Sustainability Report 2014 Lek d.d.

Sustainability Report 2014 – Lek d.d. Environment 52 Lek HSE systems The Risk Portfolio development and compilation are carried out in three steps: • Risk assessment and preparation of a Risk Portfolio for individual sites, • Preparation of a Risk Portfolio for Lek d.d. (Slovenia) and Sandoz, • Annual review of the Risk Portfolio for business groups at the corporate level. In 2014, we performed all the risk management activities required in accordance with the Novartis HSE guidelines. Special care was given to identifying HSE risks in our operations and processes. On this basis, we imple- mented the measures to minimize risks, such as avoiding potential risks, limiting the risk of exposure to hazards, and taking action to mitigate the negative impacts of any hazardous occurrence that actually took place. HSE aspects and system of achievement monitoring Pursuant to the Novartis guidelines, environmental aspects at Lek d.d. were upgraded into so-called HSE aspects. For a specific area of expertise, they are created at the proposal of the authorized person for each site separately. In addition to environmental aspects, we thus also have HSE, chemical safety, fire safety, explosion safety and biological safety aspects. A standard selection of aspects for individual areas of exper- tise is determined by the head of the respective area at Lek d.d. The site's HSE responsible person makes an as- sessment based on the results of the Gap Analysis, audits (internal, Novartis'), inspections, complaints, and in conside- ration of hazardous occurrences (near-misses). The aspects are evaluated in consideration of the criteria of legal compli- ance, profitability and the company's reputation, using the risk assessment methodology. Based on the findings in the Registry of HSE Aspects, cor- rective measures as well as business objectives and pro- grams are defined. Revisions of the Registry of HSE Aspects are carried out at least once a year or in the case of major change to the internal or external environment. It serves as a basis for the preparation of the Risk Portfolio, business and activity plans and programs, and for the setting of personal goals for responsible persons. In our operations, our compliance with legal and other re- quirements is reflected in the successfully completed inter- nal and external audits, inspections, water, air and noise monitoring, and with applicable environmental permits. In 2014, external auditing of the company's compliance with ISO 14001:2004 and BS OHSAS 18001:2007 was carried out and an audit according to the EMAS Directive. Internal audits of the HSE service planned on an annu- al basis were performed. Concurrently, internal audits of the company’s compliance with ISO 14001:2004 and OHSAS 18001:2007 requirements were carried out. Internal Novartis and Sandoz audits are more extensive, covering all areas of HSE on the part of the site being audited: environmental protection, occupational safety and health, chemical safety, fire safety, biological safety, explosion safety, and BCM and NEM. The frequency of audits depends on the nature of production, at API production sites; they take place every two to three years, whereas at pharmaceuticals production locations they are performed every three to four years. These audits also assess compliance with ISO 14001:2004, OHSAS 18001, and the EMAS Directive. In 2014, we had Sandoz’ HSE audit at Lendava and Novartis’ HSE audit at Menge‰. The results of internal audits per- formed in 2014 showed the high level of the company’s compliance with the statutory requirements as well as internal and external standards in all areas. Corrective action was taken on an ongoing basis. Environmental performance assessment with regard to our general and individual objectives is an integral part of the Management Review procedure. In 2014 we met the basic EMAS requirement for verifica- tion of compliance with the provisions of the EMAS Directive. From the environmental verifier we obtained a statement that we operate in compliance with applicable legal require- ments with regard to the environment and furthermore, that the data and information from the environmental statement provide a reliable, credible and true picture of the organi- zation’s operations at all Lek sites. In line with Novartis and Sandoz policy, Lek is committed to continuous improvement of environmental performance in compliance with local and national programs. Reporting methodology The reporting methodology used at Lek, a Sandoz company, enables monitoring of absolute indicators and trends for individual critical HSE aspects. HSE data is collected, recorded, verified and confirmed within a uniform Novartis reporting system in the Data Management System (DMS), whereby their transparency and comparability is ensured. Reporting frequency de- pends on the relevance of the reported data (monthly, quarterly or annually). Collected data serves as a basis for statutory reporting to ministries and other interested stakeholders, whereas once a year it is subject to review within the environmental management review performed by the organization's top management according to the EN ISO 14001:2004.