Agilent Corporate Citizenship Report 2015

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DISCLOSURE ON MANAGEMENT APPROACH EC

Economic Performance

In fiscal 2015, we launched a multi-year "Agile Agilent" program, re-engineering the company to be more efficient, nimble, and externally focused. As part of a company reorganization and restructuring, we established a new sales channel and divisional structure, which have been fully and successfully implemented.

Our actions from the "Agile Agilent" program delivered about $40 million in gross savings. In addition, the closure of our Nuclear Magnetic Resonance business - announced at the end of fiscal 2014 - resulted in $15 million in savings. And the Agilent Order Fulfillment organization successfully delivered $25 million in committed savings.

The "Agile Agilent" program and order fulfillment cost savings will be key drivers behind continued non-GAAP operating margin expansion. We increased our fiscal 2015 operating margins and are well on track to achieve a 22 percent operating margin by fiscal 2017. For the full fiscal year, we generated revenues of $4.04 billion. This represents our highest annual core revenue growth rate since fiscal 2011.

The company's financials are reported publically on its external website at Agilent Investor Relations.

Market Presence

Our analytical lab markets, which represent 84 percent of the total company, are comprised of two externally reported business segments: the Life Sciences and Applied Markets Group and the Agilent CrossLab Group. Together, these businesses serve customers in pharmaceuticals and life sciences research, as well as in applied chemical markets such as chemical and energy, food safety, environmental and forensics.

The Diagnostics and Genomics Group (DGG) is a global leader in diagnostics and genomics solutions for research and clinical laboratories. Within anatomic pathology, our Dako-branded tissue-based diagnostics are at the forefront of workflow solutions helping pathologists to accurately diagnose cancer and determine the most effective treatment for cancer patients. In fiscal 2015, two new Agilent diagnostics products received approval from the U.S. Food and Drug Administration.

The first was created in partnership with Merck & Co. This new companion diagnostic test can reveal whether a patient with advanced non-small-cell lung cancer is likely to respond to Merck's anti-PD-1 therapy KEYTRUDA.

The second product is the first complementary diagnostic developed in collaboration with Bristol-Myers Squibb. This new test can identify PD-L1 expression levels on the surface of non-small-cell lung cancer tumor cells, and provide information on the survival benefit with OPDIVO for patients with non-squamous, non-small-cell lung cancer.

Indirect Economic Impacts

Agilent Technologies is committed to conducting business in an ethical, socially responsible, and environmentally sustainable manner. Our citizenship objective is to be an economic, intellectual, and social asset to each nation and community in which we operate. Agilent's worldwide community programs tangibly demonstrate the company's values and commitment to corporate citizenship. In communities where we operate, we contribute through foundation and company grants, employee volunteerism, public policy and community partnerships in the areas of science education, and workplace giving campaigns.

Agilent has a carefully monitored and managed Philanthropic Support process as described below:

• Agilent reviews and selects the organizations that receive both company and Agilent Foundation grants. Once the grant has been provided, the Foundation monitors the organization's use of the grant. An agreement is signed by each grantee that they will provide an interim and/or final report for the program supported.
• Grantee is asked to provide a detailed description of what was accomplished by the grant, and the progress made toward achieving the goals. Besides this, grantee must ensure that activities under the grant have been conducted in conformity with the terms of the grant, report all expenditures supporting the grant, and maintain records of such expenditures to enable checking if needed.

Agilent recognizes ISO 26000 as a reference document that provides guidance on social responsibility. Agilent aligns with ISO 26000 standards as part of our social responsibility practices. As such, Agilent's economic-related practices and processes align with ISO core subjects: Organizational Governance 6.2 and Fair Operating Practices 6.6 and Community Involvement and Development 6.8

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DIRECT ECONOMIC VALUE GENERATED AND DISTRIBUTED, INCLUDING REVENUES, OPERATING COSTS, EMPLOYEE COMPENSATION, DONATIONS AND OTHER COMMUNITY INVESTMENTS, RETAINED EARNINGS, AND PAYMENTS TO CAPITAL PROVIDERS AND GOVERNMENTS

While building the foundation for Agilent's future with an unprecedented amount of change, we delivered very strong financial results, delivering increased growth and profitability. For the full fiscal year, we generated revenues of $4.04 billion. This represents our highest annual core revenue growth rate since fiscal 2011.

For the year, we returned $400 million to shareholders in the form of dividends and stock buybacks. We also generated $491 million in operating cash flow. On May 28, 2015, the Agilent Board of Directors approved a share repurchase program authorizing the purchase of up to $1.14 billion of the company's common stock through and including November 1, 2018.

For more information, go to the Agilent 2015 Annual Report

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FINANCIAL IMPLICATIONS AND OTHER RISKS AND OPPORTUNITIES FOR THE ORGANIZATION'S ACTIVITIES DUE TO CLIMATE CHANGE

Please refer to Agilent 2015 Annual Report risks, uncertainties and other factors that may affect future results section.

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COVERAGE OF THE ORGANIZATION'S DEFINED BENEFIT PLAN OBLIGATIONS

Agilent's defined benefit plans are fully funded at or above required levels:

• We contributed $15 million, $30 million, $30 million to our U.S. defined benefit plans in each of 2015, 2014, and 2013, respectively.
• We contributed $25 million, $72 million and $89 million to our non-U.S. defined benefit plans in 2015, 2014, and 2013, respectively.
• We contributed less than $1 million to our U.S. post-retirement benefit plans in 2015 and $1 million in both 2014 and 2013.
• Our non-U.S. defined benefit plans are generally funded ratably throughout the year.
• Total contributions in 2015 were $40 million or 61 percent less than 2014.
• Total contributions in 2014 were $103 million or 14 percent more than 2013.

 Please refer to Agilent 2015 Annual Report "retirement plans and post retirement pension plans" section.

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SIGNIFICANT FINANCIAL ASSISTANCE RECEIVED FROM GOVERNMENT

Please refer to Agilent 2015 Annual Report for details.

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RANGE OF RATIOS OF STANDARD ENTRY-LEVEL WAGE BY GENDER COMPARED TO LOCAL MINIMUM WAGE AT SIGNIFICANT LOCATIONS OF OPERATION

Agilent provides competitive levels of compensation above minimum wage requirements.

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PROCEDURES FOR LOCAL HIRING AND PROPORTION OF SENIOR MANAGEMENT HIRED FROM THE LOCAL COMMUNITY AT SIGNIFICANT LOCATIONS OF OPERATION

Hiring top talent around the globe helps ensure that Agilent maintains its leadership position. To attract and retain talent, Agilent provides everything from forward-thinking workplace design to community involvement to total compensation packages that rank with the leaders in the high-technology and life science industries. We understand the value - to our business, our employees, and our communities - of an inclusive environment that respects and celebrates unique perspectives and life experiences. Our policies and strategies create a pipeline of diverse skills and viewpoints, ensuring that our rich cultural diversity is leveraged for our competitive advantage. Agilent actively recruits top talent from under-represented groups around the world, and works to build an inclusive environment that develops and retains employees. For more information on our workplace culture, please refer to Agilent - Who We Are.

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DEVELOPMENT AND IMPACT OF INFRASTRUCTURE INVESTMENTS AND SERVICES PROVIDED PRIMARILY FOR PUBLIC BENEFIT THROUGH COMMERCIAL, IN-KIND, OR PRO BONO ENGAGEMENT

In fiscal 2015, through our businesses, employee programs, and foundation, our philanthropic efforts totaled over $10 million. Agilent provided over $7 million in university grants and equipment supporting science and technology research at the forefront of electronic and bio-analytic measurement technologies. In addition, over $650,000 in pre-university science-education grants supported programs reaching hundreds of thousands of students and educators worldwide.

Through employee match programs and other community investments, Agilent and the Foundation provided $1.6 million in donations

Because of our long-standing commitment to our communities, we have a wide range of programs that provide feedback on community needs, and therefore we do not conduct a community assessment.

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SIGNIFICANT INDIRECT ECONOMIC IMPACTS, INCLUDING THE EXTENT OF IMPACTS

Agilent continues to have a positive economic impact in the communities where we operate by enhancing skill and knowledge among students, academicians, and the professional community. Agilent's philanthropic efforts, through the Agilent Technologies Foundation, focus on education and development in life sciences. The Foundation supports a range of community and pre-university-level science education programs aimed at helping students develop the critical thinking skills essential for tomorrow's jobs. One example of such a global program is the Agilent After School (AAS) Hands-on Science Kit Program. The heart of the Agilent After School program is a series of 24 science experiment kits intended for hands-on use by children ages 9-13. The kits help students learn physics, biology, earth sciences, chemistry, and more-and they have been designed as a complete "program in a box." The kits also include measurement devices and biographies of key inventors or scientists to add context to the science. Agilent's program was designed to be implemented in afterschool venues, such as science clubs, community centers, libraries and other settings outside the classroom, and while AAS supports international, federal and state science standards, they don't compete with a teacher's curriculum.

AAS kits contain all the materials needed for students to do real-world experiments in which they build and learn about electronic-circuit games, clean water engineering, solar cars and thumb pianos (Kalimbas) - just to name a few. Agilent employees manage and implement this program, working with and mentoring the students. The program is being implemented in 17 countries and touches 35,000 students around the world each year.

Another example of encouraging scientific thinking in students is Agilent's participation in the Penang International Science Fair, an annual event attended by more than 10,000 members of the public. The fair was organized by the Penang Science Cluster, an industry-led initiative set up in collaboration with the Penang state government. Agilent was one of the key technology sponsors of the fair, and nearly 80 employee volunteers from Agilent's Penang site participated. Agilent volunteers designed a special set of games that allowed school-age children to learn about Agilent and its technologies through fun and play.

At a global level, we partner with many organizations, in which we identify local corporate social responsibility (CSR) projects, conduct due diligence, and support the implementation of the initiative on an ongoing basis. In addition, the Agilent Technologies Foundation supports several independent programs across various countries.

One such global initiative focuses on encouraging women toward the field of science. Through grants to The Association for Women in Science (AWIS), the program champions the interest of women in Science, Technology, Engineering, and Mathematics (STEM). Role models, mentoring, and educational opportunities are offered to the next generation of individuals in STEM. Educational programs are offered live as well as recorded, which can be accessed worldwide at a time that is convenient for the participant.

Agilent's scientists and technical staff collaborate with academics on path-breaking research and discoveries. Our products are found in leading research and teaching laboratories. Our global connection to academia also includes educational support, recruitment of top university talent and philanthropy. Through our "Thought Leader Program," Agilent supports scientific advancements by leading researchers around the world. We also contribute through financial support, products and expertise to research in the life sciences, diagnostics and applied chemical markets.

 In addition, the Foundation's match of employee giving strengthens a broad range of non-profit programs in communities where Agilent has a presence.

For more information, go to Community Relations.     

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POLICY, PRACTICES, AND PROPORTION OF SPENDING ON LOCALLY-BASED SUPPLIERS AT SIGNIFICANT LOCATIONS OF OPERATION

Diversity and inclusion are Agilent's core values and as such extend down through our supply chain. Agilent has a proactive Supplier Diversity Program which focuses on the procurement of materials, components, equipment, supplies, and services from Small Diverse Businesses. We use a specific methodology when sourcing suppliers that includes the evaluation and inclusion of small diversified suppliers with in our supply chain.