Our Responsibility to Our Environment

Borusan Group companies conduct their activities in accordance with legal requirements and utilize safe methods to avoid causing harm to the environment and/or the health of individuals. Companies act in a responsible manner not only to maintain the environment around them clean but also to do everything needed to protect it. While making its investment plans the Borusan Group always adheres to the principle of respect for the environment and human beings. Accordingly, the following measures have been implemented by the Group to protect the environment:

We utilize the latest and most appropriate methods to minimize the environmental effects of our waste and products, as well as to reduce our dependency on natural resources.
Health, security and environmental regulations are closely followed in the manufacturing processes of our products, their transportation and marketing. In fact, we have set higher standards than the above-mentioned regulations require.
Operations at our manufacturing plants are executed in secure and environmentally friendly surroundings completely suitable to the social conditions of the region and the needs of our workers.
We constantly go to great lengths to inform all the groups we are in contact with about environmental and health issues.

Group sensitivity to environmental issues was determined light of strategies developed by Borusan management.

Group companies with ISO 14001 Environmental Management Systems Certifi cates

Borçelik
Borusan Mannesman Boru
Borusan Lojistik
Supsan
Kerim Çelik

Borçelik and the Environment

Since its establishment Borçelik has always aimed to improve its environmental performance with relation to its activities, services and the technologies it utilizes. In 1998, Borçelik became the fi rst company in its sector to receive the ISO 14001 Environmental Management Systems Certifi cation and has successfully passed all subsequent audits over the past eight years. As per the requirements of the ISO 14001:2004 Quality Management Systems Certifi cation, Borçelik has made a commitment to adhere to all legal regulations and the monitoring and auditing of all environmental regulations is handled within scope of the quality control system.

According to Borçelik’s environmental policy and its philosophy of continuous improvement, an Environmental Management Program is prepared at the beginning of each year. With the support of the 6 Sigma methodology, which is being implemented at all Borusan companies, work is ongoing to fi nd ways to comply with environmental regulations. This includes the means of reducing the amount of harmful chemicals used and curtailing natural resource consumption, as well as minimizing the output of toxic and all other forms of wastes. Borçelik is also implementing various environmental projects designed to reduce electricity, water and nitrogen consumption.

At Borçelik’s treatment plant all chemicals are collected via piping and pumping systems which are monitored periodically by Borçelik’s supervisors. Borçelik has invested in an acid regeneration system that enables the reuse of the acid as well as in Galvanizing technology in order to reduce the negative effect of the fl ux chemical to the environment. In order to eliminate chemical and resin usage a Reverse Osmosis system has been implemented for demineralization. Beyond this, Borçelik is also making continuing to make investments in energy savings and supports the environment by planting trees in the regions of Çanakkale, Gelibolu (Gallipoli) and Mudanya.

After an evaluation by the ISO Environmental Expertise Commission, Borçelik was awarded the 2006 Environment Incentive Award by the Istanbul Chamber of Industry. Even though the domestic target for the ratio between treatment and reuse investments over the total sum of the investment stands at the percentage rate of 0.8, this fi gure at Borçelik is close to 3 %. Considering potential effects on the environment Borçelik has invested approximately $ 10 million in environment related projects. In particular, Borçelik displayed its sensitivity to the environment during 2008 by contributing to social activities designed to promote environmental friendliness. For example, on Earth Day an informative play and Earth Day photo exhibition was organized for the students of the Gemlik Elementary School.

Borusan Mannesman Boru and the Environment

Borusan Mannesmann Boru (BMB) regularly monitors natural resource consumption and waste amounts and sets annual targets to minimize them. Moreover, all employees are systematically trained to create awareness concerning these issues.

Waste Management

In order to protect nature and the environment BMB classifi es the waste it produces during manufacturing. The legal criteria pertaining to the classifi cation of the waste, the content of the waste (its degree of toxicity and hazardousness), its state (whether solid, liquid or gas) and its recycling characteristics are carefully considered during the categorization process. The primary target is to minimize waste production and recycle the necessary output. The waste which is not recyclable is appropriately disposed in a manner that protects the environment in accordance with legal requirements.

In order to recycle the waste it produces BMB carries out the following activities:

The metal waste that is amassed during production is sold to certifi ed companies to be used in cast iron molding production.
The zinc byproduct from production is currently sold at a very similar price as raw material to companies that manufacture zinc bullion and powder.
The crystal iron sulfate that emerges from production is sold through licensed companies to manufacturers of agricultural fertilizer.
Approximately 80 % of the PP waste to come out of our PP pipe production is processed into granules and reused as raw material.
The PP, PEX and PE waste that is not recyclable is also sold to licensed companies to be used as raw material or fi lling material for production of common plastic goods.
First category oils are sold to cement factories which use a high degree of heat for production, where they are recycled and used as fuel.
The oil waste produced at our Gemlik Plant is processed at our treatment facility at the Borçelik plant to be reused in production.
Our paper waste is sold to licensed companies to manufacture second rate quality paper. Glass waste is collected and sold to license companies to be processed and reused.
Vegetable oils used in the company cafeteria are sold to licensed companies for the production of biodiesel. The waste related production and services of BMB that cannot be recycled is disposed of in the following ways:
Phosphate mud and contaminated waste is stored separately and then sold to licensed companies to be disposed of by burning.
Waste batteries are also collected and sent to companies authorized to conduct disposal.
The medical waste from our clinic at the factory is stored separately and never mixed with domestic waste. Later it is turned over to authorized companies for proper disposal.
The following initiatives designed to reduce and control waste production were conceived as Green Belt projects and implemented:
At the Gemlik plant: zinc waste reduction project and operational waste material consumption reduction project
At the Halkalı plant: boron oil leakage prevention project, treatment capacity improvement project, the setup of the oil container project for the reel and stand washing
At the Izmit plant: hydraulic oil leakage reduction project In order to prevent inappropriate disposal of packaging that is considered a hazardous waste (oil and chemical barrels and boxes, etc.), the materials are either sent back to the manufacturer or turned over to license companies to be disposed of in the category of hazardous waste. They are never mixed with domestic waste. In order to prevent environmental pollution by our factories and to provide for the sustainability of the systems we have set up to protect the environment, systematic controls are put in place. Moreover, under the guidance of offi cials from the ISGÇK a “factory, fi eld and hygiene inspection” is implemented at least once every two weeks. At the end of the audit the areas that are determined to be open to improvement are immediately transformed into projects and activities designed to remedy the problem.

Plans for the incoming year: (2009)

Projects have been planned at our Gemlik plant to reduce the solid waste resulting from galvanized production and to replace the chromic acid used in passivation baths with chemicals which don’t have a negative effect on human health and environment. Meanwhile, at our Halkalı plant, the third UN environmental cleanup and boron oil consumption reduction project will be implemented.

Natural Resource Management

Various projects have been carried out at our plants to reduce the consumption of natural resources:

At the Gemlik plant: reduction of water consumption project and paper waste project
At the Halkalı plant: reduction of steam and water consumption project
At the Halkalı plant: reduction of electricity consumption by using the energy of the chimney exhaust gases and the heat of the piping system for the heating of the phosphate bath; and the reduction of fossil combustion by dismantling the diesel powered furnaces and converting them into natural gas powered furnaces
At the Izmit plant: a reduction in natural gas consumption by converting the steam boilers to hot water boilers, improvements in power consumption effi ciency by increasing the capacity of the power compensation units and reduction of power consumption by using photocell bulbs for external lighting.

Plans for the incoming year: (2009)

Borusan Lojistik and the Environment

By obtaining the ISO 14001 Environmental Management Systems Certifi cate Borusan Logistic has made a commitment to fully comply with laws designed to control adverse environmental effects. In line with this initiative, the Borusan Lojistik Gemlik Port Waste Receiving Facilities opened for operation on March 2, 2006. In accordance with the new regulations, all solid, liquid and hazardous waste from ships entering the port are accepted for proper disposal. Borusan Lojistik Gemlik Port became one of the fi rst ports in Turkey to be licensed for a Waste Receiving and Disposal Facility. Thus, the Gemlik Port not only helps to protect our seas but also enables Turkey to fulfi ll its international responsibilities. The solid and liquid waste that is currently dumped by ships causes serious damage to our seas and shores. At the Gemlik Port, Borusan Lojistik offers ships the opportunity to get rid of their waste (including solid waste, bilge water and hazardous waste) and dispose of them in a way that causes no harm to the environment nor to human health. A further investment at the port involved converting the port cranes to work by electricity in order to reduce air and noise pollution.

The waste produced by Borusan Lojistik is separated and recycled, and hazardous waste is disposed in accordance with all the relevant regulations. The temporary waste storage area that was set up at the Gebze warehouse also prevents any possible form of air, soil and water pollution that could potentially be caused by the toxic chemicals in used batteries. The new management building is equipped with an air conditioning system which does not produce harmful gases which could damage the environment and destroy the ozone layer.

Vehicles that transport fl at sheet steel and automobiles are a special consideration. Since they are not designed to carry any other goods such vehicles generally have to return empty from their delivery destination. Under the guidance of Tübitak, Borusan Lojistik is currently working on the design of a trailer that will be able to carry both fl at sheet steel and automobiles. When successfully completed, the patent will be held by Borusan. This project will enable improvements in other areas such as air pollution, traffi c and energy consumption.

In 2007 a total of 46.9 tons of the paper waste produced by the business activities of Borusan Lojistik was recycled. This paper recycling process has resulted in several important environmental benefi ts, such as saving 798 fully mature pine trees from being cut down, 192,425 kWh of electricity from being consumed and preventing the waste of 1,821 tons of water.

Employees and their families at Borusan Lojistik are encouraged to participate in environmental activities. An environmental brochure was given to employees and their families entitled “Recycling for a better quality of life”, which also included coloring pages for children.

Supsan and the Environment

Our Supsan company, which specializes in motor valves, has fully committed itself to respond to the environmentrelated requirements of its customers, comply with legal and other environmental regulations and to raise awareness about environmental issues with its suppliers and ensure their full-support of its environmental policy. Furthermore, it also seeks to control, reduce and abolish the negative environmental impact of its products, services and activities, as well as to improve and enhance the positive effects. In addition to this, Supsan has taken measures to save and protect our natural resources and to recycle and reuse them to the fullest extent possible. Finally, Supsan is dedicated as a company to taking on the responsibility of preventing ecological pollution around the world, improving the environmental-awareness of its staff and continuously improving its system in line with its quality policy.

Kerim Çelik and the Environment

Since its establishment Kerim Çelik has always tried to improve its environmental performance, especially through the services and upgrade of the technological innovations that it utilizes. In 2007 the Company received the ISO 14001 certifi cation by successfully completing all necessary inspections. As per conditions set forth in the ISO 14001:2004 Quality Management Systems Certifi cation, Kerim Çelik has made a commitment to fully comply with all legal regulations. All of the monitoring and assessment of environmental regulations are handled under its quality system. In line with its environmental policies and continual improvement philosophy, an Environmental Management Program is prepared annually at Kerim Çelik. With the support of the 6 Sigma methodology implemented in all Borusan companies work is ongoing to fi nd ways to comply with environmental regulations. This includes the means of reducing the amount of harmful chemicals used and limiting the consumption of natural resources, as well as minimizing the output of toxic and all other forms of waste. Kerim Çelik is also currently implementing projects involving possible means of minimizing electricity and water consumption while limiting the output of contaminated waste. In 2008 Kerim Çelik planted 1,000 trees in the region of Çanakkale, something it anticipates as an annual tradition.

Borusan Makina and the Environment

Borusan Makina demonstrates its sensitivity towards the environment by initiating projects involving pollution control and waste management. The company continues to improve its environmental performance by persistently developing its business processes.

Pollution control pertains to all of the applications and regulations which limit pollution and bring it within manageable levels at every level of production. This process at Borusan Makina is continually implemented at every level of the design, manufacturing, maintenance, repair and operation stages of all Caterpillar machines and components. Pollution control initiatives, including better fi ltration, enable the company to increase the cleaning standards of engine oils during the recycling process. As a consequence, signifi cant reduction can be obtained in the accumulation of used engine oil and harmful exhaust emissions, while job loss can be prevented through higher engine performance and effi ciency. In addition, implementations during the revision stages involve measures to prevent environmental pollution. For example, procedures have been set in place to prevent the release of washing water to the soil and all of our workshops are equipped with a fi ltration pool to separate oil and grime from the water.

All workshops involving CAT representatives at Borusan Makina have obtained the highest fi ve-star evaluation certifi cation from Caterpillar. Those which currently have a fi ve-star certifi cation are located in Istanbul, Adana, Izmir, Ankara, Bursa, Diyarbakır and Trabzon. The waste management initiatives at Borusan Makina are coordinated within the framework of the regulations determined by the Ministry of Environment of the Republic of Turkey.

Used Oil

Although Borusan Makina is not required by law to do so, it has obtained a special permit from the Ministry of Environment to collect the used oil from customers with its speciallyequipped Borusan Makina Customer Support Department (CSD) vehicles. The Ministry offi cials felt obliged to issue this special permission based on our company’s concern for the environment. CSD vehicles have a 350-liter tank capacity for used oil. Meanwhile, the oil from the workshops is collected in the used oil tanks. Between January and May of 2008 a total of 34,611 liters of oil was collected. The accumulated oil is then handed over to PETDER for proper recycling.

Used Filters

Used fi lters are collected by our service vehicles and stored in collection barrels at our workshops. The used fi lters are then handed over to EKASAN and the appropriate payment is made based on quantity. A total of 2,643 fi lters were collected between November of 2007 and June of 2008.

Used Battery

Borusan Makina closely monitors its battery liability limits, which have been deemed by the Ministry of Environment to fulfi ll collection requirements. All used batteries collected are given to TÜMAKÜDER. The amount of used batteries collected during the first fi ve months of 2008 amounted to 1,920 kilograms.