Climate Change Data

Environmental Metrics

ESG Focus Areas

• Climate Change

Environmental Achievements

• 50% absolute reduction in greenhouse gas emissions across the entire value chain since 2019

Social Achievements

• Not disclosed

Governance Achievements

• Established a Climate Risk Assessment Taskforce; Sustainability performance is included in long-term incentive payments for Board of Management members and the wider Leadership Team.

Climate Goals & Targets

Environmental Challenges

• Engaging thousands of suppliers at varying levels of climate action maturity; sourcing alternative, low-carbon materials; varying pricing structures for PPAs; challenges in switching to renewable energy at smaller, remote sites; sourcing alternative materials; investment and support from external suppliers needed for product redesign and new equipment; uncertainties over the availability of charging infrastructure and the cost of biofuels; continued expansion in fossil fuel production; shortage of adequate infrastructure for collecting and recycling; lack of circular principles in many products limiting recyclability; establishing effective reuse and recycling streams.

Mitigation Strategies

• Incentivizing suppliers through Tritium; supporting PPAs for suppliers; increasing use of sustainable materials; integrating carbon costs into procurement; upgrading buildings and lighting; accelerating product circularity, zero waste and clean transport; optimizing energy use; updating travel policy; switching company cars to electric or hybrid; working with travel agencies; investing in alternative fuels; working with shippers; switching last-mile delivery to EVs; prioritizing sustainable forms of transport; continuing to phase out conventional lighting; introducing more solar lighting; expanding portfolio of ultra energy-efficient lamps; working with government and business to double annual infrastructure renovation rates; advocating for acceleration in the transition to renewable energy; encouraging PPAs; expanding circularity program; redesigning packaging; integrating circular design into product development; making products more serviceable and upgradable; negotiating detailed social plans with works’ councils, trade unions and other employee representative groups; providing job-to-job and financial support; granting time off for job applications; offering access to training and outplacement services.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Tritium supplier rating system; integrating carbon costs into procurement policy; choosing suppliers with net-zero or low emissions; buying sustainable materials as the default option

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events (floods, hurricanes); supply chain disruptions; higher material prices; riverine flooding

Transition Risks

• Policy and legal changes; technology changes; market shifts; stricter environmental performance standards; increased customer awareness; supplier disruptions; changes in consumer preferences

Opportunities

• Increased demand for energy-efficient products; access to new markets; revenue growth; reduced operating costs; lower emissions; reduced exposure to variations in carbon prices; lessened reliance on scarce natural resources; reduced exposure to variations in carbon prices; resilience to climate change effects

Reporting Standards

Frameworks Used: GRI, TCFD, TNFD, UN Global Compact, EU Taxonomy

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• SDG 3, SDG 7, SDG 8, SDG 11, SDG 12, SDG 13

Not disclosed

Sustainable Products & Innovation

• Ultra Efficient LED lighting; connected LED lighting; solar lighting; circular lighting

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Climate action
• Human rights

Environmental Achievements

• Reduced 70% of its carbon footprint in the last decade
• 100% carbon neutral in its global operations since 2020
• Uses 100% renewable electricity since 2020

Social Achievements

• Not disclosed

Governance Achievements

• Not disclosed

Climate Goals & Targets

Environmental Challenges

• Physical and transition risks related to climate change impacting manufacturing sites and supply chain.
• Potential supply chain disruptions due to extreme weather events.

Mitigation Strategies

• Ongoing climate risk assessment following TCFD recommendations.
• Development of risk adaptation and mitigation strategies.
• Implementation of more than 200 energy efficiency initiatives.
• Investment in Power Purchase Agreements (PPAs) for renewable energy.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Supplier Sustainability Declaration (code of conduct)

Climate-Related Risks & Opportunities

Physical Risks

• Riverine flooding, coastal flooding, drought, tropical storm, and heatwave

Transition Risks

• Increased pricing of GHG emissions, change in regulatory requirements, substitution of products, changing customer behavior, increased cost of raw materials

Opportunities

• Increased revenue from energy-efficient and low-carbon products and services, access to new markets, use of public-sector incentives

Reporting Standards

Frameworks Used: GRI Standards: Comprehensive option, TCFD recommendations

Certifications: Null

Third-party Assurance: Independent third-party assurance

UN Sustainable Development Goals

• SDG 7 (Affordable and Clean Energy)
• SDG 8 (Decent Work and Economic Growth)
• SDG 12 (Responsible Consumption and Production)
• SDG 13 (Climate Action)

Signify's actions contribute to these SDGs through energy-efficient solutions, responsible sourcing, waste reduction, and climate action initiatives.

Sustainable Products & Innovation

• Energy-efficient and low-carbon lighting products and services

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Climate action
• Human rights
• Circularity
• Biodiversity

Environmental Achievements

• 100% carbon neutral operations
• 100% renewable electricity
• 70% reduction in gross operational emissions over the past decade
• 31 million MWh reduction in energy consumption of sold LED and connected LED products compared to conventional lighting products

Social Achievements

• Global Employee Share Purchase Plan launched in 2023
• Focus on employee engagement and development
• Commitment to diversity, equity, and inclusion

Governance Achievements

• Supervisory Board reviews climate-related risks and opportunities
• Board of Management oversees climate-related issues
• 25% of Long Term Incentives (LTI) grant vesting dependent on sustainability targets

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions
• Market share loss
• Slow market adoption
• Unavailability of electronic components
• Trade barriers
• Attacks on IT infrastructure
• Climate change related physical and transition risks
• Geopolitical instability
• Cybersecurity risks

Mitigation Strategies

• Robust risk management processes
• Climate Risk Assessment Taskforce
• Dual sourcing strategies for supply chain
• Investments in sustainable innovation and design
• Energy efficiency initiatives
• Climate change adaptation strategies
• Business continuity plans

Supply Chain Management

Responsible Procurement

• Supplier Sustainability Declaration (code of conduct)

Climate-Related Risks & Opportunities

Physical Risks

• Riverine flooding
• Coastal flooding
• Drought
• Heatwaves
• Tropical cyclones

Transition Risks

• Increased pricing of GHG emissions
• Changes in regulatory requirements
• Substitution of products and services
• Changes in customer behavior
• Increased cost of raw materials
• Reputational risks

Opportunities

• Increased demand for energy-efficient and low-carbon products
• Development of new sustainable products and services
• Access to new markets
• Reduced exposure to fossil fuel price increases

Reporting Standards

Frameworks Used: GRI Standards, TCFD recommendations

Third-party Assurance: Independent third-party assurance (Reasonable Assurance)

UN Sustainable Development Goals

• SDG 7 (Affordable and clean energy)
• SDG 12 (Responsible consumption and production)
• SDG 13 (Climate action)

Signify's initiatives contribute to these goals through energy-efficient products, emission reductions, and sustainable innovation.

Sustainable Products & Innovation

• Energy-efficient and low-carbon lighting products, systems, and services

Environmental Metrics

ESG Focus Areas

• Climate action
• Circular economy
• Food availability
• Safety & security
• Health & well-being
• Human Rights

Environmental Achievements

• Cumulative carbon reduction of 334 million tonnes CO2e towards doubling the pace of the Paris Agreement’s 1.5°C scenario
• 100% renewable electricity in operations
• 33% Circular revenues
• Zero waste to landfill, 88% recycling rate

Social Achievements

• Supplier Sustainability Performance of 97%
• 9.4 million lives lit since 2017 through the Signify Foundation
• 29% women in leadership positions
• Employee NPS of 26
• Customer NPS increased to 53

Governance Achievements

• Enhanced leadership programs including focused training on inclusivity
• Inclusivity Index of 84%
• Review and minor changes to the Integrity code

Climate Goals & Targets

Environmental Challenges

• Continued softness in consumer, indoor professional and OEM channels
• Slower than anticipated recovery in the Chinese markets
• Supply chain disruptions
• Cybersecurity risks
• Maintaining an injury prevention mindset

Mitigation Strategies

• New operating model to enhance customer centricity, speed of execution and reduce structural costs
• Supplier risk plan, regional supply capabilities, alternative suppliers, nearshoring, increased strategic inventories
• Investment in R&D, adapted business structure, go-to-market channels, tailored marketing approaches
• Three lines of defense model, ISO 27001 and ISA/IEC 62443 certifications, risk-based approach, continuous vulnerability management
• Re-designing behavior observation process, developing global and local EHS competencies, site EHS maturity assessment process

Supply Chain Management

Supplier Audits: 157 audits

Responsible Procurement

• Supplier Sustainability Declaration (SSD) based on RBA Code of Conduct
• Tritium program for supplier development and rewards

Climate-Related Risks & Opportunities

Physical Risks

• Natural disasters

Transition Risks

• Technological change
• Competition
• Global political and economic instability

Opportunities

• Growth in connected lighting, agriculture lighting, solar lighting

Reporting Standards

Frameworks Used: GRI Sustainability Reporting Standards, Value Reporting Foundation's Integrated Reporting framework, EU Taxonomy, CSRD, TCFD, TNFD, UN Global Compact

Certifications: ISO 14001, ISO 45001, ISO 27001, ISA/IEC 62443

Third-party Assurance: Ernst & Young Accountants LLP (EY)

UN Sustainable Development Goals

• SDG 3
• SDG 7
• SDG 8
• SDG 11
• SDG 12
• SDG 13

Signify's activities contribute to these SDGs through energy-efficient solutions, circular economy initiatives, improved health and well-being, sustainable cities, responsible production and consumption, and climate action.

Sustainable Products & Innovation

• Ultra Efficient LED luminaires
• 3D printed luminaires
• StoreFlow retail lighting
• Interact Space analysis

Awards & Recognition

• EcoVadis Platinum Medal
• Inclusion in the Dow Jones Sustainability World Index for a seventh consecutive year
• Eight Red Dot Design Awards
• Eight iF Awards
• Winning in both tracks of the Prototype Phase of the US Department of Energy's L-Prize competition