Sharing of added value

The Pirelli Values and Ethical Code enshrine the Company’s commitment to working to ensure responsible development over the long term, in full awareness of the links and interactions between the economic, social and environmental elements, considering the repercussions that a decision taken in any one of these areas could have on the others. This is to combine value creation, social progress, concern for stakeholders and higher standards of living and environmental quality.

Added value means the wealth created over a given reporting period, calculated as the difference between the revenues generated and the external costs sustained in the period. The distribution of added value between stakeholders enables the expression in monetary terms of the existing relations between Pirelli and the major stakeholders, thus focusing attention on the socio-economic system in which the Group operates.

DISTRIBUTION OF ADDED VALUE 

(in thousands of euros)  2014  2013  2012  
TOTAL GROSS ADDED VALUE 2,296,127   2,218,034   2,210,834  
Remuneration of employees (1,239,770) 54.0% (1,210,928) 54.6% (1,205,608) 54.5%
Remuneration of public administration (173,309) 7.5% (210,392) 9.5% (200,837) 9.1%
Remuneration of borrowed capital (262,410) 11.4% (195,832) 8.8% (129,471) 5.9%
Remuneration of risk capital (156,745) 6.8% (156,743) 7.1% (132,382) 6.0%
Remuneration of the company (457,278) 19.9% (438,682) 19.8% (537,259) 24.3%
Contributions to the external community (*) (6,615) 0.4% (5,457) 0.2% (5,277) 0.2%

(*): Includes the capital contribution to the company HB Servizi S.r.l.

 

The added value created in 2014 grew by 3.5% compared to 2013. The changes in the items determining the total gross added value, as mentioned above, are adequately explained in the Consolidated Financial Statements section of this report, to which the reader is referred for further details.

In 2014 the incidence of costs for business initiatives in favour of external community on Group net income amounted to 2.0% (1.8% in 2013 and 1.3% in 2012).

Amount of contributions to the external community 

(in thousands of euros) 201420132012
Training and Research 810 819 1,050
 Socio-cultural initiatives 4,541 3,839 3,523
 Sport and Solidarity 1,264 799 704
  Total 6,615 5,457 5,277
 

For the correct sizing and proportion of the expense in the various sectors of intervention it must be considered that the consolidated data are in euros (€) even though the sums were mainly disbursed in the local currencies in the various different countries in which Pirelli works, many of which are emerging markets/developing economies. In particular, in the case of contributions in Training and Research and Sport and Solidarity, it should be noted that although the amount is lower than the Socio-cultural initiatives category, such contributions are used to finance a wide array of development projects in the recipient countries.

For a description of the main initiatives involving the above disbursements, please refer to the paragraphs in this report dedicated to “Company Initiatives for the External Community”.

In line with provisions of the Ethical Code, Pirelli “does not provide contributions, advantages or other benefits to political parties or trade union organizations, this without prejudice to its compliance with any relevant legislation”.