Dürr : Methodology paper on the climate strategy 2030

Dürr Group Climate Strategy 2030

Methodology Paper

Status: June 2022

www.durr-group.com/en/sustainability

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Table of Contents

1. Introduction ___________________________________________________________________________________3
2. Methodology __________________________________________________________________________________4
3. Greenhouse gas emissions of the Dürr Group ________________________________________________________9
4. Target setting _________________________________________________________________________________11
5. Measures ____________________________________________________________________________________12
6. Our motto: "Invest rather than compensate" _______________________________________________________12
7. Enabling a sustainable transformation_____________________________________________________________13
8. Progress _____________________________________________________________________________________14

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1 Introduction

Climate change is one of the most pressing challenges of our time and is now more than ever a major concern for society, science, global politics as well as business. The Intergovernmental Panel on Climate Change (IPCC), in its

• Sixth Assessment Report ("Climate Change 2022: Impacts, Adap- tion and Vulnerability"), shows that global warming of 2.0°C

will be exceeded during the 21st century unless deep reductions in carbon dioxide (CO2) and other greenhouse gas (GHG) emissions are realized promptly and tightened over the upcoming decades. Recent →scientific projections are alarming, indicating a global warming between 2.0°C and 3.6°C in the year 2100, compared to pre-industrial times (status: June 2022).

Global warming beyond 1.5°C will entail significant climate- related risks and irreversible damage to natural habitats, ecosystems and biodiversity. It is most likely that exceeding this threshold will lead to a global increase in the frequency and intensity of weather extremes, droughts and tropical cyclones as well as an irreversible loss of the Arctic ice shield, snow cover and permafrost.

Gt CO2e

40

30

20

10

years

1980

2020

2060

1| Development of global CO2 emissions in bn tons

(Source: IPCC 2018,IPCC 2021)

Climatechangeis man-made.A large proportion of gases that are harmful to the climate are attributable to the combustion of fossil fuels. The mitigation of climate change requires rapid and effective action by all actors. In this context, the Dürr Group actively assumes responsibility: We have published our ambitious climate strategy in No- vember 2021, based on scientific targets and validated by the → Science Based Targets initiative (SBTi). We are committed to the resolutions of the Paris Climate Convention (2015), which have recently been reaffirmed at the UN Climate Change Conference in Glasgow (2021). We underline our commitment by signing the → Business Ambition for 1.5°C, by participating in the global → Race to Zero campaign and - as a company with strong roots in Baden-Württemberg(Ger- many) - by joining the → Baden-Württemberg Climate Alliance.

Ecological sustainability has a long tradition at the Dürr Group. As one of the world's leading mechanical and plant engineering firms, our technologies make a significant contribution to reducing emissions in production at customers' sites worldwide. Since the 1960s, we have been active in developing environmental technologies. In addition, we consequently support our customers in driving current sustainability megatrends, such as battery production, the manufacture of renewable technologies and industrial scale timber house construction.

This document describes the principles and frameworks used to calculate and manage our direct operational carbon footprint as well as the methodology for collecting and estimating indirect GHG emissions in upstream and downstream processes. It is intended to provide insights into our data collection process as well as calculation methods. In addition, it serves as a guidance for companies that have not yet implemented a climate strategy. This document will be updated on a regular basis, so that interested stakeholder groups can track our progress toward achieving our climate targets.

It is imperative to limit global warming to a maximum of 1.5°C. We have a responsibility to achieve that goal as a company not only toward our investors or customers but also toward our employees, society and ultimately ourselves. We hope that this paper will encourage our business partners and suppliers to follow our path toward climate neutrality, by setting ambitious climate targets and defining credible measures for sustainable transformation.

Dürr AG - Bietigheim-Bissingen, June 20, 2022

Our five pillars for climate protection:

• We are committed to the decisions of the Paris Climate Agreement.
• Application of the Greenhouse Gas Protocol as a stand- ardized approach for calculating emissions
• Validation of targets by the Science Based Targets initiative (SBTi)
• Science-basedclimate strategy in line with the 1.5°C target
• "Invest rather than compensate": Based on the current state of scientific research, climate certificates are no option!

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→World Resources Institute (WRI)

2 Methodology

The calculation of the Dürr Group's carbon footprint is

based on the guidelines of the →Greenhouse Gas Protocol

(GHG Protocol) of the → World Resources Institute (WRI) and the

• World Business Council for Sustainable Development (WBCSD).

The GHG Protocol is the world's leading standard for GHG accounting, establishing a comprehensive framework for measuring GHG emissions from private and public sector operations as well as supply chains and for managing mitigation measures.

In addition, our climate strategy was developed in accordance with the requirements of the SBTi, a partnership between the → Carbon Disclosure Project (CDP), the → United

Nations Global Compact, the

and the → World Wide Fund for Nature (WWF). The SBTi encourages companies to set targets for reducing carbon emissions at levels necessary to meet the goal of 1.5°C or well below 2°C compared to pre-industrialtemperatures defined in the Paris Climate Agreement. The independent initiative examines reduction targets based on the latest climate science findings. Our GHG emission reduction targets were validated and approved by the SBTi and are in line with the global 1.5°C target.

2| SBTi approval letter

(Source: Dürr AG)

Greenhouse gases are atmospheric gases that trap heat in the atmosphere, thus contributing to the increase in global average temperature. Their respective Global Warming Potential (GWP) indicates the impact of all greenhouse gases on the climate compared to the impact of carbon dioxide. The → United Nations Framework Convention on Climate Change (UNFCCC) has defined seven greenhouse gases that need to be evaluated: carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFCs), perfluoro- carbons (PFCs), sulphur hexafluoride (SF6), and nitrogen tri- fluoride (NF3). In order to improve comparability, all emissions can be converted into so-calledCO2 equivalents (CO2e).

For the calculation of our GHG emissions, the Dürr Group applies the principles of the GHG Protocol Corporate Standard:

• Relevance: ensure that the GHG inventory appropri- ately reflects the GHG emissions of the company and serves the decision-making needs of users, both inter- nal and external to the company.
• Completeness: account for and report on all GHG emis- sion sources and activities within the chosen inventory boundary. Disclose and justify any specific exclusions.
• Consistency: use consistent methodologies to allow for meaningful comparisons of emissions over time. Trans- parently document any changes to data, inventory boundary, methods, or any other relevant factors in the time series.
• Transparency: address all relevant issues in a factual and coherent manner, based on a clear audit trail. Disclose any relevant assumptions and make appropri- ate references to the accounting and calculation meth- odologies and data sources used.
• Accuracy: ensure that the quantification of GHG emis- sions is systematically neither above nor below actual emissions, as far as this can be assessed, and that uncertainties are reduced as far as practicable. Achieve sufficient accuracy to enable users to make decisions about the integrity of reported information with rea- sonable confidence.

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2.1 Organizational boundaries

The choice of system boundaries helps determine which locations, either directly or indirectly connected to the company, are to be covered by climate management. For the calculation of its carbon footprint, the Dürr Group has applied the operational control approach and is therefore responsible for 100% of the GHG emissions from operations and activities over which it has control.

Due to the coronavirus pandemic and the associated special impact on our business, the year 2019 was chosen as a realistic base year for our climate strategy.

Since 2010, the Dürr Group has been collecting climate data from all its locations worldwide on an annual base. In the base year 2019, 46 sites out of 120 locations were accountable for 95% of the Dürr Group's total emissions. For these selected locations, additional querying and detailed analysis was carried out to verify existing data and collect additional data.

2.2 Operational boundaries

The GHG Protocol distinguishes between Scope 1, 2 and 3 for calculating carbon footprints.

		CH4	HFCs	PFCs	SF6
CO2		N2O
	Scope 2		Scope 1
		direct
	indirect

purchased goods and services

capital goods

fuel and energy related activities

transportation and distribution

purchased electricity, steam, heating and cooling for own use

company facilities

Scope 3

indirect company

vehicles

leased assets

employee commuting

business travel

transportation	Scope 3
indirect
and distribution

processing of

sold goods

investments

use of sold

products

franchises

leased assets

end-of-life treatment

of sold products

waste generated in operations

Upstream activities

Reporting company

Downstream activities

3| Overview of the three scopes of the GHG Protocol

(Source: GHG Protocol)

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