Iberia 2012 CORPORATE RESPONSIBILITY Report

CORPORATE RESPONSIBILITY REPORT 2012
CONTENTS
CHAIRMAN'S STATEMENT 0. ABOUT IBERIA 1. CORPORATE RESPONSIBILITY IN IBERIA 1.1 Corporate Responsibility Framework 1.2 Impact analysis 1.3 External assessment 1.4 Prizes and recognitions obtained in 2012 2. STAKEHOLDER ENGAGEMENT 2.1 Communication channels 2.2 Actions 2.3 Public commitment 3. ENVIRONMENT 3.1 Management focus 3.2 Climate change 3.3 Local air quality 3.4 Noise in the vicinity of the airport 3.5 Consumption of resources 3.6 Waste & recycling 3.7 Nature protection 4. CUSTOMERS 4.1 Management focus 4.2 Passenger commitments 4.3 Iberia Cargo customers 4.4 Iberia Maintenance customers 4.5 Iberia Airport Services customers 5. SHAREHOLDERS AND INSTITUTIONS 5.1 Management focus 5.2 Development of the different Iberia businesses in 2012 5.3 Risk management 4 8 15 15 19 20 21 22 22 23 24 28 28 31 38 40 42 43 44 46 46 48 55 56 57 58 58 58 60
5.4 Fraud prevention and anti-corruption measures 5.5 Innovation management 5.6 Brand management 6. SUPPLIERS 6.1 Management focus 6.2 Responsible procurements 6.3 Supplier payment mechanisms 7. EMPLOYEES 7.1 Management focus 7.2 Workforce and labour relations 7.3 Satisfaction, internal communication and motivation 7.4 Training and Development 7.5 Ethics and Codes of Conduct 7.6 Equal opportunities and ethnic diversity 7.7 Work-life balance policies 7.8 Health and safety at work 7.9 Welfare benefits 7.10 Corporate citizenship 7.11 Employment of disabled workers 8. SOCIETY 8.1 Management focus 8.2 Contribution to the UN Millenium Development Goals 8.3 Main collaborations 8.4 Participation in associations and foundations 8.5 Responsible investment 9. ANNEXES A.1. Contents and Indicators according to the Global Reporting Initiative - versin 3.1 A4. Verification Certificate
60 62 66 64 64 65 63 67 67 69 71 75 83 84 85 86 90 91 94 98 98 98 103 104 106 108 108 125
CHAIRMAN'S STATEMENT
Iberia focused its application of the Corporate Social Responsibility in 2012 on the environment, the weaker segments of society, our customers and the development of our employees, within a particularly complicated economic situation. In this report we describe the principal activities and projects performed and developed within that area over the year. With regard to the environment, the reduction of fuel consumption and greenhouse gas emissions remain one of our priority goals. By permanently renewing our fleet and adopting the best environmental practices in aircraft operations, the company has managed to maintain its unit CO2 emissions on a par with previous years. During 2012 we started to implement a modern system to control fuel consumption, the Fuel Management System , which broadens the data sample considered and incorporates an expert analysis of the procedures involved in the Iberia flight operations. With this new tool we aim to save up to 3% in both fuel consumption and CO2 emissions. Furthermore, within the IAGOS air quality research project, Iberia has begun developing the necessary phases to install measuring equipment in one of its A340-300 aircraft, which will carry it for approximately 10 years. This project, which is part of the EU Research Infrastructure Strategy, consists of fitting aircraft used on long haul routes with scientific instruments to analyse the chemical composition of the air (H2O, O3, CO, CO2, NOX) and particles suspended in it, assessing the quality of the air at certain pre-set heights
D. Antonio Vzquez
Chairman of Iberia
throughout the world. Our company is the first Spanish airline and the third in Europe to collaborate in a scientific project of this magnitude. In connection with our employees, we have started up the AVANZA project, which refocuses the Training and Development model with a view to meeting the needs of a changing business environment, which requires qualified, flexible persons, while at the same time boosting our corporate strategy and contributing towards the employees commitment to the values and culture of the company. In the area of social action, Iberia was the first airline in the world to join MASSIVEGOOD, an initiative of the Millennium Foundation, which aims to obtain additional financing to meet the three Millennium Goals related with health. From May 2011 to February 2012, all Iberia customers who made a purchase on the website www.iberia.com were given the option of making a voluntary donation to the Children Without Malaria Project. The funds raised by the 7,113 customers who made donations, totalling 40,808 euro, have been allocated to this project, a campaign run by the Spanish Red Cross to prevent, diagnose and treat this disease among the infant population of Tanzania and Gambia. We should also highlight the outstanding work during 2012 by the Iberia Employees Parents of Disabled Children Association (APMIB), now the second largest association for the disabled in Spain, after the ONCE [National Association for the Blind], with six specialist centres in Barcelona, Madrid, Malaga, Las Palmas and Tenerife. Its work is no longer limited to relatives of Iberia employees, but is open to the whole society. Finally, I should point out that Iberia one of the companies with the largest capacity of influence, conversation and relationship with its followers in social networks and the third company in Spain that most connects with its customers through these channels.
The company has a major communication strategy using social networking and converses and shares information with its followers on a daily basis, through Twitter, Facebook, Google+ and the Iberia blog, among others, while at the same time actively listening to what is commented about its actions in the social environment. This is considered first-hand, real-time feedback, which has a tangible value, since it enables the company to get closer to its stakeholders, understanding their needs and heeding their suggestions. Our commitment to the values of Corporate Social Responsibility is permanent so we work constantly on actions and projects that guarantee a sustainable future for the company.
About this Report

The Corporate Responsibility Report of Iberia, L.A.E., S.A. hereinafter Iberia or the company is published every year to meet the reporting demands of the different stakeholders in respect of its economic, social and environmental impacts. To assist comprehension, the information is structured into chapters dedicated to the different stakeholders of Iberia, applying the Corporate Responsibility Policy and Framework adopted by the company, which are described in section 1.1 of this Report. The information contained in this report has been approved by the senior management and the board of directors of the company and verified externally by AENOR, recognised certification body, according to the Global Reporting Initiative, GRI 3.1 guidelines and principles (see assurance report in the Annexes hereto).
Self-declaration of A+ application level of the GRI 3.1 guidelines Both the external checking of this report and the contents and indicators set out herein correspond to the highest degree of compliance (A+) with the recommendations made in the Global Reporting Initiative.
0. ABOUT IBERIA
IBERIA LNEAS AREAS
IBERIA MAINTENANCE
Over
IBERIA AIRPORT SERVICES

Operatesat
Leading airline in Spain and on the

Europe - Latin America market
80
years experience
39
airports
112
international customers
100
200
aircraft
airlines, services for
destinations in
320,968 356
million euro invoicing to third parties
39 countries (Iberia group) 88 aircraft

Load factor of
74
million passengers
200,000 m 217
specialised installations (7 hangars)
7,300
81.32%
items of equipment
engines overhauled and
3,395,809
manhours
ABOUT IBERIA
b ORGANISATION STRUCTURE
CORPORATE GOBERNANCE BODIES

BUSINESS
IBERIA MAINTENANCE
IBERIA AIR TRANSPORT: Commercial & Customers Operations
IBERIA AIRPORT SERVICES
STRATEGIC & SUPPORT AREAS

General Counsel y Secretary of the board Corporate Affairs Financial and Control Corporate Communication Human Resources Risk & Security
In Iberia, the passenger and cargo air transport business is supplemented with another two business lines: # MRO: Maintenance, Repair & Overhaul. # Ground assistance (handling) for passengers and aircraft: airport services. Each of these businesses has its own market characteristics and stakeholders, which are described elsewhere in this Report.
ABOUT IBERIA
b MAIN ACHIEVEMENTS IN 2012
Commencement of operations of Iberia Express
Iberia Express started operating on 25 March 2012 with 17 routes, 14 aircraft and 500 employees.
This Iberia project is transforming T4 at Barajas Airport. It aims to revamp procedures at T4, making Iberias hub one of the most efficient in the world. Virtual agents: First network carrier in the world to use advanced audio visual resources to inform customers of the benefits of different products and services. New auto-check-in software: The new application for check-in kiosks can issue boarding cards and baggage tags in just 30 seconds. Fast Assistance Points: information on airport services is provided and new boarding cards and meal and/or hotel vouchers are issued to passengers who miss connecting flights.
Launching of GORA Project
New project Iberia AVANZA
Iberia set up the AVANZA project in 2012,a transformation programme through which it plans to develop three basic goals: # Renew the Iberia culture # Implement a people-focused management framework # Secure the commitment of all Iberia employees
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ABOUT IBERIA
b HIGHLIGHTS IBERIA + BRITISH AIRWAYS

As from 24 January 2011, IAG is listed simultaneously on the Madrid and London stock exchanges. Employees
59,574 377
Aircraft
54.6
Million passengers
1,750
Direct flights (approx)
> 200
Destinations
80.3%
Load factor
# IAG is a holding created with the vocation of incorporating more companies in the future. # It is the third airline group in Europe and the sixth worldwide in terms of revenues. # It is included in the selective indexes FTSE100, IBEX35 and FTSE4Good.
b MAIN BENEFITS OF THE MERGER FOR STAKEHOLDERS:

For customers: # The Group has a greater capacity to enhance and invest in new products and services. It is able to offer a larger selection of destinations for both passengers and cargo, with more connections and frequencies. # Through the merger Iberia passengers now have access to the British Airways network in Asia and the Middle East, while Iberias extensive network of Latin America destinations are available for British Airways customers. # The oneworld alliance benefits and is strengthened. For shareholders: # Shareholders participate in a leading group within the air transport sector, with a vast competitive capacity and enormous prospects for the future.
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ABOUT IBERIA
# The company is more global, larger and is highly competitive within the European and world markets, open to the possibility of participating in future consolidation processes within the sector. # The group has a strong strategic position and healthy finances, and is able to face the future with ample guarantees of profitability and sustainability. For employees: # A large company with experienced, competent employees in all areas and businesses. Employees benefit from new opportunities for professional development, working in a sound, vanguard group, with a vocation for leadership in the world air transport industry. # Employees benefit from sharing cultures, as new collaborations and working groups are created, favouring diversity and inclusion. For suppliers: # Work strengthening bonds with a strong group, which considers its relations with suppliers to be very important, sharing a responsible vision with them throughout the supply chain.
# Permanent collaboration with a vision of quality products, placing emphasis on innovation and sustainability For other stakeholders: Authorities, institutions, bodies, communities in which we operate, NGOs, society in general: # One of the groups priorities is to listen and maintain a permanent dialogue with its stakeholders. # Broaden our mission as a means for bringing people and cultures together. # Participation in different aid and development projects, events, forums and programmes and humanitarian operations will be stepped up, sharing know-how and good practice, with ambitious contributions in respect of the environment, diversity and inclusion, collaboration in the communities in which we operate, maintaining and improving a high level of cooperation with all stakeholders. The IAG Board of Directors consists of 14 members, seven of which were elected by Iberia and the other seven by British Airways. IAG also has a management team of five members. More Group information on Corporate Governance at www.es.iairgroup.com.
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ABOUT IBERIA
b IBERIA IN THE SECTOR: ONEWORLD
Iberia belongs to one of the three largest airline alliances worldwide, oneworld, along with American Airlines, British Airways, Cathay Pacific, Finnair, Japan Airlines, LAN, Mexicana, Qantas, Royal Jordanian and S7 Airlines. The German airline Airberlin, which operates 160 destinations in 40 countries, joined the alliance in March 2012. oneworld has a total fleet of 2,382 aircraft.It operates at 823 airports in 154 countries, with over 8,672 flights a day, which means a take-off or landing
every five seconds, providing a service for more than 300 million passengers a year and directly employing 277,500 people throughout the world. Since its foundation, its maxim has been customer service quality, since this allows the associated airlines to increase and improve the range of products and services they offer their customers, enabling them to travel practically anywhere in the world. Incidentally, it is the only global alliance with partners on all the continents.
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ABOUT IBERIA
b IBERIA IN THE SECTOR: ASSOCIATIONS

Iberia is also a member of national and international air transport organisations committed to a responsible development of the air industry worldwide:
IATA International Air Transport Association.
AEA Association of European Airlines.
ALA Association of Airlines operating in Spain.
ACETA Association of Spanish Air Transport Companies.
ALTA Latin American and Caribbean Air Transport Association. Iberia is an associated member.
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1. CORPORATE RESPONSIBILITY IN IBERIA

b 1.1 CORPORATE RESPONSIBILITY FRAMEWORK
Iberia regularly updates its Corporate Responsibility (CR) management framework to tailor it to current trends and keep abreast of current strategic guidelines. The framework defines the responsibilities of the areas that have ongoing relations with Iberia stakeholders and coordinate the CR-related management systems:
CR organisation and responsibilities in Iberia Management

Corporate Communication
rea
Advertising & Sponsorship
Responsibilities
Coordination &development of Social Action projects & corporate citizenship. Financial reporting Direct relations with Suppliers Crisis contingency plans Direct relations with Employees Direct relations with Customers (Passengers) Quality & Innovation Measurement & Management Systems Coordination of CR & environmental policy
Finance
Management Control Procurement
Risks & Security Human Resources Commercial & Customers
Emergency Coordination Organisation Customer Relations
Quality Corporate Affairs Corporate Responsibility & Environment
Many other management and business units also provide CR-related management information
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CORPORATE RESPONSIBILITY IN IBERIA
The Corporate Responsibility Framework agreed by all the management areas involved consists of: # Conceptof Corporate Responsibility: what the company understands by CR. # Corporate Responsibility Instruments: the bases for effective CR management and continuous improvement in Iberia. # Corporate Responsibility Policy: the principles and goals of CR and how they are to be developed and applied in the different management areas of the company.
# Stakeholders: who they are and what relationships they have with the company. # International standards: what international CR initiatives the company supports and applies. Concept of Corporate Responsibility: In Iberia, CR is the shared commitment to create economic and social value, respecting the environment and taking stakeholders expectations into account at all times.
MU
CA NI
N TION A D COORD IN
AT
IO
Gu i de l ines
Continous
st ems
Reporting
Improvement
ra
cti
o n & mana g
C R Po l i c y Mis sion, ues vision & val
16
en
CR
Ac t i ons
t sy
fo
Corporate Responsibility Policy Iberia acts in accordance with a set of principles that enable it to continue growing in line with the services demanded by its customers, within a framework of respect and preservation of the environment and active collaboration in welfare actions, thus contributing to the development of the societies in which it operates. These principles are summed up in the mission, vision and values of the company, shared across the board: # Our mission: Iberias mission is to offer air transport, airport services and MRO services that come up to our customers expectations and create sustainable economic and social value. # Our vision: Iberia aims to be leader in customer satisfaction, innovation and economic and social performance: j Perceived as leader on the domestic, European and Latin American markets. j Preferred by customers for the best possible value for money. j Distinguished by shareholdersfor its sustained returns. j Recognised for its transparencyand its social and environmental commitment.
j A company in which people wish to pursue their professional development. # Our values: focus on customers, creation of value, search for excellence in management, social commitment, importance of people, leadership, team work, constant improvement, adaptation to change, innovation and environmental protection. This policy is specified in the following goals: # Maintain its leadership in return on assets (ROA), safety and reliability. # Obtain recognition within society for its transparency, social commitment and defence of human rights. # Apply the best environmental practices in its businesses activities, making a rational use of natural resources. # Respond to the major concerns of the companys stakeholders: j Guarantee the best service to its customers in terms of quality and responsibility, respecting the protection of their rights. j Create value for its shareholders, fostering respect for the environment and distribution of wealth.
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j Support any humanitarian projects and initiatives promoted by its employees, involving other stakeholders. j Encourage the personal, labour and social development of its employees within a framework of equal opportunities. j Promote sustainable development and good management practices among its suppliers of goods and services. j Work together with institutions, public administrations and other companies in the sector in any initiatives considered of interest. j Participate in cultural, educational, sports, social and economic development projects wherever it operates. # See that these goals are met, with permanent monitoring to pinpoint opportunities to further the companys continuous improvement in CR management. Stakeholders The company has identified and analysed its different stakeholders to classify them according to their importance for achieving the companys goals and their capacity to influence or be influenced by the company.
Iberias stakeholders are divided into the following groups: # Strategic: j Customers and consumer associations. j Shareholders and investors. j Employees and their representatives. j Suppliers and subcontractors. j Regulatory and institutional: Public administrations, AENA, Civil Aviation Authority, ICAO, IATA, national and local governments. # Market: j Transport sector: airline associations, rivals, alliances. j Tourist and business sector: tour operators, travel agencies, accommodation, etc. j Maintenance & engineering sector: rivals, alliances. j Airport services sector: rivals, alliances. j Social and airport vicinity: Media, Communities in vicinity of airports and NGOs.
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# International standards Iberia has joined the following international initiatives, which are used as a constant benchmark in the implementation of Iberias RC policy: j United Nations Global Compact. j International Labour Organisation Fundamental Conventions. j Millennium Development Goals.
b 1.2 IMPACT ANALYSIS

Based on the companys Risk Map and the Global Compact principles, Iberia makes and maintains a study and prioritization of its main sustainability impacts, reaching the following conclusions: # The companys development activities generate an impact on the environment, although Iberia has implemented certain mechanisms to minimise that impact, or eliminate it if possible. # Being a means of transport, the safety and quality of the companys services to customers have enormous repercussions in the public opinion. # The risks concerning the ethics of its business, such as incidents of discrimination, corruption or fraud, are very small and duly controlled. # The company has no significant impacts in labour, in aspects such as freedom of association, the right to collective bargaining or equal opportunities in access to employment. # Owing to the nature of its business, there is no impact in respect of abuse of human rights, such as forced or child labour. # The greatest impact by the company is environmental, caused by the volume of emissions associated with climate change in its flight operations. Other environmental impacts, produced in its ground operations, are less significant. This analysis has guided the preparation of this Report, which is structured in the order of importance of the impacts analysed.
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b 1.3 EXTERNAL ASSESSMENT

Iberia attaches great importance to the performance assessments it receives regularly from independent third parties. They are an excellent instrument for measuring the effectiveness of its CR actions and are used as the basis for preparing the action plan and sustainability enhancement plan, in line with the companys Corporate Responsibility Policy. In 2012 the company has incorporated the information received from those assessments in its CR strategy, adopting actions, setting goals and outlining projects based on that information for its annual report preparation process. The principal external assessments affecting Iberia which help the company to develop its continual enhancement policy are: # DJSI Questionnaire and the assessment made thereof by SAM Group, highlighting the strengths and weaknesses of the companies.
# GRI verification of the CR Report, used to rate Iberias CR performance.
# Other assessments such as the FTSE4Good and the Carbon Disclosure Project are also used as inputs for measuring the evolution of CR in the company.
Iberias Corporate Responsibility Framework has been compared with the new international benchmarks ISO 26000 and Global Compact Management Model, with the verdict that it has been designed in accordance with the basic principles established in both guidelines: the 7 Core Subjects and the 6 Key Steps, respectively.
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b 1.4 PRIZES AND RECOGNITIONS IN 2012

Iberia is one of the safest airlines. The Swiss Air Transport Rating Agency (ATRA) has included IAG among the 10 safest airlines in the world. Future Travel Experience Prize for the best passenger assistance initiative, awarded in recognition of the different projects developed by the company to improve customer service, with innovative solutions in both airport and in-flight services. Iberias Gold and Platinum Customer Services Centre and telephonic sales service, Serviberia, have been awarded the Gold CRC by the Spanish Association of Customer Relations Experts (AEERC). The Iberia Plus Oro y Platino Centre is one of the services most highly valued by our customers for the excellent treatment received and the willingness to help and solve customers queries and problems.
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2. STAKEHOLDER ENGAGEMENT
b 2.1 COMMUNICATION CHANNELS
Iberia has several procedures in place for obtaining information on its stakeholders expectations, through numerous well-established communication channels. In addition to the communication channels specifically aimed at each type of stakeholder, as mentioned in the respective chapters of this report, the company has devised and started up an important Social Networking communication strategy. Every day, through Twitter, Facebook or the Iberia Blog, the company chats and shares information with its followers, while listening in to everything that is said about its actions in the social environment. It is first-hand, real-time feedback, which has a tangible value, enabling the company to get closer to its stakeholders, understanding their needs and taking up their suggestions.
megustavolar.es
facebook.com/iberia
twitter.com/Iberia
youtube.com/user/iberia
The use of Twitter and Facebook was important once again in 2012 to solve customers queries and problems in real time. Iberia has accounts in the main social networks at present: Facebook and Twitter (in both cases with profiles in Spanish, English, French, German, Italian and Portuguese); and also in the Spanish youth network Tuenti. We now have almost one million followers between these three channels. Iberia also has its own channels in Youtube, Flickr, Google+ and LinkedIn; and one blog, megustavolar.com.
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STAKEHOLDER ENGAGEMENT
All these channels make Iberia the Spanish airline with the largest social community.Furthermore, as indicated in the 'Twitter Engage' report published by Izo Consulting, which specialises in the management of customer engagement, Iberia is the second company in Spain in monthly interactions with its customers through Twitter, one of the companies with the largest capacity of influence, conversation and relationship with its followers and the third company that most connects with its customers. By the end of 2012, Iberia had 669,757 friends on Facebook, a year-on-year growth of 800%, and 199,215 followers in Twitter, a growth of 227%, making it one of the Spanish business enterprises with the largest followings in social networking. Apart from these multi-stakeholder channels, Iberia offers its stakeholders an online survey to assess this Corporate Responsibility Report, at http://grupo.iberia.es, the results of which are taken into account and used to improve the information given.
Supplementing this, any comments or suggestions regarding the aspects contemplated in this Report may be sent to the suggestion box at daicrescor@iberia.es.
ETHICAL ADVERTISING Iberia is a member of the Commercial Communication Self-Regulation Association (Autocontrol), through which it assumes the ethical commitment to make a responsible use of the freedom of commercial communication and helps to strengthen advertising self-regulation to guarantee respect of stakeholders rights.
b 2.2 ACTIONS
During 2012, the company participated actively in the following forums, among others, for stakeholders to discuss their experience (multi-stakeholder events):
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environmental impact of its business and initiatives that it has in place to defend environmental sustainability. # Course on Air Transport and Climate Change, VIII edition of the Summer Courses organised by the Polytechnic University of Madrid. Iberia participated in this event as in previous years, presenting the course on air transport and climate change. Iberia also promotes collaboration and interaction among different stakeholders, acting as official carrier for numerous national and international Fairs, Congresses and Events and offering participants special rates on Iberia flights.
# VI Exceltur Tourism Leadership Forum, in January. Tourism as a driving force for growth and employment: policies to enhance competitiveness . # VII International GroundStar Users Conference organised by Inform GmbH, a specialist in technological solutions to optimise handling resources. Iberia hosted and opened the conference this year, with a speech on how to optimise aircraft and passenger ground service resources using cutting-edge technology. The conference was attended by more than 200 representatives from 40 of the most important enterprises in the aviation sector.
b 2.3 PUBLIC COMMITMENT

Iberia, as part of the society for which it provides its services, has taken into account the main concerns of that society during 2012: # Economic recession: The company firmly believes that the solution to some of the causes that led to the crisis can be found in Corporate Social Responsibility. In times of crisis, sustainable management should increase and all social partners should be committed to innovation, knowledge and training as keys to competitiveness.
# V Forum for Environmental Sustainability of Tourism in Spain, Futuralia 2012. This year the forum analysed the environmental impact of certain sub-sectors of the tourism industry. Iberia was able to share its expertise and experience on the
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In 2012 AENA approved an increase in airport charges for passengers. After studying the situation, Iberia decided not to apply the increase to tickets already issued, charging the new rates only on tickets issued after that date. Iberia was adopting a decision that other airlines had previously made, but travel agencies have underlined the importance of this measure in Iberia, not only because of the larger volume of traffic, but also because its decision could set a precedent to be followed by other airlines. The Iberia CEO, Rafael SnchezLozano, assured that they had decided not to apply the new charges to those who had bought their tickets prior to 1 July, in spite of current financial difficulties in the company. We will bear any additional cost of those tickets so that our customers do not lose out, especially in these times of financial hardship", the CEO explained. # Protection of human rights and humanitarian aid: As a responsible company, Iberia incorporates and contemplates respect for human rights in its operations, based on the principles established in the Universal Declaration of Human Rights, the eight Fundamental Conventions of the International Labour Organization and the United
Nations Global Compact, which Iberia joined in 2004. Iberia is committed to the Millennium Development Goals through economic contributions and the donation of other resources for social action projects, especially those promoted by its employees. The company runs promotion campaigns to encourage its stakeholders to become involved in the achievement of these goals. More information in the Employees and Society chapters. # Climate change: Iberia continues developing its strategy to combat climate change, which it considers one of its corporate priorities, the details of which can be consulted in the Environment chapter. In November 2008 the European Union approved a Directive to include aviation in the EU emissions trading scheme. According to this regulation, all airlines operating flights which arrive at or depart from an aerodrome situated in the territory of a Member State must adjust their CO2 emissions to the limit stipulated in EU law as from 2012. However, owing to the strong international opposition to this regulation, which is seen to encroach upon the sovereign powers of nonEU countries and distort competition between Europe and the rest of the
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world, the European Union was forced to modify the scope of application temporarily at the end of 2012: during its first year of application, it will only affect the emissions of intra-European flights. Iberia supports this change since it eliminates the risk of non-EU countries taking reprisals against the airlines of EU Member States. Moreover, this decision will enable ICAO to adopt a legal framework to combat climate change globally, avoiding regional proposals which are generally ineffective, since the problem is clearly international.
# Growing need for mobility: Iberia considers it important to develop intermodal transport policies in Spain to guarantee a socially, environmentally and economically efficient system. Iberia and Alsa signed an intermodal transport agreement in 2012 whereby the two companies will jointly transport passengers from different Spanish provinces to Terminal 4 of Madrid-Barajas Airport, from where they can fly to their international destinations with Iberia. This agreement will become effective within the next few weeks.
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Iberia and Alsa are the first European companies to join forces to offer this type of service, combining transport by coach and plane in a single bus & flyticket. These tickets can be purchased through the normal distribution channels of Iberia or travel agencies and will indicate all the different stages of the journey to be made, both overland with Alsa and by air for the international leg of the journey, flying with Iberia. Both companies have coordinated combined bus-plane timetables
which are calculated precisely to give passengers enough time to check in or collect their baggage at the airport, get through the security checks and catch their connecting flight or bus. With all these benefits, this intermodal service not only offers greater value and convenience for customers, but also considerably enhances the utilisation of infrastructures and permits greater territorial accessibility.
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3. ENVIRONMENT
b 3.1 MANAGEMENT FOCUS
Environmental protection is one of Iberias corporate priorities. The company strives relentlessly to maintain a balance between development of its business activities and their impact on the environment. Iberias in-flight and ground operations may affect climate change, the quality of local air, noise, the consumption of resources and waste generation. To adequately control these aspects, the company defines and updates a set of measures which include the implementation of environmental management systems, training, motivation and awareness of its employees, regular checks and audits and the participation and collaboration with its stakeholders in environmental issues. Environmental management The implementation and maintenance of environmental management systems enable the company to develop its environmental policies and meet preestablished management objectives. The following diagram shows the environmental management systems currently established in Iberia:
COODINATION CORPORATE ENVIRONMENT DIVISION
FLIGHT OPERATIONS
Management system for the monitoring, reporting and verification of CO2 emissions Airport services Maintenance LMZ/AZI/T4 Facilities Cargo Medical service Aircraft line Maintenance
Internal control systems for acoustic emissions and local air quality ENVIRONMENTAL AUDITS AND CONTROLS
GROUND OPERATIONS
Management Systems ISO 14001 Internal Management Systems
Environmental control for suppliers
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ENVIRONMENT
The company establishes action plans to implement the environmental variables in the fleet renewal processes and adopt the best practices in flight operations. Iberias participation in national and international task forces that address these issues enables the company to adapt its policy on this matter, keeping it permanently up to date. During 2012, AENOR checked Iberias management system for monitoring, reporting and verification of CO2 emissions, in accordance with the EU emissions trading system. This market mechanism caps the total quantity of emissions of the sector as from 2012. Any airlines that exceed their maximum quota of emissions must buy emission allowances from other operators or plants subject to the laws on this matter. The market thus provides economic incentive for the cleaner airlines and penalises those that pollute more. Iberia, through an internal ad hoc working group, has adapted its internal procedures and now complies with these requirements. The Iberia fleet also complied in 2012 with the international environmental standards established by the International Civil Aviation Organization (ICAO) on noise emissions and those referring the quality of air below an altitude of 900 metres in the vicinity of airports.
Iberia pinpoints and assesses the environmental aspects of its ground operations to rate the extent to which they affect the environment. It then defines its management strategy according to that rating. The company has externally certified environmental management systems, internal management systems and specific procedures which cover all the activities having any environmental impact. Iberias airport services have been awarded the AENOR certificate for their Integrated Quality and Environment System, under the ISO 9001 and ISO 14001 standards, respectively. This is unique in that it encompasses in a single integrated system the operations of over 30 stations throughout the national airport network. Iberia also has a Management System certified under ISO 14001 for its MRO operations in Madrid and Barcelona. This is one of the broadest certifications ever awarded by AENOR in terms of area and variety of environmental aspects covered. These certificates require a huge human and material effort: environmental analysis, adequate documentation, training, awareness and preparation of installations, among other aspects.
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ENVIRONMENT
Iberias industrial areas in Madrid have Integrated Environmental Authorisation (IEA), which means that both the industrial installations and the procedures performed there to eliminate all kinds of pollutants (waste, effluent and air emissions) comply with the guidelines and good practices established in the EU "Integrated Pollution Prevention and Control" (IPPC) Directive. AENOR checked Iberias monitoring, notification and verification of CO2 emissions in 2012 according to the EU emissions trading system, which affects these installations.
Iberia has taken out Environmental Responsibility Insurance in pursuance of the applicable laws and regulations. Environmental audits A total of 34 internal environmental audits were made in areas of Iberia with significant environmental impacts in 2012, during which some 68 actions for improvement were identified. These audits were made in the areas of Flight Operations, Airport Services, MRO, Cargo and Medical Service.
Distribution by Iberia areas of the workshops dedicated to internal environmental audits in 2012
3% 3% 3%
Medical service Air Cargo Airport Services Aircraft Maintenance CO2 emissions in flight
47%
44%
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ENVIRONMENT
Environmental awareness and training Continuous training in the application of different internal environmental procedures is common practice in the company. Training and awareness campaigns are provided for the technical staff on the best practices in flight operations, with the aim of reducing noise and fuel consumption, the latter being directly proportional to CO2 emissions. In this regard, the company runs a course for new Captains on the company policies, procedures and strategies for saving fuel and reducing noise, optimum fuel management and decision-making.
Continuous training is also given for all technical staff: once a month they are informed on the evolution of fuel consumption, the best practices recommended by Airbus and IATA and how Iberia handles fuel procurement. Environment Officers have included good environmental practices modules in the training courses for ground operations and issue instructions on the correct management of urban and/or hazardous waste, depending on the activities of each business.
b 3.2 CLIMATE CHANGE

Flight operations According to the Intergovernmental Panel on Climate Change (IPCC), the aviation sector contributes only 2% of the total CO2 emissions generated by the consumption of fossil fuels. Nevertheless, in view of air traffic growth forecasts the sector ought to take measures to minimise the increase in these emissions. Zero growth in CO2 emissions by 2020 In line with other IATA (International Air Traffic Association) airlines, Iberia has defined its future strategy for limiting greenhouse gas emissions from its operations. This Strategy contemplates the following goals:
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ENVIRONMENT
1. Zero growth in CO2 emissions by 2020, i.e. Iberia will continue to grow, but its carbon emissions will not. 2. Enhance fuel efficiency by 1.5% p.a. on average from 2009 to 2020. 3. 50% reduction of total emissions by 2050 compared to 2005. The EU legislation on emissions trading was modified during 2012, limiting its provisions exclusively to intra-European flights. Iberia is in favour of this modification since it eliminates the risk of countries against the legislation taking reprisals against the airlines of countries that support the regulation. Moreover, this decision will facilitate the process for countries to agree on a
global solution through the channels offered by the International Civil Aviation Organization (ICAO). Iberias main goal for dealing with climate change is to reduce its emissions, achieving sustained, efficient growth. The measures comprising this strategy are described below. Fleet renewal: The average age of the Iberia fleet at the end of 2012 was 9.2 years. According to IATA, the average fleet age of a traditional network carrier is around 10-12 years, which means that the Iberia fleet is below average.
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ENVIRONMENT
Between 2013 and 2014 Iberia plans to add 9 new A-320 aircraft and 8 new Airbus 330 for its long-haul routes, using cutting-edge generation technology to optimise fuel consumption, saving 15% per aircraft in kerosene compared with the existing Airbus 340-300 they will replace. This fuel saving will in turn lead to a reduction in emissions, while the new engines will be less noisy. With these new additions, the average age will be reduced by almost 5% over the coming 2 years.
for example: reduction of fuel loaded for each flight, alternative reassignment of airports to use those closest to the destinations, readjustment of quantity of drinking water carried (up to 25% reductions), renovation of aircraft interiors with lighter seats and continuous studies to reduce the weight of in-flight material (magazines, cutlery, etc.). Adjustments in cruise speed continued in 2012 (in both long-haul and short and medium haul flights), along with changes in acceleration altitudes, reduction of standard thrust or use of thrust reverse. Since 2011 90% of the Iberia fleet has been fitted with a system for sending automatic messages (ACARS, Aircraft Communications Addressing and Reporting System) indicating the fuel consumption and, therefore, the CO2 emissions in each flight phase. This enables the company, with 80% of the total data issued, to make exhaustive monitoring of these parameters, using the best available technology, and to take additional measures to reduce consumption and emissions. Energy efficiency was also improved in 2012 and emissions were reduced through flight scheduling, assignment of fleets for the different routes, fleet utilisation and optimisation of the load factor. The load factor was 81.5% in 2012, above the average of the European network airlines, and fleet
Forecast evolution of the average age of the Iberia fleet (years) 9.5
9.2
9.0
8.8
8.5 2012 2014
Other measures: Further measures were taken during 2012 to reduce the weight of aircraft, which directly reduces fuel consumption and, therefore, CO2 emissions. These measures included,
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ENVIRONMENT
utilisation reached a record level for the company this year, with an average of 10.1 block hours per aircraft per day. Projects: # NIMBUS-IBERIA:
# NEW FUEL MANAGEMENT SYSTEM: Iberia, together with British Airways, is introducing a new fuel management system. The implementation of this computerised tool is being coordinated by the Iberia Fuel Manager through a working group involving the companys Operations, MRO and Environment divisions. This new software broadens the sample of consumption data considered and incorporates an expert analysis of Iberias in-flight operations and procedures. The scope of application of this tool embraces ground operations, monitoring of operational fuel consumption, review of in-flight operation procedures and policies, analysis of weight carried, flight planning and MRO activities. This tool could enable an estimated 1-3% saving in the companys total fuel consumption. # NEW ULTRA-LIGHT TROLLEYS: During 2012 the In-Flight Service Management gradually changed the trolleys used for catering on aircraft. The traditional trolleys have been replaced with new ones that are up to 35% lighter, thereby reducing the
In 2012 the Iberia Operations Management, in collaboration with the Systems Management, implemented a new system for calculating flight plans, with considerable advantages over the previous system. This new system introduces new concepts and improvements in the calculations required to plan flights, which increases the reliability and efficiency of the air routes, reducing fuel consumption and CO2 emissions.
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ENVIRONMENT
weight carried by the aircraft, with a consequent major fuel saving. An overall reduction of 2,000 tonnes CO2 has been estimated for the entire fleet in 2012. This measure will reach its final phase in the first quarter of 2013, when all trolleys on Iberia aircraft will be ultra-light. # BIOFUEL FROM MICROALGAE:
being coordinated by the Assets and Infrastructure Department and the first samples of water from the La Muoza Treatment Plant were taken in 2012 for subsequent use as feed for cultivating these organisms. The ultimate goal of this participation is to promote the production of biofuels that will help to reduce the CO2 emissions generated during operation of the Iberia fleet. # IAGOS: Iberia formalised its participation in the IAGOS air quality research project in 2011. This project, included within the European Strategy Forum on Research Infrastructures, consists of fitting long-haul aircraft with scientific instruments to analyse the chemical atmospheric composition (H2O, O3, CO, CO2, NOx), aerosols and cloud particles, assessing air quality at certain altitudes throughout the world. During 2012 the Company began developing the necessary phases to install the measuring equipment on one of its A340-300 aircraft, which it will carry for approximately 10 years. Iberia is the first Spanish airline and the third European airline to collaborate in a scientific project on this scale.
The company participates with AENA in the project for producing biofuel from microalgae, developed by the company Alga Energy. The microalgae are being cultivated at an experimentation technological plant installed next to Madrid-Barajas Airport. The centre researches, experiments with and finds ways to improve the technologies for capturing CO2 and cultivating microalgae, used to produce biomass, from which biofuels are then obtained. In Iberia this project is
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ENVIRONMENT
IBERIA AND IMPLEMENTATION OF ACDM Iberia collaborates in the implantation of the ACDM (Airport Collaborative Decision Making) at Barajas Airport, a European project aiming to improve air traffic and capacity management at airports. This commitment was formalised with the signing of a Memorandum of Understanding in July 2012 between AENA, Iberia and Barajas Airport. The implementation of A-CDM at Barajas is, moreover, an important example of the commitment of AENA and Iberia to collaborate within the gora project.
By implementing the above-mentioned measures, the company has managed to achieve a cumulative 5% reduction in CO2 emissions per passenger since 2009, maintaining its unit emissions in 2012 at similar levels to 2011.
Ground operations The greenhouse gas emissions from Iberias ground operations account for approximately 1.4% of the total emissions of this nature generated by the company. Following the GHG Protocol, emissions can be classified into: # Direct emissions (Scope 1), in our case these are emissions from boilers and diesel and natural gas generators; as well as emissions produced by petrol and diesel vehicles used for aircraft handling tasks. # Indirect emissions (Scope 2), that is, emissions produced during the generation (by different means) of the electricity consumed at the companys installations.
Evolution of CO2 emissions of the Iberia fleet measured in grammes per passenger
120 110 100
104.7 100.1
90 2009 2010 2011 2012
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ENVIRONMENT
# Other indirect emissions (Scope 3), which are emissions produced by employees as they travel to work using different means of transport. These emissions are estimated, owing to the difficulty of calculating them as the company does not directly control them. These direct emissions account for 29% of the total emissions from ground operations, while indirect emissions represented 38% in 2012 and the remainder corresponds to other indirect emissions (Scope 3). The following graph shows the evolution of direct emissions (Scope 1) in tonnes per employee over the past three years. As seen in the graph, this type of emissions has been reduced by 22% over the past three years. In 2012 they were reduced by 4% year on year.
The reduction has been achieved mainly by lowering the quantity of natural gas and gas-oil used in industrial areas, through the use of new technologies that enhance energy efficiency in the industrial processes of MRO, as well as the introduction of a new system of refuelling of ground equipment used at Barajas Airport Terminal 4. A new telemetry system was introduced in 2012, based on the installation of a wireless link terminal in the fuel tenders, which associates the refuelling with the vehicle being refuelled using rings with radiofrequency chips incorporated in the ground equipment. At the same time, the vehicles will be fitted with a reader that registers the times when the engine is on and the kilometres travelled. This system enables real-time control of the volume of fuel stored and refuelling needs. This fuel telemetry system has been installed in the 4 refuelling units, with which Iberia supplies fuel to the almost 1,000 vehicles it uses to provide handling services at Barajas. This fuel measuring system has enabled a 5% saving in the consumption of its ground equipment, reducing the CO2 emissions by 520 tonnes a year, equivalent to the absorption of 2,600 trees. See the Annexes to this Report for more detailed information on the emissions inventory.
Direct Emissions per employee in 2012

Ton. of CO2 per employee 2.00 1.50 1.00 0.50 0 2010 2011 2012
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ENVIRONMENT
CO2 CALCULATOR AND IBERIA FORESTS In line with the environmental strategy to combat climate change, Iberia offers customers and employees information on the carbon footprint of their voyage. A CO2 calculator is available at iberia.com to estimate CO2 emissions for given routes and persons. It is also possible to make voluntary donations for the preservation and sustainable management of natural spaces around certain Spanish airports. The voluntary donations and plantations are managed by Plantemos para el Planeta, a non-profit organisation that aims to revitalise the planting of trees and preservation of forests and to develop in Spain the worldwide campaign of the United Nations Environment Programme (UNEP). The joint project website, operative as of December 2011, is: www.plantemosparaelplaneta.org/bosqueiberia/index.asp
b 3.3 LOCAL AIR QUALITY

Local air quality in and around airports is affected by aircraft emissions generated during take-off and landing, consisting mainly of: nitrogen oxides (NOx), carbon monoxide (CO) and unburned hydrocarbons (UHC). Thanks to technological progress, aircraft emissions in the vicinity of airports are generally low. In fact, over the past few decades levels have been reduced very significantly.
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ENVIRONMENT
The International Civil Aviation Organization (ICAO), responsible for setting limits on the emission of these gases by aircraft, has gradually raised the NOx emission limits imposed on aircraft manufacturers since the eighties: by 20% in 1993 and 16% in 1999. In addition, the new standard approved in 2004 for new engines manufactured in or after 2008 is sets the permitted emissions level 12% lower than the previous standard and brings the total reduction to 40% since the introduction of the first restriction.
Iberia has maintained the same percentage as in 2011 of aircraft in its fleet that comply with the most restrictive NOx standard (CAEP6). CAEP 6 is not applicable to the companys engines, but is a good practice benchmark. The percentage compliance is expected to rise in forthcoming years as the new A330 fleet is introduced The measures taken by Iberia to reduce these emissions focus, just as for reducing CO2 emissions, on fleet renewal, incorporating less polluting engines, and the development of operating measures such as application of the continuous descent approach (CDA). NOx emissions can be cut by up to 40% by this measure. Moreover, at Madrid-Barajas Airport, where the bulk of the companys operations are concentrated, the airport authority AENA has an air quality monitoring network (REDAIR) which continuously and automatically examines the levels of pollutants from emissions generated at low altitudes. The readings obtained are published daily to make sure that the equipment operating at the airport, including aircraft, does not generate pollution levels in excess of the standards set in the applicable regulations.
Compliance with the ICAO NOx standards (CAEP 1 & 2) by the Iberia fleet at 31/12/12
(CAEP 4 & 6,are not applicable to the company due to the manufacturing date of the engines; they are include as a good practice benchmark.)
100% 80%
100%
100%
% of total
67% 60% 40% 20% 0 CAEP 1 and 2 CAEP 4 CAEP 6
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ENVIRONMENT
Evolution of NOx emissions in the Iberia fleet

(base year 2008)
The graph shows the cumulative reduction of total NOx emissions by the Iberia fleet over the period 2008-2012. Taking 2008 as the base year, the graph shows the cumulative reduction in each period. The cumulative reduction over the past 5 years is approximately 25%.
2008
2009
2010
2011
2012
b 3.4 NOISE IN THE VICINITY OF THE AIRPORT

Noise from aviation produces local impacts in areas around airports and is generated in flight operations at altitudes below 3,000 ft (approx. 900 metres). With the technological progress incorporated in modern engines and the improved aircraft aerodynamics, aircraft noise levels have been halved over the past ten years. Technological research anticipates achieving a further 50% cut by 2020. The ICAO Noise Standards control noise pollution during flight operations (approach, landing, take-off and climbing):
Compliance with the ICAO noise standards chapter 3 & 4 by the Iberia fleet at 31/12/12
(Charter 4, is not applicable to the company due to the manufacturing date; they are include as a good practice benchmark.)
% of total
100%
100% 80% 60% 40% 20% 0 Chapter 3 Chapter 4
83%
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ENVIRONMENT
This graph shows the situation of the Iberia fleet in 2012 in relation to the noise standard applicable to it (Chapter 3) and the more restrictive standard (Chapter 4), which, although not applicable owing to the manufacturing date of the aircraft, reflects the advanced technology used in the companys fleet. A report published by OBSA (Observatory of Sustainability in Aviation) indicates that only 57% of flights in Spain operate with Chapter 4 aircraft. But in 2012 Iberia operated 83% of its flights with Chapter 4 aircraft. The company complies with the operating procedures laid down by the Spanish civil aviation authorities, making a limited use of auxiliary engines in airports, reducing the use of brakes by using the thrust reverse technique and following the routes established by air control for arrival and departure at airports. Moreover, the airport authority AENA has established noise restrictions on aircraft operations at Madrid-Barajas airport since 2000. In order to establish these restrictions, aircraft have been classified into noise levels (NL), according to their individual noise on take-off. There is a NL classification for the different decibels, covering a range from 0 to 16 (the closer to 0, the lower the noise level). The low noise level of the Iberia fleet is evidenced by the fact that the company does not operate any aircraft above NL 2.
Noise of Iberia fleet (NL) and its share in the total take-offs at Madrid-Barajas Airport in 2011 and 2012.
100% 80% 63.7%

% of total
59.5%
60% 40% 20% 0 21.1% 15.2% 2011 23.7% 16.8% 2012
Fleet NL 0.5 Fleet NL 1 Fleet NL 2
The graph shows the distribution of take-offs by the Iberia fleet at MadridBarajas Airport in 2011 and 2012 according to the noise level classification (NL 0.5 is the most silent). In 2012, 60% of operations were made with the most silent aircraft, with a slight increase in the percentage of noisier aircraft, due to the increase of flights made by the long-haul fleet. In addition, at Madrid-Barajas Airport, where the company concentrates the vast majority of its operations, the airport authority AENA has a noise monitoring network (SIRMA) which detects, measures and associates the noise produced by aircraft when they fly over microphones installed in strategic areas around the airport. The
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ENVIRONMENT
readings obtained are published daily to make sure that the aircraft operating at the airport do not exceed the noise
levels stipulated in the Environmental Declaration of this airport.
b 3.5 CONSUMPTION OF RESOURCES

Electricity consumption Electricity consumption in 2012 remained at practically the same level as in 2011, with a slight overall increase of 1%. The reasons for this slight increase are mainly the increased production in industrial zones and the variation of new production processes in cargo operations. Despite this increase in activity in the MRO area (they are production processes with high energy consumption) electricity consumption was very similar to that of 2011 so there has been a slight improvement in energy efficiency. Water consumption Total water consumption in 2012 was 15% less than in 2011 and 28% less than in 2010. This reduction was achieved by various measures, including moving some of the cargo operations from older to more modern buildings, and other specific measures to reduce consumption, such as: the installation of water-saving nozzles on taps at the Barajas offices, changing irrigation times to reduce evaporation, etc.
Paper consumption Paper consumption was reduced again in 2012 as a result of the reduction targets set through the innovating resource-saving projects and by applying continuous improvement, the backbone of Environmental Management Systems. The company policy is to convert paper-consuming administrative processes into electronic equivalents.
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ENVIRONMENT
In 2012 this policy was applied in the following areas: During 2012 Iberia further extended the number of destinations for which there is access to the mobile Boarding Card service, which enables its customers to download their boarding cards from Iberia.com to a mobile or PDA and board the aircraft directly, without printed cards, which makes the process faster and more dynamic while reducing the use of paper. Since January 2012 and in an effort to further reduce the use of paper, Iberia has developed a new boarding card available on its website iberia.com.
Apart from improving the design format, this boarding card is reduced to a single page, thereby saving our customers some 5 million pages in 2012; equivalent to the timber from around 450 trees.
b 3.6 WASTE
As illustrated by the following graph, in 2012 Iberia continued to reduce the tonnes of SUW (Solid Urban Waste) on a global company level through the implementation of recycling systems in different areas of the company. Special interest is put into completing the system of urban waste collection in the different buildings of the company. This system allows the separation of organic waste and plastic containers through the provision of distinguished containers in all Iberia buildings.
Tonnes of Urban waste in 2010-12

2,500 2,000 1,500 1,000 500 0 2010 2011 2012
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ENVIRONMENT
Improvements continued in 2012 at the selective waste-collection point installed at the La Muoza facilities, with a new investment in the roof and walls. Through this selective wastecollection point, which enables waste separation at source, Iberia aims to achieve its zero urban waste goal within the coming years. The complete installation of shared multifunction equipment (printer + photocopier + fax + scanner) in the offices also reduces the waste generated in ink and toner cartridges, while also reducing electricity and paper consumption, as mentioned earlier. In December 2012 Iberia formalised its participation in the IATA Cabin Waste working group, which aims to study the present situation of all waste generated in flight on aircraft; analyse the best waste recycling and management
practices; and develop pilot experiences on some flights to obtain information, with the ultimate goal of developing an integral management of this type of waste.
See the Annexes to this Report for information on the evolution and management of other environmental aspects of ground operations, such as water consumption, waste generation, sewage, etc.
b 3.7 NATURE PROTECTION

Iberia collaborates closely in the protection of endangered species. It has been a member of the Convention on International Trade in Endangered Species of Wild Fauna and Flora, CITES, since 1986 and, therefore, does not permit the carriage of any of these species on its flights. It also participates actively in returning unlawfully removed animals to their natural habitats. As an example of this commitment, during 2012 and for the third year in succession, Iberia collaborated with the project organised by Fundacin Migres for the recovery of these species.
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ENVIRONMENT
Since 2010 the airline has provided transport for 56 baby fish eagles donated by the Bird Preservation Centre in Brandenburg (Germany). The chicks of this bird of prey will be taken to their new homes, in the Odiel Marshlands Nature Reserve (Huelva) and the River Barbate reservoir in the Alcornocales Nature Reserve (Cdiz). Since the Environmental Department of the Regional Government of Andalusia set this project up in 2003, with the participation of the Doana Biological Station (CSIC) and Fundacin Migres, a total of 146 baby fish eagles have been reinserted in the environment and
some of them in both Huelva and Cadiz, on reaching sexual maturity, have now reproduced. Iberia has been involved in the protection of endangered species on numerous occasions. Since 2007 the airline has run a campaign defending Spanish endangered species, christening 15 of its aircraft with names such as Iberian lynx, brown bear or Spanish imperial eagle, among others, with the aim of publicising at all Iberia destinations the richness of Spanish biodiversity and stimulate awareness of the need to protect and conserve them.
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4. CUSTOMERS
Firmly committed to its customers, Iberia guarantees quality service at every stage of their journey. The Iberia strategy contemplates enhancement of customer service quality as one of its prime objectives. Iberia has several mechanisms for controlling and monitoring the quality of its processes and services, as summarised in the following figure:
Expectations of our Clients
Processes defined by the Company
SYSTEM FOR MAEASURING CUSTOMER GEARED QUALITY

Service perceived by our Customers
Perceived Quality Level PQL
Objective measuring of compliance by processes

Obtained Quality Level OQL
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CUSTOMERS
The systems for measuring quality, PQL and OQL, are part of a general quality
model in the company, structured as shown in the following flowchart:
AIR TRANSPORT Comercial management DESIGN OF THE SERVICE Provision of service Customer Service Management
Operations: ISO 9001 In-Flight Service: ISO 9001 Cargo: ISO 9001 and Cargo 2000 Customer Service / Claims: ISO 9001
SERVICE QUALITY (OQL)
AIRPORT SERVICES AIRCRAFT MAINTENANCE CUSTOMER REQUESTS
Airports:
ISO 9001 ISO 14001
Maintenance:
ISO 9001 ISO 9110 ISO 14001 ISO 17025
KEY PROCESSES
CUSTOMER SATISFACTION (PQL)
Purchases ISO 9001
Infrastructure ISO 9001
Sistems ISO 9001

ISO 27001
SUPPORT PROCESSES
As shown above, all key areas of the company have now been certified under the requirements established in UNE-EN ISO 9001:2008, which include specific quality indicators relating to the processes of the different activities, subject to regular internal and external control. Iberia has extensive, proven experience in the safety of all its operations, both
ground and in-flight. The company has assurance systems that regulate the operation and maintenance of aircraft in accordance with the EASA and FAA international standards. Iberias Operating Quality and Safety Management System has been certified under the IATA Operational Safety Audit (IOSA) standards. As such, it is subject to regular audits,
47
CUSTOMERS
which reveal the strength of the companys controls. In addition, Iberia has a very broad insurance programme with policies taken out with top-ranking Spanish insurance companies and reinsurance with highly solvent companies on international markets to guarantee cover in keeping with the best practices
on the air traffic market and exceeding in all cases the minimum requirements stipulated in the Spanish Air Navigation Act and International Conventions. Iberia is one of the safest airlines. The Swiss Air Transport Rating Agency (ATRA) has included IAG among the 10 safest airlines in the world.
b 4.2 PASSENGER COMMITMENTS

Commitment to passenger rights The company remains committed to compliance with the European Aviation Customer Commitment, a code of conduct signed on 2 July 2002 together with the other airlines in the European Airline Association (AEA), in which obligations are established such as respecting the agreed price, providing such information as may be required on the company, notifying passengers of any incidents and providing assistance, expediting the payment of refunds and attending reduced-mobility passengers and minors, among others. Iberia deals with passenger claims in accordance with the prevailing European regulations on compensation and assistance to passengers in the event of denied boarding and of cancellation or long delay of flights (Regulation (EC) No 261/2004 of the European Parliament and of the Council of 11 February 2004). With regard to data protection, Iberia complies with the Personal Data Protection Act of 19 April 2008. It has published internal regulations on the subject and started up an Information Security Committee to guarantee the confidentiality and integrity of that information and prevent any unauthorised use of the data. Iberia maintains its ISO 27001 certification of the Information Security Management System, covering the
48
CUSTOMERS
processes related with Iberia.com and the Employee Portal (IB Personas) and its Data Processing Centres. Commitment to price transparency Iberia publishes the final prices of its tickets, including all the different elements comprising each price, such as fuel surcharges, issue charges or airport taxes, such that the announced price is the final price of purchasing the ticket.
In the study made by the Department of Consumption of the European Commission on compliance with EU legislation on airline ticket sales on Internet, Iberia is one of the European airlines that fully respect those laws, for its price information transparency and consumer protection in the services offered on Iberia.com.
ULTRA-YOUNG PRICES FOR "PEOPLE IN A HURRY FLY" Iberia ran several campaigns during 2012 of special prices for young people, through the website www.iberiajoven.com. It is a campaign with unbeatable prices offered for limited periods of time and for specific dates, with the aim of being able to offer very competitive prices for this segment of the population.
Commitment to health In its in-flight magazine, Ronda Iberia, the company includes some practical advice on how to make the flight more comfortable and healthy. For example, exercises are described to prevent deep vein thrombosis, especially recommended for passengers with circulation problems on long haul
flights. The Company also informs on this syndrome in a video played on all flights of over three hours. This advice can be consulted at: www.iberia.com/viajarconiberia/ All food products served in flight in the different catering services are subject to strict health and safety controls, in pursuance of prevailing laws and
49
CUSTOMERS
regulations. The company also offers different menus to suit the needs of all customers (gluten-free, vegetarian, etc.). In collaboration with Wolters Kluwer, Iberia runs courses to overcome fear of flying, with extremely high success rates. In these seminars, Iberia pilots inform participants about air safety and how aircraft work, while a group of psychologists teach them relaxation techniques. Commitment to passengers with special needs Reduced Mobility Persons (RMP) receive special assistance free of charge from their arrival at the airport of departure to their departure from the destination airport. All passengers with a disability or illness are accompanied to the aircraft and their wheelchair, or guide dog in the case of the blind, travels on board at no additional cost. Iberia also provides RMP passengers at all airports in the network with documents containing essential information on their rights and obligations, in formats accessible to all kinds of disability. The contents of
www.iberia.com are regularly updated following the WAI (Web Accessibility Initiative) guidelines. The Iberia Medical Service is responsible for analysing and authorising the transport of sick passengers, known as MEDA cases. Customers send their consultations on a form called INCAD, indicating the details of the person who is going to fly and sending the corresponding medical reports to be studied by the company. The crew regularly receive the necessary refresher courses in Aircraft Medical Attention. Similarly, any minors travelling without an adult (UM, unaccompanied minors) are accompanied at all times and treated with special care. Iberia offers this service to any passengers aged between 5 and 17 inclusive whenever it has been expressly requested by their parents or guardians. Iberia takes all necessary measures to ensure that these UM are never left alone, from their handover by relatives or guardians to handover to the persons taking charge of them on arrival.
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CUSTOMERS
WE INTRODUCE THE FAMILY PASS In 2012 Iberia introduced the Family Pass, a new service designed specifically for families travelling with children, which facilitates and expedites their transit through T4. The Family Pass agent accompanies them to the Fast Track security check point and from there to board their flight or to the area assigned for such boarding. The Family Pass agent also provides the family with all the information they need on services at T4: nursery, restaurants, shops, chemists, currency exchange points and gives the children a small welcome gift.
Commitment to punctuality Iberia establishes numerous internal controls to improve punctuality: specific rules, watchdog committees, cause analysis and decision-making, checking of operating processes, etc. According to company figures, the punctuality index at level 15 was 79.63% in 2012, 11.7% higher than that recorded in 2011. Commitment to customer satisfaction # Perceived Quality Level Customer satisfaction is sounded out in Perceived Quality Level (PQL) Surveys, which measure their assessment of the quality of service received, on ground and in flight.
The surveys, done online, also include a free text section for customers to make whatever suggestions they may consider appropriate. The results of both numerical assessments and suggestions are processed, coded and analysed to make decisions on which aspects of the service need to be improved. The overall satisfaction level in 2012 was 7.17 out of 10, compared to 6.98 obtained in 2011. Customer satisfaction by market and class (Global PQL 2012)
Global Short Haul Medium Haul Large Haul
Tourist Business
6.84 7.59
6.94 7.32
6.78 7.48
6.79 7.95
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CUSTOMERS
By asking its customers questions, Iberia also calculates the Net Recommendation Index (NRI) and the Net Loyalty Index (NLI). These indexes focus on the future behaviour of customers, measuring their inclination to recommend Iberias services and use them again. Being net indexes, their calculation takes into account both customers declaring themselves promoters of the company and critics , thereby obtaining a more precise idea of the effect on the companys reputation. The overall average of both indexes in 2012 was 6.75 for the NRI and 7.14 for the NLI.As illustrated in the following graph, these figures are an improvement over 2011.
# Obtained Quality Level Compliance with the service quality standards set by the company is supervised by measuring the obtained quality level (OQL). Through the methodology established, agents have on-line access to information on service quality obtained in over 8,500 assessments a year, analysing 300 aspects related with the service provided or customer service. As a sample of the information provided, the following graph shows the results of the measurements by services in respect of the goal set.
Evolution of the Net Recommendation Index (NRI) and the Net Loyalty Index (NLI)
7.14 6.97 6.66 6.75
NRI
2011 2012
NLI
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CUSTOMERS
OQL: 2012 RESULTS BY SERVICES
Check-in Claims Handling VIP Lounge
Iberia.com
Boarding
Iberia Plus
Baggage Delivery
Serviberia
In-Flight Service
Connections Madrid
Technical Crew: Messages
Punctuality Catering Cleaning & Staff
Cabin Maintenance
OQL 2012
Goal
For each one, the aspects related with the operating process, attention/attitude, image, physical environment, service times and the
range and state of products and services are measured. The overall OQL in 2012 was 8.7, 1.2% more than in 2011.
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CUSTOMERS
Iberia renewed its AENOR Certified Service N Mark for service quality and customer satisfaction management in 2012: in the measuring and monitoring of service quality and customer satisfaction, communication and dissemination, claims handling, analysis of customer expectations and Quality Plan.
Claims handling The company considers customer claims a valuable source of information for correcting faults and bringing our services in line with their expectations and an opportunity to meet their needs.
To centralise relations with customers throughout the network, Iberias Customer Relations Department, whose claims handling service has been certified under UNE-EN ISO 9001:2008, manages the after-sales service and passes customer feedback on to the entire organisation.
IPAD FOR CHIEF FLIGHT ATTENDANTS By early August, all Iberias chief flight attendants had an iPad with company applications for in-flight service, providing detailed, up-to-date information on all the passengers, thereby improving passenger services. Among other things, the iPad provides the chief flight attendant with a list of all the customers on board and where they are seated; indicates which are Iberia Plus customers and what kind of card they have (Platinum, Gold, Silver, Classic, Kids); indicates any customers with special circumstances (wheelchairs, unaccompanied minors or special meals); includes a record of their recent flights and any incidents involving the customer; creates graphs on the boarding process and informs on the time when the aircraft is ready. All this information puts the chief flight attendant in a much better position to anticipate passengers needs and offer a higher quality, customised service.
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CUSTOMERS
b 4.3 IBERIA CARGO CUSTOMERS
iberia-cargo.com iagcargo.com
Iberia Cargo offers its customers capacity in the bellies of Iberia aircraft. With cutting-edge technology and using iberia-cargo.com as its e-commerce platform, it offers a modern, dynamic, efficient, secure service, guaranteeing the carriage of its customers goods. It currently provides this service for around 100 companies. This year Iberia Cargo joined the exclusive IATA Cargo 2000 group consisting of 60 companies in total, including the most important airlines, multinational agencies, handling firms, other transport enterprises and software providers in the cargo sector. The Cargo 2000 certificate warrants that Iberia meets the requirements stipulated by that IATA programme in its business operations: from handling goods sent between airports to planning and tracking of those dispatches.The tasks performed by Iberia Cargo to obtain that certificate include revising all its quality management processes and manuals and development by Iberia Systems of its own software platform CDMP Cargo 2000 , needed for exchanging information with the other members of the IATA programme. It was
assisted in this process by the German firm Riege Software International, provider of the logistics firm Schenker, to check the adequacy of the platform developed. Apart from this distinction, Iberia Cargo has been certified under ISO 9001:2008 since 2000. IAG Cargo, formed by Iberia Cargo and British Airways World Cargo in 2011, has reached a new landmark in the integration of the Iberia and British Airways cargo businesses with the launching of its new internet websitewww.iagcargo.com. The new website will provide customers with a single point of contact with Iberia Cargo and British Airways World Cargo, as well as offering information on the entire network of IAG Cargo destinations. IAG Cargo customers may have access to the combined flight times of both airlines, using the joint tracking tool to locate their shipments or find all the contact details of the sales and customer service departments of IAG Cargo. Another function of the website is the downloading of detailed information on the IAG Cargo products.
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CUSTOMERS
which customers can track goods sent with Iberia (code 075) and British Airways (code 125), consult IberiaBritish Airways combined flight times and IAG Cargo contact details. IAG Cargo has also launched a new application for SmartPhones, with
b 4.4 IBERIA MAINTENANCE CUSTOMERS

Iberia Mantenimiento is the leading company in Spain in repair, high technology and modification of aircraft, and ninth in MRO worldwide. It serves the Iberia fleet and also more than 100 customers throughout the world: airlines on every continent, aircraft and
iberiamaintenance.com
engine manufacturers, logistic support and operational solutions for the Spanish Air Force, full maintenance services for other Spanish VIP aircraft and other types of military aircraft, among others.
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CUSTOMERS
It is certified by national and international agencies, including the Spanish Civil Aviation Authority, European Aviation Safety Agency (EASA) and the US Federal Aviation Administration (FAA). Most of the improvements and developments made in the maintenance area are pioneer innovations on a national scale, and in some cases even on an international scale, designed for the service provided for both own and third party aircraft.
The Iberia Maintenance Hangar in Barcelona, one of the largest infrastructures built in Catalonia in recent years, operates 24 hours a day and reduces the response time for customer airlines in the event of a serious fault that cannot be solved on the runway. The main beneficiaries will therefore be passengers, for whom the risk of cancelled or delayed flights will be reduced.
b 4.5 IBERIA AIRPORT SERVICES CUSTOMERS

Iberia Airport Services Services is the leading passenger and aircraft handling operator in Spain, present at almost all Spanish airports, providing services for more than 200 airlines, 74.2 million passengers and 320,968 aircraft. Within the GAUDI [Integral Development Unified Airport Management] platform, described in earlier reports, Iberia created a pioneer system at Barajas airport in 2011 that will allow employees to obtain all the information they need using iPads, anywhere in the airport, in real time, so that they can provide that information to customers, foresee and forestall problems and make the best decisions at all times.
handling.iberia.es
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5. SHAREHOLDERS AND INSTITUTIONS

Iberia is committed to the sustainable development of its business and to introducing and maintaining different management systems to generate confidence and add value for the IAG shareholders in aspects related with corporate responsibility. These systems are described below. For detailed information on the economic aspects of the Group, consult the Annual Management and Corporate Governance Reports on www.es.iairgroup.com
b 5.2 PERFORMANCE OF THE DIFFERENT IBERIA BUSINESSES IN 2012

# Passenger and cargo air transport: j Joint venture agreement with American Airlines and British Airways: For Iberia, this agreement represents a major breakthrough in the consolidation of the sector, in which it plays an important role following its merger with British Airways. This agreement reached its 2nd anniversary in 2012: in total, the combined network of the three airlines has 443 destinations in 106 countries, with almost 6,277 flights a day. # Creation of Iberia Express: In order to guarantee the sustainability of its short and medium haul flights and, therefore, secure the future of the company, Iberia decided to create a new wholly-owned company, which started operating on 25 March 2012 and since then it has been among the top five airlines operating at Barajas, with over one million passengers in its first six months of activity and a 93% punctuality index. The airline, wholly-owned by Iberia, was created to compete efficiently
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SHAREHOLDERS AND INSTITUTIONS
and sustainably on an increasingly complex market. Iberia Express contributes direct and connecting traffic profitably to the parent, thereby supporting Iberias growth in long-haul routes. After creating Iberia Express, the group is able to offer its customers more accessible prices with the service quality and experience of the leading airline in Spain. Passengers thus enjoy the same benefits as they currently have when flying with Iberia: operation at principal airports, Iberia Plus programme, VIP lounges,
in-flight service, Business class, multiple frequencies, connecting flights to over 100 destinations and the safety offered by the companys maintenance service, recognised as one of the best in the world. # And also: Iberia helped to alleviate the problems created when Spanair went out of business in January 2012. The company started up a contingency plan in collaboration with the Catalan and national authorities to help transport the passengers left stranded.
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b 5.3 RISK MANAGEMENT

Iberia takes account of any potential event that could jeopardise the achievement of its objectives and has developed a complete Risk Management System, through which all risks are identified, assessed and controlled systematically. Further information can be found in the IAG Annual Corporate Governance Report. In accordance with its Corporate Responsibility Policy (see Chapter 1 of this Report), Iberia adopts a focus of anticipation to guarantee the sustainability of its actions, through integrated management of the following risks, which form part of the companys Risk Map: # Reputational: risks deriving from the perception that the different stakeholders might have of the companys actions in the performance of its business activities. # Environmental: risks deriving from compliance with current environmental laws and any new regulations that may affect the company, such as the emissions trading regulations. # Social: risks relating to aspects such as competitiveness of the different professional groups within the company, attracting and retaining talent, the occupational health of its employees and acceptance in the local environment. Iberia also has several specific areas dealing with the management of sustainability risks, which have established different controls described elsewhere in this Report. The governing bodies of Iberia are regularly informed on the Risk Map and the actions taken in respect of Corporate Responsibility.
b 5.4 FRAUD PREVENTION AND ANTI-CORRUPTION MEASURES

Iberias different internal control systems - budget control, management control and auditing - take risks of fraud into account and are set up to detect such risks, both internally and externally. Iberia has been developing procedures to prevent fraud in carriage documents since 1991 and pays special attention nowadays to credit card transactions, for which purpose it has set up a task force for the prevention of this type of fraud.
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As a novelty in 2012, following the reform of the Penal Code companies may now be held liable for offences committed by their directors for their own benefit or by any employee for not
taking due care and control. Iberia has taken measures to ensure effective management of compliance and reputational risks, as summarised in the following figure:
METHODOLOGIES
RESULT
Culture of compliance PREVENTIVE CONTROLS Internal control map Crime prevention program Continuous monitoring processes
MINIMIZE RISKS
DETECTIVE CONTROLS
Compliance inspections Complaints channel
MITIGATING MEASURES
The company has a Security Committee and a Fraud Prevention Committee, which coordinate prevention measures and study any cases that may arise, of fraud or other possible unethical or criminal conduct. The annual internal audit programme contemplates analysis of all business units and makes random checks of the companys territorial organisation, taking these risks into consideration during the audits. Iberia also participates in the Large Cap Tax Forum, created in 2009 for the
principal Spanish companies and the Spanish Ministry of Economy and Finance to meet and work together on a code of good practice for tax treatment of complex operations in order to avoid tax conflicts. The structure and functioning of the corporate bodies of both Iberia and IAG are based on the latest rules and recommendations approved in respect of Corporate Governance. Detailed information can be consulted in the Annual Corporate Governance Report.
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b 5.5 INNOVATION MANAGEMENT

Iberia uses project management to achieve the objectives marked out in its current Strategic Plan and, in the long term, to achieve change, which is essential for the economic development of the company, satisfaction of its customers and professional development of its employees. Innovation is an inherent part of the companys culture and included in its declaration of vision, mission and values. Therefore, any project geared at improving processes, resource-saving and quality and which is new on the market is an innovative project for Iberia. This innovation is usually accompanied by technological growth. But innovation is not limited to projects; employees ideas and creativity are also considered innovation. Since 1999 Iberia has had an employee recognition programme that rewards employees for any ideas they propose that contribute value to the organisation. The company is currently relaunching this programme, which will include a computer-assisted management tool to which all employees will have access and where they will be able to propose their ideas, receiving feedback through the same channels on the state of those proposals. This platform, which will act as a meeting point and space for innovation (news, forums, focus groups, campaign results, links, press library, etc.) will also contribute towards encouraging employees to become more involved in the Innovation Process. During 2012, Iberia has identified and managed more than 20 R+D+I projects, which will require investments of over 20 million euro to put them into practice.
CHANGE
Every year, Iberia implements dozens of projects of this nature and many of them are recognised as innovative by means of independent assessments or certifications by different Spanish and international official institutions.
Strategic Plan Measures
PROCESSES
OBJETIVES
PRODUCTS
Innovation Management systems & continous improvement
Proyects
CULTURE
SERVICES
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With regard to corporate responsibility, innovation in Iberia contributes towards: # Generating satisfaction and value added for our stakeholders. # Sustainable development through efficient use of resources: many projects aim to reduce consumption.
# Obtaining competitive edge in the performance of our businesses. Iberia has been awarded the "Future Travel Experience" prize for the best initiative in passenger assistance. This is recognition for the different projects developed by the company to improve customer services with innovative solutions both at airports and in flight.
b 5.6 BRAND MANAGEMENT

The companys investments in communication, marketing and sponsorship are in keeping with the strategy marked out by the company and their profitability is analysed regularly, according to pre-established control procedures. Iberia constantly monitors the best branding practices on the market to incorporate all those that conform to the companys Strategic Plan in its decision-making processes. The brand is diversified to distinguish the different business units Iberia Maintenance, Iberia Airport Services and Iberia Cargo -, the sales and services channels Iberia.com, Serviberia - and the frequent flyer programme Iberia Plus-. Iberia is an active member of the Association of Well-Known Spanish Brands, AMRE (www.marcasrenombradas.com), which has among its members more than 70 well-known leading Spanish brands
from different sectors firmly established on an international scale with a vocation of permanence on foreign markets, which have joined forces to work on the development, defence and promotion of Spanish brands. Through its Cargo business, Iberia is a member of the Spanish Exporters and Investors Club, which defends the interests of Spanish companies in the challenge of making their business international. www.clubexportadores.org During 2012, Iberia continued work on a project to reposition its brand, involving the definition and implementation of a new brand strategy for the Iberia of the future.
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6. SUPPLIERS
Iberia considers its suppliers strategic stakeholders in its value chain, to guarantee supplies and obtain products and services that meet the quality, safety and environmental standards defined by the company. Moreover, considering its suppliers an important link in the production process, Iberia receives their support and cooperation to meet certain goals set for our company. In particular, Iberia cultured a very special relationship with its suppliers in 2012 in the application of the Expenditure Reduction Plan it had to implement in order to cut costs. Also in 2012, Iberias Procurements Department continued working towards the procurements synergy goals identified in the terms of the merger with British Airways. A number of joint negotiation projects were put into practice during this period from which important operating and economic results were obtained for Iberia and, therefore, the IAG Group. Through the platform Adquira Marketplace (Adquira, S.A, in which Iberia has a shareholding interest) Iberia has consolidated its Supplier Portal for electronic negotiations with suppliers and as a means of communication for e-invoicing. This year Iberia doubled the amount of einvoicing handled in 2011 through this platform. In its contracts with suppliers, Iberia implemented Logalty this year as a tool for the electronic signing of contracts, which has simplified the process, reducing the time spent on signing contracts, enabling the company not only to reduce space but also to make a greater contribution to improving the environment by eliminating paper. The Quality Management System of the Iberia Procurement Department has been certified under the ISO 9001:2008, the first in Spain to incorporate internal customer satisfaction in its procedures.
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SUPPLIERS
Iberias Quality System contemplates the continuous assessment of suppliers of critical products and services. It also includes a procedure for handling claims from internal customers following incidents in the service provided. There is a
Procurement Incidents Portal for handling incidents, through which internal customers can rapidly and simply report any incidents or make suggestions directly to the buyer responsible for the procurement contract.
b 6.2 RESPONSIBLE PROCUREMENT

Procurement Management Systems Iberia procurement management is geared towards achieving the companys goals, regulated by internal rules and procedures and guided by the following general principles: # Internal customer satisfaction # Compliance with the law # Free competition # Transparency and confidentiality # Caution Iberia also encourages all its suppliers to respect the codes of conduct and good environmental practices. Thus, when tendering contracts it includes, in both the bidding terms and conditions and the contract proper, clauses concerning: # Confidentiality # Industrial property # Data protection # Labour commitment # Environmental commitment # UN Global Compact In addition, suppliers awarded contracts for security and surveillance services undertake to impose limits on the use of force in their activities. Compliance with these clauses is regularly assessed on the basis of monitoring information, the risks to which the companys reputation is exposed and how critical the contract is for the value chain.
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SUPPLIERS
b 6.3 SUPPLIER PAYMENT TOOLS

As established in its control procedures, Iberia has established maximum times for the payment of invoices, in accordance with the provisions of the current Payments Act. Iberias healthy financial position guarantees payment for the products and services contracted and provided to Iberias satisfaction.
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7. EMPLOYEES

In accordance with its Corporate Responsibility policy, Iberia incorporates and contemplates respect for human rights in its operations, based on the standards established in the Universal Declaration on Human Rights, the eight Core Conventions of the International Labour Organization, the United Nations Global Compact and the Millennium Development Goals. During 2012 Iberia started up the AVANZA Project, a transformation programme with which the company aims to develop three essential goals:
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EMPLOYEES
Several initiatives were implemented during 2012 focused on achieving the goals indicated above: # To renew the culture a culture diagnosis was made through surveys, focus groups and interviews, with the participation of individuals and groups from all levels of the company. The diagnosis reflected the existing culture and aspirations for cultural renewal and was used as a basis for implementing the other AVANZA measures. Along these lines and focusing on the aspirations detected in the diagnosis, the company is working on the launching of a New Ways of Working programme geared towards encouraging collaboration and crossfunctions, using the available technological tools. An Innovation Programme is also being developed to promote a culture of continuous improvement, which will reward proposals from employees and will be set up during 2013. A new communication has been developed, Canal Directivos, aimed at managers, to encourage cascade communications. And a new leadership style has been defined, with a new profile and specific training.
# To implement a people-orientated management model all the human resources policies and processes were reviewed during 2012, adapting some of them to the renewed culture and creating other new ones, such as talent and performance assessment, designed to encourage meritocracy. More precisely, the following processes were designed: j Performance management j Management by objectives j Talent management j Company directory j Training process j Recruitment process The new processes will be included in the PeopleSoft platform, where Iberia already has its payroll, with the aim of having an integrated management tool. The positions or roles in the different areas have been identified and described within the framework of a new Classification Model for company employees in positions of responsibility, with a view to favouring the development of a new management, sound succession plans and mobility. This description is based on key behaviour and abilities that assist management. # Finally, with a view to stimulating the commitment of all Iberia
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EMPLOYEES
employees, initiatives have been put into action such as job posting, the internal publication of vacancies that are not filled by succession plans; high potential, mentoring and
coaching programmes; and training and development programmes, the most prominent initiative in this aspect being the creation of Iberias Corporate University.
b 7.2 WORKFORCE AND LABOUR RELATIONS

The composition of the Iberia workforce as at 31 December 2012, broken down by countries, sex, labour category, business and type of contract can be consulted in the Annexes to this Report. The company has employees in practically all the countries reached by its commercial network. The distribution of employees by countries is shown in the following map:
NUMBER OF EMPLOYEES
> 150
71 - 150
41 - 70
21 - 40
1 - 20
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EMPLOYEES
Union representation and participation Iberia has two committees, the Ground Staff Inter-Workplace Committee and the Flight Committee, which have continuous relations with the unions. There is also a Social and Economic Watchdog Committee, in which the unions participate. The ground staff union representatives sit on 20 Workplace Committees (works councils) nationwide, and a further 17 workplaces nationwide have workers delegates. Internationally, Iberia has workers representatives in 43% of the countries in which it has employees and there are collective agreements in: Argentina, Austria, Belgium, Brazil, Chile, France, Germany, Greece, Ireland, Israel, Italy, Mexico, Netherlands, Portugal, Sweden, United Kingdom, Uruguay and Venezuela; and union representatives in Peru (see Annexes).
both groups of employees, on 29 November 2012 for Flight Attendants and on 28 December 2012 for Ground Staff. The Bargaining Committee for the VIII Collective Agreement for Pilots was set up on 24 November 2009 and negotiated from then throughout 2010 and 2011 with a view to reaching an agreement. Owing to their disagreement with the creation of Iberia Express, pilots were called to strikein December 2011 and again on five more occasions from January to May 2012. In spite of the agreements reached, STAVLA and two minority unions representing ground staff (CNT and CTA) joined forces with SEPLA with several strikes called between February and May. In total strikes were called on 38 days, although some of them were finally called off. Operations continued without incident on both days, complying with the minimum services established by the competent authorities. In an effort to put an end to the strikes, the Government proposed entering a mediation process in March, which did not end in agreement. In view of the impossibility of reaching an agreement in the collective bargaining with SEPLA and the need to put an end to the process, the company decided to institute the process of pulling out of
Collective bargaining and employment On 30 October 2012, the company gave notice of termination of the XIX Collective Agreement for Ground Staff and the XVI Collective Agreement for Flight Attendants, both valid up to 31 December 2012. Consequently, as established in the Workers Statute, Bargaining Committees were set up in
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EMPLOYEES
the pilots collective agreement, although the process was suspended when the Government decided to impose a compulsory arbitration to solve the dispute. The arbitrator passed an award on 24 May 2012, which was replaced by a new one on 21 December, after the National Court declared the first award null and void. On 9 November 2012 the Transformation Plan was presented to all the unions in the company, whose representatives had been called to commence bargaining.
UGT, CCOO, ASETMA, USO and SITCPLA called 6 days of strikes for December, which were finally called off after an agreement was reached at the SIMA (Inter-Confederation Advisory and Arbitration Service) offices on 17 December 2012 with the unions indicated above plus CTA-Vuelo (and subsequently endorsed also by SEPLA), and negotiations were resumed.
b 7.3 SATISFACTION, INTERNAL COMMUNICATION AND MOTIVATION

Employee satisfaction is mainly channelled through the suggestion boxes available in IBPrxima and IBPersonas, through which employees can express any observation, remark or concern, even anonymously if they so wish. These suggestions are mostly assessed and answered in less than 24 hours, and those considered important are published monthly, together with the replies offered by the responsible management departments. In 2012, 1,069 suggestions were answered. The company makes regular polls through IBPrxima to find out its employees opinions on matters of general interest, many of them related with the meeting of their expectations in connection with the services offered. Employees are informed on Iberias goals and results strategic plan, stock exchange performance, punctuality details, significant milestones, etc. permanently through IBPrxima, daily on the companys notice boards and monthly through the magazine Iberavin. During 2012 IBPrxima was immersed in improving its publishing tools to be able to incorporate new contents: search engines, news commentaries, forums, digital encounters and building an intranet in line with the existing
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EMPLOYEES
websites. A website in which the set-up, information and services are structured so as to meet the needs of all employees. Also in 2012, as part of the AVANZA Project, a culture diagnosis was made
with interviews of 25 executives; surveys in which a sample of 3,600 employees from all categories and levels were invited to participate; and 11 focus groups, in which 124 employees participated.
RENEW THE CULTURE OF IBERIA
CULTURE AND CHANGE

Level of survey participation by collectives
100% Corporate areas 80% G.D. of Production
Attendees to Focus Groups by areas
13%
Commercial and clients
60%
51%
40%
19%
G.D. Maintenance and Engineering
20%
17%
Managers Rest of surveyed
0%
Survey data Sent to 3600 employees Participation higher than 50%, unequal among groups.
Focus Groups data 124 assistants Participation of 90%
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EMPLOYEES
This diagnosis, which expressed the employees aspirations and was shared with all of them, has been used as the basis for launching several initiatives that have been implemented within internal communications, such as the creation of Canal Directivos , a new communication channel for managers which offers weekly information and collects their proposals on proposed novelties. This communication channel is intended to be a basic tool for exchanging information on common contents among the different teams. Iberia has established a staff recognition system for all its employees, based on individual or group suggestions and recognition of extraordinary actions. To stimulate creativity and individual and group efforts and as a basic factor in continuous improvement, reward is given for the profitability obtained as a result of a proposal for improvement. This system is being revised with the intention of launching a renovated programme geared towards the striving for continuous improvement and innovation as the backbone of the Iberia culture. The company uses several forms of incentive through different variable pay
items added to the salary, regulated by collective agreement and rewarding employee productivity: bonuses for attendance, shift work, duties, etc. The levels of progression and promotion are linked to the Performance Assessment, made regularly. Employee Services: IBPersonas IBPersonas is a customised management tool through which employees have permanent access to an ever-growing quantity of administrative and management information, on a self-service basis. It is divided into channels, including especially those of training and development management of employee training and access to Campus Iberia, employment access to information on job vacancies, to be filled internally and/or externally, employee self-service performance assessment, wages & salaries, donations to charity causes deducted directly from salary, etc., mIBillete.free self-issuing of tickets for employees and beneficiaries, occupational hazard prevention access to documents on hazard prevention, participation and consultation, FAQs, etc., information and management services for senior staff.
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EMPLOYEES
GORA PROJECT One of the mainstays of the gora project is spreading throughout the company the passion for excellence at the hub and internally sharing the goal of making T4 one of the best airports in the world. To achieve this, the Human Resources Department has been working since the project began on trying to improve mainly team work, internal collaboration, the sharing of ideas and active learning through the chain of command, in all units, using different formulas. In this regard, it has worked together with the Madrid Barajas Airport Management on development of the briefing model for each area, defining its structure, contents, etc. An initial phase of briefing has already commenced, becoming a structured, constant meeting point for communication in all areas. We have also helped to define how we want to be perceived by our customers. One of many other initiatives is the Guidelines and Commitment training scheme provided for all agents on excellent customer services. This initiative has been supplemented with the Training on the Job project, seeking to train agents, with the help of supervisors, in the best customer service practices. The involvement and good work of our employees is impressing our customers: the PQL (Perceived Quality Level) closed the year 2012 at a cumulative 7.17, outstripping the target which had been set at 7.10.
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EMPLOYEES
b 7.4 TRAINING AND DEVELOPMENT

The AVANZA project refocused the Training and Development model to respond to the needs of a changing business environment that requires flexible, qualified individuals, promote the corporate strategy and contribute towards employees commitment to the companys values and culture. # The first initiative set underway to develop this model was the designing and development of Iberias Corporate University, Campus Iberia, the first activities of which took place in 2012 and whose operating model will be implemented in 2013. With the aim of offering learning and development opportunities for everyone who works in Iberia, the Corporate University provides a space where knowledge can be shared and in which each employee receives the training he/she needs to contribute towards improving the business results, in line with the company strategy and without losing the global vision of the organisation. Campus Iberia was set up to: j Develop a style of leadership and management of customers unique to Iberia which identifies us and makes us different from our rivals. j Create a meeting place to stimulate reflection and creativity and sharing the expertise and best practices of the companys professionals. j Boost the evolution we want to achieve. j Foster the installation of new learning technologies as a support for training and professional development. j Expand Iberias culture and values. Campus Iberia defines a differentiating learning model around the following core themes:
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EMPLOYEES
1. The principles of the model: Company strategic lever:
IBERIA CULTURE AND VALUES IMPROVEMENT OF INDIVIDUAL AND ORGANIZATIONAL PERFORMANCE INDIVIDUAL TRAINING PLANS
3. Tutoring model: Using the internal expertise of Iberia through the team of internal trainers/tutors and strengthening the role of the manager in facilitating training and the transfer or knowledge to the learning position. 4. Accreditation system: Incorporation of a credit system to be able to prove adequate academic performance of the training activities in Campus Iberia.
Alignment with business:
Professional development:
2. The methodology approach: It will boost e-learning to address the needs of mobility and just in time learning of employees.
# The second major initiative promoted was the launching of a new Training Portal,IB-Learning, which improves the experience of the participant and fosters participation and collaborative learning. This new learning environment will channel
50%
e-learning
30%
Face to face
20%
Learning on the job
FORMAL LEARNING
COLLABORATIVE LEARNING AND NETWORKING Development that occurs by interaction with other professionals in Iberia Social learning
KNOWLEDGE MANAGEMENT
Training required for each profile and person aligned with the Training Plan and Individual Training Plan. Allocated by the manager in the detection of needs
Capitalize the internal knowledge, distribute it and enrich it continuously
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EMPLOYEES
Allowing j Greater accessibility and visibility through mobile devices j Better communication: through messages sent between users j Development of collaboration: through the existence of working groups at training centres j Greater transparency: with access to the most important news j Sharing: encouraging contributions to forums and groups j New learning channels: to access best practices Training in Iberia includes both specialised training in technical skills of the sector and the development of skills and expertise to support individual and company performance. As every year, the specific training and development plans have been defined based on the strategy, goals and lines of action of each of the management areas of the company.
# A third initiative was the creation of the Summer School, offering open training with English seminars and conferences for management and professionals of Iberia and the sector. After the summer, giving continuity to the format and methods under the name Jueves Avanza, we extend the training offer, with monthly conference cycles, which are open to all employees through intranet. This training reaches Iberias entire national and international network via streaming. During 2012 Iberia provided a total of 531,699 hours of training for its employees. Within its commitment to the professional excellence of its team, 11,558 courses were organised in the company in 2012, attended by a total of 86,478 employees. In short, Iberia has created an innovative training model that contributes to making its professionals more employable, with a huge investment in our growth and a learning platform that give a broader coverage to all the companys employees.
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EMPLOYEES
Integration of education and business Iberia has agreements with several Spanish and international universities and training institutions, offering to collaborate with the government and academic institutions to implement the educational system, both by adapting vocational training modules specifically for the air-traffic sector and by offering Spanish and foreign undergraduates, graduates and vocational training students an opportunity to acquire work experience. Some 244 students obtained grants in 2012. The main objective of the Graduate Work Experience Programme is to adjust incorporations into the management and engineers group to the demand of the different areas of the company according to the Strategic
Plan. It also helps to detect graduates with potential and candidates for Qualified Staff Development Plans. The Graduate Work Experience Programme was started up in 1996 and so far almost 65% of the employees working in the management and engineers group joined the company through this programme, either through internal promotion (contract novations) or from outside, through postgraduate scholarships. Iberia also facilitates academic training for employees who are studying for official qualifications, granting Individual Training Leave to enable them to attend the corresponding commitments and releasing them from work so that they can study or go to exams.
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EMPLOYEES
Iberia maintains its collaboration with the Autonomous Community of Madrid to start up the Dual Vocational Training, in which one-third of the training is given in the secondary school and the other two-thirds directly through work experience in companies, following the German model. In 2012, 20 first-year pupils spent 4 months in the Iberia Maintenance facilities receiving theoretical training and practical training in hangars and workshops. During 2012 Iberia participated in a new edition of the Recruiting Erasmus Programme, an initiative that helps to attract and develop talent with multicountry experience for companies with a clear international vocation, such as ours. This Programme is a good example of collaboration between universities and business and provides candidates with an excellent profile in terms of qualities in high demand such as a multi-cultural outlook, adaptability, flexibility and management of change, which these young professionals have acquired in the course of their experience. Attraction and retaining of talent Iberia is constantly talent-spotting, both internally and externally, considering talent to be one of the critical factors for guaranteeing the companys competitiveness. The company has established different selection protocols and competence
profiles to detect the professionals with the greatest potential in the company. Once spotted, those professionals receive support through Personal Training Programmes, Continuous Assessment and Vocational Development and Succession Plans, through which talent is channelled towards the required field of specialisation or management, in the latter case within specialised leadership development programmes designed to guarantee a smooth take-over of all key management and executive positions at all times, having professionals capable of applying their talent to the circumstances required from time to time for the companys business. All these actions are reflected in the annual poll MERCO PERSONAS, which in 2012 maintains Iberia among the top 50 Spanish companies preferred for employment; or in the ranking published by Actualidad Econmica of the best companies to work in, where Iberia has risen 49 positions in the past year. Within the initiatives of the AVANZA Plan, Iberia made a global talent review in 2012 of all employees with positions of trust within the company, with a view to guaranteeing meritocracy in the management of people and establishing Individual Development Plans suited to the strengths and weaknesses of each professional assessed.
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EMPLOYEES
The process, called Talent Management Review, will be annual as from this first review in 2012 and consists of assessing the professional performance and potential of each manager for growth or performing other duties. It has led to a number of actions for development of the assessed individuals, many of them unprecedented in the company:
# Launching of a High Potential programme, selected among those with the highest ratings in the Talent Management Review, creating a Development Centre designed to support their professional development. This was done for 60 individuals in 2012. # Launching of the first Iberia Mentoring programme to provide
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EMPLOYEES
career advice for people with potential with the assistance of top level internal mentors. This programme also contemplates Coaching initiatives whenever career advice by an external professional is considered necessary. This was done for 30 individuals in 2012. # Launching of an International Talent programme assessing the talent of all persons with responsibilities in the countries in which Iberia operates as a multinational, especially designed to adapt to their business features and logistics facilities. 125 individuals from the international network have been assessed. # Launching of 360 assessment processes to bolster the development programmes with tools for understanding each persons perception of the professional environment. 35 of these assessments were launched in 2012. Following the 2012 Talent Management Review, 332 Individual Development Plans (IDP) were prepared and approved, supported by top-level training given by the corporate university, Campus Iberia, and also involving short, medium and long-term development targets in which each professional assessed undertakes to work on improving or consolidating his/her performance and increasing his/her potential, as appropriate.
The number of IDP will increase in 2013 with those corresponding to the International Talent programme and those of the new talent initiatives in 2013, as described in the Future Actions section of this chapter of the Report. Another policy approved and started up by AVANZA in 2012, to support mobility and equal opportunities in the internal filling of vacancies in the company, is Job Posting. Vacancies, not only in Iberia but also in the IAG Group, JBA and even some in British Airways, are posted each week indicating the job profile or characteristics, so that anyone who believes he/she meets the requirements for a post can submit an application to be assessed by the recruitment services. Since April, when this initiative was begun, 40 selection processes have been opened by Job Posting, enabling a total of 9 rotations and 12 internal promotions, for the 23 positions vacant in Iberia; and a further 17 processes enabled Iberia employees to opt for positions in IAG, BA and JBA. A total of 550 applications were presented for these positions. The Team Management and Leadership Programme is another of the initiatives promoted within the AVANZA project. The Human Resources Management and Maintenance & Engineering General Management have jointly started up this Training and Development programme aimed at Senior Technical Management Staff
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Iberias Assistant Manager Hub and Coordination, Dimitris Bountolos, received the Young, Talented Executives award in the operations category in November 2012. These awards are granted every year by Seeliger y Conde, a leading firm in Spain specialising in executive talent spotting and development. The eight people selected for these awards are executives under 40 and the award is granted for their professional track record.
(GSGT1), MRO Engineers, Managers and Supervisors, who manage working teams. This programme began on 18 April 2012 and has a participation of around 300 employees. The general purpose, in keeping with the AVANZA project, is to contribute towards change in the organisation in three basic aspects: culture, commitment and management model.
(1)
Iberia also provides training for nonemployees in the areas of airport services, cargo, operations, in-flight service and commercial, especially for companies contracted to provide services to the company.
GSGT (Grupo Superior de Gestores y Tcnicos): workers with higher education or equivalent experience and knowledge performing highly complex technical work and having autonomy and responsiblity within that technical speciality.
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b 7.5 ETHICS AND CODES OF CONDUCT

Iberia has a Code of Ethics for Application of the Global Compact, designed as a direct, simple document containing a set of good practices. It lays down the bases for ethical, responsible conduct by Iberia employees in the performance of their work. The Code has been drawn up with three essential goals: # Adapt commitment to the Global Compact to the culture and values of the company, highlighting the most important conduct in Iberia to ensure that the principles are met. # Have a general code of ethics to supplement other codes of conduct of the company. # Inform all employees on the Global Compact. One of the documents published in 2012 was the General Procedure for Data Security Awareness, the main purpose of which is to inform on the companys policy regarding protection of systems and the information they contain, with specific guidelines for the use of e-mail, the Personal Data Protection Act, and others. The General Code of Conduct of the Iberia Group establishes the general rules governing the conduct of company directors, executives and employees.
E-MAIL USE
PROTECTION OF PERSONAL DATA
THE MANIPULATION OF COMPUTER EQUIPMENT
These actions supplement the rules of conduct and ethical recommendations already existing in the company, such as the Disciplinary Rules for Collective Bargaining Agreement or the Style Guide for customer services. There is a General Protocol for the Handling of Claims , prepared by the Regulatory Compliance Unit, explaining the procedures for making the necessary analyses. The following actions were significant in 2012: # Creation of a specialise unit to handle the companys anticorruption policy.
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# Publication of Iberias Code of Conduct. # Creation of a whistle blowing channel accessible by all employees and allowing anonymous reports. # Specific anti-corruption training for key positions. # Internal regulations on Regulatory Compliance, Bribery Laws and Corporate Hospitality.
# Continuous reporting to the IAG Audit and Compliance Committee in respect of Iberias compliance policies. # Coordination with British Airways on the regulatory compliance policy within the group.
b 7.6 EQUAL OPPORTUNITIES AND DIVERSITY

Salaries in Iberia are established according to rank, seniority and position, as marked out in the respective collective agreements, with no distinction on grounds of sex, race or any other discrimination. In pursuance of Organic Law 3/2007, three Equality Plans are being negotiated with the different union representatives within the collective bargaining of the Companys three Collective Agreements: Ground Staff, Flight Attendants and Pilots. The Equality Plan for Flight Attendants was signed by all the union representatives in the Equality Committee in 2011. The company thus complies not only with Article 45 of Organic Law 3/2007 of 22 March for effective equality of men and women, but also with Transitional Provision Three of Part One of the XVI Collective Agreement for Flight Attendants. The company has suggested to the union representatives of Pilots that the Equality Plan be negotiated within the bargaining of the VIII Collective Agreement, currently in progress. In accordance with the Ground Staff Collective Agreement, the Committee was set up on 13 March 2008 to draw up an Equality Plan. In the first phase, an external auditor was engaged to
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diagnose the situation and, based on that diagnosis, Committee meetings have been held to negotiate the Equality Plan, no agreement having been reached so far. The total percentage of women in the company at 31 December 2012 was 37.9%, two tenths above the proportion in 2011. At the end of 2012, 385 employees held senior positions in the company, 121 of whom were women, 31% of the total. As regards diversity, the company has a policy of hiring local personnel, such that, apart from a few positions within the structure of some commercial management areas, which are held by people sent from Spain, 781 employees of the company are nationals of the countries in which Iberia operates as a multinational, 49.3% of whom are women.
60-64 50-54 40-44 30-34 <25 0 500 1,000 1,500 2,000 2,500 Men Women
b 7.7 WORK-LIFE BALANCE POLICIES

Reduced working hours for legal custody have been applied within the company to promote childbirth and protect maternity, paternity and care of the elderly, which benefits were taken up in 2012 by a total of 1,904 employees. The company takes account of the risks that employees work may entail for pregnancy and breastfeeding, especially among the flight groups, permitting different possibilities for reducing working hours, temporary suspensions of contract and the processing of benefits, all regulated by collective agreement. Moreover, in 2011 a new type of reduction came into force under the Flight Assistants Collective Agreement, raising from 8 to 11 years the age of children for which reduced working
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hours can be requested for custody. In 2012, 107 flight attendants applied for this reduction. The company offers a free service for accompanying minor children of
employees on Iberia flights, which is provided for children aged between 5 and 11 travelling alone.
b 7.8 HEALTH AND SAFETY AT WORK

Iberia has its own Prevention Service with Senior Occupational Hazard Prevention Officers covering the four disciplines of prevention: Safety at Work, Industrial Hygiene, Ergonomics and Psychosociology and Industrial Health. At 31 December 2012, in Iberia there are 20 Ground Staff Health and Safety Committees, 1 Flight Staff Health and Safety Committee and 1 InterWorkplace Health and Safety Committee for Ground Staff. As regards Delegates, there are 71 Ground Staff
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Prevention Delegates, 8 Flight Staff Prevention Delegates and 6 Prevention Delegates of the Inter-Workplace Committee, and a further 17 Delegates in workplaces which, because of their size, do not have a Committee, covering 100% of the employees. Every employee receives training for each type of risk to which he/she may be exposed. Moreover, IBPersonas has a specific channel for occupational hazard prevention, where employees can consult details, recommendations, rules, manuals and other preventionrelated documents, such as how to prevent muscular damage, employee prevention obligations, etc. The accident rate was further lowered in 2012 in all areas of the company by 19.43%. The seriousness of accidents at work was also reduced by 16.21% year on year. These trends show that the measures taken in respect of prevention are adequate, encouraging the company to continue along the lines defined in the Prevention Plan. The main occupational hazards to which employees are exposed are excess effort and noise. In both cases considerable training is given and the tasks that may be performed are limited if any incipient damage is detected in an employee.
Laboratory management application Development of the Laboratory Management Application was completed in 2012, in all its points:
One of the most interesting points is the Agenda for reserving equipment and the access by all members of the Prevention Service Unit to the documents of the equipment in use and the incident section, so that they can report incidents. Another section is Documentation, which includes all documents referring to the equipment, calibration and verification certificates, operating manuals, instructions for use, technical specifications, etc.
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Acquisition of new laboratory equipment The frequency measurement module has been updated in the vibration measurement equipment, with the main aim of analysing in octave bands the vibrations given off by each tool to the hand-arm system and defining the most adequate measure according to the frequencies that could entail a risk to workers health. The HADA equipment (CAD Analysis Tool) was also acquired to enable adequate analysis of the ergonomic conditions in different jobs, thereby assisting in the ergonomic design of working equipment and places and training in good practices . The purpose of the HADA system is to capture and make a 3D analysis of human movements in different jobs. It is based on the use of inertial movement sensors, transposing these movements to 3D biomechanical models. With the information provided by the sensors during the field capture in combination with 3D animation software, it is possible to reproduce the workers movements in a biomechanical model to subsequently make an ergonomic assessment of the musculoskeletalrisks deriving from the activity in question.
With the results from the studies, presentations are designed for use in the training of workers who need to use strategies, positions and movements in their job to prevent musculoskeletal injury.
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Risk assessment strategies # Management of noise exposure at work During 2012 the goal has been to define the necessary measures to make sure that employees real exposure to noise (i.e. the real noise level that the workers ear receives) in each job is always below levels that could cause loss of hearing. The Prevention Service has developed a tool based on the assignment of noise exposure points for each of the tasks/activities performed in the job. It is the development of a methodology proposed in the noncompulsory Best Practice Guide for application of Directive 2003/10/EC of the European Parliament and of the Council on the minimum health and safety requirements regarding the exposure of workers to the risks arising from physical agents (noise), published in 2009. Unlike previous years, as from 2012 the noise level in jobs is calculated on the basis of the noise level of each task performed and the exposure duration.
Measuring by tasks enables the assignment of noise exposure points for each hour of performing a given task or activity. The advantage of exposure points is that they are added arithmetically, such that the production units can organise the work to guarantee minimum exposure of the employees to noise by means of a simple operation. The minimum level of real exposure at work is also guaranteed by calculating the noise exposure points reduced with the protection offered by individual hearing protectors made available to employees. Consequently, the information on noise levels in jobs has been modified to include in all cases the real noise exposure level and the tasks that require compulsory use of individual hearing protectors. # Limits on noise exposure The limits on noise exposure were modified in 2012, introducing limits related not only with ambient noise but also with the real noise level received by each employee (real exposure), taking account of the reduction of that noise exposure
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through use of individual hearing protectors. The adaptation of employees according to Rule SH 205 is done in these cases according to the noise scale of each particular job. Noise exposure scales are always calculated in the following conditions: j Without considering the reduction of exposure through use of individual hearing protectors. In other words, the calculation of exposure scales is based on the noise level of each task. j Considering the reduction achieved through use of individual hearing protectors (conventional
or with amplifier). In other words, real noise exposure scales, considering the use of hearing protection in tasks with high noise levels. Each employee receives a scale card for his/her particular job related with any limitations he/she may have. The management of each job in turn has a general card for the job, including the necessary information to adapt employees with any of the limitations related with the noise in that job. The scale cards for each job also indicate any tasks that may be performed all day by any employee and those requiring checks regarding the use of individual hearing protectors or maximum exposure duration.
b 7.9 WELFARE BENEFITS

# Solidarity Fund The funds are used to meet social needs, such as aids for education, aids for disabled and chronically ill children, welfare loans, expenses incurred through sickness, among others. This fund is jointly financed in equal proportions by the company and employees, except in the case of cabin crew, who contribute 0.40% of their basic wage and the company contributes a fixed sum. # Ground and Flight Staff Welfare Funds The company and each employee make monthly contributions (50% each) through their salary to the pension scheme, handled by Mutualidad Montepo Loreto, set up
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as a private pension and welfare institution in 1970 by the workers in the aviation sector. Loreto is an independent institution, unrelated to any financial group, so its investments are made exclusively to obtain the best, most secure benefits for its members. It operates under a system of Individual Capitalisation, which means that the contributions made by members are used to finance the benefits of each one and that the distribution of profit is equal for all participants. This fund covers disability and retirement benefits. In the case of flight crew, it also covers long-term temporary disability and death benefits.
# Group Life Assurance Policy This assurance covers death and permanent disability. In the case of flight crew, it also covers the contingency of permanent loss of licence. It is 60% financed by the company and 40% by the employee. # Housing loans Loans may be granted each year for up to 4% of the ground staff and flight attendants on the payroll at 31 December of the preceding year. # Medical cover Iberia takes and manages all activities and actions required for the recovery of workers who suffer accidents.
montepioloreto.com
b 7.10 CORPORATE CITIZENSHIP

Iberia employees participate in numerous corporate citizenship activities, receiving logistic and economic support from the company. The solidarity initiatives that employees have been working on for years have given rise to the creation and development of two Associations, which have now been declared Public Utility Associations and are among the most important in Spain:
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# Iberia Employees Parents of Disabled Children Association APMIB apmib.com
APMIB has a human team of 611 persons, 75% of which have some kind of functional diversity. Their main occupations are the manufacturing of textile products, packaging & labelling, etc., computing and administrative coordination services. It has been supported by the company from the outset, with monetary contributions and work contracts awarded on a competitive basis. Approximately one-third of its turnover is obtained on sales to Iberia. Apart from work for Iberia, the APMIB centres perform activities and provide services for more than 500 clients, including 2012 Acciona, Cepsa, Airbus and Aena. The products and services offered by APMIB to its clients are: j Packaging, labelling, etc. j Outsourcing services j Gardening j Laundry j Stock management j Documentary management j Waste management j Cleaning Finally, in the area of assistance, they offer support services for the development of personal, social and labour skills in disabled persons of all ages.
Set up in 1977 by company employees with children with special needs, this association focuses its activities on the protection and social integration of physically, mentally or sensorially handicapped children. Twenty years later, in 1997, the APMIB Foundation was set up to provide protection and social and educational assistance for the handicapped. The Foundation promotes and manages homes and other centres for the disabled who are orphans or in a situation of neglect, whatever their age. It also organises several training activities and promotes research to improve the lives of people with special needs. It is now the second largest association for the disabled in Spain, after the ONCE [National Association for the Blind], with six specialist centres in Barcelona, Madrid (2), Malaga, Las Palmas and Tenerife. Its work is no longer limited to relatives of Iberia employees, but is open to the whole society.
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# Mano a mano
Iberia Veterans Association are particularly active in this area.
# The Veterans Association
manoamano.org.es This NGO was founded in 1994 by Iberia employees to use the free space in the bellies of company flights to send humanitarian aid to countries hit by natural disasters or wars and deliver that aid without middlemen, i.e. hand to hand (Mano a Mano in Spanish). It brings children from different countries, together with their families, to Spain on Iberia flights for specialist medical attention. Once in Spain, Mano a Mano provides them with accommodation and anything else they may need. It also manages all sorts of aid projects in developing countries. Iberia donates air tickets and cargo space to Mano a Mano. Iberias social activity, which complements its solidarity and labour responsibility actions, also extends to areas such as leisure, sport and culture. Club Iberia and the Club Iberia is a non-profit association that aims to promote leisure and sports activities among company employees and their families, thereby fostering values such as the family, solidarity and teamwork. It currently
was founded in 1972, has 8 delegations in Spain and finances all its activities with the membership fees of over 7,000 members, in 51 meeting points in Spain and more than 20 abroad. The services provided and activities organised by this Association are aimed primarily at members on retirement, disability or widowhood pensions. The activities organised are mainly cultural, touristic and recreational.
# Club Iberia
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has over 10,000 members and 12 delegations nationwide. The Club Iberia budget is funded mainly with the membership fees and an annual contribution from Iberia, which also
provides premises for the Clubs offices and facilitates internal communication for all employees through IBPrxima.
b 7.11 EMPLOYMENT OF DISABLED WORKERS

In pursuance of the Disabled Persons Integration Act, Iberia must hire a number of disabled workers equivalent to no less than 2% of its headcount. Owing to the companys complex productive nature, it is especially difficult to incorporate disabled workers in a sufficient number to meet that quota so the company meets its legal obligation through the alternative measures regulated by Royal Decree 364/2005. These measures include commercial contracts with Special Employment Centres and donations and sponsorships in favour of Public Utility Associations. Therefore, in 2012, the quota established in respect of the total headcount was 438 persons, met through: # lEmployment of disabled persons: the company provided direct employment for a total of 253 disabled workers in 2012. # Commercial contracts with Special Employment Centres: a total of 3,662,556 was invoiced under these contracts in 2012. This amount is equivalent to 164 workers. # Donations and Sponsorships: in 2012, the donations in cash or in kind made to the above-mentioned associations totalled 664,811, equivalent to 30 workers. Therefore, the number of disabled persons employed by Iberia, directly or through alternative measures, totals 447, exceeding the quota by nine workers.
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b FUTURE ACTIONS
# Within the context of Iberias Strategic Plan 2012-2015 and with the AVANZA project as the driving force for renewing the culture, implementing a people-orientated management model and strengthening the commitment of all Iberia employees, the following initiatives are to be started up during 2013: # 2. Competence-based Performance Assessment. This initiative began in 2012 and will be fully implemented in 2013 with the launching of a new performance assessment process to adjust it to best practices on the market and the international standards of competence-based management. Accordingly, a skills model has been designed and will be applicable at all levels throughout the company, beginning in 2013 with the management positions within the organisation.
# 1. A second phase in Talent Spotting and Management, following the criteria of meritocracy and transparency prevailing in the AVANZA project, to select candidates for a management career in the company, future managers to maintain a reserve for succession in key positions within the organisation; and for the project management career, new skills required by the company to meet its challenges. This initiative is an opportunity for professionals with potential who are not in a position with responsibility at present but are interested in furthering their careers with a view to becoming company leaders in the future.
# 3. Start-up of a new rewards and recognitions programme throughout the company. The pilot programme will be run for the Management of Madrid-Barajas Airport.
# 4. Launching of a project entitled New Ways of Working, which contemplates the use of collaborative tools based on the use of technology, allowing a more flexible, across-the-board application.
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# 5. Commencement of a new Innovation programme, scheduled for the summer of 2013, as the driving force of a cultural renewal aiming at continuous improvement. # 6. Creation of a corporate citizenship programme scheduled for the second half of 2013. # 7. Launching of a pulse engagement survey, planned for the second half of 2013. # 8. Within Campus Iberia (Corporate University), the creation of a Commercial School, with six training itineraries: Sales, Marketing, Customer Experience, Network Design, Revenue Management and Product Manager.
And the Project Management School, as a fundamental discipline extended to technical positions and areas to become a practice applied across the board. # 9. Launching, in early March, of IBLearning, a new learning platform which will improve communication, enabling users to exchange messages, develop communication, give greater transparency to the most important news, have forums and groups in which information and opinions can be shared, giving access to best practices. 10. Implementation of personnel management processes on the platform PeopleSoft, for both managers and employees, with the aim at all times of having an integrated management tool.
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# Moreover, within the Strategic Plan 2012-2015, the cross-sectional transformation project gora will be implemented within the MadridBarajas Airport Management. From the point of view of human resources management, further progress will be made during 2013 towards a people-orientated management model, aiming to achieve outstanding management at Madrid Barajas Airport in efficiency, punctuality and customer services, making this hub a worldwide benchmark. # The project REDNOVA will be launched in 2013, aimed at the entire airport network. It is a transformation project seeking excellence in customer services at airports. # Continue with the Negotiation under way of the Transformation Plan and Collective Agreements.
# Develop the Equality Plans in progress. # Continue to support corporate citizenship actions undertaken by employees. # New IBPrxima: after two years work the new intranet will see the light in 2013 with a new general focus, design, structuring of contents, communication tools (forums, digital encounters, etc.), novelties and improvements, based on the needs indicated by employees through surveys, suggestions boxes and workshops, facilitating the communication and cultural change that the company is putting into practice.
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8. SOCIETY
Iberia bases its social action strategy on supporting solidarity organisations by assigning space in the bellies of aircraft for transporting humanitarian aid and transporting passengers requiring some kind of aid during the provision of its regular services. The company has an adequate control system to manage its contributions, enabling continuous assessment to adjust Iberias social actions to the established strategy. In this regard Iberia steers its social actions so as to contribute directly or indirectly towards achieving the Millennium Development Goals established by the United Nations in 2000, contributing both funds and resources to solidarity projects.
b 8.2 CONTRIBUTION TO THE UNITED NATIONS MILLENNIUM DEVELOPMENT GOALS

# Treat and combat life-threatening diseases # Reduce child mortality Iberia was the first airline in the world to join MASSIVEGOOD, an initiative of the Millennium Foundation, which seeks to obtain additional financing to enable achievement of the three Millennium Development Goals related with health: # Improve maternal health From 18 May 2011 to 28 February 2012, all Iberia customers making purchases through www.iberia.com were given the
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option of making a voluntary donation to this project. The funds collected from the 7,113 customers who made donations in a total of 40,808 euro were given to the Children Without
Malaria Project, a campaign run by the Spanish Red Cross to prevent, diagnose and treat this disease among children in Tanzania and Gambia.
Iberias contribution to the UN Millennium Development Goals: The following table summarises other collaborations in 2012 related with the Millennium Development Goals, classified according to the goal to which they contribute:
Goals
Target
Main projects in 2012
j Collaboration with the canteen for 360
Halve the proportion of people living on less than 1 dollar a day
children in Tablada de Lurin, one of the poorest districts of Lima, in Peru. The aid to the bakery is maintained.
j Sending of food and clothes to Pozo del To
Raimundo, a peoples canteen project. Goal 1: Eradicate extreme poverty and hunger
j Sending of food to the canteen of the
Welfare Centre in Basakato, Equatorial Guinea. Food is also sent to the orphanage Nuestra Seora de la Almudena in Equatorial Guinea. Halve the proportion of people who suffer from hunger
j Collaboration with Hijas de la Caridad in
Santo Domingo, providing assistance and food for Los Hijos de la Calle; and with Hijas de los Sagrados Corazones, in the province of Barahona, to help with the Orphanage they run in the Dominican Republic.
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j Collaboration with the bakery of the Tablada de Lurin
canteen, panelling it to double up as classrooms and give basic education as well as food.
j The school in Paraso (Dominican Republic) was
opened in September 2012 for the beginning of the school year. Forty-three Haitian children are receiving education there, improving the quality of education in the isolated, less favoured communities of Las Lomas. It is also used as a refuge for hurricanes and as a social and medical centre.
j Collaboration with the school Santo Toms de
Valencia. Goal 2: Achieve universal primary education Ensure that, by 2015, children everywhere, boys and girls alike, will be able to complete a full course of primary schooling
j Permanent collaboration with the schools Sampaka
and Santa Teresita de Malabo with the aid of study grants in Malabo, Luba, Batete and Basakato, among others, in Equatorial Guinea. And sending of school material to Basakato, to be distributed throughout the entire area.
j Collaboration with Fundacin Reina in Quito, Ecuador,
for the integral development of children with Down syndrome.

j Collaboration with a nursery in Chambo
(Ecuador)with toy libraries and toys for individual children.

j PC bank: free transport of Amadeus PCs to
educational and welfare projects in Africa and South America.

j Cooperation with the Social Integration Sports
Schools of the Real Madrid Foundation.
Goal 3: Promote gender equality and empower women
Eliminate gender disparity in primary and secondary education preferably by 2005, and at all levels of education by the end of 2015
j Collaboration with a mothers and girls shelter
project, teaching them to sew and use computers, in Equatorial Guinea.

j Sewing workshop in El Pozo del To Raimundo. j Collaboration with Women Together projects.
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j Mano a Mano transports children on
Iberia flights for surgery or medical treatment in Spain.

j Close collaboration with the Spanish
Leukemia Foundation, to treat children in Peru, Ecuador and Guatemala. Goal 4: Reduce mortality in children under 5 Reduce by two thirds, between 1990 and 2015, the under-five mortality rate
j Sending hospital material to Annobon in
Equatorial Guinea.
j Sending of medical material to the
orphanage Nuestra Seora de la Almudena in Equatorial Guinea.

j Collaboration with Make a Wish Spain. j MASSIVEGOOD micro-donations project.
Goal 5: Improve maternal health
Reduce by three quarters, between 1990 and 2015, the maternal mortality ratio
j Building of Accident & Emergency Centre in
malas, Chulucanas-Piura (Peru), for young pregnant women and newborns.

j MASSIVEGOOD micro-donations project.
j MASSIVEGOOD micro-donations project.
Goal 6: Combat HIV/AIDS, malaria and other diseases
Have halted by 2015 and begun to reverse the spread of HIV/AIDS Have halted by 2015 and begun to reverse the incidence of malaria and other major diseases
j Sending of medicines and hospital material
to hospitals in Equatorial Guinea (Basakato & Luba).

j Collaboration with the Drug Addiction Help
Foundation, with Basida and Remar Spain.

j Collaboration to build a shelter for terminal
patients in Basakato, Equatorial Guinea.

j Contributions to the National Oncology
Research Centre Carlos III and the Drug Addiction Help Foundation.
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Integrate the principles of sustainable development into country policies and programmes and reverse the loss of environmental resources Goal 7: Ensure environmental sustainability Halve, by 2015, the proportion of people without sustainable access to safe drinking water and basic sanitation By 2020, to have achieved a significant improvement in the lives of at least 100 million slum dwellers
j See the Environment chapter of
this Report.
j Collaboration with Fundacin
Migres in its project for repopulation of the fish eagle in Doana.

j Collaboration with Fundacin
Neotrpico to transport four female white-eared titi monkeys from the Fauna Research and Conservation Centre of the Neotropical Foundation in Tenerife to El Karpn Aventura in Vizcaya.
Develop further an open, rule-based, predictable, non-discriminatory trading and financial system Address the special needs of least developed countries Address the special needs of landlocked developing countries and small island developing States Deal comprehensively with the debt problems of developing countries
j Commitment to the Global
Goal 8: Foster a world alliance for development
Compact principles.
j Close cooperation with the
Spanish International Cooperation and Development Agency (AECID).
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b 8.3 PRINCIPAL COLLABORATIONS

Permanent collaboration Some of Iberias main permanent collaborations with welfare institutions and entities are listed below: # Spanish International Cooperation Agency AECID: Iberia cooperates through agreements, which include special discounts for passenger or cargo tickets on its flights. # National Transplant Organisation: Iberia provides free transport of organs on its scheduled flights. In 2012 Iberia transported 60 organs. # Make a Wish Spain Foundation: Iberia collaborates by providing transport for sick children, who the Foundation takes to different places to make their wish come true so that they recover their desire to live . # Amadeus IT Group - PC Bank Project: Master agreement through which Amadeus reuses the computers, amortised over no more than three years of use, of its 72 commercial subsidiaries distributed throughout the world which their employees or client travel agencies no longer use, to send them to countries in need. Iberia collaborates by transporting the computers to their destinations. In 2012 it transported more than 300 kg for projects in Africa and South America. # Real Madrid Foundation for social integration through sport: Collaboration agreement through which Iberia participates in the children and youth social development and education projects organised by the Real Madrid Foundation abroad: Social Integration Sports Schools of the Real Madrid Foundation. This year Iberia collaborated in the organisation of the Corazn Classic Match 2012 to raise funds to build schools in Africa. # Encouraging children to do sport: Iberia and Coca Cola Espaa collaborate in the organisation of inflight drawing competitions for children under 12 travelling on Iberia flights. The aim is to encourage physical exercise among children. In addition, through the IBPrxima Solidarity Projects Portal, information is given and voluntary cooperation is requested for several welfare projects and organisations promoted by the employees, including: Accede a Respiro, Nantik Lum Foundation, Balia Foundation for Childhood, My Attic, Gloria Project Association, Shelter and Development Social Work, Yakaar
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Africa Association, Spanish Rare Diseases Federation (FEDER), Fundacin alia2, etc.
V WEEK OF SOLIDARITY MAGIC Iberia collaborated with Fundacin Abracadabra de Magos Solidarios in the V Week of Solidarity Magic in Madrid. Fundacin Abracadabra organises 5 days of intensive days of magic a year, in which over 10,000 children, elderly and disabled enjoy the excitement of a magic show. With the aim of restoring their desire to live, the Foundation provides free solidarity magic every year to those most in need of it: children in hospital, the elderly, the physically or mentally handicapped and young people at risk of social exclusion. There are over a hundred solidarity magicians who, being totally dedicated to small patients and the most disadvantaged groups, give away the best medicine: excitement.
b 8.4 PARTICIPATION IN ASSOCIATIONS AND FOUNDATIONS

The company belongs to several associations and foundations related with Corporate Social Responsibility. # Carolina Foundation: An institution set up in 2000, sponsored by Sogecable, PRISA, FCC, ACS, El Corte Ingls and Iberia, among others. It promotes cultural relations and cooperation in science and education between Spain and the countries of the South American Community of Nations and other countries having special historic, cultural or geographical ties with Spain. www.fundacioncarolina.es
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SOCIETY
# Exceltur: A non-profit association currently consisting of 24 of the most influential Spanish tourist business groups. This association endeavours to foresee and adapt to processes of change required by the increasingly more global and demanding markets, publishing surveys related to tourism and recommendations for the future. www.exceltur.org # Spanish Confederation of Business Organisations CEOE: Iberia, through AECA, is a member of the Social Responsibility Commission of the CEOE along with other Spanish large enterprises and SME associations, set up as a forum for encounter and debate to analyse CSR trends on the market. In turn, it represents its members in the State Council on Corporate Social Responsibility (CERSE) set up in February 2008 and headed by the Spanish Ministry of Labour and Immigration. www.ceoe.es # SERES Foundation (Responsible Business and Society Foundation): This Foundation was set up as a CSR knowledge platform to serve as a benchmark for companies and other
social partners committed to improving society, focusing mainly on the integration in employment of the underprivileged. www.fundacionseres.org # House of America: Iberia collaborates with this institution, set up in 1990 with the main purpose of generating a forum of ideas and debates on economic, political and cultural aspects of Latin America. www.casamerica.es # Euroamerica Foundation: Promotes projects stimulating collaboration and understanding between Europe and Latin America and encourages dialogue between the two continents. www.euroamerica.org # Latin America Quality Foundation: Iberia is a founding member of FUNDIBEQ, which runs a Management Excellence and Quality Programme attached to the IberoAmerican Summit of Heads of State and Governments, with the participation of major Spanish and Latin American enterprises. www.fundibeq.org
105
SOCIETY
BOOKS FOR COLOMBIA Books for Colombiais an initiative in which Iberia participated in 2012, aiming to supply 70,000 textbooks and readers to Colombian children and teenagers with no means of support. Iberia, the social network ideas4all and Telepizza ran this campaign, from 10 January to 10 February, inviting people to donate books that were no longer in use and which were nevertheless in good condition for other readers to use.
b 8.5 RESPONSIBLE INVESTMENT

Iberias direct investment in social interest groups during 2012, considering contributions in cash and in kind, totalled 0.6 million . For the fifth year in succession, the company has also made contributions to external environmental protection projects. Investments in sponsorship arrangements, that is, collaboration agreements with sports, cultural, educational, etc. organisations, 6.4 million in 2012. The company sponsors at all times initiatives and events that are in line with the values with which it identifies. The company supports both the creation and spreading of Spanish culture and its most representative institutions, including the Royal Theatre, Liceu in Barcelona or the Friends of the Prado Museum Foundation.
106
SOCIETY
FRIENDS OF THE PRADO MUSEUM FOUNDATION Iberia has been a corporate member of the Friends of the Prado Museum Foundation since 2002, being the oldest, most constant benefactor of the museum without expecting anything in return. The Foundation has made major contributions in donations of works of art, courses, publications, museum guides, educational visits, creation and publishing of an encyclopaedia of the Museum, exhibitions and economic aid for activities of the art gallery, among others. Through its collaboration agreement with the Foundation, Iberia sponsors the Spanish version of the MASTERPIECES Guidebook and the companys employees benefit from especially favourable terms for becoming Friends of the Museum.
107
9. ANNEXES
b 9.1 CONTENTS AND INDICATORS ACCORDING TO GLOBAL REPORTING INITIATIVE - VERSION 3.1
Guidelines basic contents and performance indicators index GRI 3.1 Preliminary clarifications # The GRI 3.1 indicators are classified into core and additional indicators. The former are those of interest for our company and most of the stakeholders. The latter represent a prominent, although not widely used, practice in measuring social, economic or environmental aspects, offer significant information for the interested parties and may be changed in the future to core indicators. # The standard GRI A+ means inclusion of all the core indicators or explanation of their omission. The reasons for those not applicable to the aviation industry or to Iberia are set out in the table Indicators Not Applicable. # Iberia has also included some indicators complementing those listed in the GRI guidelines, version 3, in view of their importance in its activities and compliance with the principle of transparency expressed in said guidelines. # The indicators published in this report cover all the areas and activities performed by the company, with no limitation on the scope or cover of the report on this subject. The adequate comparability of the 2012 indicators with previous years is also guaranteed. Annual information expressed in percentages is compared in percentage points (p.p.)
108
ANNEXES
Location in the Report or explanations GRI Section Contents > CHAPTER N. > Section > Sub-section or Paragraph STRATEGY AND ANALYSIS Responsible area
1.1
Chairman's statement
Chairman's Statement > 2. STAKEHOLDER ENGAGEMENT > Public commitment CORPORATE RESPONSIBILITY & ENVIRONMENT
1.2
Description of key impacts, risks and opportunities
> 0. ABOUT IBERIA > 1.OUR FOCUS ON RESPONSIBILITY> Impact analysis > 5. SHAREHOLDERS AND INSTITUTIONS ORGANISATIONAL PROFILE
2.1
Name of reporting organisation
IBERIA, L.A.E., S.A. OPERADORA, SOCIEDAD UNIPERSONAL > 0. ABOUT IBERIA > Iberia, Lineas Areas de Espaa > 5. SHAREHOLDERS AND INSTITUTIONS > Brand management > 0. ABOUT IBERIA > Organisation Structure > 1. OUR FOCUS ON RESPONSIBILITY > Corporate Responsibility Framework > CR Organisation and Responsibilities in Iberia ALL
2.2
Primary brands, products and/or services
2.3
Operational structure of the organisation
2.4
Location of organisation's headquarters
c/ Velzquez, 130 - 28006 - MADRID (ESPAA)
2.5
Countries where the organisation operates
> 0. ABOUT IBERIA > Iberia, Lineas Areas de Espaa > 7. EMPLOYEES > Workforce and Labour Relations
HUMAN RESOURCES
2.6
Nature of ownership and legal form
SINGLE-MEMBER PUBLIC LIMITED COMPANY. Owned by the shareholders of International Airlines Group (IAG)
2.7
Markets served
Air Transport Business: Spain, Europe, America, Africa and Middle East Maintenance and Airport Services Businesses: Based in Spain, serving airlines throughout the world
2.8
Scale of the reporting organisation
> 0. ABOUT IBERIA > Iberia, Lneas Areas de Espaa See also indicators EC1 and LA1
ALL
2.9
Significant changes during the reporting period
> 0. ABOUT IBERIA > Main achievements in 2012 > 5. SHAREHOLDERS AND INSTITUTIONS > Development of the different Iberia businesses in 2012
2.10
Awards received in the reporting period
> 1. OUR FOCUS ON RESPONSIBILITY > Prizes and Recognitions obtained in 2012
109
ANNEXES
Location in the Report or explanations GRI Section Contents > CHAPTER N. > Section > Sub-section or Paragraph REPORT PARAMETERS
REPORT PROFILE
Responsible area
3.1
Reporting period
2012
3.2
Date of most recent previous report
2011 CORPORATE RESPONSIBILITY & ENVIRONMENT
3.3
Reporting cycle
Annual
3.4
Contact point for questions regarding the report
daicrescor@iberia.es
REPORT SCOPE AND BOUNDARY
3.5
Process for defining report content
> 1. OUR FOCUS ON RESPONSIBILITY > Corporate Responsibility Framework > RC Policy > 1. OUR FOCUS ON RESPONSIBILITY > Impact analysis > 1. OUR FOCUS ON RESPONSIBILITY> External assessment
3.6
Boundary of the report
IBERIA, L.A.E., S.A. OPERADORA, SOCIEDAD UNIPERSONAL
3.7
Specific limitations on scope or boundary of this report
> ANNEXES > Annex A.2. > Indicators not applicable
3.8
Basis for reporting on joint ventures, subsidiaries, etc.
The indicators of this Report belong to Iberia L.A.E. Group information can be consulted in the IAG Group annual report
CORPORATE RESPONSIBILITY & ENVIRONMENT
3.9
Data measurement techniques and the bases of calculation
The indicators are calculated using internationally accepted methods
3.10
Effect of any re-statements of information provided in earlier reports There have been no changes in data or methods in respect of the previous year
3.11
Significant changes from previous reporting periods in the scope
GRI CONTENT INDEX
3.12
Location of standard disclosures in the report
> CONTENTS > ANNEXES > A.2. GRI Contents and Indicators
ASSURANCE
3.13
Policy and current practice with regard to seeking external assurance for the report
> About this Report
RESPONSABILIDAD CORPORATIVA Y MEDIO AMBIENTE
110
ANNEXES
Location in the Report or explanations GRI Section Contents > CHAPTER N. > Section > Sub-section or Paragraph GOVERNANCE, COMMITMENT AND ENGAGEMENT OF STAKEHOLDERS Responsible area
4.1
Governance structure of the organisation
BOARD OF DIRECTORS, Executive Committee, Compensation Committee, Safety Committee www.iagshares.com
4.2
Indicate whether the Chair of the highest governance body is also an Yes. www.iagshares.com executive officer Number of members of the highest governance body that are independent or non-executive members 7 of 14 (1 woman, 13 men)
4.3
4.4
Mechanisms for shareholders and employees to provide recommendations or direction to the highest governance body
General Shareholders' Meeting & Proxies. Department responsible for relations with shareholders: shareholder.services@iairgroup.com > 7. EMPLOYEES > Workforce and Labour Relations> Union representation and participation GENERAL COUNSEL & SECRETARY OF THE BOARD
4.5
Linkage between compensation for members of the highest governance body, senior managers and executives and the organisation's performance
DIRECTORS: fixed % of profit allocated in the previous year SENIOR MANAGEMENT: Annual variable bonus by objectives
4.6
Processes in place for the highest governance body to ensure conflicts of interest are avoided
The current Corporate Governance regulations are those of IAG, which are applicable to Iberia: Regulations of the Board and Code of Market Conduct www.iagshares.com (http://goo.gl/dijVi)
4.7
Process for determining the qualifications and expertise of the members of the highest governance body for guiding the organisations strategy on economic, environmental, and social topics
Proposal by the Board to the General Meeting, following report by the IAG Nomination Committee: Regulations of the Board www.iagshares.com (http://goo.gl/dijVi)
111
ANNEXES
Location in the Report or explanations GRI Section Contents > CHAPTER N. > Section > Sub-section or Paragraph GOVERNANCE, COMMITMENT AND ENGAGEMENT OF STAKEHOLDERS Internally developed statements of mission or values, codes of conduct, and principles relevant to economic, environmental, and social performance > 1. OUR FOCUS ON RESPONSIBILITY > Corporate Responsibility Framework > Corporate Responsibility Piolicy > 7. EMPLOYEES > Ethics and Codes of conduct CORPORATE RESPONSIBILITY & ENVIRONMENT Responsible area
4.8
4.9
Procedures of the highest governance body for overseeing the organisations identification and management of economic, environmental, and social performance
The Iberia Board approves the CR Policy. The CR information is assessed and approved by the Board, whereupon the Annual Report is signed.
GENERAL COUNSEL & SECRETARY OF THE BOARD
4.10
Processes for evaluating the highest governance bodys own performance
Compensation Committee: Regulations of the Board, art. 25 ap. 2 www.iagshares.com(http://goo.gl/dijVi)
4.11
Explanation of how the precautionary approach or principle is addressed by the organisation
> 1. OUR FOCUS ON RESPONSIBILITY > Impact analysis > 5. SHAREHOLDERS & INSTITUTIONS > Risk Management
4.12
Externally developed economic, environmental, and social charters, principles, or other initiatives to which the organisation subscribes or endorses Principal associations of which the organisation is a member or which it supports List of stakeholder groups engaged by the organisation
> 7. EMPLOYEES > Corporate citizenship > 8. SOCIETY > Millennium Development objectives
ADVERTISING & SPONSORSHIP
4.13 4.14
> 0. ABOUT IBERIA > 8. SOCIETY > Participation in associations and foundations
4.15
Basis for identification and selection of stakeholders with whom to engage
> 1. OUR FOCUS ON RESPONSIBILITY > Corporate Responsibility Framework > Stakeholders CORPORATE RESPONSIBILITY & ENVIRONMENT
4.16
4.17
> 2. STAKEHOLDER ENGAGEMENT > 3. ENVIRONMENT > Introduction table > 4. CUSTOMERS > Introduction table > 5. SHAREHOLDERS & INSTITUTIONS > Introduction table Key topics and concerns that have been raised through stakeholder engagement, and how the organisation has responded to them through > 6. SUPPLIERS > Introduction table > 7. EMPLOYEES > Introduction table its reporting > 8. SOCIETY > Introduction table Approaches to stakeholder engagement
112
ANNEXES
ECONOMIC PERFORMANCE INDICATORS Location in the report GRI Code Type of indicator Name of indicator CHAPTER No. > Section > Sub-section or paragraph
Direct economic value generated and distributed (NB: recurring operating revenues in million ) EC1 Core Operating costs and employee compensation 4,746 4,859 4,702 -3.2% MANAGEMENT CONTROL
2010
2011
2012
Variation 2012-2011 (% or p.p.)
Responsible area
This page
Operating costs 5,394 millon Employee compensation 1,340 millon
EC2
Core
> 2. STAKEHOLDER ENGAGEMENT Quantitative: 12 Mill. of which 8. Mill have > Public commitment > Climate Financial implications and other risks and opportunities been freely allocated. For the launch of Emission change for the organisations activities due to climate change Trading System in commercial aviation. > 3. ENVIRONMENT > Climate change
EC3
Core
Coverage of the organisations obligations deriving from > 7. EMPLOYEES > Welfare welfare benefit programmes (NB: % of employees benefits covered)
100% (see also indicator LA3)
HUMAN RESOURCES
EC4
Core
Significant financial assistance received from governments
This page
Minimum wage (in ) Minimum wage IBERIA (in ) EC5 Additional Range of ratios of standard entry level wage compared to local minimum wage at significant locations of operation
8,866.20 8,979.60
8,979.60
0.0% 2.0% HUMAN RESOURCES
15,240.93 15,240.93 15,545.79
This page
72% 70% 73% -2 p.p.
EC6
Core
Policy, practices, and proportion of spending on locally-based suppliers at significant locations of operation
> 6. SUPPLIERS > Responsible procurement
The significant trading of goods and services is done from Spain (procurement centralisation), although this does not mean that national suppliers are given priority (they compete on equal terms) The company has a policy of hiring local personnel in the countries where it operates as a multinational. Approximately 50% of the executives are locally hired. The hiring of local personnel abroad is governed by internal regulations. See Annex A.3. (Labour agreements and union representation by countries) Monetary donations social interest groups 0.6 Mill. . In kind contributions to social interest groups 1 Mill. . In kind contributions sponsorship agreements 6,4 Mill.
PROCUREMENT
EC7
Core
Procedures for local hiring and proportion of senior management hired from the local community at locations of significant operations
> 7. EMPLOYEES > Equal opportunities & diversity
HUMAN RESOURCES
EC8
Core
Development and impact of infrastructure investments and services provided primarily for public benefit through commercial, in-kind or pro bond engagement
> 8. SOCIETY > Responsible investment
EC9
Core
Understanding and describing significant indirect economic impacts, including extent of impacts
> 1. OUR FOCUS ON RESPONSIBILITY > Impact analysis
Qualitative CORPORATE RESPONSIBILITY & ENVIRONMENT
IBERIA INDICATOR
Environmental costs and investments
This page
18 millones Mill. in environmental expenditures and 1 Mill. in investments in tangible fixed assets
113
ANNEXES
ENVIRONMENTAL PERFORMANCE INDICATORS FLIGHT OPERATIONS Location in the report GRI Code Type of indicator Name of indicator > CHAPTER N. > Section > Sub-section or paragraph
Fuel consumption (tonnes/year) EN3 EN16 Core Specific fuel consumption (litres/RTK) Core CO2 emissions (tonnes) for all Iberia flights Average age of fleet (no. years) NOx emissions in LTO cycles (tonnes) > 3. ENVIRONMENT > Local air EN16 Core UHC emissions in LTO cycles (tonnes) quality CO emissions in LTO cycles (tonnes) 904 791 646 -18.3% 148 127 101 -20.5% > 3. ENVIRONMENT > Climate change 0.394 0.395 0.396 0.3% -7.5% 7.0% -14.7% CORPORATE RESPONSIBILITY & ENVIRONMENT 5,941,632 6,021,864 5,571,246 7.90 2,110 8.60 1,959 9.20 1,672 1,886,232 1,911,703 1,768,649
2010
2011
2012
Variation 2012-2011 (% o p.p.)

-7.5%
Responsible area
IBERIA INDICATOR
114
ANNEXES
ENVIRONMENTAL PERFORMANCE INDICATORS GROUND OPERATIONS Ubicacin en la memoria GRI Code Type of indicator Name of indicator > CHAPTER N. > Section > Sub-section or paragraph CARGO
CLASSIFICATION GROUND EQUIPMENT IBERIA INDICATOR Diesel vehicles Electric vehicles EN3 EN4 EN8 EN1 Core Core Core Core Diesel consumption (litres) Electricity consumption (J*10 ) Water consumption (m ) Paper consumption (tonnes) BOILER CONSUMPTION EN3 Core Gasoil C consumption (litres) > 3. ENVIRONMENT > Consumption of resource 869,669 611,514 50,617 -17.0%
3 9
2010
2011
2012
Responsible area
28 > 3. ENVIRONMENT > Climate change 132 47,940 8,967 > 3. ENVIRONMENT> Consumption of resources 3,398 27.5
27 117 45,362 6,681 1,784 29
28 114 51,237 7,369 1,715 27
3.7% -2.6% 13.0% 10.3% -3.9% -6.9%
HAZARDOUS WASTE MANAGEMENT (fluorescents, toner, batteries, oil filters, impregnated absorbers, etc.) EN24 Additional Generation (tonnes) (1) EN22 Core Generation (tonnes) > 3. ENVIRONMENT > Waste 200 180 147 -18.1% > 3. ENVIRONMENT> Waste 3.92 4.23 1.70 -59.8% URBAN WASTE MANAGEMENT (paper/cardboard, glass, wood, organic) CORPORATE RESPONSIBILITY & ENVIRONMENT
AIRPORT SERVICES
CLASSIFICATION GROUND EQUIPMENT Diesel vehicles IBERIA INDICATOR Petrol vehicles Electric vehicles EN3 EN4 EN8 EN1 Core Core Core Core Diesel consumption (litres) Electricity consumption (J*10 ) Water consumption (m ) (2) Paper consumption (tonnes)
3 9
2,675 > 3. ENVIRONMENT > Climate change 22 352
2,737 5 344
2,366 16 307
-13.6% 220.0% -10.8% -7.2% 3.2% -21.6% 2.8%
4,441,737 4,055,103 3,763,338 29,003 > 3. ENVIRONMENT > Consumption of resources 40,652 79 25,947 31,215 66 26,786 24,463 68
EN4
HAZARDOUS WASTE MANAGEMENT (oils and filters, solvents, batteries, shoes, polluted absorbents & containers, cutting oils, antifreeze, Additional decanter sludge, fluorescents, cells, etc.), including Vehicles Out of Use delivered to CART Generation (tonnes) > 3. ENVIRONMENT > Waste 253.6 130.9 127.9 -2.3%
URBAN WASTE MANAGEMENT (paper/cardboard, glass and packaging, pallets, etc.) EN22 Core Generation (tonnes) > 3. ENVIRONMENT > Waste 254.12 303.99 254.70 -16.2%
(1) Reduccin debido a mejora de proceso en la actividad de carga (2) Decrece debido al cambio de edifico en las Escalas de ALC y LPA y bajada de actividad general
115
ANNEXES
GROUND OPERATIONS Location in the report GRI Code Type of indicator Name of indicator > CHAPTER No. > Section > Sub-section or paragraph INDUSTRIAL AREAS - MADRID
FUEL CONSUMPTION IN BOILERS EN3 Core Natural gas consumption (kWh) Gasoil C consumption (litres) EN4 EN8 Core Core TOTAL ELECTRICITY CONSUMPTION (J*109) TOTAL WATER CONSUMPTION (m ) BOILER EMISSIONS IN INDUSTRIAL AREAS EN16 Core CO2 (Tonnes) USOS CRTICOS DE HALN EN19 Core kg installed in equipment kg used EN22 Core URBAN WASTE GENERATION (tonnes) (paper & cardboard, timber, not separated) > 3. ENVIRONMENT > Waste HAZARDOUS WASTE GENERATION (washing water, paints, solvents, metals in Additional solution, oils, polluted containers and absorbers, hydroxide sludge, residual kerosene, WEEE, etc.) (tonnes) (*) COMMON TO ALL GROUND OPERATIONS > 3. ENVIRONMENT > Local air quality CORPORATE RESPONSIBILITY & ENVIRONMENT 6,795 51 1,603 6,516 59 1,228 6,268 54 1,251 -3.8% -8.3% 1.9% > 3. ENVIRONMENT > Climate change 18,742 12,718 12,425 -2.3%
3
2010
2011
2012
Responsible area
86,633,127 67,804,850 67,731,297 > 3. ENVIRONMENT > Consumption of resources 12,022 259,587 376,292 133,740 296,532 322,382 108,761 299,135 277,029
-0.1% -18.7% 0.9% -14.3%
EN24
14,479
1,041
991
-4.8%
EN19
Core
Use of products containing VOCs in industrial areas (litres) Urban waste management (%) Re-use Recycling
119,894
262,335
252,105
-3.9%
0.0 48.0 > 3. ENVIRONMENT > Waste 4.0 48.0
0.0 58.1 0.1 41.8
0.0 78.6 1.6 19.8
+ 20 p.p. + 1 p.p. - 22 p.p.
Recovery Elimination EN22 Core Hazardous waste management (%) Re-use Recycling > 3. ENVIRONMENT > Waste Recovery for energy purposes Safe deposit
0.0 0.3 3.8 95.9
1.7 28.4 38.6 31.4
1.9 12.4 28.1 57.7
+ 0.2 p.p. -16 p.p. -10.5 p.p. -25.6 p.p.
116
ANNEXES
GENERAL ENVIRONMENTAL ASPECTS Location in the report GRI Code Type of indicator Name of indicator > CHAPTER No. > Section > Sub-section or paragraph
Percentage of materials used that are recycled input materials Energy saved due to conservation and efficient improvements (variation in specific consumption) > 3. ENVIRONMENT > Consumption of resources > 3. ENVIRONMENT > Climate change
2010
2011
2012
Responsible area
EN2
Core
Owing to the peculiarities of the aviation sector, the applicable technical standards and prevailing safety parameters, no recovered materials are used, only original materialss -4.81% 0.23% 0.28% + 0.05 p.p. CORPORATE RESPONSIBILITY & ENVIRONMENT
EN5
Additional
EN6
Initiatives to provide energy-efficient or renewable Additional energy-based products and services, and reductions in energy requirements as a result of these initiatives Additional Initiatives to reduce indirect energy consumption and reductions achieved
> 3. ENVIRONMENT > Management focus
See also innovative projects in Chapter >5. SHAREHOLDERS & INSTITUTIONS > Innovation management See indicators EN6, EN18 and EN26
EN7 EN13 EN14
Additional Habitats protected or restored Strategies, current actions and future plans for Additional managing impacts on biodiversity Core Other indirect greenhouse gas emissions, by weight > 3. ENVIRONMENT > Climate change > 3. ENVIRONMENT > Nature protection
Iberia does not operate in protected spaces, yet it nevertheless engages in actions to protect habitats, directly or through sponsorships The indirect emissions produced in Iberia are included in the indicators EN16 and EN20, and in the CO2 emissions inventory These tables include information on the reductions achieved in the listed environmental indicators from 2008 to 2012 151,202 124,600 91,780 -26.3%
EN17
EN 18
Additional
Initiatives to reduce greenhouse gas emissions and reductions achieved
EN21
Core
Total water discharge by quality and destination (m ) > 3. ENVIRONMENT > Waste
All effluent is treated in accordance with current legal requirements 0 0 0 CORPORATE RESPONSIBILITY & ENVIRONMENT
EN23
Core
Total number and volume of significant spills
EN26
Core
Initiatives to mitigate environmental impacts of products and services and extent of impact mitigation > 3. ENVIRONMENT > Climate change
See IB indicator (Average age of fleet) and indicators EN16 and EN20 for reductions
EN29
Significant environmental impacts of transporting products and other goods and materials used for the Additional organisations operations, and transporting members of the workforce
ee CO2 emissions inventory
EN28
Core
Episodes and fines deriving from breach of conventions, > 3. ENVIRONMENT > treaties, declarations and estndar ds associated with Management focus environmental issues CONSOLIDATED MANAGEMENT REPORT
EN30
Additional Environmental investments (million )
18 millones Mill. in environmental expenditures and 1 Mill. in investments in tangible fixed assets
117
ANNEXES
CO2 EMISSIONS INVENTORY ACCORDING TO GHG PROTOCOL METHODS Emissions GEIs (tCO2 GHG Protocol Types of emission Scope 2010
Boilers and generator sets (natural gas) Direct emissions (Scope 1) Boilers and generator sets (diesel) Vehicles owned or rented by Iberia (petrol) Vehicles owned or rented by Iberia (diesel) Indirect emissions (Scope 2) 12,032 10,989 10,223 -8.67% 0.56 0,55 0.53 -4.56%
Emissions per employee* (tCO2/employee) Variation 2012-2011

-3.69% -21.32% 554.73%
2011
2012
2010
2011
2012
Variation 2012-2010
-1.20% -19.28% 571.68%
20,053 2,688 23
12,995 2,010 3
12,515 1,581 21
0.93 0.12 0.00
0.65 0.10 0.00
0.65 0.08 0.00
Electricity consumption
22,895
24,961
29,533
18.32%
1.06
1.26
1.53
21.38%
Travel to work in private vehicle Other indirect emissions Travel to work by bus (Scope 3) Travel to work by train/underground Total Scope 1 (direct emissions) Total Scope 2 (indirect emissions) Total Scope 3 Totals Total (scope 1+2+3) Total (including flight operations, which are scope 1)
16,246 7,821 4,654 34,797 22,895 30,323 88,016
14,943 7,194 4,281 25,997 24,961 27,891 78,849
14,566 7,012 4,173 24,340 29,533 26,693 80,566 5,651.812
-2.52% -2.52% -2.52% -6.37% 18.32% -4.29% 2.18% -7.36%
0.75 0.36 0.22 1.61 1.06 1,40 4.08 279
0.75 0.36 0.22 1.31 1.26 1,40 3.97 307
0.75 0.36 0.22 1.26 1.53 1,38 4.16 291
0.00% 0.00% 0.00% -3.95% 21.38% -1,82% 4.82% -5.21%
6,029,648 6,100,713
118
ANNEXES
SOCIAL PERFORMANCE INDICATORS Location in the report GRI Code Type of indicator Name of indicator > CHAPTER No. > Section > Sub-section or aragraph
16,009 5,583 21,592 17.33 44.07 18,499 1,333 3 168 1,589 15,782 5,476 21,258 17.86 44.75 18,252 1,656 0 250 1,100 15,309 5,301 20,610 18.46 45.33 18,056 1,633 0 142 779 -3.0% -3.2% -3.0% 3.4% 1.3% -1.1% -1.4% -43.2% -29.2%
2010
2011
2012
Responsible area
LA1
Core
Workforce at 31-12-12 Ground Flight TOTAL workforce Average seniority (years) Average age of workforce (years) Type of contract Permanent Permanent part-time Permanent discontinuous Permanent partial retirement Temporary
INDICADOR IBERIA
> > 7. EMPLOYEES > Workforce and Labour Relations
INTERNAL ROTATION total women men <40 40-50
1.09% 0.51% 0.57% 0.46% 0.46% 0.17% 1.09% 0.51% 0.57% 0.46% 0.46% 0.17% HUMAN RESOURCES
LA2
Core
Total number of employees and average employee rotation broken down by age group and gender
>50 EXTERNAL ROTATION total women men <40 40-50 >50
LA3
Additional
Welfare benefits provided to full-time employees that are not provided to temporary or part-time employees, by major operations Percentage of employees covered by collective bargaining agreements Percentage union affiliation (%) Ground Pilots Flight attendants Minimum notice periods regarding operational changes, including whether specified in collective agreements
> 7. EMPLOYEES > Welfare benefits
Temporary employees enjoy the same welfare benefits as permanent employees (medical assistance, access to grants, suggestion box prizes, special payslips, meal vouchers and free tickets, among others) Approximately 100%
LA4
Core
IBERIA INDICATOR
72 > 7. EMPLOYEES > Workforce and Labour Relations 100 32
73 100 32
68 100 35
-5 p.p. +3 p.p.
LA5
Core
Spanish law contemplates cases in which minimum notice is required when the company makes a substantial modification of its employees working conditions. For the Job Posting the minimum period is one week.
LA6
Percentage of total workforce represented in formal joint managementAdditional worker health and safety committees that help monitor and advise on occupational health and safety programmes
> 7. EMPLOYEES > Health & Safety at Work
100 % (22 committees & 107 prevention delegates)
119
ANNEXES
SOCIAL PERFORMANCE INDICATORS Location in the report GRI Code Type of indicator Name of indicator > CHAPTER No. > Section > Sub-section or aragraph
5.1% 0 936 1,550 29,230 > 7. EMPLOYEES > Health & Safety at Work 0 4.9% 0 867 1,312 31,584 1 (in itnere) 7.9% 0 718 1,057 33,132 1 (in itnere) +3 p.p. -17.2% -19.4% 4.9% INDICADOR IBERIA
2010
2011
2012
Responsible area
LA7
Core
Rate of absenteeism for ordinary disease and occupational accident Occupational disease Number accidents at or on the way to/from work without sick leave Number accidents at or on the way to or from work with sick leave Number of days sick leave for accidents at or on the way to/from work Number of work-related fatalities Education, training, counselling, prevention & risk-control programmes in place to assist employees, their families or community members regarding serious diseases (number of courses given) Health & safety topics covered in formal agreements with trade unions Training: total no. courses Training: total no. participants Average hours by employee category Senior Managers & Engineers Pilots Flight assistants Technical staff/Specialists Administrative/Auxiliary Services Work experience programm Novations employee contracts No. scholarships: graduates, undergraduates, vocational training No. people with work experience contracts Programmes for skills management and lifelong learning that support the continued employability of employees and assist them in managing career endings % employees receiving regular performance and career development reviews Equal opportunities
LA8
Core
389
728
702
-3.6%
LA9
Additional
100% (See indicator LA6 ) 11,497 82,510 12,504 97,060 11,558 86,478 -7.6% -10.9%
LA10
Core
21.2 46.3 34.2 44.3 13.5 > 7. EMPLOYEES > Training & Development 8 282 31
29.9 41.8 24.7 50.0 14.9 7 396 26
42.3 31.1 19.4 51.8 17.0 6 244 50
41.5% -25.7% -21.7% 3.6% 14.3% -14.3% -38.4% 92.3% HUMAN RESOURCES
IBERIA INDICATOR
LA11
Additional
Qualitative
LA12
Additional
> 7. EMPLOYEES > Satisfaction, internal communication & motivation
100%, regulated by collective agreement
LA13
Core
% Women % Men No. women in positions of responsibility (Positions in organisation) > 7. EMPLOYEES > Equal opportunities & ethnic diversity
37.9% 62.1% 116
37.7% 62.3% 123
37.9% 62.1% 121
+0..2 p.p. -0.2 p.p. -1.63%
0 No. women on the Board of Directors LA14 Core Ratio of basic salary of men to women by employee category
Salary is the same for men and women at the different employee levels, regulated by collective agreements
120
ANNEXES
SOCIAL PERFORMANCE INDICATORS Location in the report GRI Code Type of indicator Name of indicator > CHAPTER N. > Section > Subsection or paragraph 2010 2011 2012 Variation 2012-2011 (% o p.p.) Responsible area
HR1
Core
Percentage and total number of significant investment agreements that include human rights clauses or that have undergone human rights screening. 6. SUPPLIERS > Responsible procurement
HR2
Core
Percentage of significant suppliers and contractors that have undergone screening on human rights and actions taken.
100% (Iberia requires the inclusion of a number of clauses in its contracts with suppliers, whereby the supplier undertakes not to infringe any of the principles established in the UN Global Compact, of which IBERIA is a member, and to offer in the performance of its duties effective compliance with all obligations deriving therefrom)
PROCUREMENT
HR3
Total hours of employee training on policies and procedures concerning 7. EMPLOYEES > Training & Additional aspects of human rights that are relevant Development to operations, including percentage of employees trained
The content of training is not only related to the development of skills associated with the job, but also the alignment between that content and the strategic goals of the company, such as respect for the environment and human rights. These aspects are addressed in all company management courses and in on-the-job training. Some 3 hours' training a year is estimated for approximately 7,000 employees. See also indicators HR6 and HR7
HR4
Core
Total number of incidents of discrimination and actions taken.
HR5
Core
Operations identified in which the right to exercise freedom of association and collective bargaining may be at significant risk, and actions taken to support these rights. > 1. OUR FOCUS ON RESPONSIBILITY> Impact analysis
None. See indicator LA4
HUMAN RESOURCES
HR6
Core
Operations identified as having significant risk for incidents of child labour, and measures taken to contribute to the elimination of child labour. Operations identified as having significant risk for incidents of forced or compulsory labour, and measures taken to contribute to the elimination of forced or compulsory labour.
Iberia joined the UN Global Compact in 2004 and includes a clause requiring compliance with its Principles in all its contracts
HR7
Core
HR8
Additional
Percentage of security personnel trained in the organisations policies or > 6. SUPPLIERS > procedures concerning aspects of human Responsible procurement rights that are relevant to operations
100%. See indicator HR2
PROCUREMENT
121
ANNEXES
SOCIAL PERFORMANCE INDICATORS Location in the report GRI Cod Type of indicator Name of indicator > CHAPTER No. > Section > Sub-section or paragraph
> 3. ENVIRONMENT > Local air quality > 3. ENVIRONMENT > Noise in the vicinity of the airport As a result of fleet renewal, actions in operations and environmental management systems implemented in the company, the impact of operations in areas around the airport, noise and emissions is reduced from year to year.
2010
2011
2012
Responsible area
SO1
Core
Nature, scope and effectiveness of any programmes and practices that assess and manage the impacts of operations on communities, including entering, operating and exiting the company Percentage and total number of business units analysed for risks related to corruption Percentage of employees trained in the organisations anti-corruption policies and procedures
SO2
Core
100%
100%
100%
SO3
Core
> 5. SHAREHOLDERS & INSTITUTIONS > Fraud prevention and anticorruption measures
100% of employees with responsibility in internal management and budget control: training on the job. Furthermore, the Ethical Guidelines for application of the Global Compact principles are addressed to all employees. There have been no significant cases in 2012. The obligations and actions to be taken in the event of breach are set out in the corporate governance regulations and collective agreements.
SO4
Core
Actions taken in response to incidents of corruption Public policy positions and participation in public policy development and lobbying Total value of financial contributions and contributions in kind made to political parties or related institutions, by countries This page > 2. STAKEHOLDER ENGAGEMENT > Public commitment
SO5
Core
Qualitative
SO6
Additional
SO7
Total number of legal actions for antiAdditional competitive behaviour, anti-trust and monopoly practices and their outcomes Monetary value of significant fines and total number of non-monetary sanctions. (In million ?, total operating expenses in indemnities for passengers & baggage, in pursuance of Regulation (EC) No 261/2004. Total number of non-monetary fines
SO8
Core
> 4. CUSTOMERS > Passenger commitments > Commitment to passenger rights
23
21
17
-19.05%
122
ANNEXES
SOCIAL PERFORMANCE INDICATORS Location in the report GRI Code Type of indicator Name of indicator > CHAPTER No. > Section > Sub-section or paragraph 2010 2011 2012 Variation 2012-2011 (% o p.p.) Responsible area
PR1
Core
Life cycle stages in which customer health and safety impacts of products and services are assessed for improvement, and percentage of significant products and services categories subject to such procedures
PR2
Total number of incidents of nonAdditional compliance with regulations and voluntary codes concerning health and safety impacts of products and services during their life cycle, by types of outcomes
> 4. CUSTOMERS > Management focus > 4. CUSTOMERS > Passenger Commitments > Commitment to Quality and Commitment to Health > 6. SUPPLIERS > Specific relationships in the sector
100%
100%
100%
QUALITY & CUSTOMER RELATIONS
PR3
Core
Type of product and service information required by procedures and legislation and percentage of products and services subject to such information requirements
100% > 4. CUSTOMERS > Passenger Commitments > Commitment to passenger rights, Commitment to price transparency, Commitment to passengers with special needs
100%
100%
PR4
Total number of incidents of noncompliance with regulations and Additional voluntary codes concerning product and service information and labelling, by type of outcomes
23
21
17
-19,05%
PR5
Practices related to customer Additional satisfaction, including results of surveys measuring customer satisfaction
> 4. CUSTOMERS > Passenger Commitments > Commitment to Quality
Qualitative
PR6
Core
Programmes for adherence to laws, standards and voluntary codes related to marketing communications, including advertising, promotion and sponsorship
Qualitative > 2. STAKEHOLDER ENGAGEMENT > Communication channels > Ethical advertising > 4. CUSTOMERS > Passenger Commitments 0 0 0 -
PR7
Total number of incidents of noncompliance with regulations and voluntary codes concerning marketing Additional communications, including advertising, promotion and sponsorship, by type of outcomes
PR8
Total number of substantial complaints Additional regarding breaches of customer privacy and losses of customer data Monetary value of significant fines for non-compliance with laws and regulations concerning the provision and use of products and services of the organisation > 4. CUSTOMERS > Passenger Commitments
RISKS & SECURITY
PR9
Core
123
ANNEXES
INDICATORS NOT APPLICABLE GRI Code Type of indicator Name of indicator Reason Responsible area
EN9
Additional
Water sources significantly affected by withdrawal of water
There are no significant impacts in Iberia. The water used by Iberia is obtained exclusively from the local mains; no wells or own withdrawal points are used.
EN11
Core
Description of land adjacent to or in protected areas or areas of high biodiversity value outside protected areas. State location and size of land owned, leased or managed in areas of high biodiversity value Iberia does not operate on land in or adjacent to protected natural spaces or areas of high biodiversity. Moreover, Iberia does not represent a threat to the species included on the IUCN Red List and national lists, since the companys operations are not performed in the habitats of these species. See indicator EN13. Similarly, Iberias activities do not affect the water resources and related habitats. In addition, the companys effluent is way below the limits established in current legislation.
EN12
Core
Description of significant impacts of activities, products and services on biodiversity in protected areas or areas of high biodiversity value outside protected areas
EN15
Additional
Number of IUCN Red List species and national conservation list species, with habitats in areas affected by operations, by level of extinction risk, indicating the degree to which the species is threatened
EN25
Additional
Identity, size, protected status and biodiversity value of water bodies and related habitats significantly affected by the reporting organisations discharges of water and runoff
EN27
Core
Percentage of products sold and their packaging materials that are reclaimed at the end of their useful life, by category
This indicator is not applicable to air transport activities.This notwithstanding, it is worth noting the resources saved through the issuing of electronic tickets, for both passenger and cargo services, and the ground operation waste management, which are described in the Environment chapter of this report.
HR9
Additional
Total number of incidents of violations involving rights of indigenous people and actions taken
The international structure of the company performs exclusively commercial and administrative duties, so there are no material impacts in these aspects.
HR10
Core
Percentage and total number of operations that have been revised or impact assessments in the area of ??human rights.
This indicator is not applicable to the activities of the company. The international structure of the company develops commercial and administrative functions exclusively in urban areas, therefore no significant impacts on these aspects.
HR11
Core
Number of complaints related to human rights that have been filed, addressed and resolved through formal grievance mechanisms.
There have not been any complaints about human rights
HUMAN RESOURCES
SO9
Core
Operations with significant potential or real negative impacts on local communities.
SO10
Core
Prevention and mitigation measures implemented in operations with significant potential or real negative impacts on local communities.
124
125
http://grupo.iberia.es
2012 IBERIA, L.A.E., S.A. OPERADORA, SOCIEDAD UNIPERSONAL

Iberia 2012 CORPORATE RESPONSIBILITY Report

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Iberia 2012 CORPORATE RESPONSIBILITY Report

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CORPORATE RESPONSIBILITY REPORT 2012

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About this Report

IBERIA LNEAS AREAS

IBERIA AIRPORT SERVICES

Leading airline in Spain and on the

airlines, services for

39 countries (Iberia group) 88 aircraft

specialised installations (7 hangars)

engines overhauled and

CORPORATE GOBERNANCE BODIES

IBERIA AIR TRANSPORT: Commercial & Customers Operations

IBERIA AIRPORT SERVICES

STRATEGIC & SUPPORT AREAS

b MAIN ACHIEVEMENTS IN 2012

Commencement of operations of Iberia Express

Launching of GORA Project

New project Iberia AVANZA

b HIGHLIGHTS IBERIA + BRITISH AIRWAYS

b MAIN BENEFITS OF THE MERGER FOR STAKEHOLDERS:

b IBERIA IN THE SECTOR: ONEWORLD

b IBERIA IN THE SECTOR: ASSOCIATIONS

IATA International Air Transport Association.

AEA Association of European Airlines.

ALA Association of Airlines operating in Spain.

ACETA Association of Spanish Air Transport Companies.

1. CORPORATE RESPONSIBILITY IN IBERIA

CR organisation and responsibilities in Iberia Management

Management Control Procurement

Risks & Security Human Resources Commercial & Customers

Emergency Coordination Organisation Customer Relations

Quality Corporate Affairs Corporate Responsibility & Environment

CORPORATE RESPONSIBILITY IN IBERIA

C R Po l i c y Mis sion, ues vision & val

CORPORATE RESPONSIBILITY IN IBERIA

CORPORATE RESPONSIBILITY IN IBERIA

CORPORATE RESPONSIBILITY IN IBERIA

b 1.2 IMPACT ANALYSIS

CORPORATE RESPONSIBILITY IN IBERIA

b 1.3 EXTERNAL ASSESSMENT

# GRI verification of the CR Report, used to rate Iberias CR performance.

CORPORATE RESPONSIBILITY IN IBERIA

b 1.4 PRIZES AND RECOGNITIONS IN 2012

b 2.3 PUBLIC COMMITMENT

COODINATION CORPORATE ENVIRONMENT DIVISION

Management Systems ISO 14001 Internal Management Systems

Environmental control for suppliers

b 3.2 CLIMATE CHANGE

120 110 100

90 2009 2010 2011 2012

Direct Emissions per employee in 2012

b 3.3 LOCAL AIR QUALITY

67% 60% 40% 20% 0 CAEP 1 and 2 CAEP 4 CAEP 6

Evolution of NOx emissions in the Iberia fleet

b 3.4 NOISE IN THE VICINITY OF THE AIRPORT

100% 80% 63.7%

60% 40% 20% 0 21.1% 15.2% 2011 23.7% 16.8% 2012

Fleet NL 0.5 Fleet NL 1 Fleet NL 2

levels stipulated in the Environmental Declaration of this airport.

b 3.5 CONSUMPTION OF RESOURCES

Tonnes of Urban waste in 2010-12

b 3.7 NATURE PROTECTION

Expectations of our Clients

Processes defined by the Company