Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environment
• Social Shift and Innovation
• Safe and High-Quality Products and Services
• Ethics and Compliance
• Human Capital

Environmental Achievements

• Waste sent to Landfill reduced by 3.7kt vs. FY20 - down to 18.4kt (17% reduction)
• Significant Injury Rate was 0.25, a 19% reduction compared to FY20
• A step change of +17pts was achieved vs FY20 with EcoVadis sustainability assessments completed for 53% of external supplier spend
• Average scoring of all suppliers Ecovadis assessments increased by 3 pts to 55
• World's first successful production of building glass using hydrogen energy

Social Achievements

• Back-to-school project in North America delivered 11,400 backpacks to disadvantaged children
• Tree4us project in South America planted seedlings in São Francisco Xavier park
• Unconscious Bias Training provided to all managers across the Group

Governance Achievements

• Established a group-wide ethics and compliance hotline
• Operated a group-wide approval reporting system in high-risk areas
• Adopted “Company with Three Committees” governance structure

Climate Goals & Targets

Environmental Challenges

• Intensifying commoditization of products and competition in the float glass industry
• Climate change and the need to reduce greenhouse gas emissions
• COVID-19 pandemic impact on demand and operations
• Shortages of computer chips and other components in the automotive sector
• Need to restore financial stability

Mitigation Strategies

• Revival Plan 24 (RP24) focusing on cost structure reform, business structure reform, and corporate culture reform
• Optimizing glass manufacturing processes, developing energy-saving technologies, and expanding the use of renewable energy
• Expansion of value-added business and development of new growth businesses
• Strict control of working capital and restricting capital expenditure
• Bold strategic review of shrinking or exiting non-core businesses

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Supplier Code of Conduct
• EcoVadis assessments
• Due diligence on high-risk suppliers

Climate-Related Risks & Opportunities

Physical Risks

• Flooding
• Typhoons

Transition Risks

• Regulatory changes
• Market shifts
• Increased operational costs from new ETS

Opportunities

• Supplying high-performance products associated with stricter environmental regulations
• Growth in EV market and low-energy buildings market

Reporting Standards

Frameworks Used: SASB, IIRC, TCFD

Certifications: ISO 14001, ISO 50001, SBTi

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Goal 7 (Affordable and Clean Energy)
• Goal 9 (Industry, Innovation and Infrastructure)
• Goal 12 (Responsible Consumption and Production)
• Goal 13 (Climate Action)

Various initiatives contribute to these goals through energy efficiency improvements, renewable energy use, waste reduction, and CO2 emission reductions.

Sustainable Products & Innovation

• Solar photovoltaic and concentrated solar power glass
• Energy-saving glass
• Self-cleaning glass
• Antibacterial and antiviral glass

Awards & Recognition

• CDP Climate Change A- leadership rating
• Silver EcoVadis CSR rating
• Inclusion in FTSE Blossom Japan Index

Environmental Metrics

ESG Focus Areas

• Climate Change
• Energy
• Water
• Social Shift and Innovation –R&D Strategy
• Safe and High Quality Products and Services
• Suppliers
• Ethics and Compliance
• Human Resources

Environmental Achievements

• 8 percent reduction in CO2 intensity across glass manufacturing operations compared to FY18
• World's first successful experiment in the production of architectural glass using hydrogen as a low-carbon alternative fuel
• World's first to successfully manufacture float glass using bio-based fuel oil
• Settimo Torinese site became the NSG Group's first fully decarbonized site

Social Achievements

• Launched improved Energy Advantage™ product for the Canadian market
• Developed and launched a new Pilkington Eclipse Advantage™ product
• Enhanced UV and IR absorbing coatings for the Japanese market
• Improved employee engagement scores
• Increased female manager representation to 14.3%
• Implemented Unconscious Bias Training for all managers

Governance Achievements

• Adopted “Company with Three Committees” governance structure
• Enhanced management transparency by further separation of functions between business execution and its supervision
• Strengthened role of independent external directors
• Annual evaluation process for Board effectiveness

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions
• Energy price spikes
• Russia’s invasion of Ukraine
• Delay in the recovery of vehicle production
• Logistics disruptions
• Rising energy prices
• High cost of raw materials and fuel
• Restricted levels of vehicle build
• Increased costs associated with pricing of GHG emissions
• Increased costs of raw materials
• Investment risk
• Changing consumer preferences
• Costs to transition to lower emission technologies
• Cost of Capital
• Regulatory requirements e.g. building codes
• Emissions offsets
• Enhanced emissions reporting
• Mandates & regulation of products
• Shortages of computer chip components
• Low levels of asset utilization
• Lockdowns in Malaysia
• Supply chain problems at car manufacturers

Mitigation Strategies

• Headcount reductions
• Cost reduction initiatives
• Sales price increases
• Introduction of renewable energy (Solar and Wind power)
• Trials aiming to commit to carbon neutrality (manufacturing glass using hydrogen power and 100% biofuel)
• Active risk-based hedging
• Price increase negotiations with vehicle manufacturers
• Development and implementation of mid and long-term decarbonization targets
• Working with supply chain and value chain partners
• Investment in R&D technology developments
• Development of new products
• Emergency plan to ensure that each European float can be protected by putting them on hold in a controlled manner by firing liquid fuel in case of severe gas shortage
• Lobbying through glass associations
• Capital investments that enabled floats to go on hold with liquid fuel
• Securing liquid fuel procurement & supply
• Increasing readiness to go on hold with proper training and procedures
• Continuous cost reductions
• Rational price pass-through based on raw material and fuel costs
• Sales expansion of value-added products

Supply Chain Management

Supplier Audits: EcoVadis sustainability assessments completed for 52% of external supplier spend in FY22

Responsible Procurement

• NSG Supplier Code of Conduct
• ISO 14001 or equivalent national environmental certification
• EcoVadis assessment
• Chain of Custody (CoC) certification from the Forest Stewardship Council (FSC) or PEFC

Climate-Related Risks & Opportunities

Physical Risks

• Flood
• Typhoon
• Drought
• Chronic Heat
• Sea level rise

Transition Risks

• Increased costs of raw materials
• Investment risk
• Changing consumer preferences
• Pricing of GHG emissions
• Costs to transition to lower emission technologies
• Cost of Capital
• Regulatory requirements e.g. building codes
• Emissions offsets
• Enhanced emissions reporting
• Mandates & regulation of products

Opportunities

• Opportunities to supply high-performance products in relation to the European Energy Directive
• Opportunities for sharing high-performance energy-saving products
• EV market and the growth of the energy-efficient buildings market
• Opportunities for more stringent product demand
• Opportunity for specific product development e.g. storm glazing

Reporting Standards

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

Certifications: ISO 50001, ISO 9001:2015, IATF 16949, ISO 14001

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Improved Energy Advantage™ product
• Pilkington Eclipse Advantage™ product
• Enhanced UV and IR absorbing coatings
• Pilkington Spacia™ vacuum insulating glazing
• NSG Botanical™ product range
• MAGNAVI™ high-performance glass fiber
• SLA-5DG™ lens
• New glass applications that deliver power or data to devices without the need for wires

Awards & Recognition

• CDP Supplier Engagement Leader
• EcoVadis Sustainable Procurement score of 70 (top 3% of glass companies)
• Platinum Kurumin Certification
• 2022 Excellent Health Management Corporation

Environmental Metrics

ESG Focus Areas

• Environment
• Social Shift and Innovation
• Human Capital
• Health and Safety
• Ethics and Compliance
• Safe and High-quality Products and Services

Environmental Achievements

• Launched the world’s lowest carbon glass range of its kind in Europe.
• Successful start of Europe’s first carbon capture trial in the flat glass industry.
• Revised CO2 emissions intensity target to 3% year-on-year reduction and introduced a new target of 65% renewable energy electricity ratio by FY2027.

Social Achievements

• Increased female managers in each business and functional division of the entire group from 12.7% as of 30th June 2021 to 16% by FY2024/3.
• Set new targets to increase the ratio of female managers in the entire group to 24% by FY2027/3, and to 30% by FY2030/3.
• Introduced Diversity, Equity & Inclusion (DEI) Policy.
• Awarded Platinum Kurumin Certification by Japanese Ministry of Health, Labour and Welfare in 2019.

Governance Achievements

• Implemented a committee-based governance structure.
• Established the Board of Directors, Nomination Committee, Audit Committee, and Compensation Committee.
• Adopted the “Basic Policy on Sustainability” and established targets for the Group's sustainability activities.
• Established Sub-Committees related to all major materialities.

Climate Goals & Targets

Environmental Challenges

• Climate change
• Poor product quality
• Human resources

Mitigation Strategies

• Set Science Based Targets (SBTs) to reduce GHG emissions (Scope 1 and Scope 2) by 30% compared to 2018 levels by 2030.
• Added GHG emission from Supply Chain (Scope 3) as another reduction target.
• Developing new technologies and alternative fuels.
• Introducing renewable energies.
• Reducing CO2 emissions in value chains.
• Investing in human capital and implementing a well-defined HR strategy.

Supply Chain Management

Responsible Procurement

• Introduction of the Supply Chain Charter

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: TCFD, CDP

Certifications: Science Based Targets (SBTi)

Sustainable Products & Innovation

• World’s lowest carbon glass range

Awards & Recognition

• Platinum Kurumin Certification