Climate Change Data

Environmental Metrics

ESG Focus Areas

• Health and Safety
• Environmental Protection
• Community Investment
• Employee Engagement
• Business Integrity
• Customer Service

Environmental Achievements

• Reduced global electricity consumption by 2% at sites with operational control.
• Reduced non-hazardous waste disposal by 3% at sites with operational control.
• Completed first carbon footprint calculation.
• Launched Green Pledge, a company-wide voluntary initiative resulting in almost 2,000 individual environmental initiatives.
• CAE full-flight simulators save over five million metric tonnes of CO2 per year in the company's Civil training network alone.

Social Achievements

• 18% year-over-year reduction in recordable accidents.
• Trained more than 6,900 employees on health and safety.
• Increased global implementation of 10 critical health and safety standards from 11% in fiscal 2016 to 56% in fiscal 2017.
• Donated $6 million (cash and in-kind) to local and regional initiatives worldwide.
• 9% year-over-year increase in employee engagement.
• Hosted AirSmiles event for disabled and terminally ill children.

Governance Achievements

• Updated Anti-Corruption Policy.
• Implemented use of CRM software to support anti-corruption efforts.
• Updated online and in-class anti-corruption training material.
• 97.8% of managers and key personnel trained on the Code of Business Conduct.
• All foreign representatives trained on the Anti-Corruption Policy.

Climate Goals & Targets

Environmental Challenges

• Need to further improve employee engagement.
• Need to better align donations and sponsorships with established policy.
• 10 serious health and safety incidents in fiscal 2017 (goal is zero).

Mitigation Strategies

• Developing a new comprehensive roadmap for CSR progress.
• Focusing on improving employee engagement and becoming an employer of choice.
• Increasing use of leading indicators (near misses) to improve health and safety performance.

Supply Chain Management

Responsible Procurement

• Integration of human rights, labor, environment, and anti-corruption considerations into global strategic sourcing.
• Green procurement practices.
• Conflict Minerals Policy.

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI G4 Sustainability Reporting Guidelines

Certifications: ISO 14001

Sustainable Products & Innovation

• Full-flight simulators

Awards & Recognition

• Centraide’s Solidaires Employee Campaign Award
• Canadian Industry Program for Energy Conservation (CIPEC) Leadership Award

Environmental Metrics

ESG Focus Areas

• Ethics and integrity
• People and safety
• Innovation and customer experience
• Community and environment

Environmental Achievements

• Reduced global electricity consumption by more than 1%
• Reduced non-hazardous waste disposal by more than 1%
• Implemented carpooling at Montreal headquarters
• Installed solar panels in Dubai site
• Madrid training center implemented paperless initiatives

Social Achievements

• Reduced Injury Frequency Rate by 29% and Days Lost Rate by 52% for the fourth consecutive year
• Increased Near Miss Events Reported by 34% compared to fiscal 2017
• Launched CAE Juno, a clinical skills manikin for nursing programs
• Launched CAE Rise™, a next-generation pilot training solution
• Launched CAE Master Pilot Training Program for business aviation pilots
• Expanded cadet training programs in the U.S., India, and Spain
• Formed a partnership with the American Heart Association (AHA)

Governance Achievements

• Revamped Code of Business Conduct
• Reduced the number of foreign representatives used by over 40% since 2014
• Delivered live training sessions on CAE’s Anti-Corruption Policy
• Improved Corporate Policies and Procedures
• Adapted business processes to comply with the EU’s GDPR
• Created a team of 11 data protection officers

Climate Goals & Targets

Environmental Challenges

• Intensifying competition in large markets
• Need to attract, develop, and retain diverse talent
• Maintaining high levels of customer satisfaction
• Managing risks posed by foreign representatives
• Protecting customer and employee data
• Ensuring compliance with data privacy and export control standards

Mitigation Strategies

• Strategic imperatives—'protect' and 'grow'—to maintain leadership and growth momentum
• Investing in training centers, accelerating airline outsourcing, and securing long-term defense training contracts
• Implementing a new digital strategy to enhance customer experience
• Reducing reliance on third-party representatives by expanding the global sales force
• Adapting business processes to comply with GDPR and investing in cybersecurity controls
• Implementing a new performance management system (CAE+me)
• Developing a new diversity and inclusion program

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Integrating human rights, labor, environment, and anti-corruption considerations into global strategic sourcing
• Including CSR compliance clauses in procurement documents
• Conducting spot verifications on suppliers

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: GRI Sustainability Reporting Standards 2016

Certifications: ISO 9001:2015, AS9100C, CMMI-DEV V1.3, CMMI-SVC V1.3, ISO 14001:2015, OHSAS 18001:2007, AS/NZS 4801:2001

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Full-flight simulators (FFSs)

Awards & Recognition

• Two awards from the Canadian Public Relations Society for the 70th-anniversary communication strategy
• 2017 Unity Impact Award for CAE VimedixAR
• Inaugural Innovation Award of .orgCommunity for Anesthesia SimSTAT

Environmental Metrics

ESG Focus Areas

• Workplace gender equality
• Community involvement
• Workplace inclusiveness
• Aviation safety
• Environmental sustainability

Environmental Achievements

• Sold 78 civil full-flight simulators (FFSs), saving millions of tonnes of CO2 annually.
• Implemented paperless initiatives at all sites.
• Increased renewable energy usage at European sites.
• Installed LED or energy-efficient lights at various sites.
• Improved recycling programs at several sites.

Social Achievements

• Launched CAE Women in Flight scholarship program.
• Increased diversity and inclusion initiatives.
• Improved employee engagement through various programs.
• Launched Volunteer of the Year awards program.
• Implemented CAE+me performance development approach.

Governance Achievements

• Created an Executive Diversity Council.
• Revamped Code of Business Conduct.
• Strengthened Ethics and Compliance program.
• Implemented new Data Ethics principles.
• Reduced the number of foreign representatives used by over 60% since 2014.

Climate Goals & Targets

Environmental Challenges

• Gender imbalance in the workforce.
• Need to improve employee wellness.
• Cybersecurity risks.
• Managing risks associated with data analytics.
• Maintaining high ethical standards in a global business environment.

Mitigation Strategies

• Implemented diversity and inclusion programs.
• Launched wellness initiatives and surveys.
• Strengthened IT security governance and training.
• Adopted ethical principles for data analytics.
• Strengthened Ethics and Compliance organization and processes.

Supply Chain Management

Responsible Procurement

• Integration of labour, environment and anti-corruption considerations into global strategic sourcing

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI Sustainability Reporting Standards

Certifications: ISO 9001:2015, ISO 14001:2015, OHSAS 18001:2007, AS9100C, CMMI-DEV V1.3, CMMI-SVC V1.3, AS/NZS 4801:2001, Cyber Essentials PLUS

Sustainable Products & Innovation

• CAE RiseTM training system
• CAE 600XR Series FTD

Awards & Recognition

• Bloomberg 2019 Gender-Equality Index
• Power of A Silver Award (Anesthesia SimSTAT)

Environmental Metrics

ESG Focus Areas

• Climate Change
• Diversity & Inclusion
• Governance
• Safety
• Community Engagement

Environmental Achievements

• Commitment to carbon neutrality by Summer 2020 achieved through purchasing Renewable Energy Certificates and Carbon Offset Certificates.
• 12 CAE sites in Europe offset 100% of electricity consumption through renewable energy certificates.

Social Achievements

• Launched CAE Women in Flight scholarship program.
• Introduced Employee Resource Groups (ERGs).
• Bronze Parity Certified by Women in Governance.
• Named to Bloomberg Gender-Equality Index for a second year.
• Donated $500,000 to McGill University Health Centre (MUHC) Dream Big Campaign.

Governance Achievements

• Established a Climate Change Committee (CCC).
• Revised materiality matrix to reflect carbon neutrality commitment.
• Implemented a new Global Environment, Health & Safety (GEH&S) Policy.
• Completed review of Anti-Corruption Policy.

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic significantly impacted operations across all business units.
• Supply chain disruptions due to travel bans and restrictions.
• Decreased demand for training services in civil aviation and healthcare.
• Delays in securing new orders in Defence & Security.

Mitigation Strategies

• Implemented strict cost containment measures, salary reductions, and temporary layoffs.
• Developed and delivered a critical care ventilator (CAE Air1).
• Provided free training resources to support frontline healthcare providers.
• Introduced offboard instructor operating station solutions to address social distancing requirements.
• Transitioned to remote working where possible.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Integration of labour, environment, and anti-corruption considerations into global strategic sourcing.
• Inclusion of CSR clauses in procurement documents.
• Spot verifications on suppliers.

Climate-Related Risks & Opportunities

Physical Risks

• Increased severity of extreme weather events.
• Rising mean temperatures.

Transition Risks

• Carbon pricing
• Aircraft emissions regulations
• Cap and trade system

Opportunities

• Customers reducing their carbon footprint.
• Development and expansion of low-emission goods and services.

Reporting Standards

Frameworks Used: GRI Sustainability Standards, TCFD, UN Global Compact

Certifications: ISO 9001:2015, ISO 14001:2015, AS9100D, CMMI

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• SDG 3: Good health and well-being
• SDG 4: Quality education
• SDG 5: Gender equality
• SDG 8: Decent work and economic growth
• SDG 13: Climate action

CAE's mission and activities align with these SDGs.

Sustainable Products & Innovation

• Full-flight simulators (FFSs)

Awards & Recognition

• Bloomberg Gender-Equality Index
• Women in Governance Bronze Parity Certification
• Montréal International Best Export Strategy Award

Environmental Metrics

ESG Focus Areas

• Climate change
• Diversity & Inclusion
• Governance
• Health and well-being
• Quality Education

Environmental Achievements

• Became the first Canadian aerospace company to become carbon neutral.

Social Achievements

• Launched Airside™, a digital platform providing training and career resources to pilots grounded due to COVID-19.
• Spearheaded the Industry for Vaccination coalition to accelerate mass vaccination in Canada.
• Opened the CAE Montreal Vaccination Centre.
• Developed and delivered CAE Air1™ ventilators to the Government of Canada.

Governance Achievements

• Enhanced ESG disclosure to include SASB standards for Aerospace & Defense and Professional & Commercial Services industries.
• Provided TCFD reporting.
• Continued reporting to GRI, CDP, and UNGC.

Climate Goals & Targets

Environmental Challenges

• Significant drop in demand for training services in Civil Aviation due to the COVID-19 pandemic.
• Impacts on Healthcare training and simulation market due to COVID-19.
• Supply chain disruptions and mobility limitations in Defence & Security.

Mitigation Strategies

• Introduced new virtual service offerings (remote support, virtual training, remote IOS solutions).
• Developed offboard IOS, virtual classroom, and distance learning solutions in Defence & Security.
• Offered free online training modules and COVID-19 related training solutions in Healthcare.
• Developed and manufactured CAE Air1™ ventilators.

Supply Chain Management

Responsible Procurement

• ESG criteria in supplier evaluation and selection
• D&I clauses in purchase order terms
• Green procurement initiatives

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI, SASB, TCFD, UNGC

Certifications: ISO 9001, ISO 13485, AS9100D

UN Sustainable Development Goals

• Goal 3: Good health and well-being
• Goal 4: Quality education
• Goal 5: Gender equality
• Goal 8: Decent work and economic growth
• Goal 13: Climate action

CAE's initiatives across its three business units contribute to these goals through training, technology development, community investment, and environmental sustainability efforts.

Sustainable Products & Innovation

• CAE Air1™ ventilator
• CAE Injection app
• Electric aircraft development

Awards & Recognition

• Bloomberg Gender-Equality Index
• Women in Governance Parity Certification
• Top Workplace awards
• Investors in People silver accreditation
• Prix Bernard-Landry innovation award

Environmental Metrics

ESG Focus Areas

• Climate Change
• Diversity, Equity & Inclusion
• Governance
• Community Engagement
• Human Rights
• Supply Chain Responsibility

Environmental Achievements

• Achieved carbon neutrality for the second consecutive year.
• All CAE buildings with operational control use renewable energy or are covered by renewable energy certificates.
• Initiated projects to reduce emissions at larger sites.
• Supporting the decarbonization effort of the industry and customers through investments and partnerships.

Social Achievements

• Opened the CAE Montreal Vaccination Centre, accelerating COVID-19 vaccination.
• Launched a fundraising campaign for Ukraine relief efforts, raising over $258,000.
• Updated CAE’s Human Rights Policy.
• Introduced a Supplier Code of Conduct.
• Increased senior leadership diversity by 21%.

Governance Achievements

• Created a new Chief Sustainability Officer role.
• Created a new Chief Diversity, Equity and Inclusion Officer role.
• Linked a portion of executive compensation to ESG performance.
• Conducted an ESG materiality exercise with 3,600 stakeholders.

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions due to climate events.
• Scope 3 emissions inventory completion.
• Managing climate-related risks across a global network.

Mitigation Strategies

• Developing alternative sourcing strategies.
• Implementing a decarbonization strategy with four streams: green buildings, simulator upgrades, electric aircraft, and green sourcing.
• Conducting a climate risk assessment on selected sites.

Supply Chain Management

Responsible Procurement

• Supplier Code of Conduct
• ESG criteria embedded in sourcing processes.

Climate-Related Risks & Opportunities

Physical Risks

• Business disruption
• Delivery delays
• Supply chain disruption
• Endangered network
• Data loss
• Reduced IT access
• Temporary lack of human resources
• Flight safety
• Increase of other operating costs

Transition Risks

• Rising insurance premiums
• Insufficient energy and raw resources
• More expensive resources
• Talent attrition
• Building norms evolution
• New EH&S regulation
• Carbon pricing
• Replacement of CAE’s assets
• Damages to CAE’s reputation

Opportunities

• Development and expansion of low-emission goods and services
• Access to new markets
• Strong reputation
• Talent attraction and retention
• Local sourcing
• Energy independence
• Greener simulators and more eco-efficient facilities

Reporting Standards

Frameworks Used: GRI, SASB, TCFD, UNGC, CDP

Certifications: ISO 9001, ISO 14001, ISO 45001, AS9100D, CMMI

UN Sustainable Development Goals

• SDG 3
• SDG 4
• SDG 5
• SDG 8
• SDG 13

CAE's initiatives contribute to these goals through various programs and strategies.

Sustainable Products & Innovation

• Electric aircraft
• Greener simulators

Awards & Recognition

• Bloomberg GEI
• WiG Parity Certification
• Montreal’s Top Employers
• Canada’s Top Employers for Young People
• ADRIQ Innovation Awards

Environmental Metrics

ESG Focus Areas

• Decarbonization
• Diversity, Equity, and Inclusion
• Indigenous community relations

Environmental Achievements

• Submitted near-term science-based targets to the Science Based Targets initiative to reduce carbon footprint and promote sustainable practices.
• Improved performance across various sustainability scores, including those from S&P and the Carbon Disclosure Project. Inclusion in the S&P 2024 Global Sustainability Index.

Social Achievements

• Recognized as one of Canada’s Best Diversity Employers and among America’s Greatest Workplaces for Women.
• Convened first Indigenous Advisory Board meeting and attained Committed status in Progressive Aboriginal Relations Certification.

Governance Achievements

• Re-establishment of a normal course issuer bid (NCIB) approved by the Board of Directors.

Climate Goals & Targets

Environmental Challenges

• High inflation
• Supply chain disruptions
• Risks on eight specific fixed-price contracts awarded before COVID (Legacy Contracts)
• Geopolitical uncertainty (Ukraine conflict, Hamas-Israel war)
• Increased competition in the aviation and defense sectors
• Evolving ESG expectations and regulations

Mitigation Strategies

• Divestiture of Healthcare business
• Appointment of Chief Operating Officer to drive program execution and collaboration
• Re-baselining of Defense & Security business, accelerated risk recognition on Legacy Contracts
• Investment in technology and innovation
• Strengthening strategic partnerships
• Submitting science-based targets and improving sustainability scores
• Addressing diversity, equity, and inclusion initiatives

Supply Chain Management

Climate-Related Risks & Opportunities

Physical Risks

• Extreme climate events

Awards & Recognition

• Canada’s Best Diversity Employers
• America’s Greatest Workplaces for Women