Climate Change Data

Environmental Metrics

ESG Focus Areas

• Business Ethics
• Health, Safety & Environment
• Supply Chain
• Community
• Value Creation

Environmental Achievements

• Reduced GHG emissions by 1.8% from 2017.
• Reduced total hazardous waste by 11.7% and non-hazardous waste by 5.8% compared to 2017.
• Improved waste recycling by 7.9% from 2017, reaching 84.7% of waste streams reused, recycled, composted, or recovered.
• Implemented projects estimated to save over $1.82 million annually in energy costs.

Social Achievements

• 13,000 hours of employee community service contributed.
• Held the 3rd annual Global Service Day with over 615 volunteers contributing 2,060 hours.
• Launched technical and behavioral competency frameworks and software for competency improvement and individual development plans.
• Global Lost Work Day Case Rate of 0.28 (improvement over previous years).

Governance Achievements

• Achieved a B- score from CDP for climate change management.
• Completed IATF 16949 certification across all sites.
• Implemented an ethics line for reporting violations.

Climate Goals & Targets

Environmental Challenges

• Did not meet the 3% reduction target for energy use.
• Did not meet the 4% reduction target for waste diversion.
• Did not meet the 3% reduction target for water use.
• One employee fatality in 2018 at a subsidiary in China.

Mitigation Strategies

• Implemented several projects to reduce energy consumption (lighting retrofits, cool roofs, waste recycling).
• Initiated an innovative recycling project to reuse used oil from wastewater sludge.
• Implemented a formal water data collection and tracking program.
• Completed a thorough investigation of the fatality and a corporate-wide review of safety procedures.

Supply Chain Management

Supplier Audits: 966 suppliers managed; Manufacturing Capability Assessments for all new direct material suppliers.

Responsible Procurement

• Nexteer Supplier Requirements (NSRs)
• General Terms and Conditions (GT&Cs)
• IATF 16949 Quality Management Standard

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: Hong Kong Stock Exchange ESG reporting requirements

Certifications: ISO 14001:2004, OHSAS 18001, IATF 16949

Sustainable Products & Innovation

• Electric power steering (EPS) systems

Awards & Recognition

• GM’s Innovation Award for High Availability EPS
• Ford’s Aligned Business Framework Status
• Ford’s Silver Award for quality steering gear manufacturing in Mexico

Environmental Metrics

ESG Focus Areas

• Business Ethics
• Health, Safety & Environment
• Supply Chain
• Community
• Value Creation

Environmental Achievements

• Reduced total GHG emissions by 13.5% from 2018 to 295,119 tCO2e.
• Reduced GHG emissions intensity by 9.9%.
• Reduced energy use by 11.5% (10.1 million kWh saved).
• Reduced water consumption by 3.8% (12.4 million liters saved).
• Reused, recycled, composted, and recovered 87.9% of waste streams.
• Reduced waste to landfill per unit by 53.6%.

Social Achievements

• Held 4th annual Global Service Day, contributing 15,500 hours of employee community service.
• Achieved record low lost workday cases and recordable incidents.
• Launched "Steer to a New You Wellness Program" in the US, with nearly 1,900 employees participating.
• Expanded technical and behavioral competency frameworks to corporate staff functions.

Governance Achievements

• Updated Nexteer Supplier Requirements to include Corporate Social Responsibility Supplier Principles.
• Implemented an application for automated data collection and management of conflict minerals.
• Maintained ISO 14001 and ISO 45001 certifications.

Climate Goals & Targets

Environmental Challenges

• Reducing GHG emissions further.
• Meeting water reduction intensity target.
• Further reducing waste to landfill.

Mitigation Strategies

• Implementing energy, water, and fuel reduction projects.
• Implementing key waste reduction projects.
• Improving processes and implementing additional water conservation programs.

Supply Chain Management

Supplier Audits: 100% of new direct material suppliers undergo manufacturing capability assessment (MCA).

Responsible Procurement

• Nexteer Supplier Requirements (NSRs)
• General Terms and Conditions (GT&Cs)
• Corporate Social Responsibility Supplier Principles
• IATF 16949 Quality Management Standard

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: HKEX ESG 2019 reporting requirements, UN SDGs

Certifications: ISO 14001, ISO 45001, IATF 16949

UN Sustainable Development Goals

• 3
• 4
• 5
• 7
• 8
• 9
• 12

Nexteer's contributions to the UN SDGs are detailed in Appendix B of the report.

Sustainable Products & Innovation

• Quiet Wheel™ Steering
• Stowable Steering Column

Awards & Recognition

• Frost & Sullivan’s Engineering and Production Technology Leadership Award
• National Association of Manufacturing’s Manufacturing Leadership Award for Enterprise Integration and Technology Leadership
• GM’s Supplier of the Year Award
• GM’s Supplier Quality Excellence Award
• Automotive Innovation Technology Award
• EcoVadis Silver Medal

Environmental Metrics

ESG Focus Areas

• Business Ethics
• Environmental, Health & Safety
• Supply Chain
• Community
• Value Creation

Environmental Achievements

• Implemented 31 projects estimated to reduce annual energy consumption by 0.9 million kWh and water consumption by 11,700 liters, preventing the release of approximately 719 tonnes of CO2e annually.
• Reduced total GHG emissions by 7.55% (291,377 tCO2e) compared to 2019.
• Reused, recycled, composted, and recovered 87.2% of waste streams.
• Reduced waste to landfill on a per unit basis by 5.5% compared to 2019.
• 93% of manufacturing sites are ISO 14001 certified.

Social Achievements

• Employees volunteered more than 7,000 hours to community service.
• Launched the Respect, Inclusion, Support, Equity (RISE) program to promote diversity, equity, and inclusion.
• Opened a fourth Nexteer Production System Academy.
• Achieved 93% completion rate for 2020 Code of Conduct training.
• Average of 11.98 hours of training per employee in 2020.

Governance Achievements

• Established a three-tiered sustainability governance structure including Board oversight, a Sustainability Steering Committee, and a Sustainability Work Group.
• Formalized a cross-functional global Climate Change Task Force.
• Implemented an ethics line for reporting violations.

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic disrupted supply chains and operations, resulting in reduced production and impacting energy reduction goals.
• Increased recordable and lost workday rates due to the pandemic.
• Did not meet energy reduction goal due to reduced production.

Mitigation Strategies

• Developed a 74-page comprehensive Safe Work Playbook with new health and well-being protocols.
• Implemented several water reduction projects.
• Implemented 31 projects to reduce energy consumption and GHG emissions.
• Launched a recycling campaign at the Saginaw site.

Supply Chain Management

Supplier Audits: All new direct material suppliers underwent manufacturing capability assessment (MCA) in 2020; number of existing supplier audits not specified.

Responsible Procurement

• Nexteer Supplier Requirements (NSRs)
• General Terms and Conditions (GT&Cs)
• Corporate Social Responsibility Supplier Principles
• IATF 16949 Quality Management Standard

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Stringent fuel efficiency and emissions regulations and standards.

Opportunities

• Renewable energy projects (Mexico).

Reporting Standards

Frameworks Used: GRI, HKEX ESG 2020 reporting requirements, UN SDGs

Certifications: ISO 14001, ISO 45001, IATF 16949

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Goal 3
• Goal 4
• Goal 5
• Goal 7
• Goal 8
• Goal 9
• Goal 12

Nexteer's contributions to the UN SDGs are detailed in Appendix II.

Sustainable Products & Innovation

• High-Output Rack-Assist Electric Power Steering (HO REPS)
• Stowable steering columns
• Advanced steering technologies with multi-layer cyber security.

Awards & Recognition

• Newsweek’s America’s Most Responsible Companies 2021
• EcoVadis Silver medal
• National Association of Manufacturers’ Manufacturing Leadership Award
• Ford Best Managed Companies with Outstanding Quality Performance Award
• GM Supplier Quality Excellence Awards
• China Automobile & Parts’ Innovation Capability Award
• Excellent Award in the Chassis Section from the China Automotive Parts Industry Award (Lingxuan Award)

Environmental Metrics

ESG Focus Areas

• Business Ethics
• Supply Chain
• Environmental, Health & Safety
• Value Creation
• Community

Environmental Achievements

• Executed renewable energy agreement in Mexico addressing approximately 80% of the energy consumed by Mexico operations.
• Implemented 28 projects estimated to save nearly $447,678 annually in energy, water, and waste reduction.
• Reduced energy use by 16.77% on a per-unit-of-production basis despite a 15.95% production increase.

Social Achievements

• Named one of America’s Most Responsible Companies by Newsweek for the third consecutive year.
• Recognised as a Great Place to Work® in Brazil and Morocco.
• Introduced a global SmartWork policy offering employees more flexible work arrangements.
• Continued development of the RISE (Respect, Inclusion, Support, Equity) Diversity, Equity and Inclusion programme.
• Contributed more than 72,000 employee volunteer hours in the past five years.
• Achieved some of the lowest health and safety metrics in the last nine years.

Governance Achievements

• Received CSO50 Award from IDG’s CSO for Innovative Cybersecurity Framework.
• Received National Association of Manufacturers’ 2021 Manufacturing Leadership Award for Enterprise Integration Technology Leadership.

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions due to the COVID-19 pandemic and microchip shortage.

Mitigation Strategies

• Teams quickly mobilized to minimize impacts to production.
• Maintained close contact with suppliers and aligned the Nexteer manufacturing network.
• Worked with customers to minimize impacts throughout the extended value chain.

Supply Chain Management

Supplier Audits: 39 direct material suppliers audited in 2021.

Responsible Procurement

• Corporate Social Responsibility (CSR) Supplier Principles
• Nexteer Supplier Requirements (NSRs)
• Self-assessment questionnaire (SAQ)

Climate-Related Risks & Opportunities

Physical Risks

• Extreme heat and heatwaves
• Tornadoes
• Typhoons/cyclones/hurricanes

Transition Risks

• Emerging regulations
• Carbon cost mechanisms
• Low-carbon economy market and technology shifts

Opportunities

• Energy efficiency measures
• Renewable energy procurement
• Decarbonization levers

Reporting Standards

Frameworks Used: HKEX ESG Reporting Guide, GRI Standards

Certifications: ISO 14001, IATF 16949, ISO 45001

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• 3
• 4
• 5
• 7
• 8
• 9
• 12

Nexteer's contributions to the UN SDGs are detailed in the report's Reporting Indices section.

Sustainable Products & Innovation

• High-Output Electric Power Steering Systems
• Steer-by-Wire with Stowable Steering Column technologies
• Brake-to-Steer technology
• Automated Steering Actuator technology
• Driveline halfshaft technologies
• CIS technologies

Awards & Recognition

• Newsweek’s America’s Most Responsible Companies
• Automotive News PACEpilot Innovation to Watch
• CES 2022 Innovation Awards
• GM Supplier of the Year
• National Association of Manufacturers’ Manufacturing Leadership Award
• CSO50 award

Environmental Metrics

ESG Focus Areas

• Business Ethics
• Value Creation
• Environmental, Health & Safety
• Supply Chain
• Community

Environmental Achievements

• Avoided 73,003 tCO2e GHG emissions through 40 projects
• Saved 98.29 million kWh of energy
• Saved 245.44 million liters of water

Social Achievements

• Rolled out DE&I pillars and launched the "All In" program in EMEA&SA division
• Received various Great Place to Work certifications across multiple locations
• Completed over 80,000 hours of safety training
• Reduced global recordable incident rate

Governance Achievements

• No significant instances of non-compliance with laws and regulations
• Annual Code of Conduct training for 100% of salaried workers globally

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions due to the COVID-19 pandemic and global headwinds
• Emerging regulations across the globe, such as carbon reduction targets and enhanced reporting requirements
• Carbon cost mechanisms
• Extreme weather events

Mitigation Strategies

• Remained nimble, communicative, and resilient in managing supply chain headwinds
• Continued development and collaboration on global climate roadmap
• Initiated several solar feasibility assessments
• Enhanced data management system for tracking critical climate and environmental data
• Centralized manufacturing processes at Saginaw, Michigan location

Supply Chain Management

Supplier Audits: 88 direct material suppliers audited in 2022

Responsible Procurement

• Nexteer Supplier Requirements (NSRs)
• General Terms and Conditions (GT&Cs)
• Corporate Social Responsibility (CSR) Supplier Principles

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events (heat waves, drought, tornadoes, cyclones)

Transition Risks

• Emerging regulations
• Carbon cost mechanisms
• Low-carbon economy market and technology shifts

Opportunities

• Renewable energy
• Energy efficiency improvements

Reporting Standards

Frameworks Used: HKEX ESG, GRI, SASB, UN SDGs

Certifications: ISO 14001, ISO 45001, IATF 16949

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Goal 3
• Goal 4
• Goal 5
• Goal 7
• Goal 8
• Goal 9
• Goal 11
• Goal 12

Examples of Nexteer’s contributions to each goal are provided in the report

Sustainable Products & Innovation

• Electric Power Steering (EPS)
• Steer-by-Wire systems
• Driveline systems
• High-output Rack-Assist EPS (REPS) solution

Awards & Recognition

• Hang Seng Corporate Sustainability Benchmark Index constituent member (6th year)
• Various Great Place to Work certifications
• 59 National Safety Council awards
• CES® 2023 Innovation Award Honoree
• AutoTech Breakthrough Award