Climate Change Data

Environmental Metrics

ESG Focus Areas

• Memorable Experiences
• Network Consolidation
• Good corporate governance
• Growth of the Terpel Team
• Protection of the Environment
• Community Wellbeing
• Supplier development

Environmental Achievements

• Introduced 129 new compressed natural gas-fueled taxis into the market, representing 750 tons of CO2 no longer released into the atmosphere (a reduction of more than 50% in emissions).
• Helped industrial clients offset 214,673 tons of CO2 equivalent with carbon credits for 21,307,990 gallons of B2/B4 Biodiesel.
• Installed photovoltaic systems in 3 plants and 2 service stations in Colombia.

Social Achievements

• Strengthened relationship with partners through the Terpel Business Owner Network.
• Had a record number of participants at the customer convention in Portugal: more than 1,000 people representing 686 Service Stations and 94% of the country’s Departments.
• Celebrated the 15th anniversary of the Terpel Foundation with key stakeholders, surpassing one million beneficiaries in 13 Departments of Colombia.
• Implemented the “Restoring Dreams” program, contributing to peace-building and reconciliation in Colombia.

Governance Achievements

• Received the highest rating (AAA) from Fitch Ratings and BRC Standard & Poor’s.
• Received recognition from the Colombian Securities Exchange (BVC) with their IR seal for Investor Relations for the seventh consecutive year.
• Recognized as the largest issuer in the fixed income market in 2018.
• Recognized as the company with the best reputation in the energy and oil sector according to the Reptrak 2019 study.
• Included among the 15 most sustainable countries in the retail sector according to the Dow Jones Sustainability Index.

Climate Goals & Targets

Environmental Challenges

• Significant challenges in terms of the identification and management of risks associated with the broad scope of operations and business lines.
• Sociopolitical, security, and human rights risks.
• Risks associated with possible accusations or alerts related to the environment, communities, social investment, roadway infrastructure, etc.

Mitigation Strategies

• Established a Risk Management System to prevent asset laundering and financing of terrorism.
• Annually assesses corruption risks.
• Engages in financial risk analysis.
• Designed a tool for managing sociopolitical, security, and human rights risks.
• Organized a workshop to train more than 380 workers on managing risks and risk protocols.

Supply Chain Management

Supplier Audits: 434 suppliers evaluated in Colombia (27%), 105 in Panama (16%), and 149 in the Dominican Republic (100%)

Responsible Procurement

• Purchasing policy
• Supplier selection and evaluation process
• Supplier and contractor manual

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: GRI Standards: Core option

Certifications: ISO 9001, 14001, 18001, 45001

Third-party Assurance: Deloitte & Touche Ltda.

UN Sustainable Development Goals

• SDG 7
• SDG 8
• SDG 13
• SDG 16

Initiatives aligned with SDGs 7, 8, 13, and 16 are described in the report.

Sustainable Products & Innovation

• Terpel Celerity Bio Antihumo lubricant
• Biofuels, bio gasoline, and biodiesel
• Electric vehicle charging points

Awards & Recognition

• SAM Sustainability Yearbook 2020
• Lápiz de Acero award
• ANDI Inspiring Company

Environmental Metrics

ESG Focus Areas

• Corporate Governance and Transparency
• Health and Safety
• Diversity, Equity, and Human Talent
• Quality Products and Services
• Community Engagement
• Supply Chain Management
• Alternative Energy Sources and Climate Change

Environmental Achievements

• Achieved a reduction in GHG emissions of 13,908 t CO2e relative to 2019.
• Closed out the year with 1,054 solar panels installed at work centers.
• Installed solar panels at nine work centers, leading to a considerable decrease in energy consumption.

Social Achievements

• Recognized as one of the world's most sustainable companies in the retail sector for the fifth consecutive year.
• Received a "Human Resources Management" award from Premios Portafolio.
• Protected the jobs of 100% of its workforce during the pandemic.
• Implemented a campaign to deliver ergonomic devices to protect employee health.
• Donated 100% of the fuel for vehicles used by the ABACO food bank.
• Provided fuel for the Colombian Civil Air Patrol to transport COVID-19 samples and deliver protection kits.

Governance Achievements

• Maintained Terpel's ‘AAA’ rating from Fitch Ratings.
• Obtained the IR Recognition from the Colombian Stock Exchange (BVC) for the seventh consecutive year.
• Created a crisis committee that met daily to make decisions during the pandemic.
• Strengthened commitment to protecting employee jobs.
• Implemented a campaign to reduce accrued vacation time.

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic significantly impacted operations, particularly airport operations.
• Significant fall in fuel consumption due to mobility restrictions.
• Maintaining employee job stability and well-being during the pandemic.
• Adapting to new consumer needs and maintaining memorable customer experiences.

Mitigation Strategies

• Implemented robust cost-saving measures and government support to mitigate the impact of reduced demand.
• Successfully transitioned 67% of employees to remote work.
• Defined high safety standards and adapted businesses, facilities, and offices to protect employee health.
• Developed alternative sourcing strategies and adapted products and services to meet new consumer needs.

Supply Chain Management

Supplier Audits: 67% of suppliers evaluated for environmental impact in 2020

Responsible Procurement

• Code of Conduct
• HSEQ guidelines for contracted work
• Supplier selection and evaluation process

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Development of energy-efficient products and services

Reporting Standards

Frameworks Used: GRI Standards: Core option

Certifications: ISO 9001:2015, ISO 14001:2015, ISO 45001:2018

Third-party Assurance: Deloitte Asesores y Consultores Ltda.

UN Sustainable Development Goals

• SDG 7
• SDG 8
• SDG 13
• SDG 16

Initiatives contribute to these goals through alternative energy sources, job creation, climate change mitigation, and good corporate governance.

Sustainable Products & Innovation

• New sustainable lubricants

Awards & Recognition

• One of the world's most sustainable companies in the retail sector (S&P Sustainability Yearbook)
• Premios Portafolio award for best human resource management
• Merco ranking for Responsibility and Corporate Governance

Environmental Metrics

ESG Focus Areas

• Corporate governance and transparency
• Quality products and services
• Alternative energy sources and climate change
• Diversity, equity, and human talent
• Health and safety
• Supply chain management
• Community relations

Environmental Achievements

• 120-ton reduction in CO2 emissions by using solar panels
• Installation of 19 wastewater treatment plants at service stations
• Implementation of a platform for monitoring environmental indicators
• Seven tons less CO2 emitted, 113 m3 of water saved, and more than 93,000 kW of energy saved in Howard and Alessandria Terpel service stations (Panama)

Social Achievements

• Launched own brand of water, Agua Madre Altoque, donating 4% of sales to the Soy Oportunidad Foundation
• Implemented a new quick and friendly service model at Altoque stores, supporting Colombian enterprises
• Progress implementing digital transformation model through initiatives related to process automation and incorporation of fast and efficient digital systems
• Visibility to commitment to gender equity, diversity, and inclusion through new corporate policy and “No Labels” campaign
• Restoring Dreams program supported six new projects with an investment of COP $60 million
• Implemented the Masscontrol tool to automate fuel inventories at service stations and suggested orders for convenience stores (Masser)

Governance Achievements

• Established a centralized approach from Colombia for affiliates in Peru, Ecuador, the Dominican Republic, and Panama for high-impact processes such as the prevention of asset laundering and the fight against corruption
• Obtained IR seal for Investor Relations from the Colombian Stock Exchange for the seventh consecutive year
• Created the Risk Office under the Audit Department to strengthen the identification of present and future risks

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions
• Social unrest in Colombia
• High unemployment rate in Colombia
• Inflation in Colombia
• Pandemic impacts
• Reputational harm, environmental damage, sociopolitical risks, climate change, and changes in market trends

Mitigation Strategies

• Disciplined implementation of business strategy
• National Vaccination Plan in Colombia
• Risk management model based on international standards
• Strategic risk exercise to identify, analyze, prioritize, and manage risks and opportunities
• Corporate insurance program
• Hybrid work model
• Digital transformation initiatives

Supply Chain Management

Supplier Audits: 428 suppliers evaluated in 2021 (including 134 for the first time)

Responsible Procurement

• Supplier manual with HSEQ guidelines
• Environmental criteria in supplier selection process (5% weight)
• Prioritization of occupational health and safety, benefits, SARLAFT, information protection, and business ethics

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Regulatory changes, market shifts

Opportunities

• Development of energy-efficient products (LPG, CNG, GT98)

Reporting Standards

Frameworks Used: GRI Standards (Core option)

Certifications: ISO 9001, ISO 14001, ISO 45001, NORSOK S-006 (Aviation), ISO 9001, ISO 14001, ISO 45001 (Lubricants plant), ISO 14001, ISO 45001 (Technology and innovation center laboratory)

Third-party Assurance: KPMG

UN Sustainable Development Goals

• SDG 5
• SDG 7
• SDG 8
• SDG 13
• SDG 17
• SDG 2
• SDG 3
• SDG 4

Contributions through business operations and voluntary actions as a Country Partner

Sustainable Products & Innovation

• GT Extra 98 gasoline
• LPG
• CNG

Awards & Recognition

• Dow Jones Sustainability Index (retail segment, 6 consecutive years)
• Standard & Poor’s ‘AAA’ rating
• Fitch Ratings’ ‘AAA (col)’ and ‘F1+ (col)’ ratings
• IR (Investor Relations) Recognition from the Colombian Securities Exchange (7 consecutive years)
• Merco ranking for Social Responsibility and Corporate Governance
• One of the 25 most admired companies by Cifras y Conceptos

Environmental Metrics

ESG Focus Areas

• Corporate Governance
• Alternative energy and climate change
• Diversity, equity, and human talent
• Health and safety
• Community relations
• Supply chain management
• Quality products and services

Environmental Achievements

• Installed solar panels at 14 work centers, reducing CO2 emissions by 133.9 tons.
• Total environmental investment of more than COP$12,819 million.
• Achieved a total reduction of 264,016 metric tons of CO2e compared to previous years.
• Reduced GHG emissions by converting 142 vehicles to CNG, reducing emissions by 117.3 tons of CO2.

Social Achievements

• Launched the ViveTerpel loyalty program, signing up close to 2 million users.
• Received the ANDESCO Award in the Inclusion category for the Amigos del Alma program.
• Launched the Terpel Voltex App, a 100% digital sales channel.
• Opened 45 new Altoque stores, becoming the largest network of convenience stores in Colombia.
• Provided employment opportunities to people with cognitive disabilities through the Best Buddies program.
• Invested more than COP$122 million in the Restoring Dreams program, benefiting 700 people.

Governance Achievements

• Received the IR Issuer Award (Investor Relations) for the 9th consecutive year.
• Maintained a transparent, timely and authentic dialog with stakeholders.
• Implemented a confidential reporting line for ethical concerns.
• Updated the Code of Conduct with a message from the president and clarifications on entertainment and gifts.
• No confirmed incidents of corruption in 2022.

Climate Goals & Targets

Environmental Challenges

• Reputational damage from product quality issues, fuel shortages, environmental damage, regulatory violations, internal fraud, and cyber-attacks.
• Environmental damage from spills, leaks, and loss of containment of products.
• Social and political risks from political and economic uncertainty, regulatory changes, and community demands.
• Climate change and energy transition risks from increased compliance costs, restrictions on operations, and reduced demand for fossil fuels.
• Financial risks from inflation, interest rate volatility, raw material price increases, and potential customer defaults.
• Regulatory compliance risks from changes in laws and regulations.
• Business interruption risks from political unrest, cyber-attacks, pandemics, and supply chain disruptions.

Mitigation Strategies

• Defined crisis scenarios and developed a crisis management manual.
• Implemented a comprehensive management system for environmental risks.
• Developed a plan for social management and information sharing.
• Developed an environmental stance with targets and indicators for climate change, circular economy, and safe operations.
• Implemented a climate change management model based on TCFD recommendations.
• Developed a regulatory change policy and a culture of compliance.
• Established a business continuity plan to manage disruptions.

Supply Chain Management

Supplier Audits: 60 audits in 2022

Responsible Procurement

• Business Ethics Framework
• Code of Conduct
• HSEQ standards
• Supplier evaluation process incorporating ESG criteria

Climate-Related Risks & Opportunities

Physical Risks

• Storms, hurricanes, flooding

Transition Risks

• Regulatory changes, market shifts, reduced demand for fossil fuels

Opportunities

• Development of energy-efficient products and services, sustainable mobility solutions

Reporting Standards

Frameworks Used: GRI Standards, TCFD, SASB

Certifications: ISO 9001, ISO 45001, ISO 14001, NORSOK S-006

Third-party Assurance: KPMG Advisory, Tax & Legal

UN Sustainable Development Goals

• SDG 5
• SDG 7
• SDG 8
• SDG 10
• SDG 13
• SDG 17
• SDG 2
• SDG 3
• SDG 4

Initiatives contributing to goals through business operations and voluntary actions as a Country Partner.

Sustainable Products & Innovation

• LPG
• CNG
• GT98 extra gasoline
• Electric charging services

Awards & Recognition

• Merco reputation ranking: top private company in hydrocarbons sector
• Standard & Poor’s ‘AAA’ rating
• Fitch Ratings ‘AAA (col)’ and ‘F1+(col)’ ratings
• IR Issuer Award for 9 consecutive years
• ANDESCO Award in Inclusion category
• ANDI’s ranking of the 30 most innovative companies in Colombia

Environmental Metrics

ESG Focus Areas

• Climate change and energy transition
• Diversity, equity, and human talent
• Ethic governance
• Operational eco-efficiency
• Responsible supply chain management
• Community relations and development
• Portfolio and quality operations
• Water resource management
• Biodiversity and ecosystem protection

Environmental Achievements

• Finalized deals to self-generate more than 10 MWp in solar photovoltaic power (Flux Terpel)
• Began operations at three new CNG refueling stations for heavy-duty vehicles
• Developed 11 self-generation projects, generating 3% of the energy consumed by Terpel
• Increased storage capacity by 116,000 barrels (Villa del Rosario and Mansilla plants) and over 8,600 barrels (Leticia)
• Sold 229,161 beverages in refill cups, reducing paper cup usage
• Recovered approximately 1,250 kilos of food waste, donating COP$20 million
• Recycled 3,243 kilograms of excess cardboard

Social Achievements

• Improved on all dimensions of the S&P Global Corporate Sustainability Assessment (CSA), outperforming the industry average by 44 points
• Inclusion in the Dow Jones S&P Global Yearbook 2024
• ViveTerpel loyalty program reached 2.8 million registered users
• Built 4 interactive classrooms in Mitú, Inírida, Leticia, and Guaviare to strengthen education
• Launched a new line of heavy-duty engine oils (Mobil brand) and a new motorcycle product (Terpel brand)
• Terpel Voltex launched 9 fast charging stations, closing the year with 21 fast charging stations and 4 hubs
• Donated more than COP$70 million to Soy Oportunidad and Fundayama Foundations

Governance Achievements

• New bond issue on the Colombian Stock Exchange, oversubscribed by a factor of 2
• Standard & Poor’s confirmed ‘AAA’ rating, Fitch Ratings confirmed ‘AAA (col)’ and ‘F1+(col)’ ratings
• Received the IR (Investor Relations) Award for Issuers for the tenth year in a row
• Updated telework policy and created a policy to prevent sexual harassment in the workplace
• Participation in the Responsible Business Conduct Program at the Bogotá Chamber of Commerce

Climate Goals & Targets

Environmental Challenges

• Challenging economic outlook in Colombia and globally
• High interest rates and financing costs
• Geopolitical tensions and economic events impacting global and regional economies
• Contractionary phase of the Colombian economy
• Uncertainty surrounding structural reforms in Colombia
• Slowdown in foreign investment in Colombia
• Low adoption of electric and CNG vehicles in Colombia
• Decrease in oil production and FDI in the oil sector in Colombia
• Decline in demand for oxygenated gasoline
• Supply chain disruptions and fuel shortages
• Climate-related events (landslides) impacting fuel supply
• Social and political risks in Colombia
• Climate change and energy transition risks
• Cybersecurity risks
• Increase in raw material costs
• Reputational damage risks
• Difficulties in finding, developing, and retaining talent
• Failures in the culture of ethics and transparency
• Regulatory compliance risks
• Physical security and safety risks

Mitigation Strategies

• Adaptation to changes and resilience to market challenges
• Efficiency improvements and cost savings
• Investment in renewable energy and self-generation projects
• Expansion of CNG and electric vehicle charging infrastructure
• Diversification of convenience services
• Strengthening of fuel supply chain and storage capacity
• Implementation of ESG action framework and policies
• Engagement plan for stakeholders
• Projects and alliances for new energies
• Vulnerability management and disaster recovery plan
• Cyber insurance policy
• Monitoring of market behavior and price adjustments
• Negotiations for CNG supply
• Environmental stance and climate change risk management model
• Initiatives to reduce GHG emissions
• Circular economy strategies
• Crisis management protocols and emergency response plans
• Code of Conduct and ethics training
• Regulatory monitoring and compliance programs
• Safety training and preventive measures
• Corporate Risk Management Culture Plan
• Continuous auditing and automated testing

Supply Chain Management

Supplier Audits: 71 suppliers audited (5% of total)

Responsible Procurement

• Supplier selection process with ESG criteria
• Suppliers and Contractors Manual
• Criticality analysis of suppliers
• Annual supplier evaluations
• Action plans for underperforming suppliers
• Supplier development programs (Best Colombian Companies - MEC, Companies in a Mega Trajectory, First Steps in CSR)

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events
• Storms
• Hurricanes
• Floods

Transition Risks

• Regulations limiting fossil fuels
• Carbon taxes
• Market shifts

Opportunities

• Renewable energy
• Electric mobility
• Cleaner fuels

Reporting Standards

Frameworks Used: GRI Guidelines, Core Option, TCFD, SASB, UN Global Compact

Certifications: ISO 9001, ISO 14001, ISO 45001, AEO, Icontec product seals, 3PIM, QP&G, NORSOK S-WA 006

Third-party Assurance: KPMG Advisory, Tax & Legal

UN Sustainable Development Goals

• SDG 2
• SDG 3
• SDG 4
• SDG 5
• SDG 7
• SDG 8
• SDG 10
• SDG 13
• SDG 17

Initiatives contributing to various SDGs as detailed in the report

Sustainable Products & Innovation

• Altoque Agua Madre bottled water
• Green Pass sustainable lubrication program
• New line of heavy-duty engine oils
• New motorcycle product

Awards & Recognition

• Dow Jones S&P Global Yearbook 2024
• Investor Relations (IR) Award for issuers