The document discusses ADVA Optical Networking's efforts to build a more sustainable business model. It describes how the company lacked a cohesive corporate social responsibility framework in 2010 but has since implemented a more comprehensive 10-dimensional model. This included conducting a life-cycle assessment, improving energy efficiency of its products, recovering and refurbishing used equipment from customers, and winning a game-changing challenge from BT to optimize logistics. The company has gained public recognition for its sustainability improvements.

1. Klaus Grobe
November 2015
Building a Sustainable Future
New Framework Drives Game-Changing Ideas

2. © 2015 ADVA Optical Networking. All rights reserved. Confidential.2
Content
• Who is ADVA Optical Networking?
• Corporate Social Responsibility (CSR) in ADVA Optical Networking pre-2014
• Serious About Sustainability
• New way of thinking – 10-dimensional model baseline
• Post-mortem after baseline
• Fixing the weak spots – stakeholder engagement example
• Fixing the weak spots – circular economy example
• The Game Changing Challenge
• So where did we take it?
• Public recognition – rewards

3. © 2015 ADVA Optical Networking. All rights reserved. Confidential.3
ADVA Optical Networking
Richardson Atlanta Munich Meiningen Berlin Singapore Shenzhen
Headquarters
Office
Representative
Mobility Data Centers Cloud
ADVA Optical Networking is a global provider of fiber optic
infrastructure products and services

4. © 2015 ADVA Optical Networking. All rights reserved. Confidential.4
Culture of Continuous Improvement and Growth
Our History
• Public company (FSE: ADV, TecDAX)
• Founded in 1994
Our People
• 1498-person team at year-end 2014
Our Innovation Strength
• 700 R&D engineers (50% of staff) at
year-end 2014
• Up 15% per year on average over
the last four years
Our Performance
• 19% revenue CAGR since 1994
• 2015 revenue to exceed EUR 350M
Our Community Initiatives Program (CIP)
• Rooted in TL9000 framework
• Global ISO9001 Certification (2006)
• Global TL9000 Certification (2009)
• Global TL9000 Re-Cert (annually)
• We’re constantly optimizing internally via
ADVA Efficiency Engine, Lean, 6-sigma, …
Your trusted partner for speed and innovation

5. © 2015 ADVA Optical Networking. All rights reserved. Confidential.5
Corporate Social Responsibility (CSR) in 2010
• We had a mix of good and bad
• We had no cohesive framework
• We had to learn to share
• We had great programs hidden
• We had no public ‘face’
Wandering
No ‘face’

6. © 2015 ADVA Optical Networking. All rights reserved. Confidential.6
Corporate Social Responsibility (CSR) in 2010
• By the end of 2010, we had a
pretty good idea of what we
needed to build
• It was a BIG list!
• Things like …
Building cross-functional teams
Nurture local volunteers
Developing supplier code of conduct

7. © 2015 ADVA Optical Networking. All rights reserved. Confidential.7
Fast Forward to 2013 – the five pillars
By then our
house had a
foundation –
five pillars

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Serious About Sustainability
• But still, at the end of 2013, we were told to get serious about
sustainability or potentially be replaced
• While our program had matured, it still lacked structure and
cohesiveness
• It was a wake-up call for ADVA Optical Networking –
we needed a more comprehensive approach

9. © 2015 ADVA Optical Networking. All rights reserved. Confidential.9
• We opened our doors
• We engaged and
learned a more
comprehensive
approach
• We received clear
feedback on
strengths and gaps
New Way of Thinking – 10-Dimensional Model Baseline

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Post-Mortem After Baseline
• We didn’t have the right team – needed more horsepower and
wider reach
• We had complete blind-spots
• We had to recommit ourselves to learning about blind spots and
developing programs around them

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Circular Economy Example

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ADVA Optical Networking’s First Full Life-Cycle
Assessment – 2012

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Circular Economy … But How?
Key Principle: Longevity / Reduce, Reuse, Recycle – R3
Long
Use
Reuse of
Products
Reuse
of Parts
Closed-Loop
Materials
Recycling Open-Loop
Materials
Rec.
Crushing of Products
Shredder Dust
Sorting and
Disassembly
Generation of
raw Materials,
Chemicals and
Metal Recycling
Energy
Recovery
(CO2!)
Landfill
User
Maintenance
Company
Product
Recovery
Center
Parts
Recovery
Center
Materials
Recovery
Company
Product
Producer
Parts
Producer
Materials
Producer
User of
Recycling
Materials
Oil Recovery
Company,
Smelting
Company
Thermal
Energy
Collection
Company
Final
Disposal
Company
Materials
Supplier
Recycling
Center
Shredder
Company
Collection
Center
Sales
Company
There are many references. One is (1994): ricoh.com/environment/management/concept.html

14. © 2015 ADVA Optical Networking. All rights reserved. Confidential.14
CPMRs Routers
Bringing to Light What We Were Already Doing
Refurbishment
• We’re taking back the BT routers that have
either been cancelled or ceased by BT
• We wipe off circuit information, test and
check operating status
• Approx. 200 units per year from one BT
stock location alone
Reuse Olympic Refurb Project
• Program in place for the kit used in the Olympics.
CPMRs and SFPs
• CPMR – Test, replace accessories, clean and test,
accessories clean and/or replace
• We supplied the packaging to BT to return these
units to us
• To-date we have completed 152 x CPMRs and
201 x SFPs
Creative Customer Programs bring value to customer and environment

15. © 2015 ADVA Optical Networking. All rights reserved. Confidential.15
Pitch two radical ideas:
1) Network Design 2) ADVAnced Logistics
Saw long-term benefit Oh, let’s go do this NOW!
x-Haul
X
Y
BT’s Game Changing Challenge – Pitches

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Real Customer Benefits
• Saves 300,000 miles/year
• Saves 13,000 hours/year
• Cuts 750 tons CO2 /year
• 300% return on investment
• New chapter in our relationship
2) ADVAnced Logistics
Oh, let’s go do this NOW!
BT’s Game Changing Challenge – Real Benefits

17. © 2015 ADVA Optical Networking. All rights reserved. Confidential.17
So Where Did We Take It?
• Major improvements
in one year
• Won BT’s Game
Changing Challenge
We moved from high Bronze (red line) to high Silver (blue line)

18. © 2015 ADVA Optical Networking. All rights reserved. Confidential.18
Don’t Be Afraid to Jump In – There Can Be a Payoff!

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EER, TEER, TEEER, etc.

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The ICT Challenge We All Face
[SMART 2020: Enabling the low carbon economy in the information age, The Climate Group on behalf of the Global eSustainability Initiative (GeSI), 2008]
0.0 0.5 1.0 1.5
2002
2007
2020
Global Footprint by Subsector [GtCO2]
Telco Infrastructure + Devices
Data Centers
PCs, Peripherals, Printers
Related increase in worldwide
ICT electricity consumption
2%  10%
• Global ICT carbon footprint will heavily increase to ~1.5 GtCO2 in 2020
• The related cost problems also grow with increasing cost per MWh

21. © 2015 ADVA Optical Networking. All rights reserved. Confidential.21
Circular Economy – Basic Work
• Done full ISO 14040 Life-Cycle Assessment (LCA), starting 2012
• Several environmental impact parameters dominated by use phase / energy efficiency
• Shown by own LCA
• Confirmed by Huawei LCA*
• Hence, focus on maintaining best energy efficiency
• Traditionally also required due to small product form factor
• Now complemented by other CE/DfR3 aspects – primarily recycling (erbium fibers)
*) https://www.yumpu.com/en/document/view/8901629/huawei-whitepaper-on-energy-efficiency-and-carbon-reduction

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0% 20% 40% 60% 80% 100%
Ozone depletion
Terrestrial ecotoxicity
Marine aquatic ecotoxicity
Freshwater aquatic ecotoxicity
Human toxicity
Abiotic resource depletion
Eutrophication
Acidification
Global warming potential
R&D
Manufacture
Distribution
Use
End of life
FSP 3000 LCA
LCA done with openLCA (V1.2.6) and ecoinvent (V2.2)
Global Warming (GWP)
Use phase dominates global warming, acidification, ecotoxicity, ozone depletion
Erbium amplifiers have strong GWP –
candidates for reuse/recycling

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Energy Consumption vs. Bit-Rate IncreasePowerConsumption[W]
1
1 10 100 1000
10
100
1000
WDM Channel Bit Rate [Gbit/s]
[ADVA Optical Networking data]
• We have constantly increased the energy
efficiency of our products – and will continue
• Energy in use phase still dominates LCA
• The latest version of 100G and the new
400G solutions are clearly market-leading –
with significant gap against next followers
• This is also articulated in the market –
“Half a watt per Gbit/s”

24. © 2015 ADVA Optical Networking. All rights reserved. Confidential.24
ECO ICT Guideline Council* (Japan) Update
• The ECO ICT Council Guidelines are the most stringent requirements on energy efficiency,
compared to the few other relevant, existing TEER guidelines (e.g., ANSI ATIS, ECR)
• A new version was issued in early 2015
• Now covering (coherent) 100Gbit/s solutions
• With increased normative references for older (e.g., 10Gbit/s) solutions
• Proposal to discuss ECO ICT guidelines later in QuEST Forum
• The assessment proves (next page) that our transport gear is marked-leading
*) http://www.ecoict.jp/eng/mark.html

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ECO ICT Guideline Council – Results Update Example
Older ADVA 100G New ADVA 100G
The new WDM gear clearly exceeds latest ★★★★★ ranking (the more stars, the better)
N.R. [Gbps/W] PC @ N.R. [W] 0.57 70.17 0.33 2424.24 0.86 9302.32 0.86 9302.32 0.86 9302.32
0.63 63.15 0.37 2181.82 0.96 8372.09 0.96 8372.09 0.96 8372.09
0.71 56.14 0.41 1939.39 1.08 7441.86 1.08 7441.86 1.08 7441.86
0.81 49.12 0.47 1696.97 1.23 6511.62 1.23 6511.62 1.23 6511.62
0.95 42.10 0.55 1454.54 1.43 5581.39 1.43 5581.39 1.43 5581.39
FoM [Gbps/W] Avg. PC [W] 1.09 37 0.70 1138 1.06 7579 1.80 4435 2.19 3658
★★★
★★
★★★★★ ★★★★★ ★★ ★★★★★ ★★★★★Result
★★★★
★★★★★
8000
PC @ 1 Wavelength [W]
PC @ full Wavelengths [W]
Max. Throughput [Gbps]
2004
40 800 8000 8000
Ref.-Config. 2 DWDM w/ Degree-2 ROADMRef.-Config. 7
4 x 10G CWDM PtP
32
41
40 x 10G x 2 (2WCC) 40 x 100G x 2 (PCTN)
1296
13863
40 x 100G x 2 (QF)
597
6719
40 x 100G x 2 (PCN)
752
8118
271

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Example Improvement: PSU Energy Efficiencies
[ADVA Optical Networking data]
Efficiency of power-supply
units (PSUs) continuously
improved over time

27. MHuthart@advaoptical.com
Thank you
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