SOUND VALUES

2011 SUSTAINABILITY REPORTKey Performance Indicators

Focus Area

Performance Indicator

GRI

FY 2011

FY 2010

FY 20093,772,345

3,364,428

2,854,895

135,916

35,178(422,345)

1.90

0.50

(7.19)

1.40

1.24

-

Generating Shareholder Value
Net sales ($000)
Economic
Performance*

Net income (loss) fromcontinuing operations ($000)

EC1

Diluted earnings (loss) per
share from continuing
operations ($)

Promoting Safe, Sound Enjoyment
Employee Healthand Safety

Recordable injury and illness
cases (per 100 employees) 1

LA7

Innovating to Improve our Environmental Performance
Fuel consumed (GJ) 1

EN351,473

41,90439,426

Electricity consumed (GJ) 1

EN4

263,401

247,980

214,053

Greenhouse gas emissions 1, 3
(metric tons CO2e)

EN1639,64737,18031,324

Landfilled (metric tons)

EN22

Recycled (metric tons)

EN2

Water

Usage (m3)

EN8

Wastewater

Discharge (m3)

EN21

EnergySolid Waste

Data Collection Initiated

Making Sound Investments in our People and Communities
Talent acquisition
and retention

Voluntary turnover rate (%)

LA2

Diversity: Male/Female (%) 4

LA13

55/45

62/38

65/35

Training anddevelopment

Average training per
employee (days) 2

LA10

1.67

1.34

0.43

Ethical businesspractices

Completion rate for targeted
employees enrolled in ethics
and compliance training (%)

SO3

90

90

78

Supply chain
practices

Suppliers screened for SA
8000 compliance (%) 5

HR2

100

100

100

1 Reflects automotive manufacturing sites.

Data Collection InitiatedExpanded training in place across global sites and data collection initiated.

2 Reflects automotive manufacturing sites in Germany. Data collection initiated at other sites.
3 Reflects natural gas and fuel oil consumption.
4 2009 and 2010 data reflects analysis of 15 European sites.

2011 data reflects global workforce.

5 Agreements require suppliers to certify compliance with the Harman Supplier Code of Conduct.

* Fiscal Years run from July 1 to June 30.

1

From the Chairman
I am pleased to share with you the HARMAN Sustainability Report 2011. This is the first such report inour company's 60-plus year history, and a key step toward communicating our value strategy.
The term sustainability brings many different thoughts to mind. For some, sustainability equates tosharing the ideas and good fortunes of a successful enterprise so that others may also prosper. Others
think of sustainability as empowering those who surround us, looking out for their safety, health andwelfare while providing an environment of ethics and integrity in which to pursue our mutual goals.
These and similar fundamentals add up to my preferreddefinition of sustainability – an integrated set of actions andmeasurements that empower a successful business to endure.
Sustainability at HARMAN is not a stand-alone concept. If weare to continue to endure and prosper, we must sustain not
only our own business but also those upon which we depend –and the complex world in which we live.
To that end, we have developed a simple and straightforwardsustainability vision: To become the leading premium audio
and infotainment company in a safe, sound world. This vision is
supported by three key pillars, as follows:; Generating shareholder value and promoting safe, sound enjoyment.
; Innovating to improve our environmental performance.
; Making sound investments in our people and communities.
We have already set challenging financial goals, and we report on those regularly. To ensure oursustainability journey is firmly embedded in the company’s DNA, we are focusing on new product design
and the operational aspects of our business. We are in the process of setting new targets to reduce ourmanufacturing energy use and greenhouse gas emissions, and will report on these operational targets andour progress towards achieving them in our next report. In addition, we continue to incorporate oursustainability vision into the design of our products. Finally, we will consult with our key stakeholders on
establishing a dedicated HARMAN Fund to invest in community music education, events and infrastructure.
Sustainability at HARMAN means thinking toward the future, managing today’s business challenges, andhaving the right fundamentals in place. It is the strategy through which we will differentiate HARMAN fromits competitors, and we look forward to reporting on this journey.
Best regards,

Dinesh C. Paliwal
Chairman, President andChief Executive Officer

2Generating Shareholder Value

In order to successfully navigate the sustainability journey, we wanted to ensure we had the fundamentals
right. At HARMAN, we have achieved dramatic change over the past few years by focusing on continuous
cost management and growth at both the top and bottom line. As many companies still struggle toemerge from a global economic downturn, we have the tools firmly in place to navigate the headwinds.
We have made dramatic progress where some suggested
we would falter. We have learned many important lessons
along the way and applied these to new endeavors. We
have surprised those who said we couldn't generatesavings during an economic downturn and still grow our
top and bottom line. Over the past four years, we have
reshaped our global structure, sharpened our innovation
pipeline, and instituted more than $400 million inpermanent cost savings.
But we didn't just cut our cost base. We have grown bothrevenues and profits, and turned the corner to a new
business structure that will position HARMAN to compete
aggressively for a leading share in the infotainment,
lifestyle and professional audio markets. We took these
difficult steps well ahead of the external forces that
prompted others to do so . . . that's what sustainableindustry leaders do.
As you read about the HARMAN of today, you will find it is a distant cousin of the company it was just a few
years ago. Leading an industry, any industry, requires a certain positive restlessness as those who arecontent simply to reach the finish line have likely lost the pulse of the race. True winners will circle thetrack a few more times beyond the checkered flag while others simply head for the pit to reflect on theirperformance. We cite this analogy because true leaders never stop . . . they are in constant motion. Thatis the kind of culture we are building at HARMAN.
Our goals for the future underscore this type of leadership. We intend to double the size of our businessbuilding upon the foundation that has positioned HARMAN to capture growth in every major market, matureor emerging. Our strong financial foundation gives us the flexibility to act swiftly when the rightopportunities emerge. We are investing in our brands and innovation pipeline while strengthening our
relationships with existing customers and adding new ones. We have recently brought on new andexperienced people to complement the strengths of our talented employee team, and will ensure they havethe necessary tools to lead.
We will continue to build this great company, creating an environment that is the envy of our industry anda sustainable business model that helps HARMAN claim its rightful position as a leader in its space.

3

Our Business Environment

HARMAN is fortunate to serve as a leader in many businesses where we operate. As with any robust
business, however, we also face challenges. A sound sustainability strategy requires that we address eachof these proactively, helping to mitigate potential risk, capitalize on opportunities, and preserve thecompetitive advantage that comes from HARMAN innovation.
The rapid growth of mobile infotainment technology
has created a challenging opportunity for manufacturers to optimize the confluence of mobile
phones, social networking and similar innovations
with driver safety.
Amidst this rapid growth in popularity, government
regulators and consumer advocates in many
countries are demanding that new product offerings
reduce potential driver distractions.
Our recent acquisition of online content aggregator Aha Radio was a milestone step toward this goal. We
are working with many internal and external experts to further develop solutions that integratetechnology effectively with the driving task such as hands-free Bluetooth integration of mobile devices,
sound management technologies to reduce road and wind noise, multi-language voice navigation, andspeech dialog technologies that allow voice control of additional in-car functions.
Our innovation pipeline will take the driver safety agenda many steps further, adding such innovations astrue text-to-speech technology, augmented navigation that blends live camera views with in-dashdisplays, and in-car systems that alert drivers to approaching vehicles. We will continue working withcustomers, car manufacturers, key research institutions and transportation safety experts to build aglobal coalition that will showcase our innovative technologies and promote safe, sound enjoyment.
A very different market challenge is faced in our
acoustics business, where specialized magnets
lie at the core of loudspeaker performance. The
magnets typically preferred for premium acoustic
applications contain two rare earth materials,
dysprosium and neodymium, which are mined inrelatively few places around the world. China and Russia control more than 60 percent of world reserves forthese important materials, and recent export control measures in China have resulted in significant supply
and pricing pressures.
HARMAN is working closely with the magnet suppliers who fabricate these materials to our specifications,
negotiating agreements that will help maintain continuity of supply. Meanwhile, our engineering and design
teams will continue to explore design options that yield great HARMAN sound from alternate materials.

4

Promoting Safe, Sound
Enjoyment of Our Products

Using the same design principles deployed inhigh-end consumer and professional audio, the
HARMAN HALOSonic controller synthesizes
traditional engine sounds in direct correlation tovehicle speed. These are projected from thefront of the car to alert nearby pedestrians
through high-fidelity speakers, and may also be
experienced inside the car at the driver’s option.

Harman is focused on design innovations that leadto sustainable solutions amidst ever-changing
consumer demands. The advent of electric andhybrid cars, for example, poses special challenges
for automotive designers. HARMAN is committed
to meeting our customers’ needs with innovations
that make driving safer and more convenient for
both pedestrians and drivers.
Due to their unusually
HARMAN is setting the quiet drive systems,
most electric and hybrid
pace for the electric vehicle vehicles do not provide
age with innovative the same audible
solutions for safer driving. feedback as traditional
vehicles. Drivers lackthe familiar engine
sounds that help keep them aware of speed, andpedestrians and nearby motorists may not always
be aware that a quiet, electric powered vehicle isapproaching.
Working in collaboration with automotive pioneer
Lotus Engineering, HARMAN has developed the
HALOSonic™ sound management solution to equip
electric vehicles with audible feedback both insideand outside the car.

In addition to improving safety for pedestrians
andnearbydrivers,
HARMANHALOSonic
technology
reduces
unwanted road noise
normally experienced inside the car throughprinciples similar to those used in noisecancellation headphones. This provides a more
comfortable ride, while reducing driver stress.

5Today’s connected generation has grownaccustomed to a “real-time” lifestyle experience.
The Internet, social networking, and diverse
multimedia choices are now a staple of life athome and on the go. But taking this rich content
on the road poses special challenges in order tokeep consumers connected while ensuring a safe,
distraction-free driving experience.

To extend this safety andconvenience to mobile social
networking, HARMAN has
introduced the innovative
Aha Radio™ application. Thisrobust audio publishingplatform delivers streaming,
online content that blends
user preferences, behavior,and predictive web searchtechnologies to deliver acustomized infotainment
experience that adapts basedon the driver’s anticipatedtraffic corridor.

HARMAN is a leading player in speech synthesis
and recognition technologies to address thisimportant goal. Our premium audio andinfotainment systems empower users to control
many elements of the in-vehicle experience withsimple voice commands.
Integrated, hands-free telephone systems, forexample, allow drivers to initiate and receive
important calls via portable smart phone interface
without ever touching a button.

A Nearby Traffic feature even verbally alerts
drivers to real-time traffic conditions andconstruction delays.
The end result of these HARMAN innovations is tohelp mitigate many of the potential distractions
facing drivers on the road today, improving safety
in an era of unprecedented demand for mobile
connectivity.

Other HARMAN innovations help drivers manage
the car’s audio and entertainment devices,navigation system or climate control in multiple
spoken languages. Simple spoken commands
help drivers keep both hands on the wheel for
greater safety and convenience.

6

Innovating to Improve Our
Environmental Performance

Added to this are HARMAN’s high-efficiency
speakers, which deliver higher sound pressure
than conventional products for higher acoustic
transparency. System components are packaged
in light-weight housings, using advanced
materials such as carbon fiber.

Few criteria are more important in designing
today’s advanced products than energy
efficiency. Whether on the road or around thehome, the goals of reducing energy costs,
protecting the environment and conserving
precious natural resources are vital.

For automotive applications, GreenEdge solutions
mean lower emissions, thanks to lighter weightand reduced power consumption. These criteria
are especially valuable for the coming wave ofelectric and hybrid vehicles, where HARMAN
GreenEdge technology delivers longer battery
life, greater travel range, and more power forother automotive accessories.

HARMAN is responding to this call with its
GreenEdge™ audio and infotainment technology.
Through the use of innovative microprocessor,
speaker and amplifier design, HARMAN
GreenEdge achieves power-to-performanceefficiencies of up to 90 percent – more thandouble the efficiency of traditional audio systems.

HARMAN GreenEdge
also offers sweeping
HARMAN GreenEdge™ audio
benefits for theand infotainment systems
operators of large
professional audiodeliver more than twice thesystems such as
efficiency of traditional
those used foroutdoor sporting andtechnologies, withoutmusic venues.
compromising performance.
GreenEdge systems
installed in a typicalbaseball or football stadium deliver the same highfidelity as traditional audio systems while significantly
reducing electricity consumption as compared toconventional audio technologies.

The GreenEdge design begins with advanced
amplifier technology that converts low input
power into premium audio output. The result:
Waste heat is eliminated, so bulky cooling fansor heat sinks are not required.

7

During a 2011 materiality survey of HARMAN
management, energy and environmental efficiency
ranked among the top three focus areas forachieving business objectives. This efficiency
begins in the design stage, and continues
throughout the Company’s manufacturing
operations.

Total Greenhouse Gas (GHG) emissions haveincreased over the last three fiscal years consistent
with increases in energy usage. Fuel use (directemissions) is small in comparison to GHG generated
from electricity consumption (indirect emissions).
Implementation of electricity reduction measures willbe the primary driver to reduce total GHG emissions.

Total energy usage has increased over the last
three fiscal years consistent with production
increases, while normalized energy usage has
declined over the same time frame. Various
initiatives are under way to reduce both overall
and normalized energy usage at company
facilities worldwide.
Energy assessments and select energy-reduction
projects have been completed at several
automotive manufacturing sites in Germany and a
global energy strategy is being developed toreduce usage, particularly electricity consumption.
High priority initiatives are focused on heatproduction and distribution, compressed air andprocess cooling.

Complementing the Company’s energy and GHG
reduction initiatives, our Lifestyle business hasdeveloped new packaging designs that significantly
reduce the amount of material consumed andultimately disposed.
In our Automotive operations, manufacturing sites
have been consolidated closer to key customers tosave transportation costs, fuel, and environmental
impact. Other automotive initiatives have focusedon reducing and recycling scrap material andreconfiguring production processes for fewer steps.
Our Professional Division has deployed new logistics
assets to support leading audio contractors acrossthe globe, providing both new products and lifecycle
service closer to the point of use. As noted earlier,
HARMAN’s advanced GreenEdge audio systems
amplify the action for large entertainment andsporting crowds while consuming a fraction of theelectricity of their predecessor products.

8

Making Sound Investments in
Our People and Communities

Following the devastating earthquake and tsunamithat touched Japan in 2011, HARMAN immediately
established a matching contributions program for
employees worldwide. The program wasadministered by the International Red Cross withwhom HARMAN has partnered previously onseveral occasions when global help is needed.

Partnering with community groups whose successis integral to our own, and those who simply
need a helping hand, is a part of life at HARMAN.
Our employees give generously of their time andresources, with a growing focus on musiceducation and the arts.
Other beneficiaries include a wide range of local
and national charities, non-governmentalorganizations and community initiatives. During
2011, HARMAN and its employees actively
supported such national organizations as the Red
Cross, Habitat for Humanity, the United Way,
Toys for Tots and the Salvation Army.
More localized community-outreach initiatives
included the St. Anna Children’s Hospital in
Vienna, Austria; the Rose Bruford College of
Theatrics in the United Kingdom; and The Road
Home shelter for homeless families in Utah.

Demonstrating its passion for great sound andartistic talent, HARMAN sponsorships during theyear included such milestone events as the 2011
GRAMMY® Awards, the Miss Universe China
competition, and the MusiCares Initiative which
provides support for members of the musicindustry in times of personal or financial need.
HARMAN became a premier sponsor of the
Stamford Symphony, which serves the Metro New
York area adjacent to our group headquarters. The
HARMAN Orchestra Classics Series celebrates theworld’s great composers and helps empower thetalented musicians who bring their artistry to life.
We support similar cultural initiatives in many
countries, including a recently announced “Music
Campus” project in China to engage regional
students and professionals toward continuing
music education.

9

Further helping to support tomorrow’s generationof music professionals, our AKG brand continued
its annual Scholarship of Sound initiative. A
dozen emerging musicians and producers earned
a week-long visit to the company’s studios inGermany, where they studied under the guidanceof leading music industry professionals.
In the sporting world,
HARMAN and its
brands helped
sponsor a number of
initiatives that blend
fitness with charitablesupport. The GoldenState Racing Series,
serving Northern
California and
Nevada, brought
together cycling fansfrom every age group through a partnership
between our JBL brand and the legendary Rio
Strada racing organization.

Throughout these many initiatives, the passion of
HARMAN people for sharing great sound consistently
shines through. The talents of our employees,
many of whom began their careers in the musicindustry, are a regular feature during both
workplace and community events.
This artistic passion is
also evident when
HARMAN and its employees
HARMAN people
contribute generously to various
engage their own
communities throughcharitable and relief initiatives
a variety of volunteer
that help the communities
projects and cultural
initiatives. Localized
where we live and work recoveremployee involvementfrom natural disasters.
activities during 2011
included community
arts sponsorships, health and wellness education,
domestic violence awareness, food bank and clothing
drives, literacy initiatives, and a variety of similar
programs in the communities surrounding company
facilities.

10

Empowering Our
Talented Employees

During 2011, employees were recognized throughthis program for such achievements as increasing
e-Commerce revenues, improving customer
service, and reducing warranty costs. Others wererewarded for optimizing the company’s emerging
market footprint and improving annual business
forecast processes.

HARMAN recognizes that its many talented
employees around the world are the foundation forachieving our vision, and an important element of
the sustainability journey. Attracting andretaining talented and highly-qualified employees
and key managers is vital to the success of our
future operations.

Specialized learning and development
programs are offered to HARMAN
employees at many levels. These
include advanced programs insuch areas as Lean Six Sigma,
Project Management, andeffective communications.
During 2011, for example,
we certified some 50
people to the standards of
the Project Management
Institute and some 60 others
engaged in Lean Six Sigma
training. Six of these employees
recently achieved Green Belt
status while contributing to a numberof key projects during the year.

The process begins with hiring,where HARMAN strives for arobust blend of promotion fromwithin and recruiting fresh newtalent from the world’s leading
institutes of higher education.
Each employee then benefits
from an annual HARMAN“people cycle” which ensuresregular performance reviews,
clear target setting for theyear ahead, and compensation
programs that clearly link each
employee’s pay with measured
performance toward individualand group goals.

Employee feedback on these learning anddevelopment programs underscores their worth.
Participants report a greater feeling of
empowerment and better understanding of crossdivision goals. Building upon these, HARMAN has
initiated a management apprentice program thatwill offer selected people mentoring directly bymembers of the Group Executive Committee.

In addition to this annual performance-based
people cycle, we administer a program called
Harman Heroes which enables peers or managers
to nominate employees for special recognition.
Cash or equity awards are granted to those teammembers who distinguish themselves byembracing HARMAN values or contributing to
improved performance.

11

HARMAN’s support for employee welfare extends
well beyond the workplace. We have established
two independent schools in Mexico to serve thecommunities where our people live and work. Our
employees in Brazil are active participants in the
Pescar Foundation, which assists adolescents from
low-income families with on-site professional
training and career planning services.
In memory of our late Founder, Dr. Sidney Harman,
the company recently launched the HARMAN “Vision”
Scholarship to assist the children of employees withadvanced education.
This culture of development, recognition andopportunities for growth is reflected in theaccomplishments of HARMAN employees acrossthe globe. Their positive sentiments are
expressed both in town hall meetings with senior
management and through various awards byindependent organizations.
For example, the company’s Tijuana, Mexico
facility was recently recognized by the Great
Place to Work Institute as one of the Top 100
employers in the country. Our plant in Franklin,
Kentucky recently celebrated two million work
hours without a lost-time accident.
In order to build uponthese significant
achievements, HARMAN
also offers its employees
outside education
opportunities throughtuition reimbursement,internship and coopprograms. For example,
we have partnered with China’s Nanjing University
to conduct advanced acoustic research incooperation with our nearby Suzhou engineeringand development facility.

The same commitment to health and safety that drives
our product designs also applies to HARMAN’s valued
employees. We administer various programs to promote
employee health and wellness, as well as vigorous
enforcement of work rules focused on employee safety.
These encompass, among other factors, carefulergonomic design of work processes to reduce the risk of
injuries, formal health and safety policies at all HARMAN
locations, and prompt reporting of potential violations
and suggestions for improvement.
Investing soundly in
our people is and willremain a priority at
HARMAN. We arecommitted to providing an environment of opportunity
and integrity in which
to work, while generously supporting thefuture of those whodrive our company
and our industry.

12

HARMAN established two
community schools in Mexico
and announced a new global
scholarship to support higher
education among the childrenof our employees.

Stakeholder Engagement

To keep customers informed about leading-edge
developments at HARMAN, we participate in manyof the world’s premier exhibitions and trade fairs.
These include such milestone events as the Detroit,
Geneva and Shanghai motor shows, as well as
annual exhibitions focused on the consumer andprofessional audio markets.

Sustainability at HARMAN means interacting andcollaborating with a broad range of key
constituents. We recognize the synergy of ourown success with that of investors, customers,channel partners, and governments around theworld. We regularly arrange events where thesediverse groups can exchange perspectives andstrengthen the collaboration toward shared goals.

In order to increase impact and optimize the costsof these marketing activities, we routinely teamwith both customers and technology partners forshared presentations. Automotive partners suchas Audi, BMW, Mercedes, Porsche, Toyota andconcept vehicle pioneer Rinspeed regularly host
HARMAN technologies in their own displays toshowcase our joint developments.
Technology leaders including Intel, Nuance andSierra Wireless are integral components of bothour development and marketing activities. In the
consumer sector, we partner with such leading
names as Apple, Sony, Amazon and Best Buy toengage customers through the power of ourrespective brands.
Our financial reporting processes offer maximum
transparency into HARMAN’s business results
and forward strategy. Beyond the company’sscheduled quarterly and annual reports, weregularly host key analysts and investors for a
first-hand look at HARMAN’s key facilities,
managers, and cutting-edge technologies.
Our corporate governance processes are guided by
an experienced Board of Directors whose members
hail from multiple countries and boast extensive
management experience in finance, humanresources, sales and marketing, and similar global
business processes.

13These outreach efforts have led to a dramatic
evolution of HARMAN’s global resources in recent
years. We broke ground in early Fiscal Year 2011
for what will become the company’s largest
development and manufacturing facility in northern
China, and the new site prepared for startup as the
fiscal year drew to a close. Similar expansion
programs were completed during the fiscal year in
Brazil, India and Russia.

Government relations took on increased
importance during 2011 as HARMAN worked withleaders in several countries to expand our
emerging market footprint and contribute ourexpertise to such initiatives as distraction-free
driving. We engaged key government officials
such as the honorable Yang Xiong (above),
executive vice mayor of Shanghai, to leverage
their support for HARMAN expansion programs.

In the United States, we consolidated ourmanufacturing operations to better utilize capacityand position resources closer to our major
customers. We also strengthened our supplierrules of conduct, to optimize compliance with theenvironmental, health and safety criteria of theSocial Accountability 8000 reference standard.

In the United States and elsewhere, we areworking with government transportation officials
to communicate the benefits of HARMAN
technologies that will allow customers to stayconnected on the road while reducing thepotential distractions sometimes associated withmobile communications.
At the local and state level,
we hosted a number ofpublic officials, such as US
Senate leader Mitch
McConnell (left), tostrengthen the key relationships that have led tosignificant financial
incentives to fund HARMAN
training and expansion
programs.

HARMAN’s robust partnership with key stakeholders
is illustrated by a Fiscal Year 2011 event whichbrought together in China nearly 300 global
customers, channel partners, technology leadersand government representatives from the city, stateand national level. The Company’s entire Board of
Directors and Executive Committee hosted theactivities to break ground for a major new HARMAN
facility, reinforce our commitment in the region, andexchange perspectives with other leaders on ourshared goals.

14

Our Governing Standards

Equal Employment Opportunity

Environmental Policy

It is the policy of HARMAN to seek and employ thebest qualified candidates and to provide equal
employment opportunities in all of its Human
Resources activities, including, but not limited to,recruiting, hiring, promotion and training, and toadminister these in a manner which will notdiscriminate against any person because of race,color, religion, sex, national origin, age, physical ormental disability, or any other status protected byfederal, state or local law.

HARMAN is committed to continual improvementin our environmental performance as prescribedin ISO 14001. These efforts include, but are notlimited to, the following principles:; Maintain and improve a common worldwide
Environmental Management System that includes
the practice of continual improvement.

; Ensure our activities, products and operations
are in compliance with all applicable federal,state, and local environmental laws, and otherrequirements to which we subscribe.

Supplier Code of Conduct
All suppliers with whom
HARMAN conducts businessmust have establishedpolicies for social
accountability. The
preferred reference forthese processes is theSA8000 standard fromSocial Accountability
International. Eachsupplier must comply
with applicable environmental, health andsafety standards.

; Conduct our operations in a manner that iscommitted to prevention of pollution,conservation of resources, careful handling of
hazardous substances and promotion ofenvironmental responsibility.

; Review our environmental procedures
periodically and set objectives and targets thatminimize negative environmental impact andlead to continuous improvement.

; Communicate our environmental commitments toEach must provide safe and healthy working
conditions for its employees. Each is also required toactively support HARMAN in minimizing potential
adverse environmental, health and safety impact
during the various phases of the lifecycle of HARMAN
products from development through manufacturing,usage and responsible product disposition.

15

all persons working for or on behalf of HARMAN and to our customers.
Additional details on
the Company’senvironmental
 policy and similar
directives areavailable atwww.harman.com.

Code of Ethics

Health and Safety Policy

It is the policy of HARMAN that each of theCompany's employees, including senior officers
and Board shall be accountable for adhering to thefollowing principles:

HARMAN is committed to the continuous
improvement of health and safety standards tohelp achieve the greatest benefit for our
stakeholders and to ensure the welfare of ouremployees. It is our policy to meet or exceed allapplicable environmental, health and safety laws
and regulations in each location where we
operate, and to facilitate full and open discussion
to address responsible standards and practices
where such laws and regulations do not exist.

; Act with honesty and integrity, avoiding actual orapparent conflicts between his or her personal,
private interests and those of the Company.

; Ensure that periodic reports are filed with theSEC, and that all such public communications areaccurate, complete, fair and understandable.

; Comply with federal, state, and local laws
applicable to the Company and those of private
and public regulatory agencies.

; Act in good faith, responsibly, with due care anddiligence, without misrepresenting or omitting
material facts or compromising judgment.

; Respect the confidentiality of informationacquired except when authorized or otherwise
legally obligated to disclose.

; Proactively promote ethical behavior among

Governance and Committee Structure

subordinates and peers, and prompt internalreporting of any violations.

One of the most important responsibilities of the
HARMAN Board of Directors is to determine theappropriate leadership structure for the Board
which, in turn, helps to ensure the effective,
independent oversight of management on behalf ofthe company's stockholders.

; Use corporate assets and resources employed or
entrusted in a responsible manner.

; Do not use corporate information, assets,
opportunities or one's position for personal gain.

The HARMAN Board of Directors has three standing
committees who collaborate regularly to provide thisgovernance oversight. These include the Audit
Committee, the Nominating and GovernanceCommittee, and the Compensation and Option
Committee. Each of these committees is composed
entirely of independent directors.

Whistleblower Reporting Policy
The Company provides telephone hotline,
Intranet and mailbox channels to employees forreporting of suspected violations of its ethics andgovernance policies. All reports are kept confidential and are investigated by the Company’s
Internal Auditor. The Audit Committee of theBoard of Directors is provided, at regularintervals, with a report on messages received
and the results of any investigation.

16

The Journey Ahead

As discussed earlier, publication of this first Sustainability Report is an important milestone for HARMAN,
reinforcing the Company’s commitment to a sustainable business model. We have taken concrete steps toensure we collect quality data required for sustainability reporting, and we are revising our sustainability
data collection systems so that we can measure our progress going forward. Based on the information
gathered thus far, we will be implementing pilot energy reduction initiatives at three of our largest
operations. We will report on the design and results of this initiative in our next report.
As we continue the HARMAN sustainability journey, our firstpriority will remain to create sustainable value for our
stakeholders through these primary strategies:; Leveraging our global customer base, market and technology
strengths in order to achieve continued profitable growth.

; Continuously improving the product design and state-of-theart operations through which we serve our customers in bothmature and emerging markets.

; Continuously improving our cost and capital structure so we
can reinvest in growing our business.
Toward these goals, we will continually prioritize and refine the market segments we pursue, the materials
and suppliers we select, and the customers and channel partners with whom we engage.

We will also closely

monitor the key challenges facing our industry, including the leading-edge technologies necessary to address
the issue of distracted driving, as well as the cost and availability concerns of key components such as
magnets containing rare earth minerals.
HARMAN remains committed to serving as the premium audio and infotainment company in a converging
marketplace.

Our consumers increasingly expect an always-on, connected lifestyle, and we are prepared todeliver the experience based on our deep integration expertise. Advanced technologies and innovation are at
the heart of our sustainability journey, and we will remain vigilant in creating products and systems that canbe enjoyed safely and that have a beneficial long-term impact on our stakeholders and the planet.

17About HARMAN

Everywhere discriminating people gather, HARMAN is there to make the moment more enjoyable andinformative. We create value for our stakeholders by enabling rich lifestyle experiences around the home,on the road, and in the world’s most prestigious public venues.
Our legendary portfolio of brands, 12,500 talented people, and diverse global resources combine to deliver
the most robust range of audio and infotainment solutions in the industry. Audiophiles from every
generation relax at home and on the go to thegreat sound of products from the wide range of
HARMAN brands. Some 25 million vehicles on
the road today offer a sweeter ride thanks to
HARMAN audio and infotainment. And we help
to provide visitors to the world’s leading
performance and sporting venues with the bestseats in the house.
But seizing the rich opportunities of today’s
global markets requires much more thanlegendary sound.

We have aggressively re-shaped the HARMAN organization and cost
structure to become a more agile competitor ina changing world. We have dramatically
expanded the resources with which we serve

Special thanks to the following individuals for theircontributions to this 2011 Sustainability Report.
Christian BaumScott Bowmar
Simone Brisach
Julio Caesar Garcia Cabello
Stephane Calloch
Don Crawford
Ian Evans
Chris FlumDr. Udo Huels
Marisa Iasenza
Stéphanie Joseph
Luke Keith
Russel Krystolovich

Denis Kerrigan
Jürgen Klingenberg
Frank Koch
Mike Koziol
Radocsay László
Jeremy Lindsey
Olivier Loison
Brooke Matthews
Justin Que
Michael Walter
Vivian Xia
Karney Yakmalian
Karen Zhou

Managing Editor:
Data Collection Coordinator:
Copywriting and Design:

Jean Lépine
Jennifer Carrier
Brad Hoffman

the high-growth emerging markets, and wehave focused our resources in every market to work more closely with our loyal customers. We havecontinued the track record of innovation that has distinguished our company and its premium audio andinfotainment brands for more than 60 years.
Our loyal customers have responded to these sound strategies, rewarding HARMAN with profitable repeat
business, a multi-year backlog of awarded audio and infotainment projects, and seven consecutive quartersof top-line and bottom line growth through Fiscal Year 2011.

18

Welcome to the world of HARMAN.

© 2011 Harman International Industries, Incorporated. All rights reserved.

400 Atlantic Street
Stamford, CT 06901 USA
203-328-3500
www.harman.com

AKG , Becker, Crown, Harman Kardon, Infinity, JBL, Lexicon, Mark Levinson, Soundcraft
and Studer are trademarks of Harman International Industries, Incorporated, registered in
the United States and/or other countries. GreenEdge, HiQnet, and HALOSonic aretrademarks and JBL Synthesis is a registered trademark of Harman International
Industries, Incorporated. All other marks are the property of their respective owners.
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