SCHN 2017 Proxy Statement

Proposal No. 1 – Election of Directors • A portfolio of varied long-term incentives • Committee discretion in payment of short-term incentives • Use of stock ownership guidelines • Anti-hedging and anti-pledging policies and prohibition on derivative transactions for Company stock In addition, the Compensation Committee analyzed the overall enterprise risks and how compensation programs could impact individual behavior that could exacerbate these enterprise risks. In light of these analyses, the Compensation Committee believes that the architecture of our compensation programs (executive and broad-based) provide multiple, effective safeguards to protect against undue risk. Board Oversight of Management Succession Planning Our Board and management consider succession planning and leadership development to be an integral part of the Company’s long-term strategy. At least annually, our full Board reviews senior management succession and development plans with our CEO. Our CEO presents to the full Board her evaluations and recommendations of future candidates for key leadership roles, including for the CEO position, and potential succession timing for those positions, including under emergency circumstances. Following the CEO’s presentation, the Board meets in executive session without our CEO to consider and discuss CEO succession. The Board also reviews and discusses development plans for individuals identified as high-potential candidates for key leadership positions, and the Board members interact with these candidates in formal and informal settings during the year. Prohibition on Hedging, Pledging and Derivative Trading Our stock trading policy, applicable to our directors and employees, prohibits engaging in any short sale of our stock, establishing or using a margin account with a broker-dealer for the purpose of buying or selling our stock or using it as collateral therefor, or buying or selling puts, calls, prepaid variable forward contracts, equity swaps, collars, exchange funds, or other instruments or derivatives designed to hedge the value of our stock. Our Commitment to Sustainable Business Practices As one of our core values, sustainable business practices set the foundation for our longevity and continued success. We view sustainability as integrated into our business, a key component of our long-term strategy and essential to our future growth and success. We are one of North America’s largest recyclers of scrap metal, a leading provider of used and recycled auto parts, and a manufacturer of finished steel products from recycled metal. The very essence of our business model is predicated on recycling – a cornerstone for sustainability. Our automotive and metals recycling facilities process scrap metals for reuse by steel mills globally and our steel mill produces finished products from recycled metals, conserving natural resources and significantly reducing greenhouse gas emissions. To increase the transparency of our sustainable business practices with our various stakeholders, we publish an annual sustainability report which focuses on: Environmental Performance Employee Health & Safety Ethics and Compliance Community Alliance In August 2017, we released our third annual sustainability report which covered our fiscal 2016 and continued to show year-over-year improvement in key resource measures. We lowered our water usage, energy consumption, and carbon emissions. We are committed to operating our business in a safe, efficient, and environmentally responsible manner. The Key Performance Indicators (KPIs) we report on are aligned with internationally recognized standards and have been assured by independent analysis for materiality and accuracy. In order for us to further develop our sustainability strategy and identify levers and approaches to improve our performance, in fiscal 2017 we appointed a Vice President, Chief Sustainability Officer as a direct report to the CEO. In 2017, for the third year in a row, Schnitzer was named a World’s Most Ethical Company by the Ethisphere Institute, a global leader in defining and advancing the standards of ethical business practices. We also, again, earned the Ethics Inside © Certification and Anti-Bribery Program Verification, endorsements of our Company’s commitment to ethical business practices. Please visit: to view our latest Sustainability Report, which presents our key environmental metrics and profiles best practices we employ to ensure the sustainability of our business and the communities in which we operate. Communication with Directors Shareholders and other interested parties may communicate with any of the directors, including our lead independent director, by using the following address: Board of Directors Schnitzer Steel Industries, Inc. 299 SW Clay Street, Suite 350 Portland, OR 97201 28 | Notice of Annual Meeting of Shareholders and 2017 Proxy Statement