Sustainability Report 2010 Lek d.d.

19 Lek, a Sandoz Company – Company Identity Card 1.7 Economic performance Direct Economic Value Generated 12 In 2010, the company’s Direct Economic Value Generated amounted to EUR 581 million, of which Economic Value Distributed totalled EUR 560 million (96%), and Economic Value Retained EUR 21 million. Operating Costs reached EUR 350 million (62.5%), Emplo- yee Costs amounted to EUR 122 million (21.8%), Payments to Providers of Capital reached 14.3% (EUR 80 million), and Payments to Government totalled EUR 8 million (1.4% of Direct Economic Value Distributed). Major forms of State aid received 13 Income tax relief amounted to EUR 16,560 for research activity and EUR 38,000 for investments. We also received public subsidies amounting to EUR 629,000. 1.8 Labor relations and decent work Total workforce by employment type and employ- ment contract 14 • At the end of 2010, the proportion of women in Lek’s total workforce was 46% (47% the year before). • At year end, more than 90% of Lek employees worked on a permanent full-time basis. 7.7% were fixed-term employees (in 2009, the proportion was below 2%), and 2.4% worked on a part-time basis (less than 2% in 2009). Percentage of employees covered by collective bargaining agreements 15 The Collective Agreement covers 99% of total workforce, a level identical to that in the previous five years. Coverage of the organization’s defined benefit plan obligations 16 Lek provides its employees additional pension insurance (Pillar II) to a maximum premium amount. Lek enabled the employees to join the collective additional pension scheme in 2001, and the opportunity was taken by a large majority. At the end of 2010, 88.81% of the workforce was included in the scheme. The premium equals 5.844% of the gross sal- ary of the employee. Each insured employee is allowed to make his/her own de- cisions on the use of the accumulated assets after retire- ment, whereas the law provides insured employees with a possibility to withdraw from the additional pension scheme prematurely. Procedures for local hiring and proportion of sen- ior management hired from the local community at significant locations of operation 17 As a Sandoz company and as part of an international or- ganization, Lek d.d. hires foreign employees according to an established corporate practice pursuant to EU recom- mendations. In accordance with the corporate principles, the employment process is performed through implementation of the guidelines on diversity, equal opportunities and fair treatment. Decisions are taken only on the basis of employ- ment related elements. Lek senior management consists of unit heads and Management Board members. Local repre- sentatives account for 90% of the senior management team. Average hours of training per year per employee by employee category 18 The average time of training per employee was 3.6 days (29 hours). If compulsory on-the-job training is included, the av- erage time of training was 5 days (41 hours). For the time be- ing, training data records are not kept by employee category. In 2010, the most frequently acquired skills were foreign languages (26%), statutory training (22%) and governance and management skills (19%). The highest participation rate was recorded in statutory training (37%) followed by quality (22%), and governance and management (15%). 12 Indicator GRI EC1 13 Indicator GRI EC4 14 Indicator GRI LA1 - partly 15 Indicator GRI LA4 16 Indicator GRI EC3 17 Indicator GRI EC7 18 Indicator GRI LA10 - partly Average training hours/employee As of 31 December 2010 41.1 As of 31 December 2009 44.8