Carel Industries

Environmental & Social Information • Dec 20, 2021

DRIVEN BY THE FUTURE Sustainability in action

W e 'v e g o t a n e w id e a o f fu t u re

a n d w e w a n t t o c o n t r ib u t e t o fu lfi llin g it w it h re a l a c t io n , t o m e e t a d e m a n d fo r s u s t a in a b le d e v e lo p m e n t t h a t c a n w a it n o lo n g e r.

A p ro je c t t o t ra n s fo r m o u r w a y o f b e in g a c o m p a n y a n d m a k e s u s t a in a b ilit y o u r c o re b u s in e s s .

T ru s t

W e k n o w t h a t a c t in g n o w a n d q u ic k ly is e s s e n t ia l f o r m a k in g o u r f u t u r e r e a lly p o s s ib le

A w a re n e s s

W e b e lie v e t h a t a b e t t e r f u t u r e f o r p e o p le a n d t h e p la n e t is p o s s ib le

W e w a n t t o d e v e lo p a p a t h , d a y b y d a y , t o a c h ie v e r e a l, m e a s u r a b le s u s t a in a b ilit y o b je c t iv e s f o r t h e c u r r e n t a n d f u t u r e g e n e r a t io n s

C o m m it m e n t

WHAT IS DRIVEN BY THE FUTURE

29c o m p a n ie s* 9p r o d u c t io n p la n t s	MORE THAN 1.700 s t a ff
5 c in o u n t r ie s	13% o f G r o u p
MORE THAN 45 y e a r s h is t o r y	e m p lo y e e s w o r k in R & D *

MORE THAN € 331 MILLION r e v e n u e in 2 0 2 0

€ 295 MILLION t h e e c o n o m ic v a lu e d is t r ib u t e d

€ 17,5 MILLION** in v e s t m e n t in R & D 5 .3 % o f t u r n o v e r

BE OPEN EXPERIMENT CARE THINK CUSTOMER FIRST MAKE THE DIFFERENCE

CAREL IS

L e a d e r in t h e e v o lu t io n o f c o n t ro l a n d h u m id ifi c a t io n t e c h n o lo g ie s fo r t h e a ir c o n d it io n in g a n d re fr ig e ra t io n s e c t o rs .

GLOBALLY OUR VALUES

OUR MISSION OUR PURPOSE - VISION

W e le a d t h e e v o lu t io n o f c o n t ro l t e c h n o lo g y a n d h u m id ifi c a t io n fo r a ir c o n d it io n in g a n d re fr ig e ra t io n .

O u r p ro d u c t s & s e r v ic e s s u p p o r t c u s t o m e rs w it h t h e m o s t e ffi c ie n t & s u s t a in a b le s o lu t io n s .

D a t a p ro c e s s in g p ro v id e d b y o u r IO T p la t fo r m e n a b le s v a lu a b le c u s t o m e r s e r v ic e s d u r in g t h e w h o le s y s t e m 's life .

B e in g t h e in n o v a t io n o u r p la n e t n e e d s t h ro u g h s o lu t io n s fo r t h e C lim a t e C o n t ro l In d u s t r y .

D r iv e n b y k n o w le d g e . In s p ire d b y h u m a n w e ll-b e in g .

N o w a n d fo r fu t u re g e n e ra t io n s .

6

C L E A N , A C C E S S I B L E E N E R G Y

D I G N I F I E D W O R K A N D E C O N O M I C G R O W T H

P E A C E , J U S T I C E A N D S O L I D I N S T I T U T I O N S

R E S P O N S I B L E C O N S U M P T I O N A N D P R O D U C T I O N

B U S I N E S S , I N N O V A T I O N A N D I N F R A S T R U C T U R E

F I G H T A G A I N S T

C L I M A T E C H A N G E

G E N D E R E Q U A L I T Y

7 GOALS FOR THE WORLD WE WANT TO LIVE IN

W e s h a re s e v e n S u s t a in a b le D e v e lo p m e n t G o a ls in d ic a t e d b y t h e U n it e d N a t io n s .

ESG: FROM "DOING SUSTAINABILITY" TO "BEING SUSTAINABLE"

We have an ambitious aim: not just "doing things more sustainably" but "making sustainability our new business model".

DO SHARK VALUE 3 words to talk about our commitment

ACTOR

REAL PROPERTY.

THE PLANET

SOCIAL

ACT FOR THE PLANET

PEOPLE

• Respect for human rights
• Diversity, equal opportunities and inclusion
• Professional training & development
• Health and safety at work
• Attraction, development and retention of talents
• Engagement of, listening to & satisfaction of employees
• of employment

22 GOALS DIVIDED INTO: 22 GOALS DIVIDED INTO: 11 GOALS DIVIDED INTO: ACT FOR PEOPLE

Well-being, life-work balance and protection

COMMUNICATION

Involvement, listening to & satisfaction

of customers

SUSTAINABLE DEVELOPMENT OF LOCAL COMMUNITIES

Local communities and relationship with the area

ENVIRONMENTAL POLICIES

• Environmental pollution and climate change
• Energy efficiency and sustainable products
• Reduction of waste and resort to responsible disposal methods

INNOVATION AND TECHNOLOGY

• R&D and product innovation
• Quality and safety of products and services

SUSTAINABLE STRATEGY AND GOVERNANCE

• Governance and integrity of business
• Privacy, data security and protection
• Responsible supply chain management
• Prevention of and fight against corruption

ACT TO SHARE THE VALUE

55 SUSTAINABILITYAIMS TOWARDS 2024

ACT FOR THE PLANET

ENERGY CLIMATE CHANGE INNOVATION, TECHNOLOGY, PRODUCTS & MATERIALS

ENERGY

R e d u c t io n o f in d ir e c t e n e r g y c o n s u m p t io n t h r o u g h r e l a m p i n g (L E D lig h t in g )

1 0 0 % r e n e w a b le e n e r g y in a ll t h e G r o u p 's E u r o p e a n p r o d u c t io n p la n t s

I m p le m e n t a t io n o f a n I S O 5 0 0 0 1 e n e r g y m a n a g e m e n t s y s t e m in t h e p a r e n t c o m p a n y

E x t e n s io n o f I S O 1 4 0 0 1 E n v ir o n m e n t a l C e r t ifi c a t io n f o r t h e "R e c u p e r a t o r " p la n t in I t a ly

E x t e n d in d ir e c t e m is s io n s r e p o r t in g (S c o p e 3 )

R e d u c e c o n s u m p t io n a n d im p le m e n t t h e u s e

GOAL o f re n e w a b le e n e rg y .

2024

-1 0 %

T o t a l e n e r g y c o n s u m p t io n o f t h e G r o u p a g a in s t +1 3 % h o u r s w o r k e d

5 1 %

E n e r g y u s e d f r o m r e n e w a b le s o u r c e s . M o r e t h a n 3 t i m e s m o r e c o m p a r e d t o 2 0 1 9

-3 8 %

T h e r e d u c t io n in t h e in t e n s it y o f e m is s io n s in r e la t io n t o t h e n u m b e r o f G r o u p e m p lo y e e s

R E S U L T S A C H I E V E D I N 2 0 2 0 C O M P A R E D T O 2 0 1 9

CLIMATE CHANGE

U p d a t e c o m p a n y m a n a g e m e n t s y s t e m p o lic ie s o f G r o u p p la n t s in c lu d in g t h e m a in s u b je c t s o f s u s t a in a b ilit y w it h s p e c ia l r e f e r e n c e t o Q H S E

A s s e s s m e n t o f t h e d e fi n it io n o f a G r o u p d e c a r b o n is a t io n p a t h a ls o t h r o u g h t h e p o s s ib le in t r o d u c t io n o f S c i e n c e B a s e d T a r g e t (S B T )

• I n d ic a t e t h e p o t e n t ia l r is k s
• a n d o p p o r t u n it ie s f o r t h e c o r e
• b u s in e s s lin k e d t o c lim a t e c h a n g e , a ls o in r e s p e c t f o r t h e r e c o m m e n d a t io n s d e fi n e d b y t h e T C F D

GOAL

C o n t r ib u t e t o t h e re d u c t io n o f t h e e ff e c t s d u e t o c lim a t e c h a n g e .

RESULTS ACHIEVED IN 2020 COMPARED WITH 2019

A c t iv a t io n o f p e r io d ic a n d p r o a c t iv e m o n it o r in g o f t h e E c o d e s i g n r e g u la t io n s t o in t e r c e p t p o s s ib le b u s in e s s o p p o r t u n it ie s

S e a r c h f o r p r i n t a b l e p l a s t i c c o m p o u n d s f r o m s u s t a i n a b l e c h a i n s t h r o u g h a n n u a l m o n it o r in g o f d e v e lo p m e n t s in t h e p la s t ic r a w m a t e r ia ls fi e ld L a y d o w n t h e b a s e s f o r c o n s t r u c t in g a 3 6 0 ° a s s e s s m e n t o f t h e e n v ir o n m e n t a l im p a c t o f C A R E L p r o d u c t s t h r o u g h a L i f e C y c l e A s s e s s m e n t a n a ly s is

S t r e n g t h e n t h e g o v e r n a n c e o f t h e s a le s p r o c e s s t o in c r e a s e t h e f o c u s o n t h e p r o d u c t s t h a t c a n b e c o n s id e r e d "E c o -f r i e n d l y " o n t h e b a s e o f t h e "E u r o p e a n T a x o n o m y "

4 . 5 7 0 G W h

t h e e n e r g y s a v in g m a d e b y o u r c u s t o m e r s t h r o u g h C a r e l c o n t r o l t e c h n o lo g ie s

1 . 2 5 6 . 9 4 7 t o n n e s

t h e r e d u c t io n o f C O 2 e m is s io n s c o r r e s p o n d in g t o t h e t o t a l e m is s io n s p r o d u c e d b y t h e M a ld iv e s in 1 y e a r

G O A L

R e d u c e t h e e n v iro n m e n t a l im p a c t o f t h e p ro d u c t io n c h a in o f o u r p ro d u c t s a n d im p ro v e t h e e n e rg y s a v in g s p e r fo r m a n c e o f o u r c u s t o m e rs ' p ro d u c t s t h ro u g h t h e e v o lu t io n o f c o n t ro l t e c h n o lo g ie s .

INNOVATION, TECHNOLOGY, PRODUCTS & MATERIALS

P r o c e s s t o t h e d is c lo s u r e o f t h e S u b s t a n c e s o f V e r y H i g h C o n c e r n id e n t ifi c a t io n p r o c e s s w it h in t e g r a t io n o f t h e p h a s e -o u t p o lic y

ACT FOR PEOPLE

RIGHTS, DIVERSITY, SAFETY, HEALTH, WELFARE

TRAINING AND OPPORTUNITIES FOR GROWTH

COMMUNICATION RELATIONS WITH LOCAL COMMUNITIES

S u p p o r t t h e 1 0 p r in c ip le s o f t h e G l o b a l C o m p a c t in t h e a r e a s o f : h u m a n r ig h t s , e m p lo y m e n t , e n v ir o n m e n t a l s u s t a in a b ilit y a n d a n t i-c o r r u p t io n , a ls o t h r o u g h t r a in in g a n d e m p lo y e e s ' w o r k g r o u p s

R e d u c e t h e f r e q u e n c y r a t e o f "w o r k -r e la t e d " in ju r ie s w it h lo s s o f w o r k d a y s (LT I F )

D e fi n e fl e x ib le w o r k in g g u id e lin e s f o r t h e G r o u p , t h u s s u p p o r t in g a b e t t e r w o r k -lif e b a la n c e f o r e m p lo y e e s P r o m o t e t h e h e a lt h a n d w e ll-b e in g o f e m p lo y e e s e n c o u r a g in g a h e a lt h y lif e s t y le G r a d u a lly in c r e a s e t h e n u m b e r o f f e m a l e e m p l o y e e s (2 5 % o f n e w h ir in g s in 2 0 2 1 in H Q s a n d in c r e a s e o f 5 % in t h e f o llo w in g y e a r s ). E x t e n d G r o u p a w a r e n e s s o n d i v e r s i t y a n d i n c l u s i o n

ACT FOR PEOPLE

% EMPLOYEES BY GENDER	% EMPLOYEES BY AGE
3 7 % w o m e n 6 3 % m e n	1 7 % <3 0 1 9 % >5 0 6 4 % 3 0 -5 0

2024

RIGHTS, DIVERSITY, SAFETY, HEALTH, WELFARE

GOAL

S p re a d t h e c u lt u re o f re s p e c t fo r r ig h t s , v a lo r is e d iff e re n c e s , g u a ra n t e e s a fe t y , p ro m o t e t h e h e a lt h a n d w e ll-b e in g o f t h e p e o p le w o r k in g w it h u s .

TRAINING AND OPPORTUNITIES FOR GROWTH

C r e a t e w o r k s p a c e s d e s ig n e d t o f a v o u r t h e n e w r e la t io n s h ip d y n a m ic s a n d t h e a lt e r n a t io n b e t w e e n s m a r t w o r k in g a n d "liv e " w o r k

G u a r a n t e e a d e q u a t e s k ills a n d u p d a t in g k e e p in g t h e a v e r a g e n u m b e r o f t r a i n i n g h o u r s p e r e m p lo y e e o v e r 1 2 h o u r s a y e a r

I m p r o v e t h e le v e l o f e m p lo y e e e n g a g e m e n t a n d e x t e n d t h e c o h e s io n a r o u n d c o m p a n y c u l t u r e , a ls o t h r o u g h t h e d e fi n it io n o f a n e m p lo y e e e n g a g e m e n t m e a s u r e m e n t a n d im p r o v e m e n t p r o c e s s

GOAL

P ro m o t e t ra in in g t o e n s u re c o n s t a n t u p d a t in g in m a r k e t c o n t e x t s o f in c re a s in g ly ra p id e v o lu t io n .

ACT FOR PEOPLE

COMMUNICATION

I n t e g r a t e s u s t a in a b ilit y t o p ic s in t o t a lk s w it h s t a k e h o ld e r s t h r o u g h t h e d r a f t in g a n d a d o p t io n o f a S t a k e h o l d e r e n g a g e m e n t p o lic y

P r o m o t e t h e c u l t u r e o f q u a l i t y c o lle c t in g t h e f e e d b a c k f r o m c u s t o m e r s t h r o u g h a n a d d it io n a l im p le m e n t a t io n o f t h e N e t P r o m o t e r S c o r e w it h t h e a im o f im p r o v in g t h e o ff e r p r o fi le

GOAL

D e v e lo p re la t io n s w it h c u s t o m e rs t h ro u g h e n g a g e m e n t , lis t e n in g a n d s a t is fa c t io n im p ro v e m e n t in it ia t iv e s .

ACT FOR PEOPLE

RELATIONS WITH LOCAL COMMUNITIES

D e fi n e a n d c r e a t e a c o m m u n i c a t i o n p r o g r a m m e

t o e n s u r e e x t e n s iv e a n d s u ffi c ie n t s p r e a d o f t h e c o m m it m e n t s a n d g o a ls a s s u m e d b y t h e C A R E L G r o u p o n E S G a n d d e s c r i b e d i n t h e S u s t a in a b ilit y P la n

C o n t r ib u t e t o t h e d e v e lo p m e n t o f t h e a r e a t h r o u g h t h e d e s ig n a n d c r e a t io n o f c o m m u n a l u r b a n g r e e n a r e a s

C o n t r ib u t e t o t h e s p r e a d o f k n o w le d g e o n t h e lo c a l a r t is t ic a n d c u lt u r a l h e r it a g e , a ls o w it h in it ia t iv e s o n t h e p r o t e c t io n a n d p r e s e r v a t io n o f w o r k s o f a r t

GOAL

F a v o u r t h e s u s t a in a b le d e v e lo p m e n t o f t h e c o m m u n it ie s w e 're p a r t o f t h ro u g h t h e v a lo r is a t io n o f t h e a re a s a n d t h e c re a t io n o f s h a re d w e ll-b e in g .

ACT FOR PEOPLE

ACT TO SHARE THE VALUE

GOVERNANCE & BUSINESS INTEGRITY

RESPONSIBLE SUPPLY CHAIN MANAGEMENT

PRIVACY, SECURITY & PROTECTION OF DATA

PREVENTION & FIGHT AGAINST CORRUPTION

GOVERNANCE AND BUSINESS INTEGRITY

I m p le m e n t a t io n o f a d i g i t a l r e p o r t i n g s y s t e m f o r t h e d a t a a n d n o n -fi n a n c ia l in f o r m a t io n f o r t h e p e r io d ic m o n it o r in g o f t h e s u s t a i n a b i l i t y K P I s a n d t h e ir a s s e s s m e n t o n a p e r s p e c t iv e b a s is E n s u r e t h e in t e g r a t io n o f E S G s u b je c t s in t o t h e m a n a g e m e n t m o d e ls , t h e s t r a t e g y a n d c o m p a n y p u r p o s e

I m p le m e n t a t r a i n i n g p a t h f o r m e m b e r s o f t h e B o D a n d t o p m a n a g e m e n t o n s u s t a in a b ilit y t o e n s u r e t h e in t e g r a t io n o f E S G s u b je c t s in t o t h e m a n a g e m e n t m o d e ls , t h e s t r a t e g y a n d c o m p a n y p u r p o s e

GOAL

In t e g ra t e E S G s t ra t e g ie s in t o t h e g o v e r n a n c e m o d e l fo r e n v iro n m e n t a l s a fe g u a rd s , in t e r p e rs o n a l re la t io n s , t ra n s p a re n c y a n d b u s in e s s in t e g r it y .

2024

D r a f t a r e s p o n s ib le in v e s t m e n t p o lic y t h a t t a k e s E S G s u b je c t s in a s s e s s m e n t p r o c e s s e s in t o c o n s id e r a t io n a n d a s p ir e s t o t h e U n i t e d N a t i o n s R e s p o n s i b l e I n v e s t m e n t P r i n c i p l e s

RESPONSIBLE SUPPLY CHAIN MANAGEMENT

B r in g t h e p o lic y o n t h e s o -c a lle d c o n fl ic t m in e r a ls e v e n c lo s e r t o t h e O E C D r e c o m m e n d a t io n s , im p le m e n t in g t h e p r o c e s s o n t h e c h e c k a n d a s s e s s m e n t o f t h e r i s k o f t h e s o -c a l l e d c o n fl i c t m i n e r a l s d e fi n e d in 2 0 2 1 w it h r e f e r e n c e t o t h e r a w m a t e r ia ls in d ic a t e d a s p o t e n t ia lly c o n t a in in g t h e m a n d a c t iv a t in g t h e E x e c u t i v e C o m m i t t e e f o r t h e m a n a g e m e n t o f c r i t i c a l s i t u a t i o n s

E n c o u r a g e G r o u p s t a k e h o ld e r s t o a c t s u s t a in a b ly in t h e ir a r e a s o f a c t io n t h r o u g h t h e d r a f t in g a n d a d o p t io n o f a S u p p l i e r s ' C o d e o f C o n d u c t

E x t e n d t h e E S G s u p p l i e r a s s e s s m e n t s u r v e y p e r im e t e r t h r o u g h t h e in v o lv e m e n t o f t h e s e lf -a s s e s s m e n t o f a n a d d it io n a l 2 0 s u p p lie r s e a c h y e a r F r o m 2 0 2 3 , p e r f o r m a n c e o f p e r io d ic s u s t a i n a b i l i t y a u d i t s a t 3 0 s u p p lie r s e a c h y e a r t o m o n it o r t h e c o n s is t e n c y o f t h e E S G s e lf -a s s e s s m e n t

ACT TO SHARE THE VALUE

D i g i t a l i s e t h e p r iv a c y m a n a g e m e n t p r o c e s s

PRIVACY, SECURITY AND PROTECTION OF DATA 2024

PREVENTION OF AND FIGHT AGAINST CORRUPTION 2024

P r o m o t e a c u lt u r e o f in t e g r it y , t r a n s p a r e n c y a n d c o m p lia n c e t h r o u g h a n I S O 3 7 0 0 1 c e r t ifi c a t e d a n t i-c o r r u p t io n s y s t e m

CAREL INDUSTRIES SpA Via dell'Industria, 11 35020 Brugine, Padova - Italy esg@carel.com carel.com

www.esg.carel.it