1. The sustainability approach of DB
Meeting with SITRA
Deutsche Bahn AG
Dr. Markus Rometsch
Corporate Strategy
Berlin, November 6, 2012

2. DB’s organizational structure consists of three divisions
and nine business units
Passenger transport: Infrastructure: Transport and logistics:
Domestic and European-wide Efficient and future-oriented rail Intelligent logistics services
mobility services infrastructure in Germany via land, air and the sea
DB Bahn Long Distance
DB Netze Track DB Schenker Rail
Long-distance rail passenger
Rail network European rail freight transport
transport1
DB Bahn Regional
DB Netze Stations DB Schenker Logistics
Regional/urban passenger
Traffic stations Global logistics services
transport (Germany)
DB Arriva
DB Netze Energy DB Services3
Regional/urban passenger
Traction current Integrated range of services
transport (Europe)2
1 Within Germany as well as cross border traffic; 2 In UK with Arriva-affiliate ‘CrossCountry’ also long-distance passenger transport;
3 Business unit is assigned to the Rail Technology and Services division
Deutsche Bahn AG | Dr. Markus Rometsch | November 6, 2012 2

3. Record revenues in 2011 –
EBIT increased about 24% compared to 2010
Revenues 2011 in € millions EBIT 2011 in € millions
DB Bahn Long Distance
DB Bahn Regional
DB Arriva
DB Netze Track
DB Netze Stations
DB Netze Energy
DB Schenker Rail
DB Schenker Logistics
DB Services
1
37,901
As of December 31, 2011; 1 Difference between total for divisions and DB Group due to other activities/consolidation
Deutsche Bahn AG | Dr. Markus Rometsch | November 6, 2012 3

4. The Railway Reform Act of 1994 marked the beginning of a
new railway era in Germany and the creation of Deutsche Bahn AG
Before Rail Reform Today
 Implemented
entrepreneurial
structures
 Rail opened up to
competition
 Bureaucratic structures Responsibility for  Modern and efficient
 Monopoly structure
 Heavy government influence
 local rail passenger
transport delegated
to regional levels
organization
 Competition is expanding
 High losses – personnel  Value-driven decision making
expenses exceeded revenues  Greater profitability
 More than EUR 30 bn in debt  Debt is continuously shrinking
 Rail was losing market share  Rail is enjoying a renaissance
Deutsche Bahn AG | Dr. Markus Rometsch | November 6, 2012 4

5. DB’s success story since the 1994 Rail Reform has made it
possible to sustainably strengthen rail transport in Germany
Volumes sold rail passenger transport Volumes sold rail freight transport1
Germany, in bn passenger kilometers Germany, in bn tonne kilometer
+60.3%
+30.1%
Sources: DB AG, Federal Statistical Office, BMVBS/BAG
As of March 2012; 1 Up to 1998 net transportation performance, from 1999 gross transportation performance = gross weight includes weight of freight plus container weight
Deutsche Bahn AG | Dr. Markus Rometsch | November 6, 2012 5

6. DB Group’s revenues have risen continuously since 1994 –
with just one exception in 2009 due to the global economic crisis
Development of DB Group revenues
in bn €
1
+156%
As of December 31, 2011; 1 Revenue 2003 has been adjusted for effects from Stinnes acquisition
Deutsche Bahn AG | Dr. Markus Rometsch | November 6, 2012 6

7. Earnings before interest and taxes have shown a favorable
development in the last years
Development of DB Group EBIT
Earnings before interest and taxes, in € millions
HGB IFRS
EBIT with compensation for legacy burdens
- 2,998 EBIT
As of December 31, 2011; Adjusted EBIT shown
Deutsche Bahn AG | Dr. Markus Rometsch | November 6, 2012 7

8. Starting position
We need to prepare ourselves in advance for the
many and varied challenges in our market environment
Are we sure that we can keep pace with other
companies in the battle to acquire skilled How do we respond to the need for increased public
workers? participation in planned infrastructure projects?
?
How can we facilitate age-appropriate work,
so that each and every employee can play an There is no future without innovation – are we
active role in our company? aware of customers’ future needs and are we
developing products to meet them?
How do we defend our market position in the
face of increasing competition? Do we recognize the working conditions at our sub-
contractors around the world – are there any risks for
us if customers are increasingly better informed?
What are the implications of a scarcity of
resources for our cost structure? Some of our employees have a downbeat
view of the future – can we therefore provide
outstanding service for our customers?
…
Deutsche Bahn AG | Dr. Markus Rometsch | November 6, 2012 8

9. Starting position
Future challenges require a broader management approach
to assure DB‘s sustainability
DB‘s sustainability approach Decisions of the board
Entrepreneurial success is more than
economic performance
Sustainable business success and social
Sustainable business success and social acceptance acceptance as overall Goals for DB‘s
sustainability activities.
Economy, social affairs and ecology should
Economy Social affairs Ecology be into harmony with each other
DB undertakes various individual activities,
but needs to develop a consistent
corporate concept
Mid-2011: Group-wide project team
Profitable Top- Eco- established to further the incorporation of
market leader employer pioneer sustainability
Deutsche Bahn AG | Dr. Markus Rometsch | November 6, 2012 9

10. List of milestones
Important milestones have been reached since the
Sustainability Project was launched in mid-2011
Topics Explanation
Description of status quo and stipulation of goals
1 Status quo and DB sustainability goals
for sustainability at DB
Approx. 15 meetings with companies demons-
2 Discussions with best-practice companies
trating best practices (from different sectors)
Development of a new corporate strategy in which
3 Developing a sustainable strategy concept
sustainability sets the key
Development of target systems incl. integration in
4 Review of Group and BU target systems
financial planning
Amending mission statement towards
5 Amendment of mission statement
sustainability
Since March 2012: CSO takes on overall responsibility
6 Incorporation in organisational structures
for sustainability. Steering through Competence Center
7 Definition of CSR profile Developing a clear target image for future social
and environmental commitment
Deutsche Bahn AG | Dr. Markus Rometsch | November 6, 2012 10

11. 1 Status quo and goals
After establishing the status quo of DB’s sustainability activities,
the goals for DB were defined – the third step will be target derivation
1. Establishment of status quo 2. Defining the goals
 Recording the status quo of  Stipulating a detailed goal for
DB’s sustainability activities, each criterion of the German
evaluation on basis of levels of Sustainability Code and
excellence specifying target excellence
 Criteria of German Sustainability level
Code (GSC) as basis for  This also takes into account
structuring the status quo best practice at several major
analysis business players
Deutsche Bahn AG | Dr. Markus Rometsch | November 6, 2012 11

12. 2 Best Practice
The most successful best-practice companies have systematically
incorporated sustainability in target and incentive systems
Exchange of experience
Consulted companies (selection)
Lessons learned – best practice
 Sustainability is a fixed element of the
corporate vision
 Sustainability targets are specified in
all three sustainability dimensions in
the Group target system
 Sustainability targets are incorporated
in incentive systems
“Sustainability is an integral “The central success  All sustainability dimensions are
part of the BMW genes: factor for the implemen- systematically taken into account in
sustainability is the starting tation of sustainability is board decisions
point for our corporate the high commitment of
strategy and is consistently the Daimler Board of
integrated into our target Management.”
systems.”
Deutsche Bahn AG | Dr. Markus Rometsch | November 6, 2012 12

13. 3 Sustainable Strategy DB2020
Achieve sustainable business success by bringing all
three dimensions into harmony with each other
Vision We are becoming the world's leading mobility and logistics company
Sustainable business success and social acceptance
Sustain- Profitable market leader Top employer Eco-pioneer
ability Economic Social Environmental
dimension
Strategic
Top
1 Customer and
1 Top 10
3 Cultural change/
Top
4 Resource
1
directions quality employee preservation/
satisfaction emissions and
2 Profitable
growth noise reduction
Deutsche Bahn AG | Dr. Markus Rometsch | November 6, 2012 13

14. 3 Sustainable Strategy DB2020
We want to become the profitable market leader by 2020
Leading Appropriate Financial stability
market position returns
Redemption coverage
revenues in € billion ROCE in % in %
70 ≥10% ≥30%
1
> 10
+100% M&A
Top
6% 18%
34.4
As a profitable
market leader
we offer our
customers first-class
mobility and logistics
solutions
Deutsche Bahn AG | Dr. Markus Rometsch | November 6, 2012 14

15. 3 Sustainable Strategy DB2020
We want to become one of the top 10 employers in Germany by
2020 – and also be a top-ranked employer in international markets
Top 10
NEU
…
Top 20
…
As a top employer we
I’m a proud
win and build loyalty
10
DB
with qualified employee
employees who work
with enthusiasm for DB
and its customers Top
Deutsche Bahn AG | Dr. Markus Rometsch | November 6, 2012 15

16. 3 Sustainable Strategy DB2020
By 2020 we’ll be recognized as the pioneer of environmental
measures including cutting emissions of CO2 and noise
1
Specific CO2- Share of renewable Noise emissions –
emissions DB energy in the DB rail rail
energy mix
35%
-15%
Top -50%
20% +75%
As an eco-pioneer our
products set standards
for the efficient use of
resources
Deutsche Bahn AG | Dr. Markus Rometsch | November 6, 2012 16

17. 4 Target systems
Top targets will be defined for achieving the DB vision – taking
into account the specific challenges of the different business units
Principles of target selection
Target system in practice  Balanced set of targets, i.e.
each strategic direction is
represented by the same
number of targets
 Target system applies
throughout the entire Group,
but takes into account the
specific challenges of the
different business units
 Monitoring during the course
of the year and discussion at
board level envisaged
Deutsche Bahn AG | Dr. Markus Rometsch | November 6, 2012 17

18. 5 Mission statement
Sustainability is incorporated in our mission statement,
corporate policies and directives
Example: DB Mission Statement
 The Mission Statement describes the mission,
vision and values of the DB Group and answers
central questions such as: “Who are we?”, “What is
our goal?” and “How do we achieve this?”
 Sustainability is particularly important in the question
“What is our goal?”: “We design our leading position
around economic, social and environmental
dimensions. We bring these aspects into harmony
with each other in order to ensure sustainable
business success and social acceptance.”
Deutsche Bahn AG | Dr. Markus Rometsch | November 6, 2012 18

19. 6 Incorporation in organisational structures
Sustainability is permanently incorporated in the DB organisation:
Chief Sustainability Officer appointed and Competence Center established
Organisational level
Essential tasks
Primary decision Chief Sustainability
level Officer  Chief Sustainability Officer has overall
responsibility for ensuring that all
activities and units at DB are geared to
meeting sustainability requirements
Steering and  Competence Center Sustainability
Competence Center
decision-making supports the Chief Sustainability Officer
Sustainability
body as a steering and decision-making body
 Working level is responsible for the
operational handling of all central
Sustainability questions
Management dept.
Working
level
Working groups
Deutsche Bahn AG | Dr. Markus Rometsch | November 6, 2012 19

20. 7 Definition of CSR profile
In the future DB brings four key topics into focus
Target image On the track for tomorrow we take everyone on board!
Offering perspectives
Climate protection
Ad hoc
Priorities Integration & Care Education & Culture &
disaster relief
nature conservation
„strengthening“ „promoting“ „helping“ „protecting“
 Off-Road-Kids  Stiftung Lesen  Luftfahrt ohne  Fahrtziel Natur
Examples of  Bahn-Azubis gegen  DB Museum Grenzen  Bergwald-projekt
measures1 Hass & Gewalt  Chance Plus  …  …
 …  …
1 Selected examples of existing societal measures of DB
Deutsche Bahn AG | Dr. Markus Rometsch | November 6, 2012 20

21. Next steps
The DB2020 Strategy provides a framework –
much work is required for further implementation
The kick-off was a success Next steps (selection)
 Talks with executives indicate a high degree  Consistently monitoring targets and
of acceptance of the strategy underpinning the DB2020 strategy with
measures and further implementation
 Positive reports in the press following the
 Development of business unit strategies
Annual Results Press Conference
derived from the corporate strategy DB2020
 Solid framework and target system in place –  Broad internal and external communication
numerous individual measures have already and dialogue (incl. integrated reporting and
been developed stakeholder management)
Deutsche Bahn AG | Dr. Markus Rometsch | November 6, 2012 21