Disclosure 103-1 Explanation of the material topic and its Boundary

Empowered, motivated, and highly skilled employees that create value for the company and its stakeholders are essential to Clariant’s long-term success. Clariant is thus striving to build a reputation as a preferred employer to attract, engage, develop, and retain the right people with the right skills. Human resource practices such as recruiting, learning, and performance management are central for all business areas and regions along Clariant’s entire value chain. The recruitment and onboarding processes need to be efficient so that new employees can quickly contribute to the implementation of the business units’ strategies. Skills development is also imperative to remain agile and drive innovation in fast-evolving markets that continuously demand new competencies. Lastly, employee engagement and performance management are critical to retain talent and motivate employees to implement Clariant’s business strategy and contribute to a high-performing company.

Disclosure 103-2 The management approach and its components

Within Clariant, engaging and developing talent is a shared responsibility of all management functions. Clariant’s leaders are key in shaping a high-performance culture. They are supported by Group Human Resources and Senior Management Development, which has established strong processes for talent acquisition, onboarding, performance management, and talent management in all regions. Globally, Clariant’s operational and strategic human resources departments comprise 280 employees dedicated to talent attraction and development. Clariant’s People Excellence strategy ensures that the different employee initiatives are closely linked to business needs and implemented effectively and efficiently.

For the management of Talent Attraction and Development, Clariant abides by its Global Talent Acquisition Policies (Recruitment Policy, Global Recruitment Agency Policy, Onboarding Policy, and Employee Referral Policy). The policies clarify and specify the roles and responsibilities of the hiring manager and recruitment and HR personnel to ensure an efficient, effective, and professional talent acquisition process. More specifically, highly trained talent acquisition teams partner with the business units to source and select the best talent. Employer branding programs create awareness in the market and positively influence potential candidates. Moreover, line managers are trained in the “License to Hire” program to ensure they make the right hiring decisions.

With regard to capability development, Clariant creates an inspiring learning environment and promotes a learning culture. It offers structured capability-building programs, which entail defining required competencies per job family, assessing these competencies, and creating individual development plans. Working sessions are made available to all line managers involved in the process to ensure that development plan discussions between managers and employees are effective, and that supervisors can guide and support the development of their team members. The Clariant Academy encompasses all global learning offerings designed to support Clariant's strategy and to promote common language and values across the organization. Learning programs within the Clariant Academy are differentiated by job family and management level. A nomination process for the Clariant Academy programs ensures that all relevant employees participate in the training programs designed for a specific target audience. Besides the Clariant Academy, trainings, social learning (e.g., learning communities, mentoring, and peer coaching), and on-the-job learning opportunities (e.g., job rotation and work shadowing) are offered. Dedicated regional learning managers help identify the right learning solution for each employee and foster peer and cross-level learning by facilitating workshops with management teams. Clariant’s support of its employees’ education is described in global and regional learning policies, which include budget frameworks for trainings and study assistance guidelines.

The objective of talent management is to have a consistent and structured pipeline of functionally and vertically deployable talent for each management level. This process entails systematically identifying, developing, and retaining talent and provides local, regional, and global talent pools to ensure successful short-, mid-, and long-term succession planning and availability of candidates. Clariant aspires to fill at least 80 % of open positions at management level with internal candidates. Dedicated regional and local talent managers lead talent potential reviews, create individual development plans with Clariant’s talents, and participate in internal placement decisions. They also organize so-called “talent engagement sessions” in order to give internal talent visibility and exposure to senior managers.

In 2017, all business units developed a clear strategy regarding People Excellence, which will be implemented in 2018. Moreover, several new training programs were rolled out across the organization, such as the “Pioneer Program” for Clariant’s high-potential talent, the “Frontline Leadership Program” for manufacturing supervisors, the “Leading without Formal Authority” trainings for experts acting in the matrix organization, and the “License to Hire” program for all line managers conducting recruitment interviews. In addition, Clariant’s people development specialists supported sales managers in defining and implementing development measures for the sales professionals. For a first group of R&D managers, competency assessments were accomplished. Furthermore, over 20 regional and global teams conducted a “Team Effectiveness” program to strengthen team collaboration.

Disclosure 103-3 Evaluation of the management approach

The feedback collected after each training is systematically reviewed and required amendments are performed in order to ensure high-quality trainings. In 2017, the average feedback score for Clariant Academy trainings was 3.5 (with 3 being fully satisfactory and 4 superior). Individual training feedback scores ranged from 3.3 to 4.2. For selected programs of the Clariant Academy, feedback on the mid-term impact is collected from participants. For instance, for the Competency Management Training, 70 % of participants agree or strongly agree that they have been able to apply the information learned to their day-to-day work and 50 % have been able to apply more than 75 % of the information learned.