IBERDROLA's environmental strategy and management has been acknowledged in several international environmental indices. Amongst the most prestigious we may highlight the Dow Jones Sustainability Index, where IBERDROLA has been selected in every index since the Index was founded, or the FTSE4Good Index. To make progress along these lines, the following basic principles are established:

• The commitment of the Board of Directors of IBERDROLA towards ensuring that the environmental policies approved become a reality, thereby making respect for the environment a strategic element. This commitment is realised by establishing a framework of action in which improvement and innovation projects are created, promoted, defined and developed. The different business areas of the Company are necessarily involved in this progress, and every year the global environmental performance indicators reflect the improvement.
• Permanent diagnosis is based on a single Environmental management system for the entire Group, underpinned by complete systems of certificates under different standards (ISO14001, EMAS, ISO14064), thus helping to reduce environmental risk. This reduction of environmental risk must always take place in compliance with applicable laws and the various international undertakings signed, as well as the Company's internal standards. It would not be possible to comply with the requirements of these certifications without having systematic and continuous improvement in environmental management, thereby ensuring the coherence of the general system of environmental targets within the Company's strategy.
• Collaboration with the main stakeholders (Public Administration, sector companies and suppliers) in both defining and implementing innovation projects, and in developing traction initiatives for the rest of supplier companies. Here we may highlight IBERDROLA's direct participation in the Eco-efficiency in Basque Companies Programme and in the recently-established Basque Ecodesign Center, with the aim of developing projects for the entire Group in the field of green mobility, ecodesign, making the supply chain more sustainable, developing new methodologies for the economic assessment of environmental impacts and energy efficiency.

In order to address international expansion and the variety of activities carried out with an environmental impact for the Company, in 2008 the IBERDROLA Group Environmental Management System was approved, with the aim of creating a common environmental framework, enabling different plans and measures to be co-ordinated, and respecting autonomy and particularities at regional level. This common system has been developed in terms of agreed policies and strategic guidelines, adopting criteria and standards from compliance reports and setting a joint series of monitoring indicators.

The main objects of the Group's Environmental management system can be summarised as follows:

• Effective application of the eco-efficiency principle, a basic reason for the reduction or improvement of the environmental impact of the Company's operations.
• Continuous unlocking of value on the environmental side of operating activities, working simultaneously on the reasons for and the impacts of these activities, establishing actions and improvement targets.
• Effective implementation of a continuous improvement and ongoing innovation process.