Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environmental Protection and Climate Change Prevention
• Occupational Health and Safety
• Social Engagement
• Responsible Business
• Supply Chain Responsibility

Environmental Achievements

• Reduced GHG emission (scope 1 and 2) by over 7% y/y
• Increased the mass of aluminium scrap used by over 13%
• Increased the share of recyclable films and laminates significantly

Social Achievements

• Maintained workplaces without financial limitations for the employees, increasing headcount by 2% compared to 2019
• Donated PLN 660,000 to local hospitals and emergency service
• Average TRIR of 0.9

Governance Achievements

• Revised the Code of Ethics document
• Implemented actions aimed at optimising capital expenditure

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic and related sanitary limitations
• Market economic conditions fluctuations
• Raw materials availability
• Customs policy changes
• Exchange rate fluctuations
• Competition
• Access to external sources of finance
• Political and economic situation in Ukraine
• Necessity to adjust the Polish economy to the assumptions of the EU policy regarding climate change
• Changes in law
• Risk of extraordinary events caused by climate changes
• Risk of losing key employees
• Risk related to non-adjustment of the organisation to zero-emission economy
• Corruption risk
• Reputation risk related to a failure to respect human rights
• Risk of direct and indirect emission of greenhouse gases and legal changes related to emission levels
• Risk of emission to water, soil and air of any pollutants originating from the infrastructure, production and warehouse processes, or hazardous waste management
• Currency risk
• Risk related to rapid changes in the prices of basic materials
• Extraordinary events risk
• Liquidity risk
• Interest rate risk
• Risk of economic downturn on the main markets
• Non-compliance risk

Mitigation Strategies

• Implemented actions to provide employees with maximum safety (disinfectants, sanitization, safety zones, remote work)
• Diversification of sales among customers (no customer exceeds 5% of consolidated sales)
• Fast reactions to potential disturbances in supplies
• Measures to mitigate FX risk (currency forward transactions, maintaining debt in foreign currencies)
• Constant meeting of the requirements imposed by the competitors and the customers (investments in technologies, new products, sales network expansion)
• Adjusting personnel policy to market changes
• Continuous improvement of production and sales processes and cost effectiveness
• Re-starting suspended investment projects in the second half of the year
• Transfer of a portion of risk to the insurer
• Diversification of the location of production plants
• Periodic assessment and evaluation of positions and suitable remuneration policy
• HR policy, including resource planning, development and training policy, competence management system, incentive system
• Implementation of a system for monitoring direct and indirect greenhouse gas emissions and carbon footprint
• Actions aimed at greenhouse gas emission reduction and lowering of the products carbon footprint
• Analysis of the possibility to offset a part of own emissions
• Monitoring of legal regulations changes and analysis of the consequences of their introduction
• Internal procedures, including anti-corruption policy and purchasing procedures
• Internal controls and audits
• Opening of whistleblowing channels
• Introduction of regulations in the supply chain enabling audits of the practices applied by the suppliers with regard to respecting human rights
• Control of emissions and optimisation of natural gas combustion processes
• Implemented formal procedures of supervision of the greenhouse gases emission aspects
• Supervision and monitoring of the Capital Group emission sources
• Periodical tests of emission to air
• Supervision of the legal requirements regarding failure prevention, or hazardous substances management
• Training in EHS and fire-safety in accordance with the schedule
• Supervision of infrastructure, particularly as regards efficiency maintenance of utilities systems
• Current identification and assessment of the conditions of applying and approving for use of hazardous substances and mixtures
• Preparing workstations, machines, equipment and infrastructure in a manner which limits the possibility of a failure to the maximum
• Keeping equipment and employees in permanent readiness to react to emergency situations
• Determination and implementation of the principles of acting in crisis situations
• 'natural hedge' measures
• forward and futures contracts
• debt currency structure management
• 'natural hedge' measures (pricing formulas)
• contracts based on fixed delivery prices
• Investments in fire-fighting systems
• Training courses in fire safety
• Diversification of the sources of funding in terms of entities and products and maintaining liquidity buffers in the event of sudden increases in material prices
• Transfer of a portion of the trade credit risk to the insurer
• Applying interest rate risk mitigation procedures depending on the level of debt of a particular company
• Geographical diversification (exports growth)
• Product diversification – sales growth in industries not related to construction (automotive, food)
• Internal procedures, including internal control and internal audit

Supply Chain Management

Responsible Procurement

• Cooperation with selected suppliers who guarantee adequate level of deliveries, diversification, and ethical standards

Climate-Related Risks & Opportunities

Physical Risks

• Floods
• Heatwaves
• Droughts
• Whirlwinds

Transition Risks

• Legal changes related to emission levels
• Necessity to change the source of energy used in the process of aluminium melting and heat treatment

Opportunities

• Higher demand for aluminium elements in the automotive and transport sector
• Higher demand for architectural solutions supporting energy efficiency of buildings

Reporting Standards

Frameworks Used: GRI Standards

Certifications: ISO 14001:2015

Sustainable Products & Innovation

• LOW CARBON KETY billets
• Recyclable packaging films and laminates
• Aluminium building systems for environmentally-friendly, passive buildings

Environmental Metrics

ESG Focus Areas

• Environmental impact
• Occupational health and safety
• Employee development
• Supply chain responsibility
• Community engagement
• Climate change
• Recycling
• Waste management
• Sustainable product development
• Human rights
• Corruption prevention
• Dividend policy
• Risk management
• Support for local initiatives

Environmental Achievements

• 8.2% y/y reduction in total greenhouse gas emissions (scope 1 and 2, location-based)
• 12.7% y/y reduction in gas consumption per ton of production
• 3.21% y/y reduction in waste generation per ton of production
• 70.5% share of aluminium scrap in products extruded from low-emission billets
• 32% increase in the number of Aluprof-systems-constructed buildings with environmentally-friendly certificates

Social Achievements

• 42 implemented local projects under the “Together with the Group” program
• 1,658 liters of blood collected through the ‘Ultrakrew’ blood donation campaign
• 75% of strategic suppliers covered with the Suppliers Code of Conduct

Governance Achievements

• Consequent dividend policy (85% of consolidated net profit for 2021 paid out as dividends)
• Implementation of the Code of Conduct for Suppliers of the Capital Group of Grupa Kęty S.A.

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic
• War in Ukraine and its aftermath
• Supply chain disruptions
• Volatile material prices
• Energy crisis
• Inflation
• Economic downturn
• Increased staff turnover (12.3%)

Mitigation Strategies

• Postponement of some investment projects
• Focus on efficiency improvement and cost reduction
• Review and additional actions to address staff turnover
• Exit interviews with departing employees to improve working environment

Supply Chain Management

Supplier Audits: 75% of strategic suppliers covered with the Suppliers Code of Conduct

Responsible Procurement

• Suppliers Code of Conduct

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Development of energy-efficient products

Reporting Standards

Frameworks Used: Null

Certifications: ISO 14001

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Easily recyclable, homogeneous packaging
• Innovative aluminium semi-products for the electro mobility sector
• Energy-efficient, passive architectural systems

Awards & Recognition

• Second position in the ‘The Stock Exchange Company of the Year’ ranking