BMW Group

BMW AG is a stock corporation (Aktiengesellschaft) within the meaning of the German Stock Corporation Act. It has an executive Board of Management and a Supervisory Board that monitors how the Company is managed by the Board of Management.

Board of Management – Duties, diversity, expertise

The Board of Management has overall responsibility for the management of BMW AG. It defines the strategy and resource framework and takes actions to implement the strategy. The Board of Management decides on product and customer-related issues of particular importance and consequence to the BMW Group, as well as on automobile product strategy. The Board of Management incorporates various sustainability matters into the decisions taken at its meetings and addresses the material impacts, risks and opportunities associated with the Company's course of business.

As at 31 December 2024, 14% of the seven members of the Board of Management were female and 86% were male based on the composition principles and taking into account the ESRS reporting obligations.

The Board of Management must comprise at least one man and one woman. The Board of Management deals with the impacts, risks and opportunities arising from business development on a continuous basis.

Supervisory Board – Composition, diversity, expertise

BMW AG's Supervisory Board is composed of ten shareholder representatives (elected by the Annual General Meeting) and ten employee representatives (elected in accordance with the German Co-Determination Act). Female members made up 30% of the Supervisory Board at the end of 2024.

Skills Matrix Board of Management and Supervisory Board

Both the Board of Management and Supervisory Board have expertise across all material sustainability topics including:

• Climate change
• Pollution
• Water and marine resources
• Biodiversity and ecosystems
• Circular economy and resource use
• Own workforce
• Workers in the value chain
• Consumers and end-users
• Business conduct

Supervisory Board – Duties and committees

The Supervisory Board monitors the activities of the Board of Management and advises the Board of Management on important matters relating to the management and the strategic development of the Group. Sustainability issues and their associated material impacts, risks and opportunities are of key importance to the Supervisory Board.

The Supervisory Board has established committees including:

• Presiding Board - prepares meetings and addresses sustainability matters
• Audit Committee - reviews sustainability reporting and monitors ESG risks
• Personnel Committee - addresses Board of Management remuneration including sustainability targets
• Nomination Committee - prepares election proposals considering diversity objectives

The Board of Management incorporates various sustainability matters into the decisions taken at its meetings and addresses the material impacts, risks and opportunities associated with the Company's course of business. It also monitors the key sustainability-related indicators and targets as well as department-specific sustainability activities and developments.

The Board of Management regularly discusses:

• Reports related to the latest business developments
• The current market environment, financial and non-financial risks
• The Group risk strategy and the effectiveness of the risk management system
• The development of the workforce, diversity, and ongoing qualification and retraining measures
• Ongoing compliance activities and potential risks
• The implementation status of corporate due diligence requirements relating to respect for human rights and associated environmental standards

Progress Reports: The Sustainability and Mobility function submits progress reports on the BMW Group's overarching sustainability targets to the Board of Management at least three times a year. The targets and measures with regard to reducing CO2e emissions in all scopes, the circular economy, environmental and social standards and social sustainability are presented, and the strategic and operational implementation status is discussed.

Materiality Assessment: The results of the materiality assessment, including the material impacts, risks and opportunities, are presented to the Board of Management by the Group Reporting function for discussion.

Supervisory Board Reporting: At each of its meetings, the Board of Management presents the material impacts, risks and opportunities related to the latest business developments in its report on the current business situation to the Supervisory Board.

Annual ESG Reporting: Every September, the Supervisory Board receives a report from the Chairman of the Board of Management and the Board of Management member responsible for Finance on the extent to which key ESG targets have been achieved. These include targets for:

• Reducing carbon emissions
• The proportion of all-electric vehicles to total deliveries
• The fulfilment of sustainability requirements by suppliers
• The proportion of women in management positions
• The amount of spending on employee training and development

Board of Management Remuneration

The total remuneration provided to the members of the Board of Management consists of fixed and variable components. Variable remuneration accounts for 58-66% of the total target remuneration.

Performance Component Structure

The performance component of the bonus rewards the achievement of certain non-financial performance criteria defined by the Supervisory Board. These criteria are divided into:

• Individual targets for individual Board of Management members (departmental targets) - 10% of target amount
• Collective targets for the entire Board of Management (interdepartmental targets) - 90% of target amount

Sustainability Integration

The interdepartmental targets include sustainability-related performance criteria and other non-financial criteria:

• 50% weighting for sustainability-related targets
• 40% weighting for other non-financial targets

Long-term Component

The share-based remuneration as a variable long-term component depends on target achievement for financial indicators including return on capital employed (RoCE).

Target Setting and Review

The Board of Management's remuneration targets for each year are set in December of the previous year. A meeting is held in March to:

• Review the extent to which targets for the past financial year have been achieved
• Pass a resolution on the Board of Management's remuneration

The achievement of material ESG targets is discussed as part of the reporting on the annual and Group Financial Statements and is integrated into the remuneration system for the Board of Management.

The BMW Group has implemented comprehensive due diligence processes across its operations and value chain:

Human Rights Due Diligence

The due diligence processes for respecting human rights and related environmental standards apply to:

• Our own business
• Our suppliers
• Our other business partners

Supply Chain Due Diligence

Organizational Structure: In 2024, responsibility for developing procedures and implementing due diligence processes in the supply chain was firmly embedded in the purchasing strategy and strengthened by the establishment of a dedicated department.

Standards and Requirements: The ↗ BMW Group Supplier Code of Conduct stipulates that affected (local) communities, and indigenous peoples especially, must also be taken into account and protected across the supply chain.

Risk Assessment and Site Evaluation

Environmental Assessment: All sites that require an environmental assessment and approval under national law are subject to due diligence processes. This includes:

• All production sites
• Component production facilities
• Research and Innovation Centre (FIZ)
• Test tracks
• Distribution centres

New Site Assessment: New sites are assessed for impacts and risks using:

• Environmental due diligence
• Environmental impact analysis
• Climate risk assessments
• Baseline assessments of biodiversity (where required)

Materiality Assessment Integration

The Company's established environmental, social and governance due diligence processes form the starting point for identifying impacts on the environment and society along the BMW Group value chain as part of the materiality assessment.

Stakeholder Engagement

Maintaining an ongoing dialogue with civil society, affected communities and other relevant stakeholders in the supply chain is a key component in the approach to dealing with critical raw materials.

Grievance Mechanisms

Stakeholders can report compliance-related concerns through:

• The ↗ BMW Group Compliance Contact
• The ↗ BMW Group SpeakUP Line (available in all countries where BMW Group employees work via local, toll-free telephone numbers in more than 30 languages)

The BMW Group is involved in RBA Voices, a standardised, cross-industry grievance mechanism available for download from the Apple App Store and the Google Play Store.

Internal Control System Structure

The BMW Group has established comprehensive internal control systems for sustainability reporting integrated into its governance structure:

Board Level Controls

Board of Management Oversight: The Board of Management regularly discusses:

• The effectiveness of the risk management system and internal control system
• Material impacts, risks and opportunities arising from business development
• ESG risks as part of comprehensive risk reporting

Committee Structure

Audit Committee Responsibilities: The Audit Committee is responsible for:

• Monitoring the effectiveness of the internal control system
• Overseeing the internal audit system
• Monitoring the internal Compliance Management System
• Reviewing sustainability reporting and the financial reporting process
• Preparing internal and external audits for sustainability reporting

Risk Management Integration

Risk Reporting: The Committee receives detailed reports every six months on:

• Risk management and risk strategy
• Current risk situation
• Extent to which risk cover funds have been utilised
• ESG risks are included in these reports

Compliance Reporting: The Chief Compliance Officer reports to:

• The Audit Committee twice a year on compliance matters and Compliance Management System changes
• The Supervisory Board once a year

Sustainability-Specific Controls

Sustainability Function: The Sustainability and Mobility function:

• Ensures high-level management of sustainability topics as part of Group strategy
• Identifies areas where the Company potentially needs to take action
• Defines targets to be achieved
• Ensures sustainability issues are considered in all material Company decisions

Progress Monitoring: Progress reports on overarching sustainability targets are submitted to the Board of Management at least three times a year.

Data Quality and Verification

Skills Assessment: Both Board of Management and Supervisory Board members are surveyed annually on their sustainability expertise. The Legal, Patents and Group Compliance Management department verifies the plausibility of information provided.

External Validation: For materiality assessment mapping, the BMW Group arranged for its mappings to be validated by two external consulting firms.

Regulatory Compliance

ESRS Implementation: The Board of Management holds regular discussions on:

• Processes and actions for implementing new regulatory requirements
• Ensuring compliance with external reporting requirements in sustainability
• The extent to which CSRD/ESRS requirements have been implemented

BMW Group Strategy and Business Model

The aim of the BMW Group Strategy is to find the right balance between business, the environment and society. The key areas of focus within the strategy are:

• Electrification
• Digitalisation
• Sustainability or circularity

Sustainability encompasses the strategic organisation of the entire value chain. Sustainability considerations are therefore integrated in corporate structures and processes in a comprehensive and holistic manner.

Operating Segments

The BMW Group's business model comprises three segments:

Automotive Segment

• Development and manufacturing of premium automobiles
• Focus on all drivetrain technologies with strong emphasis on electromobility
• 17.4% of total deliveries in 2024 were all-electric vehicles

Motorcycles Segment

• Development and manufacturing of premium motorcycles
• Various drivetrain technologies including electric options

Financial Services Segment

• Credit financing and leasing of BMW Group vehicles
• Fleet business for commercial customers
• Key role in the sales system

Value Chain Structure

Upstream Value Chain

Comprises a multi-layered network of suppliers providing:

• Production materials
• Raw materials
• Components
• Capital goods
• Services for vehicle and parts production

Own Operations

• Global production network with plants being transformed for electromobility
• Research and Innovation Centre (FIZ)
• Vehicle testing facilities
• Component production

Downstream Value Chain

• Global sales network for vehicle distribution
• Customer care and maintenance services
• Vehicle recycling and dismantling (thousands of vehicles recycled annually)
• Use phase of vehicles by customers

Workforce

At 31 December 2024, the BMW Group employed 158,441 people worldwide.

Strategic Sustainability Goals

Climate Targets

• Net zero carbon emissions across entire value chain by 2050 at latest
• Aligned with 1.5°C pathway of Paris Agreement for Scope 1 and 2 emissions
• Well-Below-Two-Degree (WB2C) approach for Scope 3 emissions
• Reduce carbon emissions by at least 40 million tonnes by 2030 compared to 2019

Circular Economy

• Guided by principles: Re:think, Re:duce, Re:use, Re:cycle
• Increasing secondary raw material quota
• Closing material loops within automotive industry

Product Innovation

• NEUE KLASSE model generation launching 2025 with emphasis on efficiency and supply chain sustainability
• Hydrogen fuel cell variant planned for 2028
• Technology openness approach across all drivetrain types

Workforce Development

• Strategic goal of increasing proportion of women in management positions
• Continuous investment in employee expertise and training
• "Just Transition" approach combining transformation with modern, safe workplaces

The BMW Group attaches great importance to regular, frank and transparent dialogue with its stakeholders. The goal is to build trust, increase transparency and awareness, and facilitate the transfer of knowledge by providing information and opportunities for dialogue.

Stakeholder Policy and Groups

The Company revised its ↗ Stakeholder Engagement Policy in 2024, reviewing and redefining its key stakeholders. A distinction is made between:

• Affected stakeholders - directly or indirectly affected by business activities
• Users of sustainability statements - mainly consumers of general reporting (e.g., investors, business partners)

Key Stakeholder Groups

Internal Stakeholders

Employees (158,441 worldwide):

• Company-wide employee survey conducted every two years
• Participation through company ideas management system
• Works council representation and collective bargaining
• Due diligence processes for human rights apply to own workforce

Board of Management and Supervisory Board:

• Regular briefings on stakeholder feedback and views
• Direct dialogue with stakeholders such as investors and political decision makers
• Attendance at Annual General Meeting

External Stakeholder Groups

Investors and Financial Community:

• Regular conferences and analyst meetings
• Financial statement press conferences
• Incorporation of feedback into corporate and business strategies

Customers:

• Market research through global surveys to determine needs and expectations
• Customer satisfaction surveys and market research (e.g. Corporate Reputation Study)
• My BMW App for direct engagement
• Discussions with consumer bodies

Suppliers and Business Partners:

• Supplier theme days
• Various dialogue formats
• Integration into due diligence processes
• Partner academy programs

Affected Communities:

• Work directly with affected communities or local representatives
• Example: Local stakeholders closely involved in planning new battery assembly plant in Irlbach-Strasskirchen
• Designated contacts at BMW Group locations for stakeholder relations
• Ongoing dialogue regarding critical raw materials in supply chain

Scientific Community:

• International Sustainable Mobility Research Platform (ISMO) established 2024
• Partnership with four renowned universities: Cambridge (UK), Friedrich-Alexander-Universität Erlangen-Nürnberg (Germany), Harvard (USA), Tsinghua University (China)
• Board of Management involvement in discussing research results twice yearly from 2025

Civil Society and NGOs:

• Regular participation in public and political discussions
• Engagement during events like London Climate Week
• BMW Group award for social responsibility

Political Stakeholders:

• Participation in committees and working groups
• Memberships in initiatives and associations
• Regular briefings before major events (OECD conferences, AGM)

Industry and Multi-Stakeholder Initiatives

Active engagement in:

• Branchendialog Automobilindustrie
• Supply Chain Sustainability Working Group of German Association of Automotive Industry (VDA)
• Responsible Business Alliance (RBA)
• Drive Sustainability
• RBA Voices - standardised, cross-industry grievance mechanism

Communication Channels

Multiple channels available for stakeholder engagement:

• Main email addresses
• ↗ BMW Group Compliance Contact
• ↗ BMW Group SpeakUP Line (available in 30+ languages via toll-free numbers)
• Plant tours, BMW Welt, BMW museum
• Social media, company website, press releases
• Conferences, industry dialogues, studies

Integration into Decision Making

Strategy Development: External viewpoints and expectations help develop strategy and promote BMW Group's innovative strength.

Environmental Analysis: Stakeholder feedback incorporated into environmental and trend analyses, which feed into corporate and business department strategies.

Materiality Assessment: Most important external stakeholders included in materiality assessment through structured interview formats and virtual stakeholder forums with external moderators.

Board Level: Chairman of Supervisory Board maintains regular contact with stakeholders; Supervisory Board members interact with stakeholders through other activities and mandates.

Material Sustainability Topics Identified

The BMW Group's ESRS-based materiality assessment identified 85 material impacts, risks and opportunities across 31 sustainability sub-topics and sub-sub-topics. These are categorized across the entire value chain:

Environmental (E)

• E1 Climate Change: Climate change adaptation, Climate change mitigation, Energy
• E2 Pollution: Pollution of water, Pollution of soil, Microplastic
• E3 Water and Marine Resources: Water consumption, Water withdrawals
• E4 Biodiversity: Direct exploitation
• E5 Circular Economy: Resources inflows including resource use, Resource outflows related to products and services, Waste

Social (S)

• S1 Own Workforce: Health and safety, Gender equality and equal pay, Diversity, Training and skills development, Secure employment, Social dialogue
• S2 Workers in the Value Chain: Working time, Freedom of association including work councils, Health and safety, Training and skills development, Measures against violence and harassment, Child labour, Forced labour
• S4 Consumers and End-Users: Access to quality information, Privacy, Health and safety, Protection of children

Governance (G)

• G1 Business Conduct: Political engagement and lobbying activities, Corruption and bribery prevention and detection including training

Interaction with Strategy and Business Model

Climate Change Integration

The BMW Group directly and indirectly generates greenhouse gas emissions worldwide through:

• Upstream processes and raw material procurement
• Development and production activities
• Supply and use of products and services

Strategic Response:

• Offering electrified vehicles (BEV, PHEV, FCEV)
• Expanding use of CO2e-free energy including through PPAs
• Contributing to progressive decarbonisation
• Target: Reduce carbon emissions by at least 40 million tonnes by 2030 compared to 2019

Circular Economy Integration

Incorporating circular economy principles into business models and products is an important step towards:

• Reducing use of natural and limited resources
• Contributing to CO2 emissions reduction
• Preserving biodiversity
• Mitigating environmental and social impacts from primary material extraction

Strategic Elements:

• Re:think, Re:duce, Re:use, Re:cycle principles
• Increasing proportion of recycled materials in products
• Closing material cycles within automotive industry

Workforce Diversity

Diversity is an important element of the BMW Group's competitiveness:

• Strategic target: Increasing proportion of women in management positions
• Consistent support for employees to acquire new professional qualifications
• Investment in training and education at all locations

Material Impacts Assessment

Methodology: Double materiality approach considering:

• Inside-out perspective: BMW Group's impacts on environment and society
• Outside-in perspective: External sustainability factors influencing business model

Value Chain Coverage:

• Upstream: Multi-layered supplier network
• Own Operations: Production, R&D, testing facilities
• Downstream: Sales network, customer use phase, recycling

Resilience Analysis

Strengthening resilience is a key concern through:

• Early Recognition: Changes in environment identified early
• Scenario Planning: Alternative development scenarios considered
• Risk Management: Effective management of risks and opportunities
• Supply Chain Resilience: Expanding resilient global supply chains
• Digitalisation: Across entire supply chain for sustainable management

Environmental Analysis: Regularly updated analysis based on selected relevant topics including assessment of political and regulatory framework conditions.

Financial Effects

Current Impacts:

• Competition in electrified vehicle market intensified in reporting year
• Regulatory restrictions on certain energy sources (e.g., biogas) - financial effects avoided through hedging activities

Forward-Looking: No material risks or opportunities identified with significant probability of occurrence in 2025 that would result in material adjustment to carrying amounts of assets and liabilities.

Time Horizons

• Short-term: 2024 financial year
• Medium-term: 2025-2030 (2025-2035 for climate-related impacts)
• Long-term: After 2030 (after 2035 for climate-related impacts)

Most material impacts have already materialised, with ongoing management through established policies, targets, and measures across the value chain.

Materiality Assessment Process

The BMW Group conducted its first materiality assessment based on the European Corporate Sustainability Reporting Directive (CSRD) and ESRS, following the double materiality approach outlined in ESRS 1.

Four-Step Methodology

Step 1: Identification and Assessment

Topic Review: First step involves reviewing relevant sustainability topics identified from previous BMW Group materiality assessments, extended to meet ESRS requirements. New sustainability-related topics added in areas of:

• Strategy
• Board of Management remuneration
• Competition
• Environmental analysis

Impact Formulation: Negative or positive impacts on environment and society formulated for each sustainability topic along entire BMW Group value chain. Starting point is the Company's established environmental, social and governance due diligence processes, supplemented by new impacts not yet subject to detailed monitoring.

Assessment Methodology: Tool-supported assessment by internal experts using scale of 1 to 4. Material threshold: Impact, risk or opportunity exceeds 2.

Severity Assessment:

• Scope × Scale = Severity
• For negative impacts: remediation extent considered
• For potential impacts: probability of occurrence applied
• Risks/opportunities: financial scale × probability of occurrence

Value Chain Coverage: Both upstream (supply chain) and downstream value chain considered. Business conduct impacts focus on supplier relationship management.

Mitigating Actions: Effective mitigating actions already implemented during reporting period taken into account.

Step 2: Stakeholder Consultation

Affected stakeholders and sustainability statement users consulted:

• Investors
• Works Council of BMW AG (employee representatives)
• Customers
• Suppliers and business partners
• Network partners
• Civil society representatives, NGOs
• Political and scientific representatives

Method: Structured interview formats including virtual stakeholder forums with external moderators. Stakeholders placed in E, S, or G groups based on expertise.

Step 3: ESRS Mapping

Material sustainability topics assigned to individual ESRS disclosure requirements. BMW Group mapped topics independently and arranged validation by two external consulting firms due to absence of final European Commission mapping matrix.

Step 4: Validation and Finalization

Outcomes explained to relevant bodies, particularly Board of Management and Audit Committee of BMW AG. Results discussed with decision makers and adjusted if necessary.

Climate-Related Specific Processes

Physical Climate Risks

Scenario Analysis: Three IPCC climate scenarios used:

• Low-emissions: <+1.5°C (Paris Agreement, SSP1-1.9)
• Medium scenario: +2.5°C (intermediate, SSP2-4.5)
• High scenario: >+4°C (fossil-fueled development, SSP5-8.5)

Risk Assessment: Site-specific risk data from external insurance company for all relevant BMW Group and supplier sites. Average annual expected damage loss calculated using:

• Location-related hazard situation
• Exposure
• Site-related vulnerabilities

Transitory Climate Risks

Assessed for medium-term using climate-related risk drivers and qualitative expert assessments. Include:

• Regulatory risks
• Technology risks
• Capital and financial market risks
• Market risks

Integration: All short-term risks from own operations and value chain assessed for transitory climate risks. Material climate-relevant risks included in scenario analysis.

Water-Related Assessment

LEAP Approach Applied: Locate, Evaluate, Assess, Prepare methodology:

Phase 1 - Locate:

• Aqueduct tool used to identify geographic areas affected by water-related risks
• BMW Group sites and upstream/downstream activities considered
• Sites in areas subject to high water stress identified

Phase 2 - Evaluate: Materiality of impacts assessed using river basins as relevant level, combined with operational risk assessment. Water Framework Directive 2000/60/EG criteria considered.

Phase 3 - Assess:

• Transitory risks/opportunities: Legal, political, technological, market, reputational changes
• Physical risks: Water scarcity, water stress, water quality deterioration
• Opportunities: Resource efficiency, market diversification, financing opportunities

Environmental Pollution Assessment

Site-Specific Analysis: Sites with particular influence on business activities examined. Risk assessment performed for each influential site:

• Environmental impact assessments
• Case-by-case certification depending on risks
• High-risk sites subject to damage reduction measures

New Site Assessment:

• Environmental due diligence
• Environmental impact analysis
• Climate risk assessments
• Baseline biodiversity assessments (where required)

Results and Validation

Material Outcomes: 85 impacts, risks and opportunities identified as material, assigned to 31 sustainability sub-topics and sub-sub-topics.

Stakeholder Validation: Material topics identified by internal assessment confirmed by surveyed stakeholder groups. Information on adjusting topic relevance incorporated into validation.

Disclosure Mapping: 31 material sustainability sub-topics associated with over 500 individual disclosure requirements (data points) for 2024 financial year in accordance with respective ESRS.

Review Process

First-Time Application: 2024 marked first ESRS-based materiality assessment - no prior year comparison possible.

Future Reviews: Results review planned following 2024 BMW Group Report publication during 2025 financial year and ongoing in subsequent years.

Based on the materiality assessment, the BMW Group has identified the following material sustainability topics that are covered by ESRS disclosure requirements:

Environmental Standards (E)

E1 - Climate Change

Material Sub-topics:

• Climate change adaptation
• Climate change mitigation
• Energy

Associated Disclosure Requirements: The BMW Group reports on climate-related policies, targets, actions, energy consumption and mix, GHG emissions across all scopes, and anticipated financial effects from climate risks and opportunities.

E2 - Pollution

Material Sub-topics:

• Pollution of water
• Pollution of soil
• Microplastic

Associated Disclosure Requirements: Covered through policies, actions, targets and metrics related to pollution prevention and management.

E3 - Water and Marine Resources

Material Sub-topics:

• Water consumption
• Water withdrawals

Associated Disclosure Requirements: The BMW Group reports on water-related policies, actions, targets, and consumption metrics, particularly for sites in water-stressed areas.

E4 - Biodiversity and Ecosystems

Material Sub-topics:

• Direct exploitation

Associated Disclosure Requirements: Covered through biodiversity-related policies, actions and impact assessments.

E5 - Resource Use and Circular Economy

Material Sub-topics:

• Resources inflows, including resource use
• Resource outflows related to products and services
• Waste

Associated Disclosure Requirements: The BMW Group reports on circular economy policies, actions, targets, resource inflows and outflows following the Re:think, Re:duce, Re:use, Re:cycle principles.

Social Standards (S)

S1 - Own Workforce

Material Sub-topics:

• Health and safety
• Gender equality and equal pay for work of equal value
• Diversity
• Training and skills development
• Secure employment
• Social dialogue

Associated Disclosure Requirements: Comprehensive reporting on workforce policies, processes, targets, and metrics including diversity statistics, training investments, health and safety performance, and collective bargaining coverage.

S2 - Workers in the Value Chain

Material Sub-topics:

• Working time
• Freedom of association, including the existence of work councils
• Health and safety
• Training and skills development
• Measures against violence and harassment in the workplace
• Child labour
• Forced labour

Associated Disclosure Requirements: Covered through supply chain due diligence processes, supplier code of conduct requirements, and value chain worker protection measures.

S4 - Consumers and End-Users

Material Sub-topics:

• Access to (quality) information
• Privacy
• Health and safety
• Protection of children

Associated Disclosure Requirements: Addressed through consumer protection policies, product safety measures, and data privacy frameworks.

Governance Standards (G)

G1 - Business Conduct

Material Sub-topics:

• Political engagement and lobbying activities
• Corruption and bribery – Prevention and detection including training

Associated Disclosure Requirements: The BMW Group reports on business conduct policies, anti-corruption measures, compliance management systems, and political engagement activities.

General Disclosures (ESRS 2)

All material topics are supported by ESRS 2 general disclosures covering:

• Governance: Board roles, risk management, due diligence processes
• Strategy: Business model, stakeholder engagement, material impacts integration
• Impact Management: Identification and assessment processes

Disclosure Scope and Coverage

Total Disclosure Requirements: The 31 material sustainability sub-topics and sub-sub-topics are associated with over 500 individual disclosure requirements (data points) for the 2024 financial year.

Value Chain Integration: Disclosure requirements address impacts, risks and opportunities across:

• Upstream value chain (supplier network)
• Own operations (production, R&D, testing)
• Downstream value chain (sales, customer use, recycling)

Cross-Reference System: Detailed ↗ ESRS Index provides complete mapping of disclosure requirements and referenced data points throughout the sustainability statement.

Materiality Considerations

Bottom-up Approach: Materiality assessed at lowest topic level, meaning topics classified as non-material under ESRS may still hold significant importance for the BMW Group.

Mitigating Actions: Assessment factors in effective, Group-wide mitigating actions already implemented, which may affect materiality determinations compared to other companies.

Legal Compliance: Legally compliant behaviour remains a top priority for the BMW Group even in areas classified as non-material under ESRS.

This comprehensive coverage ensures that all material sustainability aspects of the BMW Group's operations and value chain are addressed through appropriate ESRS disclosure requirements.

Transition plan for climate change mitigation

Scope of the plan

The BMW Group's transition plan covers the entire value chain:

• Own operations: All BMW Group production sites and locations (Scope 1 and 2)
• Upstream value chain: Multi-layered network of suppliers providing production material, raw materials, components, capital goods and services (Scope 3 upstream)
• Downstream value chain: Global sales network, customer use phase, and end-of-life treatment (Scope 3 downstream)

The plan encompasses all segments: Automotive, Motorcycles, and Financial Services. The reporting entity covers all companies included in the BMW Group's Financial Statements, with subsidiaries incorporated in full and joint operations on a proportionate basis.

The Chinese joint operation Spotlight Automotive Ltd. is partially excluded from certain supply chain metrics for the reporting year, though the BMW Group supports it with implementation and further development of management approaches.

Target year(s) for net zero / carbon neutral

Net Zero by 2050 at the latest: The BMW Group aims to achieve net zero CO2e emissions across the entire value chain (Scope 1, 2 and 3) by no later than 2050. This means reducing CO2e emissions by at least 90% compared to the base year 2019, with a maximum of 10% of base year emissions to be neutralised through permanent CO2 sinks.

Scope 1, 2, 3 reduction milestones with baseline years

Base year: 2019 (150.1 million tonnes CO2e total)

2030 targets (absolute reduction of at least 40 million tonnes CO2e to 108.6 million tonnes CO2e):

• Scope 1 + 2 combined: 0.635 million tonnes CO2e by 2030 (46.3% reduction from 1.182 million tonnes in 2019)

  • Approximately three quarters allocated to Scope 1, one quarter to Scope 2
  • Scope 2 calculated using market-based method

• Scope 3 (Automotive segment): 108 million tonnes CO2e by 2030 (27.5% reduction from 148.9 million tonnes in 2019)

  • Covers Purchased goods and services, Logistics (Upstream transportation and distribution), and Use phase
  • These categories account for more than 95% of all reported Scope 3 emissions

Excluded Scope 3 categories: Business travelling, Employee commuting, and End-of-Life treatment excluded from targets due to relatively small volumes or lack of direct influence.

2035: The time horizon of the target corridor will be extended through derivation of guidelines for 2035.

Alignment with 1.5°C / SBTi validation status

SBTi alignment:

• The BMW Group joined the Science Based Targets initiative (SBTi) and validated its relative decarbonisation targets in 2020
• Scope 1 and 2: Aligned with 1.5°C pathway in accordance with Paris Agreement
• Scope 3 (Automotive segment): Aligned with Well-Below-Two-Degree (WB2C) approach
• Targets developed using science-based, cross-sectoral methods aligned with SBTi approach

Current validation status: Ongoing revisions to SBTi guidelines (expected to continue until at least end of 2025) and interim requirements currently prevent validation of the absolute targets. At the time of target derivation, the Scope 3 target for 2030 fully meets SBTi Well Below Two Degrees pathway requirements, but is approximately 30% higher than theoretical 1.5°C pathway targets.

Paris Agreement commitment: The BMW Group is fully committed to the Paris Agreement and its climate targets contribute to the ambitious targets for limiting global warming.

Key levers / decarbonization pillars

Scope 1 and 2 (Own operations):

• Energy efficiency measures
• Electricity from renewable sources via Power Purchase Agreements (PPAs)
• Energy Attribute Certificates (e.g. guarantees of origin)
• Replacing natural gas with non-fossil energy sources: biogas, green hydrogen, electricity from renewable sources
• Site-specific geothermal energy, renewable district heating, power-to-heat systems
• Planning premise: new sites operated without fossil fuels (approved by Board of Management)
• Example: Debrecen plant (Hungary) - all paint line processes powered by electricity instead of natural gas; all production-related electricity from renewable sources

Scope 3 Upstream (Supply chain):

• Use of electricity from renewable sources in supplier operations
• Secondary materials and raw materials from CO2e-reduced production processes
  • Aluminium: up to 80% CO2e reduction
  • Steel: up to 70% CO2e reduction, including direct reduction processes
  • Glass and plastics: beneficial effect from renewable electricity use
• Agreements with raw material suppliers (aluminium, precious metals)
• Agreements with high-voltage battery cell suppliers
• Next generation battery technology (NEUE KLASSE): approximately one-third reduction in battery cell supply chain emissions

Logistics:

• Expanded innovation and infrastructure management process for logistics measures

Scope 3 Downstream (Use phase):

• Electrification of vehicle fleet: largest contribution (~65% of total 2030 reduction target in absolute terms)
• Consistent electrification across all brands
• Hydrogen drivetrain development and gradual integration
• Efficiency improvements for conventional drivetrains
• Increasing use of electricity from CO2e-free sources for vehicle charging
• Support for charging infrastructure development
• Technology openness: high-quality mix of state-of-the-art, efficient drivetrain types
• Higher share of renewable fuels for existing fleet:
  • B-series petrol engines approved for E25 fuel (20-45% CO2e reduction)
  • Diesel engines approved for HVO100 fuel (90% fewer carbon emissions)
  • Pilot project: all diesel models produced in Germany filled with HVO100 since early 2025
  • Existing fleet: ~4.5 million diesel engines, >13 million B-series petrol engines

Product approach:

• NEUE KLASSE: higher level of sustainability throughout entire vehicle life cycle
• Certified life cycle assessments demonstrate measure effectiveness
• Design for Circularity guidelines
• LCA comparison shows BEVs can reduce Scope 3 CO2e emissions by up to three quarters vs. comparable ICE vehicles

Cross-cutting:

• Digitalisation and AI to increase efficiency and foster innovation
• Continuous monitoring and updating of climate scenarios and assumptions
• Integration of sustainability targets into corporate planning

CapEx / investment commitments

CapEx plan 2024-2030 (7-year period, approved by Board of Management):

The CapEx plan covers capital expenditure and operating expenditure for expansion of Taxonomy-aligned economic activities or transformation of Taxonomy-eligible activities to become Taxonomy-aligned. The increase compared to the previous year is largely attributable to generally higher capital expenditure and operating expenditure associated with electrification until the end of the decade.

EU Taxonomy alignment (2024):

• Taxonomy-aligned revenues: 14.6%
• Taxonomy-aligned CapEx: 29.1%
• Taxonomy-aligned OpEx: 29.7%

Specific monetary amounts for CapEx and OpEx necessary for implementation of measures outside the CapEx plan are not quantified for confidentiality reasons (ESRS 1-106).

Internal carbon pricing: Not used for financial reporting purposes (impairment testing, residual value assessment, fair value measurement). However, volume- and price-related assumptions for EU ETS emission allowances are incorporated into corporate planning and impairment testing for Automotive segment assets.

Locked-in emissions and stranded asset analysis

The BMW Group does not explicitly report locked-in emissions or stranded asset analysis in the traditional sense. However:

Residual emissions at Net Zero: Maximum 10% of base year 2019 emissions (approximately 15 million tonnes CO2e) will remain in 2050, requiring permanent neutralisation through CO2 sinks. Scope 3 emissions will account for around 99% of remaining total emissions, with 1% from Scope 1 and 2.

Asset and planning considerations:

• Physical climate risks assessed for BMW Group and supplier sites under IPCC scenarios (medium-term 2036, long-term 2050 and beyond)
• Climate risk analysis considers expected service life of buildings and facilities
• Updates on identified climate scenario risks inform new construction and conversion planning
• Uncertainty factors continuously recorded: regulatory requirements, customer expectations, technological developments, macroeconomic trends
• Flexibility embedded in strategy to address uncertainties in framework conditions and political controllability

Portfolio approach:

• Technology openness maintained: efficient mix of drivetrain types
• Existing combustion engine fleet represents significant decarbonisation opportunity through renewable fuels
• Gradual rollout of NEUE KLASSE technologies across entire vehicle portfolio by end of decade
• Continuous development of combustion technology to offer state-of-the-art vehicles independent of drive system

Use of carbon credits / removals

Target setting approach: CO2e credits (certificates) are not factored into target setting and monitoring. Only actual reduction measures are counted toward the targets.

Beyond Value Chain Mitigation (BVCM): The BMW Group supports permanent CO2e sequestration projects voluntarily since 2024, with yields not counted toward CO2e targets:

2024 cancellations:

Future planned cancellations: 46,000 - 57,500 tonnes CO2e until and including 2026

Biochar projects: Support development of permanent CO2e sequestration methods. Biochar is carbon-rich material from pyrolysis of waste biomass, added to soil for quality improvement, water retention, erosion reduction, and carbon removal.

Quality criteria for BVCM projects:

• Permanence of CO2e storage effects
• Additionality
• Certification by independent institutions (e.g. CSI/EBC C-Sink)
• Alignment with UN Sustainable Development Goals
• Benefits to society (income generation, soil revitalisation)

Partnership approach: Cooperation with Atmosfair and Firstclimate to foster scaling of promising Carbon Dioxide Removal (CDR) technologies, preparing for the sub-target of neutralising maximum 10% of base year emissions at Net Zero 2050.

Governance and implementation

Strategic integration:

• Climate change mitigation and adaptation anchored in corporate strategy as key pillar
• Strategic fields: electrification, digitalisation, sustainability/circular economy
• Sustainability strategy confirmed by Board of Management
• Climate strategy draws on Greenhouse Gas Protocol, science-based targets, implementation pathways, and regulatory changes

Decision-making:

• Board of Management discusses sustainability status report quarterly
• Topic-specific Board meetings for overarching CO2e reduction targets and circular economy initiatives
• Sustainability aspects (ESG criteria) built into individual market strategies
• Targets broken down to implementation levels (vehicle projects, component level)

Monitoring and steering:

• CO2e targets integrated into BMW Group's steering system
• Long-term corporate planning (12-year period) updated annually, incorporating climate risks/opportunities
• Scenario analyses inform operational measures and sustainability strategy updates
• Progress reviewed regularly; necessary actions discussed in committees and by Board of Management
• Annual comparison of planned emissions with targets; structured process to define measures
• 2024: Long-term planning expanded to assess and simulate impact on absolute CO2e emissions

Performance management:

• Steering indicators: carbon emissions over entire product life cycle during development phase
• CO2e strategy integrated with volume planning, drivetrain forecasting, financial planning
• Internal premises established for target implementation
• Certified life cycle assessments for transparency
• Customer studies in major markets to incorporate feedback into strategy

Reporting and compliance:

• Comprehensive digital reporting system ensures climate perspectives consistently taken into account
• ESRS-based sustainability reporting
• EU Taxonomy disclosure
• Environmental management system (ISO 14001) at all production sites
• EMAS certification at German plants

Supply chain engagement:

• CO2e reduction requirements for supplier network
• Risk analyses and monitoring
• Due diligence processes
• Sustainability questionnaires and on-site assessments
• Verification of supplier CO2e reduction measures by external service provider
• Catena-X: standardised calculation methods and exchange formats for Scope 3 upstream emissions

Stakeholder dialogue:

• Continuous dialogue with stakeholders in Germany and abroad
• Engagement with affected communities and indigenous peoples
• Dialogue with policymakers, business partners, NGOs
• Sustainability network for sharing best practices

Uncertainties and resilience

Key uncertainties:

• Customer acceptance of different drivetrain options in different markets
• Availability and expansion of charging infrastructure
• Proportion of renewable energies in energy mix
• Availability of alternative low-carbon fuels
• Total-cost-of-ownership considerations (purchase incentives, taxation, energy costs)
• Regulatory requirements introduced at short notice
• Geopolitical risks
• Supply chain decarbonisation pace (especially CO2e-intensive raw materials)
• IEA forecasts on renewable energy adoption

Resilience approach:

• Regular review and update of climate scenarios and assumptions
• Annual updates to strategic market and drivetrain forecasts
• Monitoring of fleet carbon emissions limits, pollutants, BEV quotas, drivetrain bans
• Flexibility as focal point of climate dimension in strategy
• Simulations of planning effects enable early action
• Volume and drivetrain mix adjusted annually and ongoing
• Comprehensive consideration across all functions: Strategy, Planning, Development, Purchasing, Production, Sales, Finance, Personnel

Business model resilience: Based on current assumptions and forecasts, the BMW Group's business model is resilient to impacts and adjustments resulting from climate change and climate change adaptation through 2030 and beyond.

Just Transition

The BMW Group combines transformation with modern workplaces guaranteeing safety and reliability for workforce in productive environment. Entire plants transformed for electromobility while production continues. Highly regarded employer ratings consistently rank BMW Group as one of world's most attractive employers.

Safeguard clauses

Per § 289e HGB, safeguard clause applied to:

• ESRS E1-1.16c) (transition plan details)
• ESRS E1-3.29c) (action details)

Information omitted for intellectual property, expertise, and innovation results protection. ESRS 2 BP-1.5e) safeguard clause not used for 2024.

The BMW Group has implemented comprehensive policies related to climate change mitigation and adaptation as part of its strategy to achieve net zero carbon emissions across the entire value chain by 2050 at the latest.

Climate Change Mitigation Policies

Strategic Framework

The BMW Group's ambitious sustainability targets are aligned with:

• 1.5°C pathway of the Paris Agreement for CO2e emissions (Scope 1 and Scope 2)
• Well-Below-Two-Degree (WB2C) approach for CO2e emissions from supply chain and use phase (Scope 3)

Target Setting

In 2030, the BMW Group intends to reduce its carbon emissions levels by at least 40 million tonnes compared to 2019. This new target replaces the previous goal of reducing carbon emissions per vehicle by 40% over the same period.

Holistic Approach

The Group's science-based approach involves:

• Permanent reduction of energy requirements (Scope 1 and 2 emissions of BMW Group locations)
• Greater use of renewable energy (Scope 1 and 2 emissions of BMW Group locations)
• Latest technology to improve efficiency (Scope 3 Use of Sold Products)
• Renewable electricity criterion when awarding supplier contracts (Scope 3 Purchased Goods and Services)
• Continuously increasing secondary raw material quota (Scope 3 Purchased Goods and Services)

Product and Technology Policies

Drivetrain Strategy

Technology Openness: The BMW Group offers state-of-the-art drive technology regardless of drivetrain type, recognizing that a high-quality mix of efficient drivetrain types makes an effective contribution to CO2e emissions reduction.

Electrification Timeline:

• 2024: All-electric vehicles accounted for 17.4% of total deliveries
• 2025: NEUE KLASSE model generation launch with strong emphasis on efficiency and sustainability
• 2028: Introduction of hydrogen fuel cell variant

Fuel Innovation

Advanced Fuel Compatibility:

• B-series petrol engines (since 2015): Approved for fuel containing up to 25% ethanol (E25), reducing CO2e emissions by 20-45% depending on fuel composition
• B-diesel engines (since 2015): Compatible with HVO100 fuel derived from waste materials with 90% fewer carbon emissions
• 2025 Pilot Project: All diesel models produced in Germany filled with non-fossil HVO100 as factory fill

Existing Fleet Impact: As of January 2025:

• 4.5 million diesel engines in BMW Group fleet
• Over 13 million B-series petrol engines
• Higher renewable fuel share enables significant CO2e emissions cuts

Adaptation Policies

Physical Risk Management

The BMW Group addresses climate adaptation through comprehensive physical risk assessment:

Scenario Planning: Uses three IPCC climate scenarios:

• Low-emissions scenario: <+1.5°C (SSP1-1.9)
• Medium scenario: +2.5°C (SSP2-4.5)
• High scenario: >+4°C (SSP5-8.5)

Risk Assessment: Site-specific analysis for all relevant BMW Group and supplier sites covering:

• Acute extreme weather events (heavy rain, hail, storms, floods)
• Longer-term changes in temperature and rainfall
• Average annual expected damage loss calculations

Resilient Infrastructure

Construction Planning: Updates on risks identified in climate scenarios are taken into account when planning new construction and conversion measures.

Supply Chain Resilience: Forward-looking risk management and digitalisation help strengthen supplier network resilience against climate impacts.

Implementation Framework

Governance Integration

Climate policies are integrated into corporate structures through:

• Regular Board of Management discussions on climate-related impacts, risks and opportunities
• Sustainability and Mobility function ensuring high-level management of climate topics
• Progress reports to Board of Management at least three times per year

Measurement and Monitoring

Climate impacts are assessed, recorded, measured and reported in accordance with:

• Greenhouse Gas Protocol requirements
• Regular internal review and adjustment of relevant emission categories
• Integration into long-term corporate planning with CO2e emissions simulation

Value Chain Integration

Policies extend across entire value chain:

• Upstream: Supplier requirements for renewable energy use
• Own Operations: Energy efficiency and renewable energy expansion
• Downstream: Product efficiency improvements and customer support for sustainable mobility

The BMW Group has implemented comprehensive actions and allocated significant resources to support its climate change policies across the entire value chain.

Energy and Production Actions

Renewable Energy Expansion

Power Purchase Agreements (PPAs): The BMW Group is expanding the use of cost-effective CO2e-free energy, including through PPAs, contributing to progressive decarbonisation.

Production Transformation: Entire plants in the production network are being transformed and geared towards electromobility while production continues, demonstrating the "Just Transition" approach that combines transformation with modern, safe, and reliable workplaces.

Efficiency Improvements

EfficientDynamics Technologies: The BMW Group has been reducing fuel consumption for many years using innovative EfficientDynamics technologies, which bring together:

• Highly efficient drivetrains
• Intelligent lightweight construction
• Optimised vehicle energy management systems

Historical Achievement: Between 1995 and 2020, the BMW Group halved the CO₂ emissions of its new car fleet in Europe through unwavering commitment to EfficientDynamics technologies.

Product Development Actions

Electrification Strategy

NEUE KLASSE Development: The new model generation launching in 2025 was developed with strong emphasis on:

• Efficiency throughout the supply chain
• Sustainability integration
• Strategic approach to close material cycles and move toward circularity

Drivetrain Diversification:

• 2024 Achievement: All-electric vehicles accounted for 17.4% of total deliveries, making BMW Group one of the world's most successful suppliers of all-electric vehicles
• 2028 Target: Introduction of second all-electric and locally emission-free variant powered by hydrogen fuel cells

Advanced Fuel Implementation

Immediate Action - 2025 Pilot Project: Since early 2025, all diesel models produced in Germany are filled with non-fossil HVO100 as their first factory fill prior to delivery to retail partners. This pilot project demonstrates that HVO100 is a fully viable and practical diesel substitute.

Fleet Readiness: The BMW Group's vehicle fleet includes:

• Around 4.5 million diesel engines compatible with HVO100
• Over 13 million B-series petrol engines approved for E25 fuel

Supply Chain Actions

Supplier Requirements

Renewable Energy Criteria: The BMW Group uses electricity from renewable sources as a criterion when awarding contracts to suppliers (Scope 3 Purchased Goods and Services).

Secondary Materials: Continuously increasing secondary raw material quota to reduce supply chain emissions (Scope 3 Purchased Goods and Services).

Due Diligence Enhancement: In 2024, responsibility for developing procedures and implementing due diligence processes in the supply chain was firmly embedded in purchasing strategy and strengthened by establishing a dedicated department.

Circular Economy Actions

Material Cycle Closure

4R Principles Implementation: Guided by Re:think, Re:duce, Re:use, Re:cycle principles, working closely with partners in the circular economy to:

• Close material loops within the automotive industry
• Integrate circularity into processes
• Reduce consumption of resources and drive development of closed material cycles

Recycling Operations: Thousands of vehicles are dismantled and recycled using efficient methods every year at the BMW Group's recycling and dismantling centre.

Resource Management Actions

Water Efficiency

Monitoring and Reduction: The BMW Group monitors fresh water and energy consumption levels consistently to minimise usage.

Treatment Systems: Expanding water treatment systems to:

• Minimise fresh water usage
• Maximise efficiency
• Alternative water sources utilisation (e.g., rainwater)

Waste and Resource Optimisation

Measures developed specifically for Company facilities include:

• Water consumption reduction
• Alternative water source usage
• Resource efficiency improvements

Research and Innovation Actions

Scientific Collaboration

International Sustainable Mobility Research Platform (ISMO): Established in 2024, this international research partnership includes:

• BMW Group
• University of Cambridge (UK)
• Friedrich-Alexander-Universität Erlangen-Nürnberg (Germany)
• Harvard University (USA)
• Tsinghua University (China)

Objective: Conduct research into sustainability and develop scientifically sound approaches to help develop strategy, with Board of Management involvement in discussing research results twice yearly from 2025.

Technology Development

Efficiency Innovation: The BMW Group's entry into electromobility began over 15 years ago with development of the all-electric BMW i3, with extensive experience continuing to shape manufacturing processes for all-electric models.

Organisational Actions

Governance Structure

Sustainability Function: The Sustainability and Mobility function:

• Ensures high-level management of sustainability topics as part of Group strategy
• Identifies areas needing action
• Defines targets to be achieved
• Prepares Board of Management resolutions

Reporting and Monitoring: Progress reports on overarching sustainability targets submitted to Board of Management at least three times per year, covering:

• CO2e emissions reduction targets across all scopes
• Circular economy progress
• Environmental and social standards
• Strategic and operational implementation status

Employee Development

Just Transition: The BMW Group combines transformation with modern workplaces, investing continuously in building workforce expertise through:

• Continuous training programmes
• Job security guarantees
• Skills development for future technologies

Recognition: Highly regarded employer ratings consistently rank the BMW Group as one of the world's most attractive employers.

Financial Resources

While specific financial allocations for climate actions are not detailed in the available text, the BMW Group demonstrates significant resource commitment through:

• Major production facility transformations
• Research and development investments
• Global supply chain transformation
• International research partnerships
• Continuous workforce development programmes

These actions represent a comprehensive, science-based approach to climate change mitigation and adaptation across the BMW Group's entire value chain, with measurable progress toward the 2030 target of reducing carbon emissions by at least 40 million tonnes compared to 2019.

The BMW Group has established comprehensive targets related to climate change mitigation and adaptation aligned with scientific climate pathways.

Overall Climate Targets

Long-term Net Zero Commitment

2050 Target: The BMW Group is committed to achieving net zero carbon emissions across its entire value chain by 2050 at the latest.

Science-Based Target Alignment

The BMW Group's ambitious sustainability targets are aligned with:

• 1.5°C pathway of the Paris Agreement for CO2e emissions (Scope 1 and Scope 2)
• Well-Below-Two-Degree (WB2C) approach for CO2e emissions from the supply chain and use phase (Scope 3)

Updated 2030 Target

Absolute Emissions Reduction: In 2030, the BMW Group intends to reduce its carbon emissions levels by at least 40 million tonnes compared to 2019.

Note: This new target replaces the previous goal of reducing carbon emissions per vehicle by 40% over the same period.

Scope-Specific Targets

Scope 1 and 2 Targets (Own Operations)

Energy Requirements: Permanent reduction of energy requirements at BMW Group locations

Renewable Energy: Greater use of renewable energy at BMW Group locations

Infrastructure: Use of cost-effective CO2e-free energy, including through Power Purchase Agreements (PPAs)

Scope 3 Targets (Value Chain)

Supply Chain (Upstream)

Supplier Energy Criteria: Use electricity from renewable sources as a criterion when awarding contracts to suppliers (Scope 3 Purchased Goods and Services)

Secondary Materials: Continuously increasing secondary raw material quota (Scope 3 Purchased Goods and Services)

Product Use Phase (Downstream)

Efficiency Improvements: Use latest technology to improve efficiency (Scope 3 Use of Sold Products)

Product and Technology Targets

Electrification Targets

2024 Achievement: All-electric vehicles accounted for 17.4% of total deliveries

2025 Milestone: Launch of NEUE KLASSE model generation with strong emphasis on efficiency and sustainability throughout the supply chain

2028 Target: Introduction of second all-electric and locally emission-free variant powered by hydrogen fuel cells

Fleet Emissions Targets

Historical Performance: Between 1995 and 2020, the BMW Group halved the CO₂ emissions of its new car fleet in Europe

EU Compliance: The BMW Group regularly surpasses EU carbon targets for its fleet

Advanced Fuel Targets

Immediate Implementation: 2025 pilot project filling all diesel models produced in Germany with non-fossil HVO100 as factory fill

Fuel Compatibility Enhancement:

• B-series petrol engines approved for up to 25% ethanol (E25), reducing CO2e emissions by 20-45%
• B-diesel engines compatible with HVO100 fuel with 90% fewer carbon emissions

Circular Economy Targets

Material Efficiency

4R Principles: Implementation of Re:think, Re:duce, Re:use, Re:cycle principles

Circularity Integration: Strategic approach to close material cycles and gradually move closer to circularity

Resource Reduction: Reduce consumption of resources and drive development of closed material cycles

Adaptation Targets

Risk Management

Scenario Coverage: Address climate risks across three IPCC scenarios:

• Low-emissions: <+1.5°C (SSP1-1.9)
• Medium: +2.5°C (SSP2-4.5)
• High: >+4°C (SSP5-8.5)

Infrastructure Resilience: Integration of climate risk assessments into new construction and conversion planning

Supply Chain Resilience: Strengthen supplier network resilience against climate impacts

Monitoring and Accountability

Target Integration

Climate targets are integrated into:

• Corporate Planning: Long-term corporate planning with CO2e emissions simulation
• Board Reporting: Progress reports to Board of Management at least three times per year
• Performance Management: Regular review against reduction targets with measures initiated as needed

Measurement Framework

Targets measured and reported according to:

• Greenhouse Gas Protocol requirements
• All relevant scopes and categories
• Regular internal review and adjustment processes
• Integration into Group Financial Statements assumptions

Workforce and Social Targets

Just Transition

Employee Development: Continuous investment in building workforce expertise for transformation

Workplace Quality: Modern workplaces that guarantee safety and reliability in productive environment

Training Commitment: Continuous training guarantees jobs during transformation

Strategic Implementation Timeline

2024: Foundation year with 17.4% BEV delivery share and pilot project initiation

2025: NEUE KLASSE launch and HVO100 pilot project full implementation

2028: Hydrogen fuel cell variant introduction

2030: Achievement of at least 40 million tonnes CO2 reduction compared to 2019

2050: Net zero carbon emissions across entire value chain

These targets represent a comprehensive, science-based approach to climate action that addresses both mitigation and adaptation across the BMW Group's entire value chain, with clear milestones and accountability mechanisms to track progress toward the ultimate goal of net zero emissions by 2050.

Energy consumption and mix

Total energy consumption

Total energy consumption in the reporting period was 5,914 GWh (2024), compared to 6,043 GWh in 2023 and 6,393 GWh in 2019.

Energy consumption per vehicle produced (automotive): 1.94 MWh (2024), compared to 1.97 MWh (2023) and 2.12 MWh (2020).

Scope: The energy consumption figures cover all BMW Group production sites, including the Research and Innovation Centre (FIZ), test tracks, and distribution centres. The reporting entity aligns with the financial consolidation scope. From the 2025 financial year onwards, non-consolidated companies will be excluded from reporting in accordance with ESRS requirements. For 2024, energy consumption for consolidated companies only is 5,869 GWh.

Disaggregated energy consumption and mix

The BMW Group has not disclosed a fully disaggregated energy mix table in the ESRS E1-7 format (fossil fuel types, nuclear, renewable subtypes) for the 2024 reporting year. The excerpts reference the following:

• All external electricity for BMW Group plants worldwide has been sourced from renewable sources since 2020.
• Natural gas remains a significant energy carrier. The transition to alternative non-fossil energy sources (biogas, green hydrogen, electricity from renewable sources) is underway but depends on availability, technical retrofitting, policy frameworks, and economic efficiency.
• The new Debrecen plant (Hungary) uses electricity instead of natural gas for paint line processes, with all production-related electricity sourced from renewable sources.
• Renewable energy is increasingly generated on-site (solar, wind, geothermal, biomass, district heating from renewable sources).
• Specific measures include procurement of biomethane (Spartanburg, USA) and conversion from fossil fuel district heating to district heating from wood chips (Steyr, Austria), contributing to an ~38,000 t CO₂e reduction in Scope 1 and 2 emissions in 2024.

The excerpts do not contain a structured table breaking down consumption by coal, crude oil/petroleum products, natural gas, other fossil sources, nuclear, biomass, solar, wind, etc. as required by ESRS E1-7.

Energy intensity (per revenue): Not explicitly disclosed in the excerpts in the standard unit (e.g., MWh per million EUR revenue). Only per-vehicle intensity is reported.

Methodology note: Energy consumption data is collected through the BMW Group's environmental management systems and certified environmental statements. Electricity procurement is tracked via contracts and energy attribute certificates (EACs).

Gross Scopes 1, 2, 3 and Total GHG emissions

Scope 1 and 2 emissions (BMW Group locations)

Absolute emissions (2024)

Emissions per vehicle produced

Methodology note: Excludes sites without operational control; includes biogenic emissions. See Glossary and Explanations of Key Figures for the definition. From financial year 2024, carbon equivalent targets are presented in absolute values (t CO₂e) in line with ESRS. The relative targets introduced in 2021 (expressed as reduction per vehicle) are replaced with absolute values from reporting year 2024 onwards.

Scope 2 breakdown

The report does not separately disclose Scope 2 location-based and market-based figures for 2024. It states that "Since 2020, we have obtained all the external power required for our plants worldwide from renewable sources."

Scope 3 emissions (Automotive segment)

Absolute emissions (2024)

Methodology note: New key performance indicator from financial year 2025 onwards. Comprises the scope 3 categories purchased goods and services, transport logistics, utilisation phase; includes biogenic emissions. See Glossary and Explanations of Key Figures for the definition. Only includes automobiles.

The report does not provide a breakdown by individual GHG Protocol categories (1-15). The disclosed figure aggregates categories 1 (purchased goods and services), 4 (upstream transportation and distribution), and 11 (use of sold products).

EU fleet carbon emissions (product emissions)

Methodology note: EU-27 countries including Norway and Iceland; with effect from 2021, values are calculated on a converted basis in line with WLTP (Worldwide Harmonised Light Vehicles Test Procedure). This is a preliminary internal calculation with a potential variation of +/- 0.5 g CO₂/km, as official registration figures from the authorities are not available for all EU states. Figures officially published by the EU Commission are not expected to be available until November of the following year. Including an allowance for eco-innovations (amounts of clearly minor significance).

Total GHG emissions

The report does not disclose a combined total of Scope 1, 2, and 3 emissions for 2024.

Strategic carbon reduction targets (reference)

The BMW Group aims to reduce its carbon equivalent emissions by at least 40 million tonnes CO₂e by the target year 2030 (near-term target) compared to the base year of 2019 – from 150.1 million tonnes CO₂e to 108.6 million tonnes CO₂e. This encompasses Scope 1, 2, and 3 (purchased goods and services, logistics, use phase).

GHG intensity

No revenue-based intensity metric (tCO₂eq / M€) is disclosed in the report.

Biogenic CO₂

The report notes that biogenic emissions are included in the Scope 1 and 2 figure (0.81 million tonnes CO₂e) and the Scope 3 figure (125.1 million tonnes CO₂e), but does not report them separately.

Regulated emissions

No separate disclosure of EU ETS or other regulated emissions schemes is provided.

Current Financial Effects

Market Competition Impact

Competition in the electrified vehicle market intensified in the reporting year. The financial effects of this development are discussed in the Earnings Performance of the BMW Group section.

Regulatory Restrictions

Regulatory restrictions mean that certain energy sources, such as biogas, can no longer be used for emission reduction measures. However, hedging activities ensured that financial effects for the BMW Group were completely avoided.

Risk Assessment for 2025

No material risks or opportunities have been identified for which there is a significant probability of occurrence in 2025 that would result in a material adjustment to the carrying amounts of the assets and liabilities recognised in the corresponding financial statements.

Climate Risk and Opportunity Analysis

Physical Climate Risks

The BMW Group has implemented a wide range of measures to mitigate physical climate risks, so that no physical climate risks as defined by the sense of the ESRS are categorised as material. All material climate-related risks are transitory risks.

Risk Modelling: Physical climate risks may result in:

• Damage to assets (buildings, vehicles, parts)
• Downtime at BMW Group's own or supplier sites
• Production interruptions at individual sites in extreme scenarios

Scenario Analysis: Physical climate risks increase particularly in the long-term period for 2050 and beyond within the >+4°C scenario (SSP5-8.5), affecting both BMW Group production sites and supplier sites.

Transitory Climate Risks and Opportunities

Medium-term Risks (Until 2036)

Highest Materiality: Potential transitory risks are deemed the highest over the medium-term due to rapid, potentially unforeseeable developments in the Paris Agreement global warming scenario.

Policy Risk: It cannot be ruled out that more decisive measures will have to be taken globally in the next few years to achieve the <+1.5°C target. Regulatory requirements introduced at short notice may enter into force, which could impact:

• Products
• Production processes
• Supply chains
• Calculation and disclosure requirements
• Target contribution of measures taken

Market Risk: Competition and demand, especially for electric vehicles, may change in a 1.5°C scenario.

Strategic Alignment

Consistency: At present, the BMW Group's strategy is consistent with the transition to a carbon-neutral economy in accordance with ESRS E1 AR 12(d).

Planning Integration: The attainment of the Paris Agreement targets is part of the BMW Group's long-term corporate planning, meaning that the low-emission scenario is incorporated into the assumptions for the Group Financial Statements.

Climate Opportunities

Market Opportunities

The BMW Group recognises economic opportunities in the orientation towards the 1.5°C path, arising from:

Product Demand: Demand for low-emission products generated by the goal of slowing down climate change

Efficiency Gains:

• Efficiency and transport potential in carbon footprint reduction in upstream value chain
• Increasing range of BMW Group drivetrain variants
• Growing market share among environmentally conscious buyers

Competitive Advantage:

• One of the world's most successful suppliers of all-electric vehicles
• Regular surpassing of EU carbon targets for its fleet
• Strong rankings in prestigious sustainability rating schemes

Technology Opportunities

Innovation Leadership:

• Over 15 years of experience in electromobility development
• Extensive experience from BMW i3 development continues to shape manufacturing processes
• NEUE KLASSE development with strong sustainability emphasis

Fuel Technology:

• Advanced fuel compatibility (E25, HVO100) provides immediate emission reduction potential
• Technology openness approach enabling flexible response to market demands

Financial Planning Integration

Corporate Planning

Climate impacts are made integral to long-term corporate planning through:

• CO2e emissions simulation based on sales planning
• Focus on supply chain and use phase emissions
• Current assumptions checked against reduction targets
• Derivation of required measures and implementation initiation

Risk Management

Physical and transitory risks and opportunities are:

• Taken into account in internal management
• Incorporated in Group Financial Statements preparation
• Covered across wide range of scenarios over long-term planning period and beyond
• Address plausible risks and uncertainties

Target Achievement Monitoring

Financial effects are managed through:

• Regular progress reporting to Board of Management
• Target system monitoring
• Suitable actions discussed and approved when targets not met
• Integration into performance measurement and remuneration systems

The comprehensive risk and opportunity analysis demonstrates that while the BMW Group faces potential financial effects from climate-related transitory risks, particularly in regulatory and market developments, the company has positioned itself strategically to capitalise on the transition to a low-carbon economy while maintaining financial resilience through diversified risk management approaches.

The BMW Group has implemented comprehensive policies related to pollution prevention and management across its operations and value chain.

Environmental Management Framework

Holistic Environmental Management

The BMW Group takes a comprehensive approach to environmental protection through robust environmental management systems and corporate responsibility practices that have upheld high standards for over fifty years. The Company pioneered sustainable business practices by appointing the first environmental officer in the German automotive industry over fifty years ago.

Site-Specific Policy Implementation

Environmental Assessment Requirements: All sites that require environmental assessment and approval under national law are subject to comprehensive pollution management policies, including:

• All production sites
• Component production facilities
• Research and Innovation Centre (FIZ)
• Test tracks
• Distribution centres

Risk-Based Approach: Sites with high risk and high level of damage potential are subject to specific measures to reduce potential environmental damage.

Pollution Prevention Policies

New Site Assessment

For new sites, the BMW Group implements systematic pollution prevention through:

• Environmental due diligence assessments
• Environmental impact analysis
• Climate risk assessments
• Baseline assessments of biodiversity (where required)

Risk mitigation measures derived from these assessments are implemented as required.

Existing Site Management

Certification and Monitoring: Sites with particular influence on business activities are subject to:

• Environmental impact assessments
• Case-by-case certification depending on risks involved
• Continuous monitoring and improvement measures

Technology and Process Policies

EfficientDynamics Integration: Environmental protection is integrated into product development through EfficientDynamics technologies that bring together:

• Highly efficient drivetrains
• Intelligent lightweight construction
• Optimised vehicle energy management systems

Air Quality Policies

Emissions Reduction

Fleet Emissions: Between 1995 and 2020, the BMW Group halved the CO₂ emissions of its new car fleet in Europe through commitment to efficiency technologies.

Advanced Fuel Support: Pollution reduction through support for cleaner fuels:

• B-series petrol engines approved for up to 25% ethanol (E25), reducing emissions by 20-45%
• B-diesel engines compatible with HVO100 fuel with 90% fewer carbon emissions
• 2025 pilot project: All diesel models produced in Germany filled with non-fossil HVO100

Technology Innovation

Electrification Strategy: Accelerating transition to zero local emission vehicles:

• 17.4% of 2024 deliveries were all-electric vehicles
• NEUE KLASSE development emphasizing efficiency and sustainability
• Planned hydrogen fuel cell variant for 2028

Water and Soil Protection Policies

Water Management

Material Topics Identified: The BMW Group's materiality assessment identified as material:

• Pollution of water
• Pollution of soil
• Microplastic pollution

Water Treatment Systems: The BMW Group is expanding water treatment systems to:

• Minimise fresh water usage
• Maximise efficiency
• Prevent water pollution through proper treatment of discharge

Soil Protection

Site Assessment: Environmental impact assessments include soil protection measures for all relevant facilities, with particular attention to:

• Manufacturing sites requiring permits under national environmental laws
• Sites with potential soil contamination risks
• Preventive measures for new construction projects

Supply Chain Pollution Prevention

Supplier Requirements

Due Diligence Enhancement: In 2024, responsibility for environmental due diligence in the supply chain was firmly embedded in purchasing strategy and strengthened through establishment of a dedicated department.

Supplier Code Compliance: The ↗ BMW Group Supplier Code of Conduct includes environmental protection requirements that suppliers must meet, including pollution prevention measures.

Raw Materials Management

Responsible Sourcing: The BMW Group's raw materials strategy includes pollution prevention considerations as part of responsible resource management integral to holistic corporate strategy.

Regulatory Compliance

Legal Framework Adherence

Pollution prevention policies ensure compliance with:

• Federal Immission Control Act (BIMSchG) in Germany
• Country-specific environmental assessment requirements
• Water Framework Directive 2000/60/EG and its guidelines
• National environmental permitting requirements

Environmental Statement

Comprehensive Assessment: The BMW Group Environmental Statement includes:

• Qualitative assessment of environmental impact of manufacturing technologies at various sites
• Assessment of other emissions topics where available
• List of material environmental effects for all technologies
• Indirect environmental effects (e.g., employee commuting)

Circular Economy and Waste Prevention

4R Principles

Pollution prevention through circular economy implementation following Re:think, Re:duce, Re:use, Re:cycle principles:

• Reducing consumption of virgin materials
• Minimising waste generation
• Closing material loops to prevent environmental releases
• Working with partners to integrate circularity into processes

Recycling Operations

Waste Management: Thousands of vehicles are dismantled and recycled using efficient methods annually at the BMW Group's recycling and dismantling centre, preventing pollution from improper disposal.

Monitoring and Continuous Improvement

Performance Tracking

Pollution prevention policies are monitored through:

• Regular environmental performance assessments
• Integration into sustainability reporting
• Board of Management oversight of environmental impacts, risks and opportunities
• Annual review and updating of environmental management systems

Innovation and Technology

Continuous Development: The BMW Group continuously invests in:

• Cleaner production technologies
• Advanced emission control systems
• Alternative materials and processes that reduce environmental impact
• Research partnerships for environmental innovation

These comprehensive pollution-related policies demonstrate the BMW Group's long-standing commitment to environmental protection across all aspects of its operations, from individual site management to global supply chain oversight, ensuring systematic prevention and management of pollution impacts throughout the value chain.

Substances of concern and substances of very high concern

The BMW Group has established processes to monitor and ensure legal compliance with prohibitions and limits relating to the use of chemical substances at the vehicle level. With regard to hazardous substances that fulfil the criteria of any of the classes or categories specified in Article 57 of the REACH Regulation (EC) 1907/2006 in accordance with the CLP Regulation (EC) 1272/2008 and which constitute at least 0.1% of the mass of the final product, the BMW Group has initialised a process to assess the extent to which these substances can be replaced with suitable alternatives.

Firstly, the points of the supply chain at which these substances are used were identified and assessed in a further step against the background of the state of the art and taking business, regulatory and technical concerns into account. If the use of these hazardous substances cannot be avoided, the BMW Group uses them under controlled conditions in accordance with hazardous material regulations.

Exclusion of problematic substances

All substances used by the BMW Group are in compliance with national and European laws. In addition, compliance with statutory prohibitions and limits on the use of chemical substances is monitored. Substitutes are sought for hazardous substances that are categorised as being of very high concern in accordance with Articles 57 and 59 of the REACH Regulation, provided they are used with a proportion exceeding 0.1% by mass in a mixture in the production processes, while taking factors such as economic and technical requirements into account. If such substances cannot be avoided, they are used under controlled conditions and in strict compliance with hazardous substance regulations.

To the extent possible, the BMW Group excludes the use of problematic substances right from the vehicle design stage and sets out corresponding stipulations for its suppliers. Guidance is provided in the form of the Global Automotive Declarable Substance List (GADSL).

Furthermore, the Company is committed to reducing exposure to emissions inside the vehicle to a minimum. All BMW, MINI and Rolls-Royce brand Automobiles are equipped as standard with interior air filters for pollutants and particles. Since 2020, the BMW Group has been using interior air filters equipped with nanofibre technology that not only trap fine dust, but also certain microbial particles and allergens.

Given that vulnerable people react particularly sensitively, the statutory requirements for potentially hazardous substances include children in particular. Therefore, complying with threshold values also regularly comprises the protection of children's health.

No quantitative data on total amounts of substances of concern or substances of very high concern in tonnes has been disclosed.

Actions and resources related to pollution

BMW Group cross-references E2-2 to the following sections: Reduction of Environmental Pollution, Social and Environmental Responsibility in the Supplier Network, Due Diligence in the supplier network, and Responsible raw material management. However, the provided excerpts do not contain the detailed action-level disclosures from these referenced sections.

Actions identified in excerpts:

Own Operations:

• Replacement of old and inefficient building services systems with new systems that are more efficient
• Development of new processes that are more efficient and more environmentally friendly
• Replacement of fossil fuels with renewable energy sources

Supply Chain:

• Use of electricity from renewable sources and secondary materials in the supply chain
• Requirements for direct suppliers (Tier 1 suppliers) regarding use of electricity from renewable sources
• Requirements for energy-intensive processes of pre-production stages (N-tier suppliers) involved in manufacture of CO₂e-intensive components and materials

Scope: The actions address own operations (building services, process improvements, fuel replacement) and upstream value chain (supplier energy requirements).

Time horizon: Not explicitly stated for pollution-specific actions in the excerpts.

Resources allocated: Not quantified in the excerpts provided.

Expected outcomes/KPIs: Not explicitly stated for pollution-specific actions; references link to CO₂e reduction targets (Scope 1, 2, 3 emissions reduction of at least 40m tonnes CO₂e by 2030).

Link to policies: Actions link to Environmental policy and Holistic Environmental Management within the BMW Group.

Targets related to pollution

The BMW Group's sustainability statement indicates that E2-3 (Targets related to pollution) is disclosed with cross-references to the following sections:

• Reduction of Environmental Pollution
• Social and Environmental Responsibility in the Supplier Network
• Due Diligence in the supplier network
• Responsible raw material management

However, the excerpts provided do not contain specific quantified targets related to pollution (air, water, soil pollutants, substances of concern, or substances of very high concern as required under ESRS E2-3).

The excerpts focus primarily on:

• CO₂e emission reduction targets (classified under ESRS E1, not E2)
• Circular economy and secondary materials strategy (classified under ESRS E5)
• Water consumption targets (classified under ESRS E3)

The table on page 236 explicitly lists "ESRS E2-4.28 Amount of each pollutant listed in Annex II of the E-PRTR Regulation (European Pollutant Release and Transfer Register) emitted to air, water and soil" as Not material.

No specific pollution-related targets (e.g., reduction of NOx, SOx, particulate matter, microplastics, or other pollutants) with quantified values, target years, or baseline years are disclosed in the provided excerpts.

Pollution of air, water and soil

Own Operations

The BMW Group has a comprehensive environmental management system at its own operations. Detailed checks and inspections are carried out during the planning and construction of new production and other sites with the aim of eliminating air, water, and soil pollution from the outset or reducing it as much as possible. Extensive measures are implemented to ensure compliance with limits. As a result, there are no significant impacts, risks or opportunities related to pollution within the BMW Group's own operations.

Note: Volatile organic compounds (VOC) used in the production process were reported in the past. This metric is no longer reported due to the switch to ESRS reporting and the resulting categorisation of air, water and soil pollution as immaterial in connection with own operations. The BMW Group will continue to address this issue and monitor it internally. Information about site-specific solvent emissions will continue to be published in the environmental statements of the EMAS-certified plants.

Products - NOx Emissions

There have already been signs of a reduction in NOx pollution in German and European cities over the last few years. Apart from various measures taken to reduce pollutants, the ongoing renewal of the vehicle fleets of all automobile manufacturers has also contributed to the improvement.

Products - Tyre Abrasion (Microplastics)

During the use phase of the BMW Group's products, tyre abrasion during driving produces microparticles which negatively impact the environment. Ongoing discussions on standardised methods for measuring tyre abrasion have yet to yield reliable definitions that accurately and comparably reflect the actual impact of vehicles. For this reason, the BMW Group has not yet established specific policies or targets aimed at reducing microparticles from tyre wear.

Until relevant thresholds are laid down, the BMW Group will be actively involved in developing measurement procedures for tyre abrasion and reducing wear levels while working closely with industry associations. An obligation to meet any future thresholds will also be included in specifications for tyre suppliers. Systems are being implemented to establish internal processes for measuring tyre wear. Tyre wear thresholds are expected to be published in 2025 in line with the Euro 7 regulations, and will most likely be mandatory for tire manufacturers from 2028 onwards. The BMW Group will review these specifications and fully comply with the resulting requirements concerning tyre abrasion values through the manufacturers and then provide the disclosures required under ESRS regarding the quantification of microplastics generated during driving.

Supply Chain

The BMW Group assumes responsibility within its supply chain by monitoring processes and taking action to protect the environment. A materiality assessment identified risks and impacts in the supply chain related to soil and water. All guidelines, actions and targets for actively managing these material impacts and risks in the supply chain are part of the due diligence process for upholding environmental and social standards within the supplier network.

Products - General Statement

The BMW Group's products themselves do not present any material concerns related to air, water, or soil pollution. Further details about applicable emissions standards can be found in Consumption and Carbon Disclosures and additional information about emission technologies in Innovations and Product Technologies.

E-PRTR Disclosure

ESRS E2-4.28 Amount of each pollutant listed in Annex II of the E-PRTR Regulation (European Pollutant Release and Transfer Register) emitted to air, water and soil: Not material

Anticipated financial effects from pollution-related impacts, risks and opportunities

BMW Group has applied the phase-in exemption for ESRS E2-6. The disclosure requirement is listed as "n. a./phase-in" in the mandatory disclosures pursuant to ESRS table.

No quantified financial effects, methodology, or time horizons are disclosed for pollution-related impacts, risks and opportunities in the 2024 reporting year.

Policies related to water and marine resources

BMW Group discloses water-related policies integrated within its broader environmental management framework. While specific standalone water policies are not named, the company describes comprehensive water management policies and approaches.

Environmental Policy (water management component)

Scope:

• All BMW Group production facilities
• Own operations
• Upstream value chain (through supplier network requirements)

Key content and principles:

• Using potable water economically as an essential component of the environmental management system
• All production facilities are required to reduce water consumption and use alternative sources of water, such as rainwater
• Management of and responsibilities for the BMW Group's own operations are an integral part of the BMW Group's environmental policy
• Water strategy focuses on both water consumption and water quality
• Uniform standards for wastewater treatment technology apply across the Group in line with national legislation and applicable limits

National and international standards referenced:

• In Germany: Ordinance on Installations for the Handling of Substances Hazardous to Water, Water Resources Act, Ordinance on the Protection of Surface Waters, and Groundwater Ordinance as implemented under the Water Framework Directive

Monitoring and implementation:

• Regular inspections are performed to ensure requirements are consistently met
• Location-based monitoring provides insights to continuously adjust measures
• Production sites (excluding motorcycles) are included in target management process as part of the BMW Group's water strategy
• Evaluation system based on water stress index, updated as site conditions change to react immediately as situations emerge

BMW Group Biodiversity Policy

Key content related to marine resources:

• Due to uncertainty surrounding environmental consequences of deep sea mining, the BMW Group joined the World Wildlife Fund (WWF) and other companies in 2021 to issue a joint statement pledging not to extract raw materials from the deep sea
• The BMW Group is committed to protecting the oceans, though no material impacts, risks or opportunities have been identified in marine waters area, so no specific strategies or practices are pursued for protecting marine waters

Public availability:

• Referenced in documentation (↗ BMW Group Biodiversity Policy)

Supplier Network Policies

Scope:

• Upstream value chain
• Supplier network

Key content:

• All guidelines, actions, and targets for actively managing material impacts and risks related to water withdrawal and water consumption in the upstream value chain are part of the due diligence process
• Due diligence process for upholding environmental and social standards within the supplier network
• Elaborated in Social and Environmental Responsibility in the Supplier Network

Links to international frameworks:

• Part of broader due diligence framework addressing UNGPs and OECD standards (as referenced in S2-1.17 and S2-1.18 disclosures)

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Note on marine resources: BMW Group explicitly states that "no material impacts, risks or opportunities have been identified" regarding marine waters, and therefore "is not pursuing any specific strategies or practices in order to protect marine waters" beyond the deep sea mining commitment.

Actions and resources related to water and marine resources

The BMW Group Report 2024 cross-references E3-2 to the following sections:

• Measures to reduce water usage
• Social and Environmental Responsibility in the Supplier Network
• Due Diligence in the supplier network
• Responsible raw material management

However, the provided excerpts contain only the index/navigation structure and do not include the actual content from these referenced sections. The substantive disclosure of actions, programmes, resources allocated (capex/opex), timelines, and expected outcomes would be located in those referenced sections of the full report.

Content not available in provided excerpts.

Water consumption

Total water consumption

Total water consumption (2024): 5,813,743 m³

Water consumption in areas affected by water risks or water stress (2024): 3,079,270 m³ (includes sites in areas of high or very high water stress)

Total water recycled and reused (2024): 4,778,429 m³

Total water stored (2024): 455,525 m³

Changes in storage during the year (2024): 333,720 m³

Water intensity

Water intensity (total water consumption per million € net revenue, 2024): 41.35 m³/million €

Potable water consumption per vehicle produced (automotive)

The BMW Group has set itself the target of reducing the amount of potable water used in automobile production by 25% by 2030 compared to the base year 2016. In the reporting period, specific potable water consumption per vehicle in automobile production was 1.67 m³, lower than in the previous year (2023: 1.78 m³, -6.2%).

Sites by water stress level

The BMW Group's production sites, vehicle test facilities and joint ventures located in areas subject to water stress:

Methodology notes

Water consumption comprises potable water, groundwater, surface water and rainwater. This does not include water released back into the environment or returned to third parties during the reporting period. Water consumption is measured using meters at production plants and some non-manufacturing sites. For remaining sites, consumption is extrapolated based on number of employees and other factors.

Water stress assessment uses the Aqueduct Atlas tool to identify geographic areas affected by water-related risks. Sites with a water stress level of more than 40% are included in the metric for water consumption in stress-affected regions.

Scope: Metrics include all production facilities (automobiles and motorcycles) and non-manufacturing sites, including test tracks, office buildings and branches, excluding partner plants and contract manufacturing. Data from the new plant in Debrecen (Hungary) is currently not included as production has not yet started. The metric includes no information on the supply chain of Spotlight Automotive Ltd.

Data from production sites is certified by EMAS, ISO 14001 and partly ISO 50001.

Anticipated financial effects from material water and marine resources-related impacts, risks and opportunities

BMW Group applies the phase-in exemption for this disclosure requirement.

As stated in the sustainability statement: "E3-5 – Anticipated financial effects from water and marine resources-related risks and opportunities: n. a./phase-in"

Policies related to biodiversity and ecosystems

BMW Group Biodiversity Policy

The BMW Group has established a dedicated Biodiversity Policy that addresses biodiversity and ecosystems protection.

Scope:

• Applies to the BMW Group's own operations
• Extends to the BMW Group's suppliers and their supply chains
• Includes a commitment not to extract raw materials from deep sea (issued jointly with WWF and other companies in 2021)

Key content and principles:

• Acts in line with the aims of the EU Biodiversity Strategy and the Kunming-Montreal Global Biodiversity Framework
• Internal guideline on protecting biodiversity and ecosystems that informs actions of both the BMW Group and its supply chain
• Refers to material impacts, risks and opportunities that have been identified
• Lays out the BMW Group's position on biodiversity
• Addresses the extent of commitment, scope of policy, due diligence and traceability measures, complaint and monitoring mechanisms

Governance and oversight:

• The department for Sustainability and Mobility is responsible for the Group's approach to biodiversity
• Implementation of relevant topics relating to the supply chain is the responsibility of the Supply Chain Sustainability department

Public availability:

• Referenced as publicly available (↗ BMW Group Biodiversity Policy)

Link to international standards:

• Aligns with EU Biodiversity Strategy
• Aligns with Kunming-Montreal Global Biodiversity Framework

Monitoring:

• Materiality assessment used to identify and evaluate potential impacts, risks and opportunities related to biodiversity
• Environmental management system ensures effective oversight
• Analysis performed showing own operations do not have significant negative impact on nearby protected areas

BMW Group Anti-Deforestation Policy

Scope:

• Covers the BMW Group's supply chains
• Applies to relevant materials including natural rubber, leather, paper, and wood

Key content and principles:

• Clear stance against deforestation and forest degradation in supply chains
• Addresses the extent of the BMW Group's commitment
• Covers scope of the policy as well as due diligence and traceability measures
• Includes complaint and monitoring mechanisms
• Material-specific requirements for natural rubber, leather, paper, and wood
• Safeguarding measures used in supply chains for relevant materials

Link to international standards:

• Adheres to EU regulations and relevant industry standards

Monitoring:

• Due diligence and traceability measures in place
• Complaint and monitoring mechanisms established

BMW Group Supplier Code of Conduct

Scope:

• Applies to suppliers in the BMW Group's supply chain

Key content and principles:

• Addresses biodiversity
• Includes clear provisions on the handling of critical raw materials
• Part of multistage due diligence process to uphold environmental and social standards in the supply chain

Monitoring:

• Multistage due diligence process implemented
• Additional details available in Social and Environmental Responsibility in the Supplier Network and Due Diligence in the supplier network sections

Related commitments and initiatives

The BMW Group supports its biodiversity policies through participation in several initiatives:

• Global Platform for Sustainable Natural Rubber (GPSNR) (joined 2019): To prevent deforestation and forest degradation from natural rubber cultivation, formalized through the BMW Group's High Level Commitment for sustainable natural rubber

• Leather Working Group (LWG): Signatory to "Deforestation Free Call to Action for Leather" (with Textile Exchange and WWF), committing to source cowhide from supply chains free from deforestation and land conversion by 2030

• Living Rubber project (Indonesia): Natural rubber project to empower affected communities

Implementation approach:

• Follows the reduction hierarchy: avoid – reduce – compensate
• Priority given to avoiding negative impacts on biodiversity and ecosystems
• Compensation means restoration and improvement, often through on-site projects
• Offsetting measures are not used for biodiversity management purposes
• Stakeholder consultation including local communities and indigenous people when selecting and assessing measures

Actions and resources related to biodiversity

The BMW Group Report 2024 references the following sections for E4-3 disclosure:

• Measures to protect biodiversity
• Social and Environmental Responsibility in the Supplier Network
• Due Diligence in the supplier network
• Responsible raw material management

The excerpts provided contain only the index/table of contents referencing where E4-3 disclosures can be found in the full report. The actual content of these referenced sections describing specific actions, their scope, time horizons, allocated resources, expected outcomes, and linkages to policies and targets is not included in the provided excerpts.

Without access to the referenced sections ("Measures to protect biodiversity", "Social and Environmental Responsibility in the Supplier Network", "Due Diligence in the supplier network", and "Responsible raw material management"), the specific actions and resources allocated to biodiversity and ecosystems cannot be extracted.

Impact metrics related to biodiversity and ecosystems change

Operations in or near protected areas / key biodiversity areas

An analysis showed that the BMW Group's own operations do not have a significant negative impact on nearby protected areas.

Number and area of sites in or near protected areas or key biodiversity areas: The metric shows the BMW Group sites that are located in or near biodiversity-sensitive areas, insofar as a material negative impact on this biodiversity is identified.

The proximity of BMW Group sites to protected areas is determined using the platform Integrated Biodiversity Assessment Tool (IBAT). A distance of 1 km to protected areas is used as a reference. For all sites identified by the IBAT tool analysis as being near a protected area or key biodiversity area, the second step is to identify and assess the potential impacts using the ENCORE (Exploring Natural Capital Opportunities, Risks and Exposure) methodology.

As a result, the metric shows the BMW Group sites that are located in or near biodiversity-sensitive areas, insofar as a material negative impact on this biodiversity is identified. The units of the two sub-elements of the metric are number (of sites) and hectares (total area of the sites).

Specific quantified results: Not disclosed in the excerpts provided.

Supply chain biodiversity impacts

In the supply chain, the extraction of raw materials was identified as a material topic. The BMW Group is currently assessing whether any risks exist in this area and what actions may be required to minimise negative impacts on biodiversity.

Deforestation

As part of its commitment to deforestation-free procurement, the BMW Group adheres to EU regulations and relevant industry standards. The Company takes a clear stance against deforestation and forest degradation in its supply chains in the BMW Group Anti-Deforestation Policy.

Safeguarding measures are used in the supply chains for relevant materials such as natural rubber, leather, paper, and wood.

The BMW Group joined the Global Platform for Sustainable Natural Rubber (GPSNR) in 2019 to prevent deforestation and forest degradation as a result of the cultivation of natural rubber. As a signatory to the "Deforestation Free Call to Action for Leather" the BMW Group is committed to sourcing cowhide from supply chains that are free from deforestation and land conversion by 2030.

Specific deforestation footprint metrics: Not disclosed.

Species impacts

The Red List of Threatened Species by the International Union for Conservation of Nature (IUCN) is referenced in the IBAT methodology used for site assessment.

Specific Red List species impact metrics: Not disclosed.

Land use and biological materials

Percentage share of biological materials which are sustainably sourced: 0.0% of the total resource inflows are sustainably sourced biological materials.

The metric is compiled based on primary data. The unit is percentage weight [%] and describes the relative content of the sustainably sourced biological materials in the total mass [t] of the BMW Group's resource inflows in the reporting period.

Restoration metrics

The BMW Group considers compensation to mean restoration and improvement, often in the form of on-site projects. Offsetting measures are not used for biodiversity management purposes.

Specific hectares restored: Not disclosed.

Transition plan and consideration of biodiversity and ecosystems in strategy and business model

Integration of biodiversity into strategy and business model

The BMW Group joined the Global Platform for Sustainable Natural Rubber (GPSNR) multi-stakeholder initiative in 2019. The aim of the GPSNR is to prevent deforestation and forest degradation as a result of the cultivation of natural rubber. This commitment is set out in the BMW Group's High Level Commitment for sustainable natural rubber.

The BMW Group is also part of the Leather Working Group (LWG). As a signatory to the "Deforestation Free Call to Action for Leather" of the LWG, Textile Exchange and WWF the BMW Group is committed to sourcing cowhide (including stamped parts) and components containing cowhide from supply chains that are free from deforestation and land conversion by 2030.

Use of frameworks

The guidelines of the Taskforce on Nature-Related Financial Disclosure (TNFD) provided the basis for the scenarios used for the resilience analysis. Various scenarios for the year 2035 were analysed with different characteristics related to the decrease in biodiversity and market coherence.

Resilience analysis

The resilience analysis assessed potential short-term risks to individual stages of the supply chain. This approach was used to assess the long-term resilience of the BMW Group's strategy and business model to biodiversity risks.

The probability of occurrence of scenarios with very low biodiversity and market coherence was very low, which is why they were not assessed in the resilience analysis. In all other scenarios, the BMW Group's business model was resilient to physical and transitory biodiversity risks.

Uncertainties and factors were identified in collaboration with internal and external stakeholders to serve as the basis for the development of the scenarios.

Stakeholder engagement

When selecting and assessing measures to protect biodiversity, the BMW Group consults stakeholders such as local communities and indigenous people. It takes part in initiatives like the Living Rubber natural rubber project in Indonesia to empower affected communities. In order for the BMW Group's projects in this area to be effective, it is committed to actively involving local communities in the design and subsequent implementation of on-site projects.

Anticipated financial effects from biodiversity and ecosystem-related impacts, risks and opportunities

Phase-in exemption applied

BMW Group has applied the phase-in exemption for this disclosure requirement. The disclosure is marked as "n. a./phase-in" in the company's mandatory disclosures table pursuant to ESRS.

ESRS E4-6 – Anticipated financial effects from biodiversity and ecosystem-related risks and opportunities: n. a./phase-in

Resource Inflows (ESRS E5-4)

Overall Resource Inflows

The BMW Group reports the following resource inflows for the 2024 reporting year:

Total resource inflows: 14,804,645 tonnes

The main materials used by the BMW Group in its production processes are steel, aluminium and thermoplastics.

Secondary Materials

Reused and recycled secondary components, products and materials account for 37.0% (5,476,984 t) of total resource inflows.

Biological Materials

The BMW Group notes that "biological materials play a minor role in terms of overall quantity" relative to the total volume of materials used. Therefore, 0.0% of the total resource inflows are sustainably sourced biological materials.

Scope and Context

Automobiles are the main products of the BMW Group for this report. In the future, motorcycles will also be included in the reporting process. In terms of the total volume of materials used, motorcycles represent a negligibly small share.

Water, auxiliaries and operating materials are also relevant process materials alongside the main manufacturing materials (steel, aluminium, thermoplastics).

Electrified vehicles use raw materials like lithium, nickel and cobalt in their batteries, which are included in the total resource inflows figure.

Resource Efficiency and Circular Economy Strategy

The BMW Group's objective is to reduce its dependency on primary raw materials through its "Secondary First" approach. The company aims to increase the proportion of recycled materials used, particularly for key materials such as steel, aluminium, battery materials, and thermoplastics.

For the NEUE KLASSE (launching 2025), requirements for the proportionate use of secondary materials for battery cell materials such as cobalt, lithium and nickel will be imposed as soon as contracts are awarded. The NEUE KLASSE will also contain a higher proportion of secondary materials in other material groups such as steel and aluminium.

Starting in 2023 with the BMW 5 Series, the BMW Group has disclosed the share of secondary materials in its new vehicles as part of life cycle assessments (Vehicle footprint).

Policies related to resource use and circular economy

BMW Group's disclosure for E5-1 references the following sections of their sustainability statement:

• Holistic approach for the transition to a circular economy
• Social and Environmental Responsibility in the Supplier Network
• Due Diligence in the supplier network
• Responsible raw material management
• Raw materials security and strategy

The company has not provided the specific policy names, detailed policy content, governance structures, approval mechanisms, public availability information, or links to international standards in the excerpts provided for this disclosure requirement. The references point to various sections of the broader sustainability report where these topics are addressed, but the actual policy details required under ESRS E5-1 are not included in these excerpts.

Anticipated financial effects from resource use and circular economy-related impacts, risks and opportunities

Phase-in exemption applied

BMW Group has applied the phase-in exemption for disclosure requirement E5-6 – Anticipated financial effects from resource use and circular economy-related impacts, risks and opportunities, as indicated by "n. a./phase-in" in the ESRS E5 disclosure overview table.

Compensation metrics

Pay gap

In the reporting year, the Company determined an unadjusted gender pay gap for the first time. This takes into account total direct remuneration plus key benefits. The gender pay gap in the reporting year stood at –10.9%.

The gender pay gap in favour of female employees of the BMW Group is largely due to structural effects. As an automobile manufacturer, a large share of the BMW Group's employees work in production, where a disproportionately large percentage of the workforce is male. Given that wage levels are lower in production than for example for administrative or development roles, female employees benefit from an advantage when it comes to pay.

Remuneration ratio

Not disclosed.

Methodology

According to the ESRS, the unadjusted gender pay gap between female and male employees is calculated on the basis of average gross hourly pay level. This is calculated on the basis of the sum of the gross annual income as stated in the employee's payslip (including bonus payments, commissions, additional non-recurring payments), Company car as a benefit, employer's contribution to the Company pension and health insurance, divided by the annual paid working hours less unpaid absences, on average for all male and female BMW Group employees. Expatriates are not taken into account.

The unadjusted gender pay gap is first calculated locally for each company or location using the following formula:

Gender Pay Gap = [(Average gross hourly pay level of male employees - Average gross hourly pay level of female employees) / Average gross hourly pay level of male employees] × 100

To determine the total BMW Group gap, the weighted average of the location gaps is calculated based on the number of male and female employees as at 31 December of the reporting year. This approach takes into account a fair consideration of different wage levels and avoids annual volatility due to exchange rate changes or varying purchasing power adjustments in countries with high inflation.

Health and safety metrics

Coverage of health and safety management system

100% of BMW Group employees, other BMW Group employees and temporary agency workers work at a location that has an occupational health and safety management system. All production sites have occupational health and safety management systems certified in accordance with ISO 45001 or OHRIS (based on ISO 45001).

The metric includes Spotlight Automotive Ltd. with a share of 100%.

Work-related fatalities

There were in total 2 fatal accidents in the reporting year 2024. These involved two employees of external companies working on BMW Group premises.

There were 0 reported fatalities due to work-related ill health during the 2024 reporting year.

Work-related accidents and accident frequency rate

The accident frequency rate is calculated based on the total number of accidents in the reporting year per million hours worked. Accidents are only included in the total if they result in at least one day of absence. This includes work-related accidents in the employee's own household (home office accidents). Accidents that occur on the way to or from work are not included. The analysis covers accidents involving BMW Group employees, other BMW Group employees and temporary agency workers.

Days lost

Number of days lost to work-related injuries, fatalities and work-related ill health: not disclosed for 2024. The company notes 'no application 2024' for ESRS S1-14.88(e).

Policies related to own workforce

The BMW Group discloses several policies and frameworks related to its own workforce under ESRS S1-1, though not all policies are named with specific titles. The company refers to a comprehensive set of guidelines and management systems rather than individually titled policy documents.

BMW Group Code of Conduct

Policy name: BMW Group Code of Conduct

Scope: All employees of the BMW Group

Key content/principles:

• Transposes BMW Group's corporate values into essential guiding principles for all employees
• Based on values and fundamental beliefs, founded on trust, mutual respect and tolerance
• Boosts employees' sense of individual responsibility
• Covers compliance aspects and legal requirements at all organizational levels
• Addresses discrimination prevention: every individual is entitled to a workplace free from discrimination, preferential treatment or harassment based on gender identity, skin colour, religion, nationality, political or other beliefs, ethnicity, disability, age or sexual orientation
• Extends to other characteristics protected under local laws, including national minority status or former military affiliation (veteran status)

Public availability: Referenced throughout the report; mandatory training for all employees in Germany

Links to international standards:

• Aligned with BMW Group's commitment to the UN Guiding Principles on Business and Human Rights
• Supports compliance with international labour standards

Monitoring/implementation:

• Mandatory BMW Group-wide training programme combating workplace discrimination for all employees in Germany
• Supported by Compliance organisation and regulatory framework
• Regular monitoring to ensure compliance with requirements

Occupational Health and Safety Management System (ISO 45001)

Policy name: Occupational Health and Safety Management System

Scope: All BMW Group production facilities and operations

Key content/principles:

• Comprehensive preventive measures in occupational health and safety
• Extensive training programmes
• Health Initiative
• Standards on various occupational safety topics to guide implementation of safety measures
• Regular assessments of methods and tools to ensure continuous improvement
• Workplace accident prevention policy

Certification/standards: ISO 45001 certification

Governance/oversight:

• Employee representatives actively involved in the process
• Where appropriate, representatives for employees with severe disabilities
• Department responsible for placing orders monitors compliance with occupational health and safety regulations, supported by relevant occupational health and safety departments

Monitoring/implementation:

• Regular assessments of methods and tools used in occupational health and safety
• Internal requirements improved on a continuous basis
• Effectiveness reflected in low accident frequency rate
• Regular inspections to ensure requirements are consistently met

Environmental Policy

Policy name: Environmental policy (referenced in context of Environmental Management System)

Scope: Own operations across the BMW Group

Key content/principles:

• Part of comprehensive environmental management system
• Detailed checks and inspections during planning and construction of new production and other sites
• Aim to eliminate air, water, and soil pollution from the outset or reduce as much as possible
• Extensive measures to ensure compliance with limits

Monitoring/implementation:

• Comprehensive environmental management system at own operations
• Detailed checks and inspections carried out during planning and construction phases

Diversity, Equity and Inclusion Framework

Policy name: General operating and inclusion agreement for employees with disabilities (mentioned as revised version)

Scope: BMW AG employees, with particular focus on employees with disabilities; broader diversity initiatives apply Group-wide

Key content/principles:

• Promotes working environment that ensures all employees are appreciated, included and free from prejudice
• Discrimination has no place in corporate culture
• Strategic approach to diversity management aims to anchor importance of diversity in employee conduct
• Actively fosters culture of appreciation using initiatives to raise awareness about respectful interaction
• Sets out requirements for dealing with and promoting employees with severe disabilities, including right to accessible working environment
• Guideline regarding collaboration with Employee Resource Groups (ERGs)
• Transition guide regarding sexual orientation and gender identity

Key principles:

• No discrimination based on gender identity, skin colour, religion, nationality, political or other beliefs, ethnicity, disability, age or sexual orientation
• Equal opportunities for LGBTIQ+ community
• Support for women's advancement and family networks

Governance/oversight:

• Managers responsible for distribution of information within their respective areas
• Responsible departments, HR, Works Council and representatives of severely disabled employees available for consultation
• Continuous communication on various channels

Public availability:

• Guidelines in place throughout the BMW Group

Monitoring/implementation:

• Measured through percentage of female managers and other indicators
• Participation in training courses and events with associated feedback
• Employee survey outcomes
• Participation in competitions
• Annual planning of global measures at beginning of each year
• Results reviewed at end of year to form basis for planning initiatives for following year

Human Rights Policy Framework

Policy name: Human rights policy commitments (referenced within broader compliance framework)

Scope: All employees and business operations

Key content/principles:

• Clear stance against child labour: child's development must not be hindered by work that keeps them from receiving education; dignity respected and health and safety protected
• Adheres to minimum employment ages in accordance with ILO Core Labor Standards and national legislation
• Categorically rejects child labour, particularly worst forms for children and young people under 18
• Verification of applicants' and employees' minimum age for employment
• Determination of which tasks may be performed by those under 18

Links to international standards:

• International Bill of Human Rights (UN Universal Declaration of Human Rights, ICCPR, ICESCR)
• UN Guiding Principles on Business and Human Rights
• ILO Declaration on Fundamental Principles and Rights at Work
• ILO MNE Declaration and ILO Convention 169
• OECD Guidelines for Multinational Companies
• Ten Principles of UN Global Compact

Governance/oversight:

• Group Compliance function
• Human rights officer (according to German Supply Chain Due Diligence Act)

Monitoring/implementation:

• Multistage due diligence process
• Risk management and risk analysis
• Complaints mechanism
• Regular reporting

Data Protection Policy

Policy name: Data protection guidelines and framework

Scope: All BMW Group operations processing personal data

Key content/principles:

• Priority given to protecting privacy, maintaining confidentiality and ensuring integrity of personal data
• Compliance with applicable laws, particularly GDPR
• Privacy by Design approach
• Regular checks of all systems for compliance with latest IT security standards

Governance/oversight:

• Group Data Protection department performs role of data protection officer
• Responsible for coordinating global data protection network
• Acts independently without being subject to outside or hierarchical direction
• Works closely with relevant data protection authorities

Key responsibilities:

• Monitoring compliance with all data protection laws
• Providing training for employees
• Advising on new projects
• Reviewing compliance with data protection requirements
• Conducting process audits

Monitoring/implementation:

• Customer Data Delegates (CDDs) role firmly established within sales companies, financial services companies and corresponding central divisions
• Global CDD network ensures systematic execution to consistently high standard
• Ongoing measures running until 2026 include internal auditing, project teams, data protection projects, regular global and regional CDD workshops
• Structured incident response process for customer data breaches

Social Protection and Employment Terms

Policy framework: Collective bargaining agreements and employment terms (not named as single policy)

Scope: BMW Group employees, particularly in Germany

Key content/principles:

• Collective bargaining coverage
• Social dialogue
• Operational collaboration model
• Central participation opportunities
• Works Council involvement

Governance/oversight:

• Works Council and employee representatives
• Managers responsible for implementing codes in their areas
• Managers obliged to inform employees about content and significance of codes

Monitoring/implementation:

• Every employee must ensure compliance with requirements related to human rights and working conditions
• Professional conduct must align with principles
• Taking social responsibility established as prerequisite for prospective business partners

Taking action on material impacts on own workforce

Training and Skills Development

Digital Skills and Technical Training Programme

• Scope: Own operations
• Actions: During the reporting period, the BMW Group provided in-depth training centred around:
  • Developing digital skills of employees, mainly focused on generative artificial intelligence
  • Further training in high-voltage technology for NEUE KLASSE battery systems
  • Training for the new direct sales model of the MINI brand in Europe
• Link to strategy: Supports The BMW Group Strategy and electromobility transition
• Outcomes: Creating new jobs at new plant Debrecen in Hungary and at existing locations, plus additional production sites for batteries in Germany and abroad

Leadership Development Programme

• Scope: Own operations
• Description: Training programme based on BMW Group's understanding of leadership and the BMW Group Leadership Competency Model
• Actions: Wide range of training and networking opportunities for leaders, plus special workshop formats for management teams
• Future approach: Leadership qualification framework will be even more modular, flexible and international

Performance and Career Development

Performance and Career Assessment Processes

• Scope: Own operations
• Description: Annual performance and career assessment processes based on defined conditions and criteria
• Coverage: 81.3% of the workforce participated in annual assessment processes in 2024
  • Male employees: 81.4%
  • Female employees: 81.2%
  • Not disclosed: 13.6%
• Outcomes: Used to assess and develop employee performance and potential; outcomes play vital role in staff development and can impact remuneration
• Objective: Strengthen performance and future viability of BMW Group through holistic, Company-wide approach

Health and Safety Management

Preventive Health Measures - Heart Health Campaign

• Scope: Own operations, internationally
• Time horizon: Reporting year 2024
• Actions:
  • Health talks and dialogue formats with experts in bilingual livestreams
  • Topics: exercise, heart-healthy eating, handling of indulgences
  • Blood pressure measurements, resuscitation exercises, healthy eating days
  • Adapted internationally to reflect local circumstances and needs
• Link to policy: ISO 45001 standard for occupational health and safety

"Watch your path!" Campaign

• Scope: Global (own operations)
• Time horizon: Running until 2025
• Description: Campaign to reduce accidents related to walking, climbing stairs and cycling
• Actions: Raising awareness and providing information on precautions
• Expected outcomes: Reduce number of accidents in identified black spots
• KPIs: Effectiveness measured by comparing latest accident figures to initial metrics from beginning of campaign
• Results: In 2024, accident frequency rate stood at 2.7, with 891 occupational accidents

Occupational Health and Safety Training Programme

• Scope: Own operations, all locations
• Resources (non-financial):
  • Medical specialists and health experts in international health management project groups
  • Collaboration with safety specialists, Health Management department and BMW Group Academy
  • Emergency and rescue paramedics participate in external training courses
• Actions:
  • Occupational health and safety training for employees at all locations
  • Continuous training for safety specialists based on current state of the art
  • Seminar curriculum developed in consultation with occupational safety and ergonomics experts
• Link to policy: ISO 45001 and OHRIS certification (100% of employees work at certified locations)
• Quality assurance: Annual quality audits conducted in accordance with ISO 9001; annual internal audits to ensure compliance

Comprehensive Preventive Measures in Occupational Health and Safety

• Scope: Own operations
• Actions:
  • Consistent implementation of occupational safety measures including ISO 45001 certification
  • Extensive training programmes
  • "Health Initiative"
  • Regular assessments of methods and tools
  • Low-threshold preventive measures to raise employee awareness of healthy lifestyle
• Expected outcomes: Minimise frequency of workplace accidents and health risks
• KPIs: Low accident frequency rate achieved
• Link to policy: ISO 45001 standard, internal specifications with local adjustments possible

Diversity, Equity and Inclusion

Diversity Management Strategic Programme

• Scope: Own operations, global
• Time horizon: Annual planning cycle
• Actions:
  • BMW Group-wide mandatory training programme combating workplace discrimination (Germany)
  • International Diversity Days throughout the year (International Women's Day, International Day of Cultural Diversity, International Day of Persons with Disabilities)
  • Panel discussions, workshops and hands-on activities
  • Development of transition guide for gender identity issues
  • Guideline for collaboration with Employee Resource Groups (ERGs)
• Resources (non-financial):
  • Membership with "PROUT AT WORK" foundation and consultancy
  • Employee Resource Groups including family and women's networks, BMW Group PRIDE association
  • "HR Business and Talent Development" division responsible for strategic alignment
  • HR departments at individual locations for implementation
• Expected outcomes: Measured via percentage of female managers, participation in training courses and events, employee survey outcomes, competition participation
• Review process: Results reviewed at end of year to form basis for planning initiatives and measures for following year

"Women Rising" Programme

• Scope: Own operations
• Description: Programme for early identification and development of talented individuals
• Target: 22% share of women in management positions by 2025; work towards 23-25% corridor by 2030
• Current performance: 21.6% women in management positions in 2024 (2,752 out of 12,755)
• Link to policy and targets: Fulfils legal requirements; two main goals:
  • Increasing performance via diverse teams
  • Unlocking women's earning potential
• Actions:
  • Actively communicating importance of diversity and gender balance
  • Showcasing positive role models
  • Cooperation with international networks
• Monitoring: HR department reviews progress and reports regularly to Board of Management and Supervisory Board

Inclusion Programme for Employees with Disabilities

• Scope: Own operations (BMW AG in Germany)
• Actions:
  • Measures adopted as part of revised general operating and inclusion agreement
  • Expanding policy of training centres for the deaf at BMW AG production sites
  • Requirements for dealing with and promoting employees with severe disabilities, including right to accessible working environment
• Current performance: 5.7% of BMW AG workforce are individuals with severe disabilities (above minimum threshold in German Social Code)
• Link to policy: General operating and inclusion agreement, corresponding guidelines throughout BMW Group

Cultural Diversity and Multi-generational Management

• Scope: Own operations, focus on BMW AG
• Time horizon: 2024 focus
• Actions:
  • In-depth analyses to enhance integration of international BMW Group employees
  • Language support measures
  • Examination of multi-generational management optimization
  • Recommendations for action to promote cooperation and facilitate transfer of knowledge

Contractor and Supply Chain Safety

Contractor Safety Programme

• Scope: Own operations, contractors on BMW Group premises
• Actions:
  • Separate contractor declaration regulating cooperation on safety-related aspects
  • Safety briefings by BMW Group experts for all external workers at major construction sites
  • Contractor responsible for safety instructions for smaller orders
  • Monitoring by ordering department supported by occupational health and safety department
• Link to policy: BMW Group Supplier Code of Conduct (obligates suppliers to comply with internationally recognised occupational health and safety requirements)
• Results: 2 fatal accidents in reporting year 2024 (both external company employees working on BMW Group premises); 0 fatalities due to work-related ill health

Targets related to own workforce

The excerpts provided focus primarily on remuneration structures and performance metrics for the Board of Management and Supervisory Board, rather than quantified workforce-related targets as required by ESRS S1-5.

Workforce-related performance indicators mentioned:

Diversity targets

• Referenced as part of Board of Management remuneration criteria
• No specific target values, baseline years, or target years disclosed
• Scope: Own operations
• Type: Mentioned as departmental and interdepartmental diversity targets
• No quantified targets provided

Employee training and development

• Indicator: Spending on employee training and development
• Used as adaptability metric in Board of Management bonus targets
• No specific target values, baseline years, or target years disclosed
• Weighting: Part of 50% ESG targets in interdepartmental targets

Attractiveness as an employer

• Indicator: Placement in rankings
• Used as metric in Board of Management remuneration
• No specific target values disclosed

Leadership performance

• Indicator: Employee satisfaction
• Used in performance assessment
• No specific target values disclosed

Note: The excerpts reference targets related to diversity, employee training and development, and employer attractiveness, but do not provide the quantified target values, baseline years, target years, or progress data required by ESRS S1-5. The document cross-references other sections (e.g., "↗ Overview of targets related to social sustainability matters", "↗ Attractive employment conditions", "↗ Promoting diversity") which are not included in the provided excerpts.

Social protection

Disclosure status

ESRS S1-11 (Social protection) is listed in the phase-in disclosure table as "Complete phase-in for KPI, qualitative information as early as reporting year 2024."

However, the actual disclosure is marked as "n. a./phase-in" in the ESRS index.

Pension and retirement benefits

The BMW Group operates defined benefit and defined contribution pension plans across its major locations.

Germany

• Employer-funded and employee-funded benefit plans exist
• Benefits include retirement, disability and surviving dependents' benefits
• Pension adjustments per § 16 of the Company Pensions Act (Betriebsrentengesetz)
• Two employer-funded plans based on defined contributions:
  • Level depends on capital market developments
  • Funded by: fixed monthly contributions, deferred remuneration option, matching contribution, and performance-based contributions
  • Minimum interest rate guaranteed by BMW Group (classified as defined benefit under IAS 19)
  • One plan funded entirely by deferred remuneration
• Employer-funded defined benefit pension plan (closed to new entrants)
  • Benefit = fixed amount × completed years of service
  • Only for employees who did not switch to defined contribution system in 2021-2022

UK

• Defined benefit plans exist, closed for all plan participants
• Vested benefits remain in place
• New benefits covered by contributions to defined contribution plan
• Administered by BMW Pension Trustees Limited and BMW (UK) Trustees Limited

Plan assets (31 December 2024)

Board of Management retirement benefits

Defined contribution system with guaranteed minimum return:

• Annual Company contributions to individual savings accounts
• Annual contributions: €400,000 per Board member; €700,000 for Chairman
• Benefits based on contributions plus interest earned
• Payment as lump sum or annual instalments at Board member's discretion
• Minimum age for benefits: 62 years
• Vesting period: 1 year of employment
• Invalidity pension available if employment ends due to invalidity
• Survivor benefits for spouse/registered partner or children

Board of Management service cost 2024

Coverage and methodology

The report confirms employees in the following categories are excluded from the employee headcount (and therefore from standard benefit counts):

• Employees in inactive early retirement phase
• Women on maternity leave
• Employees absent for: sabbaticals, parental or family care leave, long-term illnesses, military service, accompanying partner abroad
• Temporary agency workers
• Other BMW Group employees (apprentices, dual students, interns, thesis authors, postgraduate students, scholarship holders, assistants, working students, journalist trainees)

No specific percentages of employees covered by social protection against loss of income from major life events (sickness, unemployment, employment injury, parental leave, retirement) are disclosed in the provided excerpts.

No country-by-country breakdown of social protection coverage is provided beyond the pension plan descriptions for Germany and UK.

Persons with disabilities

Percentage of employees with disabilities

Individuals with severe disabilities represent 5.7% of the workforce of BMW AG, in excess of the minimum threshold stipulated in the German Social Code.

Scope and methodology

Definition: The share of employees with severe disabilities is based on the statutory requirements in accordance with the German Social Code (SGB IX).

Scope: The reported percentage applies to BMW AG specifically (not the entire BMW Group).

Policies and measures

In the reporting year, the BMW Group continued to work on measures adopted as part of the revised version of the general operating and inclusion agreement for employees with disabilities. This included expanding the policy of training centres for the deaf at BMW AG production sites.

The inclusion agreement sets out requirements for dealing with and promoting employees with severe disabilities, including the right to an accessible working environment. Corresponding guidelines are in place throughout the BMW Group.

Events for the International Day of Persons with Disabilities were held as part of the BMW Group's international Diversity Days in 2024.

Training and skills development metrics

Average training hours per employee

The average number of hours of training and further education per employee is calculated on the basis of the total number of training hours in the reporting year in relation to the average number of employees in each month of the BMW Group in the reporting year. The training hours taken into account include all training and qualification measures carried out, including e-learning.

Note: Specific average training hours data (overall, by gender, or by employee category) are not disclosed in numerical form in the excerpts provided.

Performance and career development reviews

Percentage of employees receiving reviews

The percentage of employees who have received an annual performance and career development assessment is calculated by dividing the number of annual performance and career development assessments conducted by the number of employees as at 31 December of the reporting year. The calculation broken down by gender is calculated in the same way. Gender identities are defined in line with the ESRS. Only regular annual performance reviews are included.

Note: Specific percentage values for performance review coverage (overall or by gender) are not disclosed in numerical form in the excerpts provided.

Training investment

No disclosure of total investment in training (€) is provided in the excerpts.

Policies and actions

The BMW Group has identified training and skill development as a material positive impact. Key policies and actions include:

• Integrative Just Transition approach
• Performance and career development assessment processes
• Investment in vocational training and further education
• Comprehensive training measures determined using a system-supported Training Needs Analysis process
• Qualification and development of managers based on the Leadership Competency Model
• BMW Group development programmes to retain top talent at an early stage

The material impact statement notes: "Training and skill development of employees worldwide enhances qualification, allows for professional growth and continued employability."

Work-life balance metrics

Parental leave

The BMW Group defines parental leave as a period of absence from work granted to an employee of the BMW Group before and/or after the birth of a child or in the case of adoption, usually on the basis of national legal regulations.

Maternity leave is a period of leave from work granted to an employee of the BMW Group before and/or after the birth of a child or in the case of adoption, usually on the basis of national legal regulations.

Employee exclusions from headcount

The total employee figure does not include employees in inactive early retirement phase, women on maternity leave, employees who are absent for reasons including sabbaticals, parental or family care leave, long-term illnesses, military service or accompanying their partner abroad, other BMW Group employees and temporary agency workers.

Note: The document confirms that employees on parental leave, maternity leave, and family care leave are excluded from the reported headcount figures, but does not provide quantitative metrics on:

• % of employees entitled to family-related leave by type
• % of entitled employees who took family-related leave (by gender)
• Return-to-work rates after parental leave (by gender)
• Multi-year comparisons for these metrics

Incidents, complaints and severe human rights impacts

Materiality Assessment

According to the ESRS index, BMW Group has assessed:

• ESRS S1-17.103(a) Incidents of discrimination: Not material
• ESRS S1-17.104(a) Non-respect of UNGPs on Business and Human Rights and OECD: Not material

Notifications of Potential Violations in the Supply Chain

The BMW Group operates grievance mechanisms accessible to employees, suppliers and other third parties to report potential violations of sustainability principles.

Methodology note: All notifications are processed until they are fully resolved, if necessary over several financial years. Six notifications received in 2024 were still at the internal processing stage at the end of the financial year and had not yet been fully resolved. Similarly, six notifications from previous years were still being processed.

Grievance Mechanisms

The BMW Group maintains multiple reporting channels and complaints procedures:

• Internal grievance mechanisms
• RBA-developed applications that are continuously monitored and tested
• Participation in a sector dialogue (Branchendialog Automobilindustrie) working group on establishing a company-wide complaints mechanism in Mexico (piloted since 2024)
• See also: Compliance and notification systems

Supply Chain Assessments and Findings

The BMW Group conducts systematic assessments of supplier sites to identify actual or potential human rights and environmental impacts:

Note: Basis for supplier assessment metrics is industry-specific sustainability questionnaire (online assessment). On-site assessments include interviews with the workforce at supplier sites to identify actual or potential impacts. Where severe findings are identified, effectiveness of agreed measures is verified in an on-site closure assessment.

Characteristics of the undertaking's employees

Total headcount and FTE

2024: 159,104 employees (year-end) 2023: 154,950 employees (year-end) Change: +2.7%

(FTE not separately disclosed)

Headcount by gender

Share of women in management positions:

• 2024: 21.7%
• 2023: 20.8%
• Change: +4.3%

Target: The BMW Group aims to increase the share of women in management positions to 22% by 2025, with a corridor of 23 to 25% by 2030.

(Total headcount by gender - male/female/other/not disclosed breakdown - not disclosed in the excerpts)

Headcount by country or region

Not disclosed in quantitative detail in the excerpts.

Headcount by employment contract type

Not disclosed (permanent/temporary/non-guaranteed hours breakdown not provided).

Headcount by employment type

Not disclosed (full-time/part-time breakdown not provided).

Employee turnover

Not disclosed in the excerpts.

New hires

Not disclosed in the excerpts.

BMW AG specific data

As at 31 December 2024:

• 87,823 employees
• 5,942 apprentices, interns and thesis students

As at 31 December 2023:

• 85,168 employees
• 5,733 apprentices, interns and thesis students

Notes

The excerpts confirm total workforce figures at year-end and the share of women in management positions as key non-financial performance indicators. Detailed breakdowns by gender, region, contract type, employment type, turnover, and new hires are not included in the provided sections. BMW AG (standalone entity) figures are separately disclosed.

Characteristics of non-employees in the undertaking's own workforce

Definition and Scope

The BMW Group defines non-employees within the meaning of ESRS S1-7 as mainly temporary agency workers. Temporary agency work is defined in accordance with the ILO Declaration on Fundamental Principles: an employee is hired by a temporary employment agency and then hired out to perform work under the supervision and direction of the user company. There is no employment relationship between the temporary agency worker and the user company, although legal obligations exist, especially with respect to health and safety. The relevant labour contract is of limited or unspecified duration with no guarantee of continuation. The user company pays fees to the agency, and the agency pays the wages.

The use of temporary agency workers provides the BMW Group with flexibility to react to short-term peaks in capacity utilisation, market or model-specific fluctuations, unforeseeable economic changes and structural and project-related issues. In addition to being assigned to specific projects, they help balance out fluctuations and utilisation peaks.

The BMW Group complies with locally applicable legal requirements, such as the German Temporary Employment Act, as well as internal agreements with employee representatives that regulate the use of temporary agency workers.

Workforce Coverage

The entire workforce of the BMW Group, including non-employees, was considered equally in the materiality assessment. All employee groups were covered through the involvement of different stakeholder groups, including the Works Council. Impacts resulting from various areas of activity, production and indirect employment were taken into account.

Number of Non-Employee Workers

Note: Compared to the Key Performance Indicator, in accordance with ESRS only consolidated companies are included. The Joint Operation Spotlight is included proportionally.

Breakdown by Gender

Permanent employees:

• Male: 117,156
• Female: 28,649
• Other: –
• Not disclosed: 41

Temporary employees:

• Male: 10,161
• Female: 2,431
• Other: –
• Not disclosed: 3

Non-guaranteed hours employees:

• Male: –
• Female: –
• Other: –
• Not disclosed: –

Note: Non-guaranteed hours employees type of contract is not used by the BMW Group.

Breakdown by Geographical Area (2024)

Occupational Health and Safety Coverage

Occupational health and safety management systems are in place at all production sites and certified in accordance with ISO 45001 or OHRIS (based on ISO 45001). This means that 100% of BMW Group employees, other BMW Group employees and temporary agency workers work at a location that has an occupational health and safety management system.

Work-Related Accidents (2024)

Note: The accident frequency rate is calculated per million hours worked. Accidents are only included if they result in at least one day of absence.

Contractor Safety

The BMW Group regulates cooperation with contractual partners on safety-related aspects at the sites by way of a separate contractor declaration. At major BMW Group construction sites, all external workers of partner companies receive safety briefings from BMW Group experts. The contractor is responsible for providing safety instructions in the case of smaller orders. The department responsible for placing the order monitors compliance with occupational health and safety regulations, supported by the relevant occupational health and safety department.

Methodology

The counting method uses headcount (not FTE). The metric includes Spotlight Automotive Ltd. with a share of 100% for occupational health and safety data. Data has been subject to reasonable assurance for key employee figures.

Collective bargaining coverage and social dialogue

Collective bargaining coverage

Around 78% of employees in the BMW Group are covered by collective bargaining agreements.

Social dialogue and employee representation

The BMW Group has established comprehensive social dialogue mechanisms, including:

• BMW EURO Works Council: Established in 1995, serving as a central platform for dialogue between employee representatives and Group management at the European level
• Regular meetings: Up to two meetings per year between the BMW EURO Works Council and corporate management, with workers' representatives from production sites outside Europe also invited to attend
• Works councils: Present at German locations with structured co-determination rights

Workplace representation coverage (EEA)

Percentage of employees in European Economic Area (EEA) countries covered by employee representation:

Note: The workplace representation metric only looks at employees who are employed in a country in the European Economic Area (EEA) and in which the number of employees is significant. For the BMW Group, this is only Germany in the year under review.

Work stoppages

In 2024, work stoppages lasted a total of 0 days. The number of days idle for 2024 was 0.

Employee participation mechanisms

• Idea management system: Employees can suggest improvements outside the direct scope of their tasks, with awards given for ideas with positive impacts on efficiency or sustainability
• Employee survey: Company-wide employee survey performed every two years to measure workforce mood and organizational performance (High Performance Organisation Index)
• Communication channels: Company meetings, intranet, email, and town hall meetings
• Employee Resource Groups (ERGs): Including family and women's networks at numerous locations and the BMW Group PRIDE association

Rights and principles

The BMW Group recognizes:

• The right of all employees to representation and to conduct collective bargaining to negotiate working conditions
• Freedom of association and collective bargaining as fundamental rights
• Non-discrimination based on trade union membership or non-membership

The corporate culture is characterized by trusting and constructive cooperation with relevant employee representatives, maintaining a strong cooperative relationship for the benefit of the Company and its employees.

Diversity metrics

Gender distribution at management level

The BMW Group reports on gender distribution at management positions, defined as hierarchical functional levels I to IV below the Board of Management.

Gender distribution at management level (2024)

Share of women in management positions - Multi-year trend

Strategic target: The BMW Group aims to achieve a 22% share of women in management positions by 2025 and to work towards attaining a 23-25% corridor by 2030.

Age band distribution of total workforce

Employees by age group (2024)

Total workforce gender distribution

Number of employees by gender (2024)

Employees by contract type and gender (2024)

Employees by geographical areas and country (2024)

Board composition

The BMW Group reports that the Supervisory Board of BMW AG includes a joint supervisory board composed of an equal number of shareholder representatives and employee representatives. Specific gender breakdown of board members was not disclosed in the excerpts provided.

Methodology notes

• From financial year 2025 onwards, non-consolidated companies will be excluded from reporting (until 31.12.2024: all consolidated and non-consolidated companies in which the BMW Group holds more than 50% of the shares). For 2024, the figure for consolidated companies only is 157,457 employees and 21.6% share of women in management positions.
• The joint operation Spotlight is not included in employee metrics.
• Gender identities are defined in line with ESRS.
• All metrics marked with 'Assurance level: reasonable assurance' in the original report.

Policies related to value chain workers

BMW Group has established comprehensive policies governing its value chain workers through its due diligence processes and supplier requirements.

BMW Group Supplier Code of Conduct

Scope:

• Applies to all direct suppliers (tier-1) with contractual business relationships with BMW Group
• Direct suppliers undertake to extend requirements to indirect suppliers (n-tier)
• Covers upstream value chain including manufacturing, distribution sites, and raw material extraction and processing

Governance and approval:

• The Purchasing and Supplier Network department is responsible for developing and implementing due diligence processes within the supply chain
• In 2024, this responsibility was firmly embedded in the purchasing strategy and strengthened by establishment of a dedicated department

Key content and principles:

The Code contains provisions across four main areas:

Responsible business practices

Environmental responsibility:

• Reduction of air, water and soil pollution
• Decarbonisation, resource conservation and circular economy
• Lowering consumption of energy, water and raw materials
• Measures to protect biodiversity
• Responsible handling of hazardous materials and waste
• Application of Minamata Convention, Stockholm Convention, Basel Convention and REACH Regulation

Social responsibility:

• Prohibition of child and forced labour, slavery and human trafficking
• Freedom of association and right to collective bargaining
• Protection against discrimination
• Right to health and safety in the workplace
• Working conditions and working time
• Equal treatment and opportunities
• Requirement to consider and protect affected (local) communities and indigenous peoples across the supply chain

Critical raw materials:

• Clear provisions on handling of critical raw materials

Links to international standards:

The BMW Group Supplier Code of Conduct is based on the following external frameworks and guidelines:

• German Supply Chain Due Diligence Act (Lieferkettensorgfaltspflichtengesetz [LkSG])
• International Bill of Human Rights (UN Universal Declaration of Human Rights, ICCPR, ICESCR)
• UN Guiding Principles on Business and Human Rights
• International Labour Organization (ILO) Declaration on Fundamental Principles and Rights at Work
• ILO's Declaration of Principles concerning Multinational Enterprises and Social Policy (MNE Declaration) and ILO Standard 169
• OECD Guidelines for Multinational Companies
• Ten Principles of the UN Global Compact

Public availability:

• Referenced throughout the report as publicly available
• Integral part of the International Terms and Conditions for the Purchase of Production Materials and Automotive Components (IPC) for suppliers of production material and vehicle components
• Part of General Terms and Conditions for Indirect Purchasing (GTC) for suppliers of non-production-related material

Monitoring and implementation:

BMW Group employs a multistage due diligence process:

Risk analysis:

• Annual and ad-hoc specific risk analysis of direct suppliers
• Uses internal and external data sources including country- and commodity-specific indicators and media analyses
• Extends to sub-supplier locations where required
• Uses AI and big data analytics methods

Control mechanisms:

• Online assessments: Standardised sustainability questionnaire (Drive Sustainability initiative) integrated in procurement process. In 2024, 12,078 supplier sites were assessed
• On-site assessments: Risk-based audits at supplier locations using RBA Validated Audit Programme (VAP) and Responsible Supply Chain Initiative (RSCI) standards. 132 active and potential supplier sites inspected in 2024
• Closure assessments: For severe findings, effectiveness of remedial measures verified through on-site closure assessment. In 2024, 22 of 28 closure assessments confirmed all priority non-conformities had been remedied
• Certification requirements: TISAX automotive standard for cyber security; ISO 14001 and ISO 45001 certifications required based on risk assessment

Preventive measures:

• If deviations identified, preventive measures agreed with supplier and implementation monitored
• In 2024, 79% of production material suppliers implemented specified preventive measures at time of awarding; additional 17% had agreed on measures
• Mandatory training for purchasing staff on sustainability in supply chain
• Voluntary training available for purchasing staff, process partners and suppliers
• Industry-wide training programmes through initiatives like RBA

Remedial measures:

• Individual action plans drawn up by suppliers to remedy findings
• Implementation monitored in cooperation with RBA and RSCI
• Training provided to support supplier efforts

Complaints procedure:

• Multiple reporting channels available to employees, suppliers and third parties
• 22 notifications of potential sustainability violations received in 2024, of which 16 were resolved (none justified)
• Group-wide electronic case management system for tracking
• Involvement in working group on Company-wide complaints mechanism in Mexico (piloted since 2024)
• Access to RBA Voices standardised grievance mechanism
• If supplier refuses remedial measures, business relationship may be suspended or terminated as last resort
• No supplier relationships terminated in 2024 due to severe sustainability violations

Effectiveness analysis:

• Comprehensive functionality assessment of due diligence instruments and procedures
• Performance assessment focusing on preventive and remedial measures
• Regular refinement of analysis methodology

Target: All direct supplier sites completing on-site assessment shall meet locally applicable statutory requirements for sustainability and international human rights standards (BMW Group minimum requirements)

BMW Group Anti-Deforestation Policy

Scope:

• Supply chains for natural rubber, leather, paper, and wood
• Applies across value chain

Key content:

• Clear stance against deforestation and forest degradation in supply chains
• Addresses extent of commitment, scope, due diligence and traceability measures, complaint and monitoring mechanisms, and material-specific requirements
• Commitment to sourcing cowhide from supply chains free from deforestation and land conversion by 2030 (as signatory to LWG/Textile Exchange/WWF "Deforestation Free Call to Action for Leather")

Links to international standards:

• EU regulations on deforestation
• Industry standards

Monitoring:

• Safeguarding measures in place for relevant material supply chains
• Member of Global Platform for Sustainable Natural Rubber (GPSNR) since 2019
• Part of Leather Working Group (LWG)
• Participation in Living Rubber project in Indonesia

BMW Group Biodiversity Policy

Scope:

• Covers supply chain biodiversity risks and impacts
• Applies to critical raw materials

Key content:

• Addresses biodiversity risks and opportunities
• Sets out BMW Group's position on biodiversity

Monitoring:

• Implemented through multistage due diligence process in supply chain
• BMW Group Supplier Code of Conduct includes clear provisions on biodiversity and critical raw materials handling

Process for responsible management of raw materials

Scope:

• N-tier suppliers (raw material extraction and processing)
• Focus on critical raw materials including lithium, cobalt, mica, and natural rubber

Key content:

• Due diligence in raw material supply chains
• Involvement in development and implementation of environmental and social standards through Initiative for Responsible Mining (IRMA) and Responsible Minerals Initiative (RMI)
• Goal of generating positive impact for selected raw materials through local development projects (mica, cobalt, natural rubber)
• Direct securing of raw materials where required to increase security of supply
• Focus on secondary raw materials to reduce carbon emissions and preserve biodiversity

Governance:

• Supply Chain Sustainability department responsible for implementation

Monitoring:

• Risk analysis of n-tier suppliers
• Certification and traceability of raw materials supply chains
• Implementation of local projects
• Complaints procedure
• Use of digital product passports and Catena-X platform for supply chain traceability

Raw materials strategy

Key content:

• Integrated approach to reduce price, supply, geopolitical and regulatory risks in supply chain
• Long-term supply agreements with strategic partners (e.g., battery cell production capacities)
• Use of secondary materials and renewable electricity in battery cell production
• Measures agreed in sustainability agreements or considered in project awards

Monitoring:

• Close cooperation with supply chain partners
• Direct procurement of critical raw materials where required

Taking action on material impacts on value chain workers

Social and Environmental Responsibility in the Supplier Network

BMW Group has established multiple programmes and initiatives to address material impacts on value chain workers:

1. CDP Supply Chain Programme

Scope: Upstream supply chain

Description: The Supply Chain Programme of the NGO CDP (formerly the Carbon Disclosure Project) is used to assess the performance of the supply chain in terms of reducing CO2e emissions. Participating suppliers are provided support with defining CO2e reduction targets, integrating them into their business processes and reporting on the progress made on a regular basis. Associated with this is a rating from which the BMW Group derives measures for supplier development and empowerment.

Scale: In 2024, 271 suppliers took part in the rating. This corresponds to 79% of the BMW Group's direct production-related purchasing volume.

Expected outcomes: CO2e reduction in supply chain, supplier development and empowerment

2. Renewable Energy Requirements for Suppliers

Scope: Upstream supply chain (direct tier 1 suppliers and energy-intensive n-tier suppliers)

Description: Since 2021, the requirement to use electricity from renewable sources has applied to both direct (tier 1) suppliers and to energy-intensive pre-production (n-tier) processes involved in the production of CO2e-intensive components and materials.

Verification: In 2024, the BMW Group started to review the implementation concepts of new suppliers with contracts that stipulate the use of electricity from renewable sources prior to series production.

Expected outcomes: Decarbonisation of the supply chain

3. CO2 Reduction Measures Verification Programme

Scope: Upstream supply chain (series production suppliers)

Description: The BMW Group reviews the effectiveness of the CO2-reducing measures in its series production annually in cooperation with a specialised external service provider.

Resources: External service provider partnership

Scale: 71 suppliers were assessed in this regard in 2024

Outcomes achieved: In the reporting year, verified and implemented actions reduced supply chain emissions by around 2.8 million t CO2e. It is expected that it will be possible to reduce CO2e emissions again in subsequent years based on measures in the supply chain.

4. Supplier Sustainability Assessments (On-site)

Scope: Upstream supply chain (direct suppliers and surrounding facilities)

Description: On-site assessments are largely carried out in accordance with the standards of RBA-VAP (Validated Assessment Program of the Responsible Business Alliance) and VDA-RSCI (Responsible Supply Chain Initiative of the German Association of the Automotive Industry). These assessments are carried out on behalf of the BMW Group by external audit companies approved by the standard setter, such as TÜV Rheinland, Intertek, SGS, Elevate, DNV, etc.

Resources: External audit companies partnership

Scale: The total number of on-site assessments carried out at BMW Group supplier sites within the reporting year includes initial assessments and follow-up assessments. For all findings categorised as serious during an initial assessment, the effectiveness of the agreed measures is reviewed on-site as part of a closure assessment.

5. Supplier Self-Assessment Questionnaire Programme

Scope: Upstream supply chain (active and potential suppliers)

Description: Online assessments based on the Drive Sustainability initiative's industry-wide sustainability questionnaire are used as part of the awarding process. Required for the purchase of production-related material with a contract value of more than €2 million. A risk-based analysis is carried out for non-production-related purchasing processes, currently including all orders potentially exposed to risk with master agreement volume over €2 million or individual agreement volume over €10 million.

Resources: External service provider platform (12-month subscription per questionnaire)

Scale: All sustainability questionnaires completed by supplier locations that the BMW Group obtained and evaluated during the reporting year

6. Supplier Escalation Process (ESPRO)

Scope: Upstream supply chain

Description: Standardised process across the entire BMW Group for handling sustainability-related incidents with legitimate criticality. Includes predefined "escalation criteria" based on the German Supply Chain Due Diligence Act (LkSG).

Outcomes: Suspension or termination of supplier relationships with severe sustainability violations

7. Use of Secondary Materials

Scope: Upstream supply chain

Description: The use of secondary materials represents an important contribution to the decarbonisation of the supply chain.

Link to policy: Part of broader CO2e reduction measures in supply chain

8. Nature-Based Materials in Production

Scope: Upstream supply chain and own operations

Description: The BMW Group is starting to use nature-based materials in the production of its vehicles to reduce CO2e emissions related to components. This includes using renewable plant-based raw materials for certain components, such as panelling elements in vehicle interiors. In future, the BMW Group intends to use renewable raw materials for the production of seat covers or interior panelling elements.

Time horizon: Medium to long-term

Resources and Financial Planning

Financial integration: The implementation and financing of actions and the measurement of target achievement are all part of long-term corporate planning. Taking measures into account in the financial planning process ensures that adequate funding is available to implement them in the relevant periods.

Time horizon: The implementation of these CO2e reduction measures is initially geared towards the year 2030. However, the measures extend well beyond 2030 in many areas, such as the adaptation of the product portfolio or making it possible to operate new sites without the use of fossil fuels. This also supports the aim to achieve Net Zero across the entire value chain by 2050 at the latest.

Monitoring and Notification Systems

The BMW Group operates reporting channels for notifications of potential sustainability violations in the supply chain. This metric includes the number of notifications received through BMW Group reporting channels on suppliers along the entire supply chain, entered into the Group-wide electronic case management system during the financial year.

Limitations

The metrics include no information on the supply chain of the Chinese joint operation Spotlight Automotive Ltd., as the BMW Group does not have this information for the reporting year. The BMW Group supports Spotlight Automotive Ltd. with the implementation and further development of management approaches and reporting structures on due diligence obligations in the supply chain.

Policies related to consumers and end-users

BMW Group has identified ESRS S4-1.16 (Policies related to consumers and end-users) as material. The ESRS index references multiple sections of the report that contain relevant policy disclosures:

Referenced Policy Areas

According to the ESRS index, S4-1.15-17 (Policies on consumer and end-user engagement) is addressed through the following sections:

• Basis for action
• The BMW Group always focuses on the customer
• Customer data protection
• Organisation of and approach to preventing the misuse of data
• Protecting vehicle data
• Product quality and product safety standards

Additionally, S4-1.16b) specifically references:

• Compliance and notification systems (referenced in the Combined Management Report)

Policy Implementation Areas

While specific named policies are not provided in the excerpts, the following policy-related areas are disclosed:

Customer Data Protection and Data Security

• Organisation and approach to preventing the misuse of data
• Protecting vehicle data
• Dealing with the opportunities and risks associated with digitalisation

Product Quality and Safety

• Product quality and product safety standards
• Safety concepts for BMW Group vehicles
• Exclusion of problematic substances
• Safeguarding quality standards
• Raising awareness of safe driving

Customer Engagement and Transparency

• Solutions-focused customer service
• Access to quality information
• Ongoing optimisation of access to information
• Making sustainability transparent
• Ensuring customer satisfaction
• Analysing market trends and brand perception

Compliance

• Compliance and notification systems (referenced in Combined Management Report)

Link to International Standards

ESRS S4-1.17 concerning "Non-respect of UNGPs on Business and Human Rights and OECD guidelines" is identified as material and references the "Characteristics of consumers and end-users" section.

Note on Disclosure

The excerpts primarily contain index references rather than the full policy content. The actual policy details, governance structures, approval processes, scope definitions, and monitoring mechanisms are referenced but not included in the provided excerpts.

Taking action on material impacts on consumers

Actions referenced in S4-4 index

The ESRS index indicates that S4-4 disclosures are provided in the following sections:

• Ensuring customer satisfaction
• Access to quality information
• Ongoing optimisation of access to information
• Organisation of and approach to preventing the misuse of data
• Safety concepts for BMW Group vehicles

Information security and data protection

Scope: Own operations and IT systems

Actions taken:

• Introduction of processes including standardised safety assessments and regular penetration tests to protect IT systems
• Implementation of strict firewall regulations, application whitelisting and use of endpoint security software to prevent downtimes of manufacturing equipment due to targeted cyberattacks
• Launch of a programme to increase employee awareness of information and IT security through appropriate measures and to establish a lasting security culture
• Implementation of known requirements of the EU AI Act and set up of corresponding processes
• Systematic documentation of risks relating to information security, data protection and IT in conjunction with risk management requirements, with measures provided by internal specialised departments and continuous monitoring with regard to threat level and risk mitigation
• Regular analyses and controls as well as tight security management policies

Expected outcomes: Protection of information from unauthorised access or misuse; mitigation of negative effects on business performance, disruption in production or reputational damage

Product quality and recalls

Scope: Own operations and products

Actions taken:

• Deployment of thorough quality assurance processes
• Implementation of numerous control points as part of the homologation process to identify and mitigate risks
• Establishment of appropriate provisions for statutory and non-statutory warranty obligations

Expected outcomes: Reduction of product recalls and associated costs; mitigation of negative impact on reputation

Dealer network management

Scope: Downstream value chain (sales network)

Actions taken:

• Ongoing monitoring of developments in dealerships to implement measures at an early stage if necessary
• Alignment of sales organisation with future needs, prioritising customer expectations and needs more consistently

Expected outcomes: Mitigation of negative impact on global vehicle sales and service availability from dealership insolvency

Incidents of corruption or bribery

Confirmed incidents

Not disclosed. The BMW Group does not report a specific number of confirmed incidents of corruption or bribery for the 2024 reporting period.

Convictions and fines

Not disclosed. No information is provided regarding convictions, legal decisions, or fines paid for violations of anti-corruption or anti-bribery laws.

Disciplinary actions

Not disclosed. The company does not report the number of employees dismissed or disciplined due to corruption or bribery.

Contracts terminated

Not disclosed. The company does not report the number of contracts with business partners terminated or not renewed due to corruption or bribery.

Investigation procedures and speak-up mechanisms

The BMW Group maintains a comprehensive Compliance Management System (CMS) focused on preventing, detecting and combating corruption and bribery. The system includes:

Notification systems: Employees and external parties can report compliance violations through multiple channels:

• BMW Group SpeakUP Line (anonymous and confidential, available in several languages)
• BMW Group Compliance Contact
• Ombudsperson
• Local Compliance Offices
• Direct contact with managers or compliance functions

The SpeakUP Line is accessible in all countries where BMW Group employees work via local, toll-free telephone numbers in more than 30 languages.

Investigation processes: Compliance investigations are conducted on an ad hoc or non-ad hoc basis by local Compliance functions in consultation with central Group Compliance. Investigations with company-wide impact are performed by Group Compliance. Where conflicts of interest exist, Group Corporate Audit assumes responsibility. All queries and concerns are documented and processed using a Group-wide electronic case management system.

Protection of information providers: The BMW Group protects whistleblowers in two ways: individuals may provide information anonymously, and no one providing information faces retaliatory action. The company observes the prohibition on penalising whistleblowers acting in good faith.

Sanctions: Where infringements can be traced to an individual, that person will be appropriately sanctioned in accordance with defined processes. Emphasis is placed on reducing the risk of repeat offences.

External certification: In November 2024, external certification in accordance with Auditing Standard 890 of the Institute of Public Auditors in Germany (IDW PS 980) confirmed the full appropriateness and effectiveness of the Compliance Management System in terms of anti-corruption and antitrust compliance.

Reporting: The Board of Management, Supervisory Board and auditor are informed annually of the number of notifications of compliance infringements, the number of audits conducted and their results. More detailed half-yearly reports are prepared based on materiality criteria. The Chief Compliance Officer provides regular updates (at least twice a year) to the Board of Management and Supervisory Board.

Political influence and lobbying activities

Political engagement approach

The BMW Group maintains a continuous dialogue with its stakeholders and factors their different perspectives into its decision-making process. The BMW Group is increasing the transparency of its decision-making processes by communicating its BMW Group Strategy and positions on political, regulatory and social issues. At the BMW Group, the Corporate and Governmental Affairs department is responsible for understanding the values and aims of the people around us, managing relationships and communicating with relevant stakeholders. The governmental affairs structures within the BMW Group are an integral component of this department and are responsible for its relationships with political stakeholders.

The BMW Group interacts closely with key stakeholder groups including government ministries, legislators, unions, associations and non-governmental organisations (NGOs), with a view to playing a constructive and transparent role in helping shape the general political framework to the extent that it concerns the Group's business activities.

A comprehensive overview of the BMW Group's key political positions and its approach to representing its interests can be found in Advocacy.

Ethical standards and guidelines

Internal requirements are derived from the BMW Group's positions and must be implemented by the BMW Group's business entities. The BMW Group's lobbying activities are coordinated in committees. The documents are fully recorded and made available using the BMW Group's internal committee management system.

The compliance aspects related to lobbying form part of the web-based Compliance Essentials training course, which the defined group of employees is required to complete every two years. In the reporting year, the members of the Supervisory Board of BMW AG received training in the form of a written document on the subject of anti-corruption and bribery. The relevant content of the training was also the subject of a presentation given to the members of the Supervisory Board by the Chief Compliance Officer.

Supervision of lobbying activities

If new regulatory requirements and legislative proposals are communicated to the BMW Group via external networks (e.g. by industry associations or ministries) they are initially assessed and the relevant assumptions are prepared together with internal departments. The assumptions and lobbying positions which form part of the BMW Group's involvement in discussions within associations are presented and adopted by the relevant committees.

Involvement in political decision-making processes carries with it the risk of negative media coverage and a resulting loss of reputation. For this reason, the BMW Group engages in transparent dialogue and provides comprehensive information on its political positions on its website and in relevant transparency registers.

Targets and effectiveness

Given that lobbying activities are dependent on external factors, the BMW Group approach to the representation of its interests does not include the measurement of targets and effectiveness. Relevant measures include the disclosure of the BMW Group's positions and lobbying activities, as well as raising the awareness of employees via the required web-based Compliance Essentials training course.

Political contributions

The BMW Group made political contributions to the following recipient groups in the reporting year:

• Dialogue events: Sponsoring of political events for collaboration and exchange purposes
• Collaborations: Sponsoring with reciprocal business (for advertising purposes) or lectures by representatives of the BMW Group

Political contributions by recipient group

In addition to financial benefits, political contributions include benefits in kind. The conversion of the respective benefit in kind is carried out as part of an equivalency calculation under the responsibility of the department providing the benefit and, if applicable, the responsible divisional controlling department. The Purchasing division is also included above a materiality threshold of €20,000.

Political contributions are recorded by means of a Group-wide IT-supported enquiry. The feedback is analysed by the responsible office, checked for plausibility, and broken down by type of recipient. The reported metric includes all contributions above a materiality threshold of €2,000 per recipient.

Any political contributions made by the BMW Foundation Herbert Quandt (BFHQ) are not included in the figures stated above. Due to its close ties to the BMW Group, BFHQ was also incorporated into the key performance indicators. As a result, BFHQ did not make any political contributions for the BMW Group in 2024. Any political contributions made by the BFHQ are independent of the BMW Group and are made solely in pursuit of the interests of the BFHQ, and without consideration of any interests of the BMW Group.

Positions in public administration

There were no changes to the Board of Management in the 2024 reporting year. As a result, no members were appointed to the Board of Management who held a comparable position in a public administration (including regulatory authorities) in the two years prior to their appointment. In the 2024 financial year, a member was appointed to the Supervisory Board as part of the employee representative elections. This member has held a comparable position in public administration since the 2023 financial year.

EU Transparency Register

The BMW Group is listed in the EU Transparency Register and in the equivalent registers of the EU Member States listed below.

Entries in the EU Transparency Register and in equivalent registers of the Member States

Lobbying focus areas

The BMW Group engages in lobbying activities across eight defined core segments:

1. Drivetrain policy: The BMW Group is calling for a revision of the EU legislation on fleet-wide emissions targets from 2035 onwards to include all available drive technologies (battery-powered electric vehicles, plug-in hybrids, fuel cell vehicles and vehicles with internal combustion engines). The BMW Group advocates for the increased use of renewable fuels (electricity-based fuels and advanced second- and third-generation biofuels) such as HVO100. These proposals are put forward to the government ministries of the Federal Republic of Germany and at the European level.

2. Climate and energy policy: The BMW Group is committed to meeting the climate targets set out in the Paris Agreement. The BMW Group is in dialogue with the German Bundestag and the German government regarding the implementation of the Renewable Energy Directive III (RED III) to help reduce CO2e in the energy sector. The BMW Group supports the ongoing international scientific and political discussions on effective carbon accounting and the Catena-X automotive data space for standardised global calculation methods.

3. Circular economy: The BMW Group is committed to an efficient legal framework for the circular economy, focusing on high-quality recycling of end-of-life vehicles and the supply of suitable recycled materials. The focus is on innovating the automation of recycling technologies.

4. Urban mobility: The BMW Group works with cities and local authorities to develop and implement joint solutions addressing increasing traffic volumes and related emissions, including the BMW eDrive Zones project deployed in more than 150 cities.

5. Digital policy: The BMW Group engages with relevant authorities in the EU and China regarding the establishment of uniform global standards and statutory framework (e.g. EU Data Act, China cross-border data transfer). The BMW Group is also in discussions with the German Federal Ministry of Transport and Digital Infrastructure (BMDV) regarding the law on establishing a national data trustee.

6. Geopolitics, trade and industrial policy: The BMW Group maintains a dialogue with legislators to fulfil its global responsibility, particularly committed to the reduction of tariffs and non-tariff barriers to trade. In the EU's anti-subsidy proceedings against China, the BMW Group is calling for an open and rules-based trading system.

7. Human resources and social policy: The BMW Group is working with political stakeholders to update social and labour policy. In a letter addressed to members of the German parliament and the German government, the BMW Group has called for a fundamental overhaul of working time legislation to bring it into line with EU laws.

8. Charging infrastructure: With regard to the German Act on Electromobility Infrastructure in Buildings (GEIG), the BMW Group is committed to a more ambitious transposition in Germany of the EU requirements on equipping car parks with charging points.

Business conduct policies and corporate culture

BMW Group discloses several policies relating to business conduct and corporate culture, primarily through its compliance management system (CMS) and various codes of conduct.

BMW Group Code of Conduct

• Policy name: BMW Group Code of Conduct
• Scope: All employees worldwide. The Code of Conduct transposes the BMW Group's corporate values into essential guiding principles for all employees.
• Key content: The Code of Conduct is based on values and fundamental beliefs, founded on trust, mutual respect and tolerance. It addresses topics including human rights, working conditions, anti-discrimination, and compliance matters. The corporate culture is characterized by trusting and constructive cooperation.
• Governance: The Code of Conduct is part of the Compliance Management System. Managers are responsible for implementing the Code in their areas and informing employees about its content and significance.
• Monitoring: Employees can raise concerns through multiple channels including the BMW Group SpeakUP Line (available in more than 30 languages). All reports are carefully reviewed in compliance with applicable regulations. The prohibition on penalizing whistleblowers acting in good faith is observed.
• Public availability: Referenced throughout the report as a publicly available document.
• Links to international standards: The Code of Conduct reflects the BMW Group's commitment to international frameworks, though specific linkages are described more fully in the Supplier Code of Conduct (see below).

BMW Group Supplier Code of Conduct

• Policy name: BMW Group Supplier Code of Conduct
• Scope: All direct suppliers (Tier 1) who maintain contractual relationships with BMW Group entities. Suppliers undertake to extend these requirements to their own suppliers (indirect suppliers).
• Key content: The Supplier Code of Conduct contains clear provisions on:
  • Responsible business practices
  • Environmental responsibility (air, water, soil pollution reduction; decarbonization; resource conservation; circular economy; biodiversity protection; hazardous materials and waste management)
  • Social responsibility (child and forced labor; slavery and human trafficking; freedom of association and collective bargaining; anti-discrimination; health and safety)
  • Use of critical raw materials
  • Protection of affected local communities and indigenous peoples
• Governance: The Purchasing and Supplier Network department is responsible for developing procedures and implementing due diligence processes in the supply chain. In 2024, this responsibility was firmly embedded in the purchasing strategy and strengthened by establishment of a dedicated department (Supply Chain Sustainability department).
• Public availability: The Supplier Code of Conduct is referenced as being an integral part of Purchasing Terms and Conditions and the International Terms and Conditions for the Purchase of Production Materials and Automotive Components (IPC).
• Links to international standards: Based on:
  • German Supply Chain Due Diligence Act (LkSG)
  • International Bill of Human Rights (UN Universal Declaration of Human Rights, ICCPR, ICESCR)
  • UN Guiding Principles on Business and Human Rights
  • ILO Declaration on Fundamental Principles and Rights at Work
  • ILO Tripartite Declaration of Principles concerning Multinational Enterprises and Social Policy (MNE Declaration) and ILO Convention 169
  • OECD Guidelines for Multinational Companies
  • Ten Principles of the UN Global Compact
  • Minamata Convention, Stockholm Convention, Basel Convention, REACH Regulation
• Monitoring: Multi-stage due diligence process including:
  • Risk analysis using country- and commodity-specific indicators and media analyses
  • Online sustainability questionnaire (Drive Sustainability initiative) for all direct suppliers
  • On-site assessments at supplier locations (132 sites inspected in 2024) using RBA Validated Audit Programme and RSCI standards
  • Complaints mechanism accessible to employees, suppliers and third parties
  • Preventive and remedial measures with defined timelines
  • In 2024, 79% of suppliers of production-related material implemented specified preventive measures at time of awarding; additional 17% had agreed on measures
  • Target: All direct supplier sites completing on-site assessment shall meet locally applicable statutory requirements and international human rights standards

BMW Group Compliance Management System (CMS)

• Policy name: BMW Group Compliance Management System (CMS)
• Scope: All affiliated companies in which BMW Group holds majority interest of more than 50%, particularly fully consolidated affiliated companies. BBA maintains its own CMS with the same level of effectiveness. Non-controlling interests and 50:50 joint ventures maintain their own adequate compliance programmes.
• Key content: The CMS comprises measures to combat corruption and bribery, reinforcing a culture of integrity and compliance. Key components include:
  • Risk analysis (company-wide and specific)
  • Internal regulations and instructions
  • Training courses and communications
  • Case-by-case consultations
  • IT systems support
  • Notification systems
  • Regular monitoring
• Governance: Central Group Compliance function sets out basic structure of CMS, including anti-corruption compliance programme. Group Compliance has overall responsibility. Local Compliance functions implement in consultation with central Group Compliance. Around 180 managers serve as operational Compliance Responsibles; network includes business unit and division Compliance Officers plus around 80 local Compliance Officers at international subsidiaries.
• Who approves and oversees: Board of Management and Supervisory Board (including Audit Committee) are briefed regularly (at least twice a year) by Chief Compliance Officer. The CMS is audited independently on risk-oriented basis by Corporate Audit.
• Monitoring:
  • Annual internal review assessing appropriateness and effectiveness based on defined criteria
  • In 2024, external audit of CMS conducted with focus on Anti-Corruption and Antitrust Compliance programmes in accordance with IDW PS 980 auditing standard, concluded with unqualified audit opinion
  • Compliance investigations conducted ad hoc or non-ad hoc basis as part of Detect function
  • Functionality assessment and performance assessment conducted regularly
  • Annual reporting to Board of Management, Supervisory Board and auditor on number of notifications, audits and results
  • Half-yearly detailed reports based on materiality criteria

Internal Anti-Corruption Regulations

• Policy name: Internal regulations on anti-corruption
• Scope: All employees, with particular focus on employees in indirect activities and senior employees from direct areas (e.g. "Meister" master craftsmen). These employees are considered potentially particularly relevant from risk perspective.
• Key content: Provisions on:
  • Prohibition of corruption and bribery
  • Prohibition of bribery of public officials
  • Prohibition of bribery and corruptibility in business dealings (active and passive)
  • Guidance on situations with risk of corruption
• Links to international standards: Takes into account standards established by United Nations Convention against Corruption (UNCAC)
• Governance: Central Group Compliance sets requirements; managers responsible for monitoring completion of required training with support from IT escalation process.
• Training and communication:
  • Mandatory "Compliance Essentials" web-based training course (30 minutes) every two years for defined employee group, covering corruption prevention, bribery prohibitions using case studies and test questions
  • Target training rate of at least 95% for high-risk functions
  • In 2024, percentage of valid training certificates for employees in relevant areas was 97.0%
  • Members of Board of Management complete Compliance Essentials training
  • Supervisory Board members receive anti-corruption training in written form and via presentation by Chief Compliance Officer
  • New/amended principles published on intranet and communicated to all managers
  • Separate communication measures for compliance-specific modifications (newsletters, communication formats, events)
• IT systems: IT-based compliance systems for transparent and efficient documentation, assessment and approval of compliance-relevant matters Group-wide (e.g. money laundering, sanctions lists, competitor exchanges, business partner due diligence, benefits verification)

BMW Group Environmental Policy

• Policy name: BMW Group Environmental Policy (referenced in context of water strategy)
• Scope: Own operations and potentially supply chain
• Key content: Part of holistic environmental management system addressing water consumption, water quality, pollution prevention, biodiversity
• Governance: Department for Sustainability and Mobility responsible for biodiversity approach; Supply Chain Sustainability department responsible for supply chain topics

BMW Group Biodiversity Policy

• Policy name: BMW Group Biodiversity Policy
• Scope: BMW Group operations and supply chain
• Key content: Internal guideline on protecting biodiversity and ecosystems. Addresses material impacts, risks and opportunities identified in materiality assessment. Lays out BMW Group's position on biodiversity. Acts in line with EU Biodiversity Strategy and Kunming-Montreal Global Biodiversity Framework.
• Public availability: Referenced as publicly available

BMW Group Anti-Deforestation Policy

• Policy name: BMW Group Anti-Deforestation Policy
• Scope: Supply chains for relevant materials (natural rubber, leather, paper, wood)
• Key content: Clear stance against deforestation and forest degradation in supply chains. Addresses:
  • Extent of BMW Group's commitment
  • Scope of policy
  • Due diligence and traceability measures
  • Complaint and monitoring mechanisms
  • Material-specific requirements
• Links to international standards: Adheres to EU regulations and relevant industry standards. BMW Group joined Global Platform for Sustainable Natural Rubber (GPSNR) multi-stakeholder initiative in 2019. Part of Leather Working Group (LWG). Signatory to "Deforestation Free Call to Action for Leather" of LWG, Textile Exchange and WWF.
• Public availability: Referenced as publicly available
• Monitoring: Safeguarding measures in supply chains for natural rubber, leather, paper and wood

BMW Group Water Strategy

• Policy name: BMW Group Water Strategy
• Scope: Own operations worldwide
• Key content: Focuses on both water consumption and water quality. Using water responsibly is priority. Uniform standards for wastewater treatment technology apply across Group in line with national legislation. Target to reduce potable water consumption by 25% by 2030.
• Governance: Management of responsibilities for own operations integral part of BMW Group Environmental Management System

BMW Group Circular Economy Strategy

• Policy name: BMW Group Circular Economy Strategy
• Scope: Products, operations and value chain
• Key content: Clear principles for reducing use of primary raw materials, lowering consumption of natural resources, contributing to preservation of biodiversity. Aim to strengthen supply chain regarding secured sources of secondary raw materials.

Process for Responsible Raw Material Management

• Policy name: Process for responsible raw material management / Raw materials strategy
• Scope: Supply chain, particularly for critical raw materials (lithium, cobalt, mica, natural rubber)
• Key content: Integrated raw materials strategy to reduce price, supply, geopolitical and regulatory risks. Provisions in Supplier Code of Conduct on handling of critical raw materials. Goal of generating positive impact for selected raw materials through involvement in local development projects. Focus on technologies, market processes and applications of secondary raw materials.
• Monitoring:
  • Certification and traceability of raw materials supply chains
  • Implementation of local development projects (currently for mica, cobalt, natural rubber)
  • Involvement in initiatives: Initiative for Responsible Mining (IRMA), Responsible Minerals Initiative (RMI)
  • Close cooperation with partners in supply chain
  • Direct securing of raw materials where required

High Level Commitment for Sustainable Natural Rubber

• Policy name: BMW Group's High Level Commitment for sustainable natural rubber
• Scope: Natural rubber supply chain
• Key content: Commitment set out as part of membership in Global Platform for Sustainable Natural Rubber (GPSNR). Aim to prevent deforestation and forest degradation from natural rubber cultivation.
• Links to international standards: GPSNR multi-stakeholder initiative

Additional governance and culture elements

Human Rights Officer

BMW Group has appointed a Human Rights Officer in accordance with German Supply Chain Due Diligence Act. Program responsibility includes human rights compliance, design and monitoring of risk management and risk analysis, complaints mechanism, and reporting. Supported by Group Compliance and various business units.

Stakeholder Engagement

BMW Group maintains dialogue with various stakeholder groups including politics, media, networks, civil society, suppliers, employees, partners, financial world, customers and science. Regular engagement through:

• Discussion rounds/round tables
• Working groups/mobility councils
• Association meetings
• Lectures and cooperation with schools and universities
• Conferences for/with investors and analysts
• Dialogues with dealership organizations
• Various dialogue formats

Corporate Culture Values

Corporate culture based on values and fundamental beliefs:

• Trust, mutual respect and tolerance
• Forward-looking and inclusive working environment
• Individual training and education opportunities
• High-quality products and transparent behaviour
• Meeting customer needs
• Focus on diversity, equity and inclusion (working environment ensuring all employees are appreciated, included and free from prejudice)
• Prohibition of discrimination, preferential treatment or harassment
• Freedom of association and collective bargaining (around 78% of employees covered by collective bargaining agreements)
• Good operational collaboration at eye level as fundamental principle

Social Responsibility Prerequisites for Business Partners

BMW Group has established taking social responsibility as prerequisite for prospective business partners. Human rights-related and environmental due diligence obligations incorporated into dealership and agency contracts.