Climate Change Data

Environmental Metrics

Climate Goals & Targets

Environmental Challenges

• The Registrant recently engaged a new independent auditor, which needs additional time to complete its review.

Mitigation Strategies

• The Registrant will file its Form 10-Q on or before the fifth calendar day following the prescribed due date.

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Not disclosed

Environmental Achievements

• Not disclosed

Social Achievements

• Launched humanitarian relief, literacy, higher education, noble cause fund, day care facility, and preventative healthcare programs for employees.
• Employee turnover was under 10% in 2019.

Governance Achievements

• Not disclosed

Climate Goals & Targets

Environmental Challenges

• Regional tensions in Afghanistan and uncertainty caused in neighboring Kashmir and Indian territories.
• China-US Trade war could have negative ancillary effects on the automobile lease industry.
• Geopolitical unrest in the Middle East, South East Asia and potential terrorism and the disruption risk it creates.
• General global market worries of recession and uncertainty due to Brexit in Europe and US China trade war.
• Threats of conflict between Middle Eastern countries could potentially create volatility in oil prices, causing readjustments of corporate budgets and consumer spending slowing global auto sales.
• Recent growing tensions between Pakistan and India.

Mitigation Strategies

• Not disclosed

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: Null

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Employee well-being
• Gender diversity
• Community investment
• Humanitarian relief
• Literacy programs
• Higher education support

Social Achievements

• Launched employee well-being programs including a day care facility and preventative healthcare program.
• Maintained employee turnover under 10%.

Governance Achievements

• Established a Code of Business Conduct & Ethics.
• Maintained an Audit Committee with independent directors.
• Shareholder approval of executive compensation programs.

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic impacting global business environment, causing slowdown in auto and other sectors, and reducing marketing activities.
• US-China trade conflicts.
• Global recessionary impact on business sectors.

Mitigation Strategies

• Reduced travel expenses and office costs.
• Developed and monetized mobile and digital solutions.
• Focused on improving cash reserves and reducing reliance on external capital.

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Environmental Sustainability
• People and Culture
• Responsible Business

Environmental Achievements

• Developed and implemented a recycling, reducing waste and no plastics office space globally. All employees are encouraged to contribute to a safe and responsible work environment.

Social Achievements

• Employee turnover was under 20% in 2021 with a goal to maintain the turnover level under 20% or lower during the 2022 fiscal year and onwards. Combined donations totaling more than $100,000 over the last 12 months to assist employees and communities globally.
• Provides transportation, daycare support, meal support and after school care support at our Technology Campus in Lahore, Pakistan and our U.S. headquarters. Some Lahore employees also receive free medical care.
• All employees have access to gym facilities in our Pakistan and U.S. offices promoting the health and wellness of our staff.

Governance Achievements

• Advisory shareholder vote on executive compensation with 95.72% voting to ratify compensation.

Climate Goals & Targets

Environmental Challenges

• Lingering effects from the COVID-19 pandemic impacting operations and financial results.
• Competition for employees with required skills.

Mitigation Strategies

• Adjusted operations to allow employees to work from home, gradually returning to offices (30% back at Lahore campus by end of 2021).
• Implemented new tools, systems and processes (JIRA, Agile Framework) to enhance productivity.
• Expanded sales and partner success team.
• Elaborate training program for employees covering technical skills, business domain knowledge, communication, management and leadership skills.

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Environmental Sustainability
• People and Culture
• Community Investment
• Diversity and Inclusion

Environmental Achievements

• Developed and implemented recycling, waste reduction, and no-plastics office space in all global offices.
• NetSol Foundation (501(c)(3)) established for charitable contributions.

Social Achievements

• Employee turnover under 16.04% in 2022.
• Launched literacy program for children of unskilled staff.
• Contributed endowments to higher education institutions in Pakistan.
• Established Noble Cause Fund to support medical and education expenses of lower-paid employees' children.
• Implemented preventative healthcare program in Lahore offices.
• Offered flexible work schedules and WFH opportunities.
• Provided transportation, daycare, meal, and after-school care support in Lahore, Pakistan.
• Offered free medical care to some Lahore employees.
• Provided gym facilities in Pakistan and U.S. offices.

Governance Achievements

• Board determined that independent directors must meet specific standards.
• Annual review of nominations for independent board members.
• Annual Board and Committee assessment process.
• Comprehensive, ongoing Board succession planning process.
• Adopted Code of Business Conduct & Ethics.

Climate Goals & Targets

Environmental Challenges

• Global business challenges in 2022 including instability in Europe, war in Ukraine, global inflation, supply chain challenges, and a tight labor market.
• Impact of the global COVID-19 pandemic on NETSOL's performance.

Mitigation Strategies

• Initiated a cost reduction initiative with a targeted annual cost savings of at least $4 million.
• Adapted to service customers remotely during the COVID-19 pandemic.
• Accelerated plans to transform the business to meet evolving customer preferences.
• Added Tianjin subsidiary in China to enhance presence.
• Expanded footprint by offering Amazon Web Services.
• Invested in R&D to include AI and machine learning solutions.
• Critically evaluated cost structure and organizational structure for simplification.
• Carefully managed pipeline while recalibrating potential customers.
• Implemented new tools and processes (JIRA, Agile framework) to enhance productivity.
• Offered cloud-enabled NFS Ascent® at subscription-based pricing.

Supply Chain Management

Climate-Related Risks & Opportunities

Awards & Recognition

• Five-Star Premier Business Partnership Level Status with the American Financial Services Association
• Sitar e Imtiaz (highest civilian award in Pakistan) to Najeeb Ghauri in 2020.

Environmental Metrics

Climate Goals & Targets

Environmental Challenges

• The Registrant recently engaged a new independent auditor. The new independent auditor requires time to complete its review of the nine months ending March 31, 2024.

Mitigation Strategies

• The Registrant will file its Form 10-Q on or before the fifth calendar day following the prescribed due date.

Supply Chain Management

Climate-Related Risks & Opportunities