Investor Update SRI Forum , Paris

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Investor Update SRI Forum , Paris November 24, 2015

Global paints, coatings and specialty chemicals company €14.3 billion revenue (2014) 80+ countries ~46,000 employees ~200 production sites Leadership positions in many markets

Revenue by Business Area

34%

39%

Performance Coatings

Operating income by Business Area

4% 15% 39%

42%

Decorative Paints 27%

Specialty Chemicals

Revenue by geographic region

26%

10%

North America Latin America Mature Europe Emerging Europe

8% 19%

37%

Asia Pacific Other

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Global trends impacting our key market segments by 2050 Population growth Urbanization Climate Change Natural resource constraints

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New build projects Maintenance, renovation and repair

Automotive OEM, parts and assembly

Building products and components

16%

17%

Consumer durables Consumer packaged goods

% based on 2014 revenue

Automotive repair

42%

Marine and air transport

25%

Natural resource and energy industries Process industries

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Strategy delivering results and building foundation for continuous improvement Transformation | New operating models for all Business Areas

Realignment of the functions

Achievements

Operational optimization; reduction in: – Factory footprint – Enterprise Resource Planning systems – SKUs Portfolio optimization with selected divestments

Proactive management of pension liabilities Continued focus on sustainability; #1 in Dow Jones Sustainability Index* Core principles and values | Human Cities *In the materials industry group

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Principle of materiality used to assess the topics to include in Report 2014 We have updated the materiality to assess the topics to include in the AkzoNobel Report 2014, which are current and important for the company and key stakeholders. A list of more than 200 topics was reduced by reviewing the dominance of the topics, before being clustered into 18 final topics which are plotted in the matrix to the left. The most important topics include energy and resource use (1) , people and process safety (2) and Eco-premium solutions (3). Most material issues are included in our corporate strategy and/ or sustainability KPIs.

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Our Strategic Targets Financial Targets

Sustainability Targets

of return on sales (operating income/revenue) by 2015

of revenue by 2020 from products that are more sustainable for our customers than the products of our competitors

of return on investment (operating income/average 12 months invested capital) by 2015

Maintain net debt/EBITDA lower than 2.0 by 2015

more efficient resource and energy use across the entire value chain by 2020 (measured by carbon footprint reduction) (Resource Efficiency Index) A new indicator measuring how efficiently we generate value (expressed as gross margin divided by cradle-to-grave carbon footprint ) Investor Update - SRI Forum Paris

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Sustainable steam generation

Carbon credits program for shipping

Signed a multi-year agreement with Eneco to purchase sustainably generated steam for Delfzijl

Created first carbon credit methodology for international shipping industry

Paint that keeps you cool

4-dimensional profit and loss

A long-lasting exterior wall paint which protects against the elements and reflects UV rays to reduce energy use

Partnering to create new insights for decision-making

Sustainability : Embedded into the company mindset Customer Focus

Core principles: Safety Integrity Sustainability

Deliver on Commitments

We do what we say we will do

Passion for Excellence

We strive to be the best in everything we do, every day

Winning Together STI Element

We build successful partnerships with our customers

Metric

We develop, share and use our personal strengths to win as a team LTI Element

Metric

20%

Return on investment

35%

Return on investment

20%

Operating income

35%

Total Shareholder Return

30%

Operating cash flow

30%

30%

Personal targets – partly related to strategic targets

Sustainability / RobecoSAM - DJSI

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Additional effort needed to make progress towards the 2020 sustainability targets Eco-premium solutions with customer benefits

Cradle-to-Grave Carbon Footprint

REI Resource Efficiency Index

In % of revenue

% reduction CO2(e) per ton of sales from 2012

Gross margin/CO2(e) indexed

25-30

17

2012

18

19

20

90 0

2013

2014

94

100

98

96

2

2020 target

2009 2010 2011 2012 2013 2014

-4

2012

95

2013

2014

2020 target Investor Update - SRI Forum Paris 10

Eco-premium solutions - Definition A product qualifying for the list of AkzoNobel Eco-premium solutions must meet the following criteria when assessed against the competing mainstream products/solutions: 1.

It provides the same or better functionality for the customer application.

2.

When assessed along the full value chain against the following criteria: – Energy efficiency (consumption) – Use of natural resources/raw materials – Emissions and waste – Toxicity – Risks (for accidents during production, transportation etc.) – Land use – Health/wellbeing

a. b.

It is significantly better in at least one aspect (mind set 10% difference across the value chain). There are no significant measurable or perceived adverse effects in any other of the criteria.

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Easycare has been leveraged across regions to win in local markets Identified very strong marketing and communication concept (tested and on TVs in the South East, South Asia and Middle East region) Easycare concept (already successful in Ireland and South East, South Asia and Middle East region) is superior in terms of scratch, knock resistance and washability Launched in Poland in March 2015

Within three months: –

Available in 1,156 stores

–

Sold more than the full-year target in liters of paint

Eco-premium solution offering

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Resource Efficiency Index The objective of our new strategy is to create more value from fewer resources – right across the value chain. The Resource Efficiency Index is defined as gross margin divided by cradle-to-grave carbon footprint – reported as an index. Our aim is to use this metric to drive further improvements in resource efficiency across the value chain. – Gross margin: we selected gross margin as an indicator of added value - it is comparatively stable and captures the effects of efficiency improvements – Carbon footprint: we use cradle-to-grave carbon footprint as a proxy for how efficiently we are using raw materials and energy in our products.

Our Carbon Policy and cradle-to-gate carbon footprint intensity targets have been in place since 2009. We moved to cradle-to grave intensity targets in the strategy we launched in 2013

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Closing the carbon gap The chemical and coatings industries are resource intensive: long-term success depends on improving energy/material efficiency across the value chain

Million tons CO2 equivalents, 2014 15

AkzoNobel has committed to a cradle to grave carbon footprint targets : most of this footprint is outside our direct control We are using carbon abatement cost curves to prioritize improvement actions We are extending our improvement plans, by focusing on – Upstream: raw material selection/ reformulation, and Key supplier management – Own operations: further improving energy efficiency and sourcing lower carbon footprint energy – Downstream: lower intensity products/applications and collaborative projects with customer

3

10

5

11

9

4 0 Suppliers

AkzoNobel

Use / end of life*

CO2(e) GHG protocol VOC Investor Update - SRI Forum Paris 14

The three key elements to safety update People

Product

98% of our manufacturing sites have a behavior-based safety program

Committed to reducing the use of substances in our products that may pose a significant risk to long-term health or the environment

We already reached the 2015 target in total reportable injury rate and will continue focusing on continuous improvement to achieve the target of <1 by 2020

Identify and review hazardous substances which are then scored. Higher score substances are designated as priority Reviewed and risk managed 82% priority substances (2% more than the ambition for 2014) Of the priority substances reviewed in the program so far, 54 have been phased out and 91 restricted in use. We are on target to review and manage all our priority substances by the end of 2015.

3.1 2.4

2.3

Process 1.8

<2 <1

2011

2012

2013

2014

2015 target

2020 target

Process safety management (PSM) framework was initiated at mostsafety critical sites (46 in total) Other sites will follow in 2015 and 2016.

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Engagement increased during ongoing change Our people are the key to our success

ViewPoint score employee engagement (1 to 5 scale)

We aim for a high performance culture of engagement, feedback and trust Employee engagement is measured through our ViewPoint engagement survey 3,97

4,03

3,88 3,74

2011

3,8

2012

2013

2014

2015

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Leadership changes providing clear direction and driving culture change Significant changes at the top Majority of Executive Committee in last few years 50% of senior executives in 2014 ~ 80:20 of internal promotion and external hires

Diversity is an important factor Reflects the societies where we do business Better insights into our customer and employee base Leads to higher performance

* Previously referred to as “’high growth markets”

% of female executives

13

15

16

17

18

>20

2011

2012

2013

2014

H1 2015

ambition

% of executives from Asia Pacific, Latin America and emerging Europe*

13

13

14

16

16

>20

2011

2012

2013

2014

H1 2015

ambition

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Conclusion Sustainability fully integrated into our processes and mindset We have the right strategy in place and progress is being made Our people are the key to our success as an organization. We need to ensure that we have a performance-driven culture Continue to improve in people, process and product safety Targets are embedded in remuneration Well positioned to benefit from end-market trends The Planet Possible concept creates uniform communication within the organization and our suppliers Our Human Cities initiatives helps us identify business opportunities, connect with customers and influencers higher up the value chain and increase our potential impact

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Appendix

Focus will shift towards continuous improvement and organic growth Hardwire new organization model

Create a continuous improvement culture

Build further operational excellence

Drive organic growth and innovation

Value generating bolt-on acquisitions

Next steps

Culture Core principles and values CSR agenda: Human Cities Investor Update - SRI Forum Paris 20

Vision confirmed; financial guidance 2016-2018 Vision: Leading market positions delivering leading performance

Guidance 2016-2018: Return on sales: Return on investment:

9-11% 13-16.5%

Clear aim to build on the foundation we have created and grow in line or faster than our relevant market segments

Key assumptions: Currencies versus €: $1.1, £0.71, ¥7.1 Oil price ~$60/bbl; no significant market disruption

ROS = EBIT/revenue ROI = EBIT/average 12 months invested capital

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Visions confirmed; performance ranges 2016-2018 Specialty Chemicals

Performance Coatings

Decorative Paints

Vision: Delivering leading performance based on sustainable chemical platforms driving profitable growth in selected markets

Vision: Leading market positions delivering leading performance

Vision: The leading global Decorative Paints company in size and performance

Performance range 2016-2018: Return on sales: 11.5-13% Return on investment: >16%

Performance range 2016-2018: Return on sales: 12-14% Return on investment >25%

Performance range 2016-2018: Return on sales: 8-10% Return on investment: >11.5%

Clear aim to build on the foundation we have created and grow in line or faster than our relevant market segments Key assumptions:

Currencies versus €: $1.1, £0.71, ¥7.1; Oil price ~$60/bbl; no significant market disruption ROS = EBIT/revenue; ROI = EBIT/average 12 months invested capital

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Improved operating performance clearly visible in the financial results Operating income € million

Adjusted EPS €

Key levers for the improvement:

2,81 908

958

2,55

987

Improvement programs in all Business Areas and functions

2,62 2,07

792

Portfolio optimization 1,56

569

Lower operating costs Reduced restructuring expenses 2012

2013

2014

H1 2014

H1 2015

2012

2013

2014

H1 2014

H1 2015

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Profitability improvement on track towards 2015 targets Return on sales %

Return on investment %

2015 targets:

10,5 11,7 8,0 6,6

6,9

2013

2014

8,9

9,6

10

10,1

2013

2014

H1 2014

Return on sales 9% Return on investment 14%

5,9

2012

H1 2014

H1 2015

Note: ROI 2012 with impairment of Decorative Paints excluded from invested capital for the full year: 8.9 percent

2012

H1 2015

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All businesses contributing to the improved performance Return on sales % (Operating income/revenue) 16 12 8 4 0

13,1 9.5 6.3

8,8

7,5

9.5

9.4

9.8

13,7

12

10.4

9.0

12

6.0

2.2

Decorative Paints

Performance Coatings

Specialty Chemicals

Return on investment % (Operating income/average 12 months invested capital) 32 21.7

24 13.7

16 8

8.8

10,4

21.3

22.0

23,9

25 14.8

13.6

12

17

8.2

15

FY2012 FY2013

3.0

0

FY2014

Decorative Paints*

Performance Coatings

Specialty Chemicals** H1 2015 Expected outcome 2015 (announced 2013)

* Adjusted for 2012 impairment charge (€2.1 billion); includes sale of Building Adhesives in 2013 (€198 million) **Includes 2013 impairment charge (€139 million)

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Sustained leading performance in working capital management Operating Working Capital € million

Strong record of operating working capital management

Operating Working Capital OWC as % of LQ revenue * 4 2.500

16% 14%

2.000

10,7%

9,9%

10,1%

1.000

12% 10%

1.500

1.572

1.384

1.418

Discipline will be maintained and effectiveness improved

8%

Temporary planned increase to serve customers during footprint optimization

6% 4%

500

Seasonal pattern throughout the year to meet peak in customer demand

2% 0

0%

2012

2013

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Disciplined capital expenditure based on ROI and investment in growth Capital expenditures € million Specialty Chemicals Performance Coatings CAPEX as % revenue

Decorative Paints Other

5.4%

Build on significant investments made during recent years

Strong discipline 4.6% 4.1

826 666

588

Prioritization based on cash generation and return on investment 40-50% growth projects

2012

2013

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Pension top-up payments projected to reduce in future years From escrow account

Estimated cash top-ups € million

Cash

594 438 300

350

340

340

563

408

2012

2013

240

200

200

200

270

316

300

280

240

200

200

200

2014

2015

2016 E

2017 E

2018 E

2019 E

2020 E

2021 E

2022 E

Relate mainly to the two UK plans: ICI Pension Fund and the Courtaulds Pension Scheme (actuarial deficit £1.1/ €1.5 billion) Regular defined benefit contributions €125 million per year Prudent actuarial valuation of liabilities and low risk investment strategies Extensive de-risking of liabilities Lower payments in the medium term and recovery plan extended until 2021 Reduced volatility and more certainty regarding future cash flows Assumes €1: £0.71/$1.1 Note: schedule includes non-cash transactions related to the CPS escrow account; 2012 and 2013 include one-off de-risking transactions

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Dividend policy “stable to rising” Dividends € per share

Final dividend Interim dividend

1.12

1.12

1.12

1.12

Dividend policy is to pay a “stable to rising” dividend each year Interim and final dividend paid in cash, unless shareholders elect to receive a stock dividend (normal uptake 35-40%)

Interim dividend up 6% to €0.35 per share (paid November 26, 2015) 0.33 0.33

0.33

0.33

0.35

2012

2013

2014

2015

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Strong financial position provides foundation for growth Maintain investment grade rating of BBB+ Net debt reduced to 1 x EBITDA Undrawn revolving credit facility and commercial paper programs Average interest rate reduced further with repayment of high interest debt Renewal of €1.8 billion undrawn credit facility

€ bonds

7.75%

4.00%

622

1

1,5

1,6

2013

2014

x 0,5 0

Average cost of debt %

2.625%

800

€

1,0 1

1,0

2,3

£ bonds

1.75% 8.00%

2

1,5

1,4

2012

7.25%

825

3

0

Debt maturities € million (average debt duration 4.8 years) Repaid

Net debt (€ billion)/EBITDA

6 4

750 500

320

2

5,6

4,9

2012

2013

3,6

0

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2014

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