Report highlights ST's continuing investment in its people and their communities, in the global environment, and in research and development for the future

Geneva, September 18, 2003 - In its recently published 2002 Social and Environmental Report, STMicroelectronics (NYSE: STM) - which is listed among the top five semiconductor manufacturers worldwide, according to the 2002 final rankings from market analysts Gartner Dataquest, IC Insights and iSuppli - confirms its commitment to encourage and nurture its people and to become the employer of first choice, and highlights its successes and initiatives in its drive to preserve and enhance the wider environment.

Social Report
People are central to the company's success, and their training, development and motivation helps ST to attract and retain the world's top talents. Employees received 44 hours training, on average, from either ST University courses or on-the-job instruction. The "ST-trains-ST" program is building a network of employees qualified to train their colleagues; in 2002 nine percent of all employees were certified trainers. ST University, which was established in 1994, received an Excellence Award from New York based Corporate University Xchange in June 2002.

With 43,000 employees ST remains a popular employer: in 2002, 94% of job offers were accepted. Employees are encouraged to achieve their career ambitions within the company, and the Career Paths Project aims to provide a clear picture of career options. In 2002, 61% of positions requiring experience were filled by existing ST employees. Nearly half of all employees have worked for ST for more than five years; the average career length is more than 10.

Underlying its aim of continuous improvement in health and safety performance, ST meets and exceeds both legal requirements and globally recognized standards. During 2002, three sites were certified to OHSAS 18001 (Occupational Health & Safety Assessment Series), and the remaining manufacturing sites are on target for certification during 2003.

ST believes passionately in people as its most important asset and in the overriding importance of preserving the global environment. Pasquale Pistorio, President and Chief Executive Officer of STMicroelectronics, comments: "I believe that there is no conflict between the needs of shareholders and those of our customers, suppliers, business partners and the broader society.

I'm convinced that being a good corporate citizen is not only ethically correct but good for the bottom line too. The data we have been collecting over the past eight years on our investments show the validity of the concept."

As a signatory to the UN's Global Compact, ST is committed to uphold fundamental principles on human rights and the environment, and is currently formalizing policies to include specific reference to human rights and the avoidance of child labor. ST is an Executive Committee member of the World Business Council for Sustainable Development, chairs the EU delegation to the World Semiconductor Council, and is working with the UN Information & Communication Technologies Task Force to find ways to narrow the gap between those with modern digital technologies and those without.

In addition, the non-profit STMicroelectronics Foundation has instigated the Informatics and Computer Basics program (ICB) with the goal of training 1,000,000 people in education, small enterprises and communities in developing countries within 10 years.

Environmental Report
Formal and quantifiable environmental initiatives are applied to every area of activity, with the ultimate aim of becoming environmentally neutral. By the end of 2002, 17 of ST's 18 manufacturing sites were EMAS (Eco-Management and Audit Scheme) validated and ISO14001 certified (the new plant in Morocco will be certified in 2003); 72% of its materials suppliers were also certified, with a further 16% in process of certification.

Considerable progress has been made towards ST's ambitious goal to become CO2 neutral by 2010. In 2002, energy efficiency initiatives cut electricity consumption by 15% per production unit; construction work began on a 10.5MW wind farm in France that will provide 33,450MWh each year; 600 hectares of forest were planted to sequester ST carbon emissions, and an agreement was signed with the Moroccan government to plant 10,000 hectares of forest over the next six years, with planting already started.

Landfilled waste reached a record low of 10.7% of total in the final quarter of 2002, reflecting a steady reduction to 15% for the year compared to 70% in 1994. The proportion of manufacturing waste reused or recycled has increased from 25% to 65% over the same period. Since 2001 ST uses the Environmental Burden Method that monitors 10 categories to evaluate the impact of emissions to water and air - the planned reduction in water consumption is ahead of target: consumption has fallen 33% since the 1994 baseline, through recycling and purification schemes, with a $70M saving.

"All these results demonstrate that the challenging goals of the ST Environmental Decalogue, not only have been met in most of cases but that we can also perform better through the continuous dissemination among our sites of the good environmental practices and our robust environmental culture," adds Georges Auguste, Corporate Vice President, Total Quality and Environmental Management.

ST has demonstrated that environmental initiatives are also financially attractive; since 2000, environmental improvements have saved nearly 1.5 times their cost. Despite the downturn in the semiconductor market, environmental measures represented 1.2% of the company's investments in 2002. ST continues to be highly ranked on ethical financial indices, and in 2002 was recognized by DJSGI (Dow Jones Sustainability Group Indexes) for excellent overall sustainability performance. In 2002, for the first time, the environmental data has been externally verified by Pricewaterhouse Coopers.

Note for editors The full report is available for download as a PDF file from ST's website: http://www.st.com /stonline/company/environm/report02/socenv03.pdf

About STMicroelectronics
STMicroelectronics is a global leader in developing and delivering semiconductor solutions across the spectrum of microelectronics applications. An unrivalled combination of silicon and system expertise, manufacturing strength, Intellectual Property (IP) portfolio and strategic partners positions the Company at the forefront of System-on-Chip (SoC) technology and its products play a key role in enabling today's convergence markets. The Company's shares are traded on the New York Stock Exchange, on Euronext Paris and on the Milan Stock Exchange. In 2002, the Company's net revenues were $6.32 billion and net earnings were $429.4 million. Further information on ST can be found at http://www.st.com.