Climate Change Data

Environmental Metrics

ESG Focus Areas

• Energy efficiency and climate change
• Road safety
• Quality Service
• Training and involving the employees
• Management of subcontracted parties
• Community integration
• Intelligent transport systems
• Internal social responsibility
• Financial soundness
• Innovation
• Communication
• Intermodality
• Occupational health and safety
• Differentiation from the competitors
• Peripheral position
• Supplier evaluation in matters of sustainability
• Data protection
• Ethics and Compliance

Environmental Achievements

• 14% reduction in GHG emissions since 2007
• 10% reduction in specific consumption (gep/vk) since 2007
• 5% reduction in energy consumption in ISO 14001 certified centers
• Estimated 16% reduction in plastic film consumption through automatic wrapping machines
• Ecological Products Warehouse certification at Guadalajara Logistics Operations Center

Social Achievements

• Regional Merit Award received for fight against Covid-19
• COTEC Innovative Statute awarded for innovation initiatives
• Managers of the Year award recognizing outstanding employees
• More than 400 transports carried out for the Food Bank in Portugal
• Collaboration with Fundación Madrina for food storage and distribution
• Three blood donation campaigns held at COL Carregado
• 118 employees took parental leave with 100% return to work rate

Governance Achievements

• Aggregation of Legal department and Processes & Compliance into “Legal & Compliance”
• Implementation of Supplier Risk Management methodology
• Approval of new procedure for Transport business defining rules of action for civil liability
• Continuous work on defining “Functional Profiles” for access to LS applications and systems
• Implementation of digital signatures by LS and Providers in Procurement area (pilot project)

Climate Goals & Targets

Environmental Challenges

• Quality of Service
• Safety and Health at work
• Training and Involvement of Workers
• Communication
• Financial Robustness
• Innovation
• Supply chain disruptions
• Increased fuel costs
• Increased cost of raw materials
• Increased driver salaries
• Increased tolls
• Lack of vehicle components
• Increased sale price of new and used vehicles
• Pandemic impact on economic activity
• Geopolitical tension

Mitigation Strategies

• Strengthening and automating processes
• Greater digitalisation of processes
• Improved response time to customers and suppliers through central email boxes
• Inclusion of risk assessment to support processes
• Implementation of digitalisation process in transport business
• Reduction of paper and incidents through “Printing of waybills” process
• Implementation of AGVs for pallet operation and handling at COL Cabanillas
• Voice Picking implementation in Logistics
• Cost control measures
• Investment in regular fleet renewal
• Ecodriving training
• Energy Efficiency Plan at Logistics Operations Centre in Carregado
• Regular training initiatives for employees
• Hybrid model of teleworking

Supply Chain Management

Supplier Audits: 72 audits in transport and logistics areas

Responsible Procurement

• Supplier sustainability requirements
• Code of conduct
• Letter of Commitment for the Subcontracting of Transport

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI Standards: Core option

Certifications: ISO 9001, ISO 14001, ISO 22000

UN Sustainable Development Goals

• Goal 3
• Goal 5
• Goal 7
• Goal 8
• Goal 9
• Goal 11
• Goal 12
• Goal 13
• Goal 16

Alignment of LS’ sustainability strategy with the Sustainable Development Goals (SDGs) of the United Nations

Sustainable Products & Innovation

• Gigaliners

Awards & Recognition

• Regional Merit Award
• COTEC Innovative Statute
• Ecovadis Gold Medal 2021

Environmental Metrics

ESG Focus Areas

• Energy efficiency and climate change
• Road safety
• Quality Service
• Training and involving employees
• Management of subcontracted parties
• Community integration
• Occupational health and safety

Environmental Achievements

• Reduced GHG emissions by 12% since 2007 baseline (scopes 1 and 2).
• Implemented 15 Gigaliners in Portugal and Spain, reducing GHG emissions per tonne transported by up to 30%.
• Replaced regular bulbs with LED lighting at Carregado 1 and 2 centers, expecting a 25% reduction in energy consumption.
• Developed a method for reusing angle brackets, reducing raw material consumption and cost.

Social Achievements

• Conducted 18,488 hours of training in 2022.
• Increased the total number of women employees by 13% over the previous year and 28% over 2018.
• Nine Luís Simões drivers awarded IRU Diploma of Honour for their safe driving records.
• Participated in various community initiatives, including food drives and humanitarian aid.

Governance Achievements

• Implemented actions to mitigate risks related to conflicts of interest, legal compliance with the European Directive on whistleblowing, and cybersecurity.
• Conducted 61 audits in transport and logistics in 2022 (internal, client, and external).

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions due to the war in Ukraine and rising inflation.
• Rising fuel prices and growing inflation.
• Increased workplace accidents (25% increase over 2021).
• Gender disparity in certain positions (e.g., drivers).

Mitigation Strategies

• Developed a decarbonization roadmap.
• Implemented energy efficiency plans.
• Invested in employee training and safety measures.
• Implemented actions to mitigate risks related to conflicts of interest, legal compliance, and cybersecurity.

Supply Chain Management

Supplier Audits: 52 vehicle audits (PT + ES) in 2022; 11 audits to carriers and CrossDocking platforms.

Responsible Procurement

• Purchasing Policy (February 2022) includes social and environmental considerations.
• Sub-contractor Driver Manual covers social and environmental terms.

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: GRI Standards (GRI 1: Foundation 2021)

Certifications: ISO 9001 (Quality), ISO 14001 (Environmental Management), IFS Logistics, BRC Global Standard for Storage and Distribution

Third-party Assurance: Deloitte & Associados, SROC S.A.

UN Sustainable Development Goals

• SDG 7 (Affordable and clean energy)
• SDG 8 (Decent work and economic growth)
• SDG 9 (Industry, innovation and infrastructure)
• SDG 11 (Sustainable cities and communities)
• SDG 12 (Responsible consumption and production)
• SDG 13 (Climate action)
• SDG 16 (Peace, justice and strong institutions)
• SDG 5 (Gender equality)

Not disclosed

Sustainable Products & Innovation

• Gigaliners

Awards & Recognition

• COTEC Innovator Status
• Ecovadis Gold Medal (Transport)

Environmental Metrics

ESG Focus Areas

• Climate Change
• Safety
• Quality of Service
• Employee Training and Engagement
• Supplier Management
• Community Engagement
• Compliance
• Innovation
• Financial Robustness

Environmental Achievements

• Reduced Scope 1 and 2 emissions by 12% compared to 2007 (although increased slightly compared to 2022).
• Installed photovoltaic panels at several locations in Portugal.

Social Achievements

• 18,276 hours of employee training provided.
• Implemented a hybrid telework policy.
• Reduced absenteeism by 20% in Portugal compared to 2022.

Governance Achievements

• Implemented a compliance incentive model.
• Implemented background checks for certain job roles.
• Conducted 77 audits in transport and logistics (48% internal, 40% client, 12% external).

Climate Goals & Targets

Environmental Challenges

• Cybersecurity attacks.
• Supply chain disruptions due to climate events.
• High costs of low-emission solutions.
• Client demands for more sustainable transport solutions.
• Absenteeism (increased in Spain).

Mitigation Strategies

• Developed business continuity plans.
• Implemented a compliance incentive model.
• Implemented background checks.
• Developed a performance improvement methodology for ADR compliance.
• Implemented low-emission vehicles (HVO) and improved refrigeration systems.
• Implemented photovoltaic panels.
• Ecodriving training.

Supply Chain Management

Supplier Audits: 11 audits in 2023 (3 transport, 8 cross-docking)

Responsible Procurement

• Supplier Code of Conduct
• Environmental and social criteria in procurement (for contracts > €100,000/year)

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events
• Temperature changes

Transition Risks

• Increased carbon tax
• Increased fuel prices
• High cost of low-emission solutions
• Client demands for sustainable solutions

Opportunities

• Development of energy-efficient products and services
• Implementation of low-emission vehicles and technologies

Reporting Standards

Frameworks Used: GRI Standards

Certifications: ISO 9001, ISO 14001, GDP (Cabanillas del Campo), Organic Product Warehouse (Guadalajara)

Third-party Assurance: European Quality Assurance Spain, S.L. (EQA España) - Limited assurance

UN Sustainable Development Goals

• SDG 7 (Affordable and clean energy)
• SDG 8 (Decent work and economic growth)
• SDG 9 (Industry, innovation and infrastructure)
• SDG 11 (Sustainable cities and communities)
• SDG 12 (Responsible consumption and production)
• SDG 13 (Climate action)
• SDG 16 (Peace, justice and strong institutions)
• SDG 17 (Partnerships for the goals)

The report details how various initiatives contribute to these goals.

Sustainable Products & Innovation

• Gigaliners/Megatrailers

Awards & Recognition

• CEOE Guadalajara Business Excellence Award (José Luís Simões)