Alcan Sustainability Report 2007

A - L

O - Z

•	AIMS Alcan Integrated Management System.

•	Anode Effects A phenomenon that occurrs when the concentration of alumina in the molten bath is too low, which leads to the reaction of anodes with fluorides instead of alumina. A sharp increase in pot voltage takes place due to the presence of an insulating layer of gas under the anode.

•	Bauxite residue A slightly alkaline residual slurry resulting from the extraction of alumina in the Bayer process. The residue contains mostly iron and silicon compounds left over from the bauxite.

•	CI Continuous Improvement.

•	CO₂ equivalent (CO₂e) A unit of greenhouse gas emissions that is equal to one unit of carbon dioxide. An amount of another greenhouse gas can be converted to its CO₂e using the relative global warming potential of that gas compared to carbon dioxide.

•	Co-generation Production of electricity from the heat produced as a by-product of another process, such as manufacturing or incineration.

•	Effluent Generally applies to liquid waste discharged as a result of manufacturing operations, as well as from water treatment facilities.

•	EHS Environment, health and safety.

•	Emissions intensity A ratio that expresses GHG impact per unit of physical activity. Alcan has established a new indicator that combines Alcan’s different business groups and product lines into an indexed unit of production. This provides an overall indicator per unit of production to allow for the reporting of company-wide performance on an intensity basis. Our targets refer to a reduction of 10% of our Scope 1 emissions per unit of production. Denominators are those most relevant to indicate production in each Business Group.

•	Greenhouse gas (GHG) Carbon dioxide (CO₂) and other gases that are believed to contribute to global warming, also known as climate change.

•	GRI The Global Reporting Initiative is a multi-stakeholder group focused on developing and disseminating globally applicable sustainability reporting guidelines.

•	ISO International Organization for Standardization.

•	LCA Life Cycle Assessments are part of the product stewardship process to track the life cycle impact of our products.

•	OECD Organisation for Economic Co-operation and Development.

•	OHSAS Occupational Health and Safety Assessment Series.

•	PAH Polycyclic aromatic hydrocarbons (PAHs) are environmental contaminants that are primarily derived from the incomplete combustion of any organic material, including fossil or synthetic fuels. In the aluminum industry, PAHs are generated in smelters using older Söderberg technology. PAHs are also generated by forest fires, wood heating and incineration.

•	PFC Perfluorocarbons (PFCs) include CF₄ and C₂F₆ gases that have a very high CO₂ equivalency and constitute major contributors to greenhouse gas emissions. PFCs occur as a result of anode effects (‘process upsets’, brief periods of instability and dis-equilibrium in the smelting process)in smelting operations.

•	Prebake Prebake technology refers to modern anodes used in the smelting process that are “prebaked” as opposed to being baked during the reduction process such as with older Söderberg technology. PAH emissions associated with anode baking are captured in the anode baking furnace during the baking process in a Prebake system.

•	Söderberg Reduction cell (smelting) technology used in the smelting process where the anode is made of a block of paste that bakes as it approaches the reaction zone in the cell.

•	Spent potlining (SPL) The residue lining, made up of bricks and carbon, inside the pots that are used in aluminum smelting. This lining deteriorates with use and must be replaced. The old material that is removed from the pot before the pot is re-lined is the ‘spent potlining’ (SPL).

•	TARGET Alcan’s greenhouse gas emissions reduction program.

•	UBCs Used aluminum beverage cans.

•	United Nations Global Compact A voluntary international initiative launched by the United Nations in 1999 that promotes the development of a more sustainable and inclusive global economy.

•	VOC Volatile organic compounds.

•	WBCSD World Business Council for Sustainable Development.

"Alcan" or "Company" means Alcan Inc. and, where applicable, one or more subsidiaries.

"Subsidiary" means a company controlled, directly or indirectly, by Alcan.

"Joint Venture" means an association (incorporated or unincorporated) of companies jointly undertaking a commercial enterprise, but in which Alcan does not hold or exercise a controlling interest. Joint ventures are accounted for using the equity method, except for joint ventures over which Alcan has an undivided interest in the assets and liabilities, which are consolidated to the extent of Alcan's participation.

"Related Company" means a Company in which Alcan owns, directly or indirectly, 50% or less of the voting stock and in which Alcan has significant influence over management.

"Novelis” means Novelis Inc., a corporation incorporated under the Canada Business Corporations Act and formed to acquire, pursuant to the Novelis Spin-off, the businesses contributed by Alcan.

"Novelis Spin-off" means the transfer to Novelis of certain aluminum rolled products businesses and Novelis becoming an independent publicly-traded company on January 6, 2005.

"Pechiney" means Pechiney, a Subsidiary of the Company following its acquisition in 2003, now known as Alcan France SAS.

"Business Group" refers to each of Alcan's business groups: Bauxite and Alumina, Primary Metal, Engineered Products and Packaging. Further information on Business Groups is disclosed in note 33 – Information by Operating Segments in Alcan’s 2006 Annual Report on Form 10-K.

"Business Group Profit (BGP)" comprises earnings before interest, income taxes, minority interests, depreciation and amortization and excludes certain items, such as corporate costs, pension actuarial gains and losses and other adjustments, as well as certain OSIs (definition below) that are not under the control of the business groups or are not considered in the measurement of their profitability.

“Economic Value Added” is calculated as net operating profits after tax (NOPAT) minus the cost of capital (EVA capital multiplied by the weighted average cost of capital (WACC)). NOPAT is determined as income before interest, taxes, equity income and minority interest plus/(minus) operating adjustments for Other Specified Items less economic taxes. EVA capital is the capital employed of the previous month, calculated as the sum of cash, operating working capital, deferred items and fixed assets.

"Other Specified Items (OSIs)" include, for example, restructuring and synergy charges; asset impairment charges; gains and losses on non-routine sales of assets, businesses or investments; unusual gains and losses from legal claims and environmental matters; gains and losses on the redemption of debt; income tax reassessments related to prior years and the effects of changes in income tax rates; and other items that, in the Company’s view, do not typify normal operating activities.

"Foreign Currency Balance Sheet Translation" effects largely arise from translating certain monetary items denominated in Canadian and Australian dollars into US dollars for reporting purposes. Although these effects are primarily non-cash in nature, they can have a significant impact on the Company’s net income.

Currency Legend

Symbols

•	US$	United States Dollar
•	CAD	Canadian Dollar
•	AUD	Australian Dollar
•	€	Euros
•	£	UK Pound

•	CO₂	carbon dioxide
•	CO₂e	carbon dioxide equivalent
•	GJ	gigajoule
•	GWh	gigawatt hour
•	kg	kilogram
•	km	kilometre
•	kt/y	thousand tonnes per year
•	kW	kilowatt
•	kWh	kilowatt hour
•	m3	cubic metre
•	Mt/y	million tonnes per year
•	MW	megawatt
•	t	tonne
•	t/y	tonnes per year

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