for Multinational Enterprises.
Our disclosures are made in accordance with the relevant local and/or international regulations.

Our goal is to seek an open and constructive dialog with the tax authorities in the countries where we operate, and we aim to disclose all relevant facts and circumstances. We believe that this will enhance certainty on our respective tax position in view of the applicable tax rules and regulations.

LOOKING AHEAD

Looking ahead, we will continue to standardize and unify our socially responsible business practices, and integrate them into our business strategies. Specifically, we will focus on the following areas and strategies to strengthen our overall corporate responsibility performance:

  • Communicate and interact with our stakeholders and use their feedback as input to design an integrated strategy, and to help manage and measure our performance and product stewardship;
  • Continue the progress we made in 2016 toward our 2020 Environmental Objectives;
  • Recruit and retain talent in technology development to maintain our technology leadership;
  • Strengthen our supply chain governance and assurance.