ASML Holding N.V. is incorporated under Dutch law and has a two-tier board structure. Responsibility for the management of ASML lies with the Board of Management. In turn, the Supervisory Board - composed of independent, non-executive members - supervises and advises the members of the Board of Management in performing their management tasks (see figure 2). More information on ASML's legal regime and corporate structure can be found in Item 6.C of the company's 2009 Annual Report on Form 20-F.

ASML endorses the importance of good corporate governance, the most significant elements of which are independence, accountability and transparency. These are also the elements on which a relationship of trust between ASML and all its stakeholders is built. ASML's objective is to be open and transparent about its structure, financial reporting, internal controls and procedures as well as its decision-making process. Details about these reports, controls and procedures can be found in our Form 20-F and Statutory Annual Report as well as on our website www.asml.com.

Since 2005, ASML has had an Environmental, Health and Safety Board tasked with guiding regional sustainability management issues and working towards a global sustainability management system. This Board, expanded and renamed Sustainability Board in 2009 (see figure 3), comprises senior management members from the main Business Operations. It represents three global regions where ASML is active, as well as members of key support departments. In 2009, the company appointed a new worldwide Sustainability coordinator who reports to the Sustainability Board, which is chaired by ASML's Chief Operating Officer. This officer is a member of the Board of Management. The Sustainability Board, which aims to meet quarterly, was adjusted in 2009 to increase the focus on green manufacturing and product development. The Sustainability Board has introduced the first ambitious Sustainability targets and will work to introduce more in 2010 and beyond, as well as watching over the implementation of policy measures to reach those targets.

ASML employs 14 Sustainability specialists to monitor and manage issues. These specialists include environmental and product safety engineers based in Wilton, Richmond and Veldhoven. Social aspects at all sites are monitored by human resources employees.

Since 1988 ASML has been a member of the Semiconductor Equipment Manufacturing Institute (SEMI), the global industry association serving the advanced semiconductor manufacturing supply chain, and subscribes to the SEMI standards in the area of Environment, Health and Safety (EHS).

ASML has a Code of Conduct containing the company's Principles of Ethical Business Conduct, Internal Guidelines, Complaints Procedure and Whistleblower's Policy. The Principles have formed the basis for ASML's Internal Guidelines on Ethical Business Conduct and contain ASML's ethical values in relation to various issues such as:

• Respect for human rights.
• Respect for the different cultural identities of our employees, stakeholders and customers.
• The promotion of honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships.
• Conducting our business in good faith and on the basis of integrity.
• Compliance with applicable government laws, rules, and regulations.

The Internal Guidelines apply to all payroll and flexible contract ASML employees worldwide and contain rules, guidelines and practical examples. The Internal Guidelines also include certain obligations and requirements, stemming from the Dutch Corporate Governance Code and Sarbanes-Oxley Act of 2002. These obligations and requirements mainly concern the issues of conflicts of interest, financial reporting and the Whistleblower's Policy.

The Code of Conduct includes support for the principles of the International Labor Organization (ILO). The non-discrimination principle was already explicitly mentioned in the Code of Conduct. ASML supports the freedom of association and respects the right of employees to organize and form employees' and workers' organizations, as also set out in the Code of Conduct. No action was taken in 2009 in response to incidents of corruption as no such incidents were reported.

Starting in 2004 (or upon joining ASML), employees were requested to read the Code of Conduct and sign an acknowledgement stating that they will adhere to its terms. All new employees who join ASML receive a copy of the Code of Conduct and are requested to sign a form to confirm that they acknowledge ASML's Code of Conduct. In addition ASML developed a one-hour computer-based course in 2008, addressing many topics in the Code of Conduct. All fixed and flex employees were obliged to complete this course successfully.

To further strengthen the Code of Conduct, ASML has installed a project group, including works council members. The goal is to increase awareness of the Code of Conduct. A new awareness program should be implemented by the end of 2010.

All documents encompassing the Code of Conduct can be found on the Corporate Governance section of ASML's website: www.asml.com.

As a global business organization, ASML respects the rule of law and complies with the national laws, regulations and administrative practices of the countries and communities in which it operates. ASML conducts its activities in a competitive manner, within the framework of applicable laws and regulations, and applies its principles of ethical business conduct. One of the elements of responsible behavior in society is our continuous compliance with competition law. In 2009, no legal action was taken by the competent authorities in relation to anti-competitive behavior.

With our Code of Conduct and by meeting our responsibilities for sustainable policies and actions that are documented in this report, we adhere to the sustainability principles laid down by organizations such as the United Nations and the Organization for Economic Cooperation and Development (OECD):

• Embrace that human rights as proclaimed by the United Nations in the Universal Declaration of Human Rights are a common standard of achievement for all members of the global community. We encourage respect for these rights and freedoms.
• Respect the rule of law and comply with the national laws, regulations, and administrative practices of the countries and communities in which we operate.
• Support the general principles laid down by the OECD in its Guidelines for Multinational Enterprises and the Tripartite Declaration of Principles Concerning Multinational Enterprises and Social Policy of the ILO.
• We believe in acting as a responsible corporate citizen and subscribe to the view held by the United Nations Commission on Global Governance that "business must be encouraged to act responsibly in the global neighborhood and contribute to its governance."

ASML strives to consult parties that have a relevant stake in the company. Stakeholder dialogue is conducted regularly by senior and executive managers on a proactive and reactive basis, across a range of business and company topics, subject to materiality. These are mostly planned to take place at regular intervals and include:

• Customers.
• Suppliers.
• Shareholders, bondholders and analysts, including socially responsible investors and analysts. The Board of Management meets with key investors every quarter, while Investor Relations and the Board of Management meet with the top 10 investors in ASML every six months. We have also held meetings with sustainable investors to specifically discuss the sustainability aspects of ASML's business.
• Works councils and unions whose membership includes ASML employees. ASML has a roster of regular meetings that include different departments, works councils and unions to discuss social, financial, organizational and other developments.
  • Employees. ASML informs its employees in many ways. Via presentations by board members during our All Employee meetings, directly through management, presentations, emails, the global intranet (Netscanner), etc. Via Netscanner, every employee can apply for the monthly lunch meetings with a member of the Board of Management.
• Industry peers and organizations, e.g. SEMI. Through various departments ASML is an active participant in SEMI-organized conferences, workshops and events and is involved in giving presentations, leading discussions and encouraging dialogue between the industry and stakeholders.
• National and local governments, e.g. the Dutch government, the municipalities of Veldhoven and Eindhoven, the state of Arizona and the state of Connecticut. Last year, members of the Board of Management met with the Dutch Prime Minister and the Dutch Economics Minister, while maintaining regular contact with the mayors of Eindhoven and Veldhoven to coordinate efforts to address the global recession. ASML does not make political contributions to influence lobbying efforts.
• Universities, such as Eindhoven Technical University, the University of Twente, Delft Technical Universityand the Erasmus University Rotterdam in the Netherlands; Wuhan University in China; Rochester Institute of Technology, the University of Connecticut, the University of Arizona, Stanford University and the DeVry University in the United States.

ASML discussed our Sustainability policies and reports with several stakeholders in 2009, including the ASML Works Council, Dutch association of investors for sustainable development VBDO, the global sustainability assessment for investors SAM and SEMI. These discussions resulted in a more ambitious Sustainability policy with specific short- and long-term targets which can be found in this report.