THE KERING GROUP

IFC, a Member of the World Bank Group Provides investment, advice, resource mobilization Over $100 billion invested in emerging markets since 1956 AAA credit rating; nearly 60-year history in emerging markets Present in 100 countries IFC s Committed Investment Portfolio by Region (FY14) Latin America & the Caribbean Europe & Central Asia Sub-Saharan Africa East Asia & the Pacific Middle East & North Africa South Asia Global 11% 16% 11% 2% 16% 23% 21% Overview (FY14) Shareholders S&P &Moody s rating Total Assets Portfolio Committed in FY14 # of Projects in Portfolio # of countries in Portfolio 184 member countries AAA/Aaa $84.1 billion $51.7 billion $22.4 billion (Own account: $17.3 and $5.1 mobilized) 2,011 projects 98 countries

Leveraging Global Industry Knowledge for Clients 10 Infrastructure & Natural Resources Power Renewables Transport Utilities Oil & Gas Mining Sub-national Finance Financial Markets Banking Insurance Sustainability and Microfinance Climate Change SME Banking Finance Trade Finance Private Equity/ Funds Securities Markets Housing Finance Manufacturing, Agriculture & Services Agribusiness Forestry Healthcare & Life Sciences Education Manufacturing Industries Energy Efficient Machinery Chemicals Tourism, Retail & Property FY13 Commitments by Industries Infra & Natural Resources Financial Markets Manufacturing, Agri & Services

IFC s Global Reach Global Knowledge and Local access: more than 109 offices worldwide in 84 countries, with over half of IFC s 4,015 staff based in emerging markets Owned by 184 member countries. Collaborate with the rest of the World Bank Group Staff with specializations in financial services, industry, environment, corporate governance, advisory services and more Moscow Almaty Washington Istanbul Cairo Mexico City New Dehli Hong Kong Santo Domingo Dakar Bogota Nairobi São Paulo Buenos Aires Johannesburg IFC HQ/Regional Hub IFC Hub Offices IFC Regional Operations Center IFC Country Offices World Bank Group Hub Office Singapore

IFC s Products and Services Senior Debt On-lending Liquidity management Acquisition financing Warehousing facilities Syndicated loans Local currency financing Trade Finance Global trade supplier finance (GTSF) Distribution finance Global trade finance program (GTFP) Global trade liquidity program (GTLP) Critical commodity finance program (CCFP) Structured Finance Partial credit guarantees Securitization Bond underwriting Advisory Services Sustainable Business Advisory, including: Food safety Hospitality training Corporate governance Access to finance, including housing finance Investment Climate Public-Private Partnerships 12 Mezzanine Finance Convertible debt Subordinated debt Other Tier II instruments Private Equity Common shares Preferred shares Syndication via IFC Asset Management Company Sustainable Finance Carbon finance Renewable energy Green building & energyefficiency finance Supply chain financing Corporate governance financing

SUSTAINABILITY SEPARATE FROM BUSINESS SUSTAINABILITY EMBEDDED IN BUSINESS DECISIONS

How Does IFC Support Supply Chains? IFC supports suppliers through its $500 million Global Trade Supplier Finance Programme (GTSF): Short-term financing to suppliers through receivables purchasing (reverse factoring) Suppliers interest rates based on buyer s superior credit rating Funds transferred via electronic platform (post-acceptance and post shipment) GTSF is applicable to all sectors and is already operational in: Bangladesh, China, Dominican Republic, Egypt, Mexico, Nicaragua, Pakistan, Philippines, Sri Lanka, Vietnam

GTSF Direct Financing Structure & Legal Framework 1 Buyer uploads approved invoices, providing irrevocable payment obligation (automated process, post shipment) Goods shipped on open account terms Supplier offers receivables for sales (i.e. views and requests early payment for approved invoices) Buyers (PUMA) Independent SF 2 IT Platform (GT NEXUS) 3 Emerging Market Suppliers Buyer pays to IFC full invoice amount on due date (standard payment routines) IFC accepts Supplier s receivable sale offer 4 5 IFC pays discounted invoice amount 6

How Sustainable Are The Supply Chains?

Additional Pieces in the Sustainable Supply Chain Puzzle? Buyers Sustainable Procedures Audits Engagement/ Support from Stakeholders Country Standards

Financial Incentives: An Innovative Tool to Promote Sustainability PUMA and IFC are launching a supplier finance program that will reward Sustainability performance of PUMA suppliers : IFC s interest rate is based on suppliers rating against PUMA s evaluation system for labor, health, safety, and environmental performance GTSF Interest Rate High Standard Preferential Low Low Low E&S rating Average E&S rating Good E&S rating High E&S rating High Supplier s Sustainability Compliance Rating The higher the supplier s sustainable compliance rating, the lower the interest rate

2015 Asia US$ 15m credit line Supplier finance credit line of US$ 15 million approved for the provision of short term financing through the GTN platform to the suppliers of PUMA in EM

Sounding-Results-PVFP_final_20150815.pptx

Which are the Benefits? This innovative kind of supplier financing product positively impacts the entire chain, from buyers to suppliers Buyer Benefits Be a sustainability champion: be among the first to offer financial incentives to improve supply chain sustainability Respond to increasing demands from consumers and other stakeholders to improve safety and working conditions in the supply chain Reduce cost of goods and financial volatility in the supply chain Reduce operational costs through automated settlement of payments Strengthen the relationship with key suppliers Offer supplier financing to all direct suppliers, regardless of company size Supplier Benefits Improve E&S practices and enhance reputation as responsible supplier Reduce financing costs through lower interest rates Strengthen balance sheet with nonrecourse financing vs. bank debt Improve transparency of invoicing process and ability to manage cash flow

IFC GTSF Key Selection Criteria Target Buyer Profile Good credit quality, investment-grade Environmental & Social Management System in compliance with IFC performance standards Presence of direct Suppliers in emerging markets Corporate interest in Supplier development, community outreach Proven track record of long term Supplier relationships Deferred payment terms from Buyer to Supplier Transactions between Buyer and Supplier in USD, Euro or other IFC-qualified currency Target Industries Retail Agribusiness / Food and Beverage Consumer Packaged Goods Pharmaceuticals Technology / Electronics Automotive and Transportation Consumer Durables

Do you want to be the next supply chain sustainability champion? Contact us at: Olaf Schmidt oschmidt@ifc.org www.ifc.org