ACCELERATING OUR TRANSFORMATION An interview with Yves Chapot What levers are you activating at Michelin to create value? > Yves Chapot: We strongly believe that value is created by striking a subtle balance between caring for People, making a Profit and helping to safeguard the Planet. To put this into practice, we nurture positive interactions with each of our stakeholders, which act as vectors of our long-term performance. For our customers, we create value by delivering products and services perfectly aligned with their expectations, while constantly striving to raise performance outcomes and foster efficient interaction. For our employees, we implement policies and initiatives that enable them to work safely in a fulfilling job, with opportunities for career-long learning and development. For our suppliers, our host communities and public authorities, value is created by forging trust-based relationships that enable every stakeholder to plan for future growth and development. Michelin is also working to reduce its environmental footprint to conserve the planet's resources. This means taking fewer natural resources from the environment and releasing less waste and effluent into it, while increasing the proportion of recycled or renewable materials used in our products. Creating value for people and the planet in this way ultimately feeds through to strong business and financial performance, with a sales growth target of 5% a year between 2023 and 2030, and a targeted return on capital employed (ROCE) of more than 10.5%. How does the Group share the created economic value among its stakeholders? > YC: The Group is committed to sharing the value added it creates fairly among its stakeholders. In 2023, this value added stood at €13.1 billion. More than half of that was distributed to employees in the form of fixed and variable compensation and benefits. A significant portion – more than 20% – was also used to finance our future-facing capital projects and drive the development of our business activities. The various taxes and duties paid to our host country governments represented 8% of the total value created. Lastly, just over 10% went to lenders and shareholders, who provide the financing that supports the Group's development. You emphasized that reducing your environmental footprint is a way of creating value. What do you mean by that? > YC: I mean that it is our responsibility to protect natural ecosystems, which represent a silent stakeholder. To pro-actively track the impact of our operations, which generate both positive and negative externalities, since 2019 we’ve valued four negative externalities with the goal of reducing them from €590 million in 2019 to €545 million in 2023. We’re making progress faster than expected, with a valuation of €436 million at year-end 2023. This initiative will be further fine‑tuned in the years ahead, so that we can more effectively disclose the impact of our operations to our stakeholders and more effectively address it in the Group’s management practices. Yves Chapot, General Manager and Chief Financial Officer We are committed to fairly sharing the value added we create.” Our priority is to increase the value the Group creates for all its stakeholders 2023 UNIVERSAL REGISTRATION DOCUMENT_MICHELIN _27 An interview with Yves Chapot
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