Climate Change Data

Environmental Metrics

ESG Focus Areas

• Prioritizing People
• Operating Sustainably
• Delivering Sustainable Components
• Managing Our Business

Environmental Achievements

• Reduced wastewater hauled off-site to zero at one Mobile Solutions facility.
• Implemented water conservation strategies across facilities.
• Improved air quality by phasing out high VOC substances and reducing chemical testing frequency.
• Increased tooling efficiency to reduce overall energy usage.
• Implemented building improvements (LED lighting, motion sensors) to decrease energy usage at Kentwood, Dowagiac, and Charlotte facilities.
• Partnered with a Michigan-based recycler to divert plastic and corrugated waste from landfills.

Social Achievements

• Achieved zero lost-time incidents across all six manufacturing locations in 2021.
• Consistently outperformed industry averages for TRIR and DART over the past five years.
• Implemented COVID-19 safety protocols, including onsite vaccination clinics.
• Offered Learn and Earn Program providing apprenticeships and co-op opportunities.
• Supported local communities through various initiatives (e.g., United Way, Veterans Day celebrations).

Governance Achievements

• Updated Whistle Blower Complaint Procedure in 2021.
• Implemented KnowBe4 phishing drills and employee training for data security.
• Established NN Sustainability Executive Council and ESG Leadership Committee.
• Added directors to the Board with expertise in electric vehicles and power grid.

Climate Goals & Targets

Environmental Challenges

• Power Solutions Group did not meet its 10% TRIR reduction target in 2021.
• Supply chain disruptions due to the COVID-19 pandemic.
• Need for a comprehensive carbon footprint assessment.

Mitigation Strategies

• Continuous improvement activities (RCA, kaizen) to address safety incidents.
• Diversifying materials sourcing to mitigate supply chain risks.
• Planning to conduct a comprehensive carbon footprint analysis and develop a reduction strategy.

Supply Chain Management

Supplier Audits: Annual audits including ESG metrics

Responsible Procurement

• Supplier Code of Conduct (to be developed)
• Self-assessment by suppliers
• Compliance with Section 1502 of the U.S. Dodd-Frank Act (conflict-free minerals)

Climate-Related Risks & Opportunities

Opportunities

• Growth in electric vehicle and power grid markets

Reporting Standards

Frameworks Used: TCFD, SASB, UN Sustainable Development Goals (SDGs)

Sustainable Products & Innovation

• Components for electric vehicles and power grid modernization

Environmental Metrics

ESG Focus Areas

• Employee Health & Safety
• Climate Impact
• Governance & Business Ethics
• Human Rights
• Human Capital
• Water & Wastewater Management
• Supply Chain Management
• Product Quality & Safety
• Community Relations
• Sustainable Products
• Air Quality
• Management of the Legal & Regulatory Environment
• Data Privacy & Security
• Materials Sourcing & Efficiency

Environmental Achievements

• Implemented several facility-level energy initiatives, resulting in approximately 2,304,000 kWh/year in energy savings.
• Reduced methanol usage by over 10,000 pounds, resulting in cost savings and a safer work environment.
• Reduced cyanide usage by 5.7% and phosphoric acid by 20% at the Attleboro, Massachusetts facility.
• Surpassed recycling goals at several facilities.
• Achieved lowest air pollution result (3.4 mg/m3) in Kamienna Góra, Poland since 2015.

Social Achievements

• Launched company-wide 8D Root Cause Analysis (RCA) program to monitor workplace safety incidents and near misses.
• Decreased Total Recordable Incidence Rate (TRIR) by 17% and Days Away, Restricted, or Transferred (DART) by 20% in 2022 compared to 2021.
• Introduced NN Connect, a global internal communication platform to support employee engagement and communication.
• Participated in various community events and volunteer opportunities.

Governance Achievements

• Updated Code of Conduct and Ethics, Whistle Blower Policy, and Non-Retaliation Policy.
• Engaged the Board of Directors to leverage their strategic expertise in key markets.

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions caused by global challenges.
• Communication challenges during the COVID-19 pandemic.

Mitigation Strategies

• Working to diversify material sourcing and improve business continuity planning.
• Developed NN Connect, a global internal communication platform.

Supply Chain Management

Supplier Audits: Some North American sites began evaluating supplier compliance, quality, and performance on a monthly basis.

Responsible Procurement

• Suppliers are expected to comply with NN’s Code of Conduct and Ethics.
• Developing a company-wide supplier code of conduct with environmental and social impact criteria.

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Expansion into electrical, electric vehicle, and automotive market segments.

Reporting Standards

Frameworks Used: TCFD, SASB, UN SDGs

Certifications: ISO 14001 (5 of 24 facilities), IATF 16949 (16 of 24 facilities), ISO 9001 (11 of 24 facilities), ISO 13485 (4 of 24 facilities), NADCAP AC7108 (1 of 24 facilities), NADCAP AC7004 (1 of 24 facilities)

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Schaeffler’s 2022 Supplier Best Quality Award
• Cummins’ two 2022 Best Delivery Performance – Direct Sourcing awards (North America and Global)

Environmental Metrics

ESG Focus Areas

• Prioritizing People
• Operating Sustainably
• Delivering Sustainable Components
• Managing Our Business

Environmental Achievements

• Reduced energy consumption by an estimated 450,000 kilowatt hours annually through various energy efficiency projects (LED lighting, machine replacement, adjusted maintenance schedules).
• Implemented various waste reduction and recycling initiatives across global sites (oil recycling, improved chip briquetting, alternative chemical sourcing).
• Improved wastewater treatment capacity in Asia and implemented daily water consumption control in France.

Social Achievements

• Delivered over 158,000 hours of training content across various topics, averaging 45 hours per employee.
• Achieved a 13% improvement in Days Away, Restricted, or Transferred (DART) rate compared to 2022.
• Increased female representation in management roles from 20% to 23%.

Governance Achievements

• Reduced the size of the Board of Directors from nine to seven, enhancing efficiency.
• Refreshed the Code of Conduct and Ethics in 2022, adding topics such as sustainability and cybersecurity.
• Updated Whistleblower and Non-Retaliation Policies in 2022.

Climate Goals & Targets

Environmental Challenges

• 2023 emissions increased approximately 3% due to growth-related factors (new machines, processes supporting new business wins).

Mitigation Strategies

• Robust analysis of emission drivers (growth, mix shift, process improvement opportunities) to mitigate similar increases in the future.

Supply Chain Management

Supplier Audits: Monthly evaluations at some North American sites

Responsible Procurement

• Sourcing raw materials from conflict-free regions (Dodd-Frank Act compliance)
• Supplier adherence to NN’s Code of Conduct and Ethics

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: TCFD, SASB, UN Sustainable Development Goals (SDGs)

Certifications: IATF 16949 (16 sites), ISO 13485 (4 sites), ISO 9001 (11 sites), ISO 14001 (5 sites), NADCAP AC7108 (1 site), NADCAP AC7004 (1 site)

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Awards from DENSO and Nidec for excellent quality performance in Wuxi, China.